Tax on transfer/ gift of money.

No income tax will be applicable in anyone's hand. Gift tax has been abolished.

The amount will be taken in your income and included in computation of tax... As the income is assessed in your hand the will be exempt in the hands on your relative if you transfer as Gift to them..
Eg- Father income is 10 lakh... The same will be taxed in Fathers Hands as Income from salary/business/CG/other source... Than father can tansfer any amount to their spouse/children or other relative as gift.. and it will not be taxed again.

I am a retired employee and I have received some pensionery benefits such as gratuity etc. Now I like to give or transfer some money to my spouse and children. Who will bear the tax on interest earned from transferred amount.

If an Individual transfers any asset to his/her spouse without adequate consideration – then the income from such asset would be clubbed with the income of the individual who has transferred the asset.

Money is also considered as an asset so if you gift your wife some money – the provisions of clubbing of income would still be applicable.

In such a case – the asset/money transferred to the spouse can be considered as a gift and is tax free at the time of receipt. However, the income generated from this gift would be taxable in the hands of the person who has made the gift and not in the hands of the person who has received the income.

Section 64(1)(iv)
https://www.google.co.in/amp/s/www.charteredclub.com/clubbing-of-income/amp/

By giving Gift to spouse you will not be able to reduce your income bcoz after gift income will still be taxed in your hands