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Clubbing of income

CA Krishna Chaitanya M (Chartered Accountant) (463 Points)

05 January 2013

Mr A given 700000rs cash to mrs A without adequate consideration , mrs A purchased shop worth 700000 with that money, shop is registered in the name of mrsA, early rent earned by mrsA from that shop is 100000rs. Rental income received by mrsA is clubbed in the hands of mrA .Is it correct? is Clubbing provisions applicable in this case?

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3 Replies

(Guest)

hello chaitanya,

yes it is correct. income to be clubbed with the income of mr.A.

y bcoz income on the asset transferred to be clubbed & but not on the income accreation to the asset.

rent recieved by mrs.A to be clubbed on the income of mr.A.

property registered in the name of mrs.A is irrelevant.

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Saurabh Maheshwari (B.com,ACA) (5923 Points)
Replied 05 January 2013

Originally posted by : gvgr7
	hello chaitanya, yes it is correct. income to be clubbed with the income of mr.A. y bcoz income on the asset transferred to be clubbed & but not on the income accreation to the asset. rent recieved by mrs.A to be clubbed on the income of mr.A. property registered in the name of mrs.A is irrelevant.

Yes income earned form the gifted money of spouse is to be clubbed in the hands of spouse giving such gift.(Sec 64(1A).

CA Krishna Chaitanya M (Chartered Accountant) (463 Points)
Replied 05 January 2013

if mrs A transfer shop to any one, capital gain arising from such transfer taxable under mrA, is it correct.

another one is if property is purchased using huf funds, but registered in the name of karta, karta has any right to transfer such property personally without consulting other members of huf.