09 September 2009
As per section 56 of the Income Tax Act, 1961, any sum of money, the aggregate value of which exceeds Rs.50000 received from any person without consideration by an individual or HUF shall be charged to tax under the head "Income From Other Source"
However, certain exemption has been granted in this regard. According to it if any sum received:
a) from any relative; or
b) on the occasion of the marriage of the individual; or
c) under a will or by way of inheritance; or
d) in contemplation of death of the payer; or
e) from a local authority; or
f) from any fund, foundation, university, other educational institution, hospital, medical institution, any trust or institution referred to in Sec. 10(23C); or
g) from charitable institutions registered u/s 12AA, shall be exempt from tax.
In respect of above gifts there is no ceiling limit and therefore, entire amount is exempt from chargeability.
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