Tax liabilty

This query is : Resolved

dinesh bhatia (Querist)
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16 January 2017 A (son) and B (father) are the owners of a property 50:50. both A and B are getting rental income from this property in equal ratio.

In september 2016, B made a gift deed of his 50% share of this property in favour of C (daughter in law, wife of A).

From september 2016, daughter in law starts getting rent of this property in her name , tenant pay rent to C and deduct TDS from the rent and deposited into C's PAN. C got all the TDS certificates also...

Now my query is : rent received from september 2016 will be treated as an income of B (father in law) or C (daughter in law) ...

with regards,
dinesh

CA Suresh Jain

CA Suresh Jain (Expert)
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17 January 2017 As per section 64(1)(vi), if an individual transfers (directly or indirectly) his/her asset to his/ her son's wife otherwise than for adequate consideration, then income from such asset will be clubbed with the income of the individual (i.e., transferor being father-in-law/mother-in-law). The provisions of clubbing will apply even if the form of asset is changed by the transferee-daughter-in-law.