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Gift

Vijay (Proprietor) (130 Points)

29 December 2015

Hi A Reg Partnership Firm Consisting of five family members (father son and Daughter in Law). Capital of father is Rs.40Lack father wants to gift Rs.10L to son and Daughter in law each and the said capital would be again Individually invested in the Firm. My Q is 1 While making gift in cash(through Chq) whether gift deed is necessary if yes on which Bond paper and any format?

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2 Replies

Ruchi (CA) (1410 Points)
Replied 29 December 2015

There is no mandatory requirement of a gift deed. However, its always advisable to make the same. A non-judicial stamp paper of Rs . 100 is suffice. There is no specific format , only necessary details must be mentioned.

Here , I would like to remind you that in case of gift to daughter-in-law, clubbing provisions as per section 64(1)(viii) would apply.

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Vishal Goel (Chartered Accountant) (1693 Points)
Replied 29 December 2015

Yes,
As per section 64(1)(viii) , if any individual transfers (directly or indirectly) his/her asset otherwise than for adequate consideration to a person or an association of persons for the immediate or deferred benefit of his/her son’s wife, then income arising from the asset so transferred will be clubbed with his income and will be charged to tax in his hands.