Gift of plot of land and Capital Tax

This query is : Resolved

CA Subhash Nayik (Querist)
Follow

26 November 2019 Dear Sir/Madam,

Sister gifted a plot of land to her brother and for the same gift deed has been executed and registered. Few days later brother gave Rs.15lakhs in the form of DD to her Sister for day to day expenses without any deed or agreement.

In this case, will attract any capital tax or any other options??

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
Follow

29 May 2020 Gift from specified relative is exempt from tax as per Section 56(2) of the Income Tax Act. Therefore, there will not be any tax liability on the gift of 15 lakh received by your son. Also, there will no tax liability on you. Any income received on the gift amount will be taxable in the hands of your sister. The gift will have to be supported by a gift deed, which is not required to be registered, however, please consider the issue of payment of stamp duty on gift of movable property.