Mrs. X (Mother) has received settlement amount (compensation) of Rs. 17,50,000, but the cheques are issued in the name of Mr. Y (Mrs. X's Son). Whether they are taxable in Mrs. X's hands or Mr. Y's hands.
Regards,
Devendra Kulkarni
Devendra (Chartered Accountant) (4775 Points)
17 July 2013Mrs. X (Mother) has received settlement amount (compensation) of Rs. 17,50,000, but the cheques are issued in the name of Mr. Y (Mrs. X's Son). Whether they are taxable in Mrs. X's hands or Mr. Y's hands.
Regards,
Devendra Kulkarni
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 17 July 2013
Obviously taxable in the hands of the person who has earned the income....here Mr.Y has just received on the behalf of Mrs. X...and he is no more good than her agent...
CA Rohit Saboo
(Consultant)
(30 Points)
Replied 17 July 2013
What type of compensation it is? Some compensation can be of cpital nature and are exempt under income tax act. So please define the type of compensation you earned?
Devendra
(Chartered Accountant)
(4775 Points)
Replied 17 July 2013
Assessee has an ancestral property, so she has received the amount to remove their ownership from the land ie. their name shall be removed from the documents and will no more be the legal owners of the land. Hence, the above amt. is recd. as compensation.
Akshata
(CA Final )
(324 Points)
Replied 17 July 2013
This is the case of relinquishment of rights.
It will be taxable in Mrs. X's hands, she being the owner.
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