23 February 2012
Does your HUF has a establishment under a trade or business firm name ? . If no, then it can be treated as your income. As you are working in the company, and execution of sales require personal indulgence. In no way, the tag of HUF is helpful to you achieving the sales as well as commission thereon. Due to your personal competence only, such commission is deemed to be awarded you. It becomes a case of diversion of income for reducing the tax burden upon the employee.
As far as particular section is concerned, the most attracted section will be the accounts section of your company. However, from Income tax point of view, it will come under the perview of Section 17(1)(iv). .
23 February 2012
Yes , I agree with all the experts,
but differently.
It will not be clubbed-------True. . But why ?? . Because it will be treated as his personal income as any direct or indirect benefit received from the employer can be treated as Salary in the hands of the employee. . In spite of clubbing, it can be treated as the Salary Income of the employee as without personal involvement of the employee in question, the sales commission would not have reached to the hands of the HUF. ....
We may examine this query from 2 angles . Would the commission receivable could be forgone by the employee- .. 1. Had there been no HUF in the picture ? . or . 2.had the employee been a female or any a member other than karta ? . The reply will emerge out. .
if the point of question is dat involvement of person as an individual, then in any case income earned by huf (not in profession) will be clubbed with individual as no work can b done by karta without involving himself or any member of family personally. huf is seperate entity which cant do any work. work is done by member of huf
CAclubindia
