Tax on interest income of cash gift

This discussion explores the tax implications of a student receiving substantial cash gifts from her grandmother and father, which were then invested in Fixed Deposits. The core questions revolve around whether the interest earned on these FDs is taxable and if the 'clubbing of income' provisions apply. The consensus suggests that interest income is generally taxable, but clubbing may not be applicable as the recipient is an adult. The thread also touches on tax-free investments and a separate query regarding gifts to a non-taxpaying spouse.