I have a query regarding clubbing provisions of income tax act. Suppose the parent gifts minor Rs. 1 lac which are in turn invested in bank FD's. Suppose the same earn interest @ 10% of Rs.10,000. The Rs.10,000 are invested by the minor in another FD which again earns him interest @ 10% of Rs.1000.
I am aware that the Rs.10000 will be clubbed alongwith the income of the parent whose taxable income is higher , however will Rs.1000 shall also get clubbed ? Please answer quoting relevant section number / case laws.
CAclubindia
