Originally posted by : praveen |
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I have a case where the individual is abroad and has sent some money to his wife in India, She arranges some more money from bank through loan and also uses the money received from her mother to buy a property. Now if the property is let out for rent and earns say 7.00 Lacs per annum. Will clubbing provisions apply & if yes what will be the taxable income in the hands of the individual |
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Deemed owner Section 27 would not apply as the husband is transfering money not house property to his wife . However clubing Section 64 would apply if he transfers money without or inadequate consideration.
Assuming husband is transfering money without any consideration then proportionate income would be taxable to husband as NRI / Resident not ordinary / Resident as the case may be.
Even if wife is paying interest on amt. received from husband it has to be seen whether interest amount is adequate or inadequate If it is inadequate then then income from HP will be clubbed in hands of Husband proportionately.
For ur reference
“Owner of house property”, “annual charge”, etc., defined.
61 27. For the purposes of sections 22 to 26—
(i) an individual who transfers otherwise than for adequate consideration any house property to his or her spouse, not being a transfer in connection with an agreement to live apart, or to a minor child not being a married daughter, shall be deemed to be the owner of the house property so transferred;
Income of individual to include income of spouse, minor child, etc.
17 64. 18 [ 19 [(1)] In computing the total income of any individual, there shall be included all such income as arises directly or indirectly—
(iv) subject to the provisions of clause (i) of section 27, 24 [* * *] to the spouse 25 of such individual from assets transferred 25 directly or indirectly to the spouse by such individual otherwise than for adequate consideration 25 or in connection with an agreement to live apart ;