06 August 2012
My client being an Individual who is son of Father.
Now the Father has paid LIC premiums from his bank account.But he can not claim the same in his personal return of Income.The Policy is in the name of Son.
Now the query is whether said son can claim such LIC premiums paid by father on his Behalf from his Gross Taxable Total Income under section 80C of I.T. Act or not by considering the same as Loan/Deposit in the books of Father/Son as the case may be.
06 August 2012
Yes it can be claimed by showing it as loan taken from father. Many time this type of arrangement is adopted to claim the deduction u/s 80C but technically the claim is available only to the payee.
Thanks for the prompt reply. Now can you clarify me that in the books of Son such LPC Premiums paid by father can be considered as unsecured Loan/deposit by way of Journal(i.e.J.V.).
Whether such transactions are contraventions of Section 269SS of I.T.Act as the total Amount of Such premiums paid Rs.103545/- for the year under consideration or not as this is Hawala Transaction. Please again confirm.
06 August 2012
2 negatives make it positive? Now you are proceeding to confirm the 2nd wrong. Basically try to understand, why did you feel to claim deduction u/s 80C. Forget, for the time being what has been given by income Tax... how a SON can think of claiming deduction u/s 80C for the payment made by FATHER. It is not only awesome but shameful also... on the part of SON. Request you to explode your valuable remarks.
CAclubindia
