29 October 2013
Introduction to Wealth Tax Act 1957 Wealth Tax Rules 1957
Wealth tax is a Direct Tax. It is levied by Central Government on few Persons. Power to Levy Wealth Tax is derived by Constitution of India. It means Taxes on Wealth.
Wealth Tax recognizes 5 types of wealth 1. Wealth from House XXX 2. Wealth from Motor Cars XXX 3. Wealth from Jewellery XXX 4. Wealth from Air/Water Vehicles XXX 5. Wealth from Land XXX . Total Wealth YYYYYYYYYYY
In Wealth Tax, Tax is always levied for 1 complete Financial Year(1/April to 31/March). This Financial Year is known as PREVIOUS YEAR. Year next to Previous Year is known as ASSESSMENT YEAR.
Person on whom Wealth Tax is levied is known as an ASSESSEE.
Wealth Tax Chapter
Reason to levy wealth tax To tax ------ Unproductive assets & bring about equality in society.
Persons liable to pay Wealth Tax Wealth Tax shall be charged for value of ASSETS on Valuation Date to: 1. Individual 2. HUF 3. Company
Persons not liable to pay Wealth Tax Wealth Tax shall not be charged to: 1. Company registered under section25 of companies Act 1956. 2. Co-operative society 3. Social Club 4. Political Party 5. Mutual Fund specified under section 10(23D) of Income Tax Act, 1961
Rate of Wealth Tax Rate of Wealth Tax shall be 1% for wealth in excess of Rs.15 Lacs.
Valuation date Means the last day of the previous year. i.e. 31st march. All calculations of wealth shall be made at the midnight of 31st march.
Computation of Wealth Tax Value of assets belonging to assessee = XXX Less: Exemption of assets under Section 5 = (XXX) Gross Wealth = XXX Less: Debts under Section 2(m) = (XXX) Net Wealth = XXX Less: 15 Lacs = (XXX) Wealth Chargeable to Tax = XXX
Definition of Assets Section 2(ea) Assets, means
(i). House Any building or land appurtenant thereto, Whether used for residential purposes or commercial purposes or for the purpose of maintaining a guest house or otherwise It includes a farm house situated within 25 kilometers from local limits of any municipality or a Cantonment Board.
But does not include: A house meant exclusively for residential purposes and which is allotted by a company to an employee or an officer or a director who is in whole-time employment, having a gross annual salary of less than Rs. 5 Lacs. ; Any house for residential or commercial purposes which forms part of stock-in-trade ; Any house which the assessee may occupy for the purposes of any business or profession carried on by him; Any residential property that has been let-out for a minimum period of 300 days in the previous year; Any property in the nature of commercial establishments or complexes;
(ii). Motor cars But does not include: Cars used by the assessee in the business of running them on hire. Cars used by the assessee as stock-in-trade ;
(iii). Jewellery Jewellery, bullion, furniture, utensils or any other article made wholly or partly of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals : But does not include: Jewellery used by the assessee as stock-in-trade ;
(iv). Air/ Water Transport Vehicles Yachts, boats and aircrafts But does not include: Those held as stock-in-trade Those used by the assessee for commercial purposes)
(v). urban land ; Means land situated (i) in any area which is comprised within the jurisdiction of a municipality or a cantonment board and which has a population of not less than 10000 according to the last preceding census of which the relevant figures have been published before the valuation date ; or (ii) in any area within such distance, not being more than 8 kilometers from the local limits of any municipality or cantonment board referred to in sub-clause (i), as the Central Government may, having regard to the extent of, and scope for, urbanization of that area and other relevant considerations, specify in this behalf by notification in the Official Gazette,
But does not include: • Land on which construction of building is not permissible under any law for the time being in force in which such land is situated. • Land occupied by any building which has been constructed with the approval appropriate authority • Any unused land held by assessee for industrial purposes for a period of 2 years from the date of its acquisition by him. • Any land held by assessee as Stock-in-trade for a period of 10 Years from the date of its acquisition by him.
Example 1 Mr. A purchased a plot of land on 1.2.2004 for industrial purposes. This land was not used by him. Test whether this is taxable under wealth tax act 1957 on 31/march/2007.
Solution 1.2.2004 - 1.2.2005 - 1.2.2006 Valuation Date Remarks 31.3.2003 Not an asset – As assessee did not have it 31.3.2004 Not an asset – As it was purchased for industrial purposes. 31.3.2005 Not an asset – As it was purchased for industrial purposes. 31.3.2006 It is an asset – As it 2 years passed and it was still unused 31.3.2007 It is an asset – As it 2 years passed and it was still unused
(vi). Cash-in-hand Means In case of Individual and HUF - cash in excess of Rs. 50000 In the case of other persons - any amount not recorded in the books of account.
Example 2 X Ltd. is engaged in construction of residential flats: a) Land in urban area (construction is not permissible as per municipal laws in force) Rs.35 Lacs b) Motor-Cars (used in business of running them on hire) Rs.700000 c) Jewellery Rs. 1500000. Loan taken for purchasing this Rs. 1000000 d) Cash balance (as recorded in books) Rs.225000 e) Bank Balance Rs.350000 f) Guest house Rs.600000 g) Residential flats occupied by the Managing Director Rs. 1000000. The managing director is on a whole time appointment and is drawing a salary of Rs. 3 Lacs per month. h) Residential house were let out on hire for 200 Days of Rs. 800000 Compute Taxable Wealth on 31st march.
Solution I. Land in urban area Not an asset II. Motor-Cars Not an asset III. Jewellery 1500000 IV. Cash balance Not an asset V. Bank Balance Not an asset VI. Guest house 600000 VII. Residential flats 1000000 VIII. Residential house (assume it not to be SIT ) 800000 Total 3900000 Less: Debt (1000000) Net Wealth 2900000
Taxable wealth 1400000 Wealth Tax @1% 14000
Example 3 Mr. X an individual is engaged in construction of residential flats:
a) Land in urban area (construction is not permissible as per municipal laws in force) Rs.35 Lacs b) Motor-Cars (used in business of running them on hire) Rs.700000 c) Jewellery Rs. 1500000. Loan taken for purchasing this Rs. 1000000 d) Cash balance (as recorded in books) Rs.225000 e) Bank Balance Rs.350000 f) Guest house Rs.600000 g) Residential flats occupied by the manager Rs. 1000000. The manager is on a whole time appointment and is drawing a salary of Rs. 3 Lacs per annum. h) Residential house were let out on hire for 200 Days of Rs. 800000 Compute Taxable Wealth on 31st march. Assume no exemption is considered by Mr.X
Solution I. Land in urban area Not an asset II. Motor-Cars Not an asset III. Jewellery 1500000 IV. Cash balance 175000 V. Bank Balance Not an asset VI. Guest house 600000 VII. Residential flats 1000000 VIII. Residential house (assume it not to be SIT ) 800000 Total 4075000 Less: Debt (1000000) Net Wealth 3075000 Taxable wealth 1575000 Wealth Tax @1% 15750
Example 4 X Ltd. is engaged in business of retail Jewellery: a). Land (construction is not permissible as per municipal laws in force) Rs.45 Lacs b). Motor-Cars (used in business) Rs.700000, Loan taken for purchasing this Rs. 300000 c). Jewellery Rs. 1500000. d). Cash balance (as not recorded in books) Rs.445000 e). Bank Balance (as not recorded in books) Rs.350000 f). Residential house were let out on hire for 350 Days of Rs. 800000 g). Yatch held for personal uses Rs. 100 Lacs Compute Taxable Wealth on 31st march.
Solution a). Land in urban area Not an asset b). Motor-Cars 700000 c). Jewellery (held as SIT) Not an asset d). Cash balance 445000 e). Bank Balance Not an asset f). Residential house Not an asset g). Yatch 10000000 Total 11145000 Less: Debt (300000) Net Wealth 10845000 Exemptions
TRUST Section 5(i) Any property held under trust or other legal obligation for any public purpose of a charitable or religious nature in India shall be exempt from tax.
Co-Parcerners Exemption under section 5(ii) Share of a co-parcerner in HUF property is exempt, as tax on whole property is paid by Karta.
Ruler-Building Exemption under section 5(iii) Any building declared as official residence of a ruler by Central government shall be exempt from tax.
Ruler-Jewellery Exemption under section 5(iv) Jewellery in possession of any ruler, not being his personal property, which has been recognised as his heirloom by central government shall be exempt from tax.
Recognition is granted by Central government on following terms: I. Jewellery shall be permanently kept in India and shall not be removed outside India except for a purpose and period approved by CBDT. II. Reasonable steps shall be taken for keeping the Jewellery substantially in original shape. III. Reasonable facilities shall be allowed to government officer (authorized by CBDT) to examine the Jewellery as and when it deems fit.
Exemption under section 5(v) Person of Indian origin or Citizen of India who ordinarily residing in foreign country and who leaving such country has returned to India with the intention of permanently residing in India, THEN Money and assets brought by him into India and the value of assets acquired by him out of such moneys within 1 year immediately preceding the date of his return and at any time thereafter, Shall be exempt from tax for a period of 7 successive years.
Exemption under section 5(vi) Individual or HUF having one house or part of house or plot of land upto 500 sq. meters shall be exempt from tax.
DEBTS Section 2(m) Debts owned by assessee on the valuation date are deductible if these debts are incurred on the assets included in the wealth.
Example 5 Mr. Wasim Akram has gold of Rs. 10 lacs &Silver biscuits of RS. 23 Lacs. & house of Rs. 50 Lacs. Gold was purchased by him, by taking a loan of Rs. 2 Lacs. Compute Taxable Wealth on 31st march.
Solution Gold = 1000000 Silver Biscuits = 2300000 House = Exempt section 5(vi) Gross Wealth = 3300000 Less Debts = (200000) Net Wealth = 3100000
Example 6 Mr. Wasim Akram has gold of Rs. 20 Lacs &Silver biscuits of RS.32 Lacs. & Plot of land (of 530 meters) for Rs. 150 Lacs. Shares of RIL Rs. 300000 Gold was purchased by him, by taking a loan of Rs. 11 Lacs on security of shares. Compute Taxable Wealth on 31st march.
Solution Gold = 2000000 Silver Biscuits = 3200000 Plot of land (of 530 meters) = 15000000 Shares = Not an asset Gross Wealth = 20200000 Less Debts = (1100000) Net Wealth = 19100000
Example 7 Mr. Wasim Akram has 2 houses of Value Loan taken on this house House in Bombay- House I 2000000 1400000 House in Delhi- House II 5000000 4900000 Gold was purchased by him, by taking a loan of Rs. 11 Lacs on security of shares. Compute Taxable Wealth on 31st march.
Solution Computation of wealth Option 1 is better so we shall opt this. Option 1 House I = Exempt House II = 5000000 Gross Wealth = 5000000 Less Debts = (4900000) Net Wealth = 100000 Option 2 House I = 2000000 House II = Exempt Gross Wealth = 2000000 Less Debts = (1400000) Net Wealth = 600000
VALUATION of ASSETS I. Valuation of immovable property Schedule III
Step 1: Determination of Gross Maintainable Rent Actual Rent received/ receivable for the year = XXX ADD: 1/9 of Actual Rent received/ receivable for the year- if repairs are borne by tenant = XXX Taxes in respect of the property agreed to be borne by tenant = XXX 15% of Interest on deposit received from tenant – interest recovered = XXX
Lease premium or non-refundable deposit received = XXX No. of years of lease
Any other obligation of owner met by tenant = XXX ANNUAL RENT = xxx
Gross Maintainable Rent shall be higher of: Annual rent Annual value assessed by Local Authority
Example 8 A house property is rented by owner for a rent of Rs. 20000 p.m for all 12 months. Details are as follows: 1. Repairs for Rs. 12000 were borne by tenant. 2. Municipal Taxes are Rs. 120000, 50% of which are borne by tenant and rest by owner. 3. Tenant has given an advance of Rs. 10 Lacs owner. Owner is paying an interest of 6% on deposit. 4. Tenant has given him other benefits of Rs. 3000 monthly. 5. Tenant has also given him a deposit of Rs. 500000, which is non-refundable. Lease term is 5 Years. Compute Gross Maintainable Rent on 31st march.
Solution Annual Rent = 240000 Repairs = 26667 [240000/9] Municipal taxes borne by tenant = 60000 Security deposit = 90000 [1000000 X (15-6)%] other benefit = 36000 [3000 x 12 ] Non-refundable deposit = 100000 [500000/5] Annual rent = 552667
Example 9 A house property is rented by owner for a rent of Rs. 20000 p.m for 9 months till 31 December. Details are as follows: 1. Repairs for Rs. 12000 were borne by tenant./ 2. Municipal Taxes are Rs. 120000, 50% of which are borne by tenant and rest by owner. 3. Tenant has given an advance of Rs. 10 Lacs owner. Owner is paying an interest of 6% on deposit. 4. Tenant has given him other benefits of Rs. 3000 monthly. 5. Tenant has also given him a deposit of Rs. 500000, which is non-refundable. Lease term is 5 Years. Compute Gross Maintainable Rent on 31st march.
Solution All things shall be computed for a year. Actual Rent = 240000 Repairs = 26667 [240000/9] Municipal taxes borne by tenant = 60000 Security deposit = 90000 [100000 X (15-6)%] other benefit = 36000 [3000 x 12 ] Non-refundable deposit = 100000 [500000/5] Annual rent = 552667
Example 10 Compute GMR in above question if annual rent is Rs. 552667 & annual value assessed by local authority is Rs. 400000. Compute Gross Maintainable Rent on 31st march. Solution GMR = 552667
Example 11 Compute GMR in above question if annual rent is Rs. 552667 & annual value assessed by local authority is Rs. 800000. Compute Gross Maintainable Rent on 31st march.
Solution GMR = 800000
Example 12 A house property is rented by owner for a rent of Rs. 240000 p.a. Details are as follows: 1. Repairs for Rs. 42000 were borne by tenant. 2. Municipal Taxes are Rs. 120000, 30% of which are borne by tenant and rest by owner. 3. Tenant has given an advance of Rs. 10 Lacs owner. Owner is paying an interest of 2% on such deposit. 4. Tenant has given him other benefits of Rs. 48000 yearly. 5. Tenant has also given him a deposit of Rs. 1200000, which is non-refundable. Lease term is 3 Years. If annual value assessed by local authority is Rs. 800000, Compute Gross Maintainable Rent on 31st march.
Step 2: Determination of Net Maintainable Rent GMR = XXX Less: 15% of GMR = (xxx) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (xxx) Net Maintainable Rent = XXX
Example 13 GMR = 360000 Municipal taxes = 30000 50% of municipal taxes are paid by tenant, rent are still unpaid. Compute Net Maintainable Rent on 31st march.
Solution GMR = 360000 Less: 15% of GMR = (54000) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (30000) Net Maintainable Rent = 276000
Example 14 Annual Rent of property = 200000 Annual value as per local authority = 220000 Municipal taxes = 3000 50% of municipal taxes are paid by tenant, rent are still unpaid. Compute Net Maintainable Rent on 31st march.
Solution GMR shall be higher of 200000 220000
GMR = 220000 Less: 15% of GMR = (33000) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (3000) Net Maintainable Rent = 184000
Example 15 A house property is rented by owner for a rent of Rs. 30000 p.m for 9 months till 31 December. Details are as follows: 1. Repairs for Rs. 12000 were borne by tenant. 2. Municipal Taxes are Rs. 20000, 50% of which are borne by tenant and rest by owner. Annual value assessed by local authority is Rs.500000 Compute Net Maintainable Rent on 31st march.
Solution All things shall be computed for a year. Rent = 360000 Repairs = 40000 [360000/9] Municipal taxes borne by tenant = 10000 Annual rent = 410000 Annual value assessed by local authority is Rs.500000 GMR = 500000 Less: 15% of GMR = (75000) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (20000) Net Maintainable Rent = 405000
Step 3: Determination Value as per Rule 3, 4 & 5 of Schedule III Value as per Rule 3, 4 & 5 of Schedule III shall be higher of following: 1. NMR X Capitalisation factor (12.5/10/8) 2. Cost of Construction + Cost of Improvement
Provided Value as per Rule 3, 4 & 5 of Schedule III shall be NMR X Capitalisation factor (12.5/10/8), if all the following conditions are fulfilled: One house Exclusively used by assessee for own residential purposes House at Delhi/Bombay/Calcutta/Madras --- Cost of Construction + Cost of Improvement does not exceed 50 Lacs House at any other place --- Cost of Construction + Cost of Improvement does not exceed 25 Lacs
Capitalisation factor (12.5/10/ 8) Property Capitalisation Factor Property is constructed on Freehold Land 12.5 Property is constructed on Leasehold Land, unexpired period of lease on valuation date > = 50 Yrs 10 Property is constructed on Leasehold Land, unexpired period of lease on valuation date Specified area
Percentage of Default Addition in value Upto 5% NIL Above 5% Upto 10% 20% of value as per rule 3, 4 & 5 Above 10% Upto 15% 30% of value as per rule 3, 4 & 5 Above 15% Upto 20% 40% of value as per rule 3, 4 & 5 Above 20% Value shall be FMV for property
Percentage of Default = Un-built area – Specified area x 100 Aggregate area
Specified area in general terms mean permissible un-built area. Specified area is : 1. Property is at Delhi/Bombay/Calcutta/Madras – 60% aggregate area. 2. Property is at specified cities – 65% aggregate area. 3. Property is at other cities – 70% aggregate area.
Step 5: Adjustment for unearned increase in value of land as per Rule 7
Value as per Rule 3, 4, 5 & 6 = xxx Less: Lower of following: = (xxx) Amount of unearned increase to be claimed by government 50% of Value as per Rule 3, 4, 5 & 6 Value for Immovable property = XXXX
‘Unearned increase’ means the difference between value of Land on valuation date as determined by government and the amount of premium paid or payable to government for the lease of land.
Example 17 Mr. X is an owner of commercial house built on a plot of 1000 sq. yards at Delhi. The plot has been taken on a lease from government. He has built up in 1975, 240sq. yards at a cost of Rs. 170000. House has been let for commercial purposes to tenant @ 1000 p.m. The tenant has agreed to bear cost of all repairs and has given a refundable deposit of Rs.20000. Municipal taxes levied are Rs.1080. Municipal valuation by local authority Rs.9000 DDA has notified Rs.300000 as unearned increase out of which 40% is payable to government. Unexpired period of lease is 79 Years. Compute value of house property.
Solution Actual Rent = 12000 Repairs = 1333 [12000/9] Security deposit = 3000 [20000 X 15%] Annual rent = 16333 Annual value assessed by local authority is Rs.9000 GMR = 16333 Less: 15% of GMR = (2450) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (1080) Net Maintainable Rent = 12803
Value as per Rule 3, 4 & 5 of Schedule III shall be higher of following: = 170000 12803 X 10 = 128030 170000 Add: Adjustment of un-built are = 68000 [40% x 170000] Workings Unbuilt area= 1000-240 = 760 Percentage of Default =Un-built area – Specified area x 100 Aggregate area = (760 - 60%1000) x 100 = 16% 1000 Total = 238000 Less: unearned increase = (119000) Workings Least of the following shall be deductible 40% x 300000 = 120000 50% x 238000 = 119000 Value of House = 119000
Example 18 Mr. X is an owner of commercial house built on a plot of 1000 sq. yards at Bombay. The plot has been taken on a lease from government. He has built up in 1999, 240sq. yards at a cost of Rs. 180000. House has been let for commercial purposes to tenant @ 2000 p.m. The tenant has agreed to bear cost of all repairs and has given a refundable deposit of Rs.50000. Municipal taxes levied are Rs.5000, 50% borne by tenant. Municipal valuation by local authority Rs.40000 DDA has notified Rs.300000 as unearned increase out of which 30% is payable to government. Unexpired period of lease is 29 Years. Compute value of house property.
Solution Actual Rent = 24000 Repairs = 2666 [24000/9] Municipal taxes borne by tenant = 2500 Security deposit = 7500 [50000 X 15%] Annual rent = 36666 Annual value assessed by local authority is Rs.40000 GMR = 40000 Less: 15% of GMR = (6000) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (5000) Net Maintainable Rent = 29000 Value as per Rule 3, 4 & 5 of Schedule III shall be higher of following: = 180000 29000 X 8 = 232000 180000 Add: Adjustment of un-built are = 72000 [40% x 180000] Workings Unbuilt area= 1000-240 = 760 Percentage of Default =Un-built area – Specified area x 100 Aggregate area = (760 - 60% x 1000) x 100 = 16% 1000 Total = 252000 Less: unearned increase = (90000) Workings Least of the following shall be deductible 30% x 300000 = 90000 50% x 252000 = 126000 Value of House = 162000
Example 19 Mr. X is an owner of commercial house built on a plot of 900 sq. yards at Bombay. The plot has been taken on a lease from government. He has built up in 1999, 250sq. yards at a cost of Rs. 200000. House has been let for commercial purposes to tenant @ 4000 p.m. The tenant has agreed to bear cost of all repairs and has given a refundable deposit of Rs.150000. Municipal taxes levied are Rs.15000, 40% borne by tenant. Municipal valuation by local authority Rs.40000 DDA has notified Rs.500000 as unearned increase out of which 70% is payable to government. Unexpired period of lease is 89 Years. Compute value of house property.
Example 20 X is the owner of a house which is constructed on leasehold land acquired from DDA. He has let out this house for a rent of Rs.12000 p.m. 60% of municipal taxes shall be paid by tenant Cost of repairs shall be borne by tenant Rs. 100000 of advance shall be given by tenant, this shall be refundable deposit. Premium of Rs. 50000 shall be paid for leasing the property for 5 years. Annual value assessed by the local authority is Rs.100000 and taxes levied shall be Rs.15000. Percentage of default shall be 12.33%. Cost of building (including land) in 1980 was Rs. 10 Lacs X paid Rs.80000 for acquisition of land but now DDA’s value of land is RS. 4Lacs for the purposes of computing unearned increase. 50% of which shall be paid to government. Unexpired period of lease shall be 85 years. Compute value of house property.
Solution Actual Rent = 144000 Repairs = 16000 [144000/9] Municipal taxes borne by tenant = 9000 Lease premium = 10000 [50000/5] Security deposit = 15000 [100000 X 15%] Annual rent = 194000 Annual value assessed by local authority is Rs.100000 GMR = 194000 Less: 15% of GMR = (29100) Less: Municipal taxes on accrual basis (whether paid by owner or tenant) = (15000) Net Maintainable Rent = 149900
Value as per Rule 3, 4 & 5 of Schedule III shall be higher of following: = 1499000 149900 X 10 = 1499000 1000000 Add: Adjustment of un-built are = 449700 [30% x 1499000] Total = 1948700 Less: unearned increase = (160000) Workings Least of the following shall be deductible 50% x (400000-80000) = 160000 50% x 252000 = 974350 Value of House = 1788700
II. Valuation of all other property Schedule III Shall be Fair market value of property
CHART for illustrations Commercial flats lying vacant Asset Commercial flats on rent to a Company Asset Factory Building in which production is carried on Not an Asset Commercial building in which assessee has an office Not an Asset Commercial building held as Stock-in Trade Not an Asset Residential House given to employee of a company Not an Asset, if his salary is less than 5 lacs Residential House given to employee of a firm Asset Guest house for use of company’s guests Asset Residential house let out for 280 Days Asset Residential house let out for 340 Days Not an Asset Commercial flat let out for 340 Days Asset Commercial complex Not an Asset
Motor cars used for transport of the employees Asset Motor cars held for hire Not an Asset Motor cars held for vehicle dealer Not an Asset
Jewellery held by Jeweler Not an Asset Gold held by a person Asset Silver furniture held by a person Asset Loose Diamonds
Aircraft held by company for its employees Asset Helicopter held by company for its employees Asset
Cash of Rs. 100000 held by an individual Rs.50000 is asset Cash of Rs. 100000 held by an Company, unrecorded Asset Cash of Rs. 100000 held by an Company, recorded in books Not an Asset
Land held as stock-in-trade Not an Asset
THEORY CONCEPTs
Deemed Assets Section 4 In computing the net wealth of an individual, there shall be included following assets, as belonging to that INDIVIDUAL, the value of assets which on the valuation date are held –
1. By the SPOUSE of such individual to whom such assets have been transferred by the individual, directly or indirectly, otherwise than for adequate consideration. Provided assets transferred under agreement to live apart this provision shall not apply.
2. By a MINOR CHILD, Exceptions minor child suffering from any disability of the nature specified in section 80U of the Income-tax Act, minor married daughter, of such individual,
3. By an AOP to whom such assets have been transferred by the individual directly or indirectly, otherwise than for adequate consideration for benefit of the INDIVIDUAL, his or her SPOUSE.
4. By an AOP to whom such assets have been transferred by the individual under a REVOCABLE transfer, (i.e. a transfer which is not for the life or under which transferor has certain right. JHOOTA transfer)
5. By the SON'S WIFE, of such individual, to whom such assets have been transferred by the individual, directly or indirectly, otherwise than for adequate consideration,
6. By an AOP to whom such assets have been transferred by the individual, directly or indirectly, otherwise than for adequate consideration for the benefit of SON'S WIFE.
7. Where, in the case of an individual being a member of a Hindu undivided family, any property having been the separate property of the individual has, been converted by the individual into property belonging to the family through the act of impressing such separate property with the character of property belonging to the family or throwing it into the common stock of the family, directly or indirectly, to the family otherwise than for adequate consideration then the converted property shall be deemed to be assets belonging to the individual and not to the family;
8. Holder of Impartible state (KARTA)
9. Property allotted to Members Whenever property is allotted or leased by a co-operative society, company or other association of persons to its members under a house building scheme then such member shall be Deemed Owner.
10. Possession transferred If the purchaser has paid the consideration to seller & has taken the possession as per Section 53A of the Transfer of Property Act, 1882, then Purchaser shall be the Deemed owner
DISCLAIMER-This is not my own work Note- 1.threshold limit is 30lacs. 2.residential house not to be charged to wealth tax in case the same is alloted to wtd or employee having gross annaul salary of less than 10lacs instead of 5lacs