Problem with a gift !!!

Please help me out in this peculiar case


A, an individual, wants to transfer Investments of book value 2 crores (Market value 4 crores) to B, another individual. The transfer would be in the nature of a "gift". Again, the transfer should be made at the market value and not book value.


Please tell me the journal entries to be passed in both the books.(if at all it is possible!!!)

Also, would there be any applicability of Gift Tax in B's case??

Thanks

Replies (4)
My opinion is In books of "A" Dr. Investments A/c. 2 Croes Cr. Corpus A/c. (A) 2 Croes Dr. Corpus A/c. 4 Croes Cr. Investment A/c. 4 Croes In personal statement of affairs of Mr.A Corpus Opening xxxx Add : Appreciation in Invst. 2 Croes Less : Gifts made 4 Croes In books of B Dr. Inv. A/c. 4 Croes Cr. Corpus A/c. 4 Croes
Good work S.Karunakaran ! In B's Case no Gift Tax implication,since Gift Tax Act is abolished. The value of Rs.4 crores will not be taxable in the hands of B under Section 56 of the Income Tax Act,1961 since it is not a sum of money.
What is "corpus" ? pls define it. thanx Ghanshyam
Dear ghanshyam, Corpus means Capital.It is more suitable to use this word in case of a not- for-profit organisation.

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