My father-in-law's father self acquired a house in Kolkata. When he died intestate, all his children signed a Release Deed in favour of my father-in-law. Prior to my father-in-law's death, he registered a Gift Deed for the house in the name of my brother-in-law, who is one of four Persons Of Indian Origin (foreign passport holder) children, upon the oral condition that my brother-in-law would pay the fair share to all the descendants. My brother-in-law appears to have agreed to pay my wife her share. Since the house does not have my wife's name in the title or the Gift Deed made by my father-in-law, is it correct that this money from my brother-in-law to my wife is a gift and since it is to a relative there is no gift tax? If this is correct, should she file a Non-resident tax return showing income from other sources and then deducting it as a gift on the return or is she exempt from filing a return? She has no income from India.
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