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FACULTY OF LAW, JAMIA MILLIA ISLAMIA

TAX LAW - I PROJECT

CLUBBING OF INCOME

BY: Sameeksha Kashyap


III-Year, Semester-6
Self-finance
ACKNOWLEDGEMENT

The success and final outcome of this project required a lot of guidance and
assistance from many people and I am extremely privileged to have got this all
along the completion of my project. All that I have done is only due to such
supervision and assistance and I would not forget to thank them.

I respect and thank to Prof. Kiran Bala, for providing me an opportunity to do the
project work and giving us all support and guidance which made me complete the
project duly.

I am also extremely grateful to the library staff of Faculty of Law, Jamia Millia
Islamia for helping me identifying the relevant material for my project and guiding
me through the library sections on the tax law.

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TABLE OF CONTENTS

INTRODUCTION…………………………………………………………………...P. 3

I. SECTION 60………………………………………………………………...P.4

II. SECTION 61………………………………………………………………...P.5

III. SECTION 64………………………………………………………………..P.6

1. Section 64(1)(ii).........................................................................................P.6

2. Section 64(1)(iv)........................................................................................P.9

3. Section 64 (1)(vi).......................................................................................P.11

4. Section 64(1)(vii).......................................................................................P.12

5. Section 64(1)(viii)....................................................................................P.13

6. Section 64(1A)..........................................................................................P.14

7. Section 64(2).............................................................................................P.15

IV. SECTION 65…………………………………………………………………..P.15

V. BIBLIOGRAPHY……………………………………………………………...P.18

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INTRODUCTION TO ‘CLUBBING OF INCOME’ UNDER INCOME TAX ACT, 1961

Generally, a person is taxed in respect of income earned by him only. However, in certain special cases
income of other person is included (i.e. clubbed) in the taxable income of the taxpayer and in such a case
he will be liable to pay tax in respect of his income (if any) as well as income of other person too. The
situation in which income of other person is included in the income of the taxpayer is called as clubbing
of income. E.g., Income of minor child is clubbed with the income of his/her parent.

Section 60 to 64 contains various provisions relating to clubbing of income.

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Section 60- Transfer of income without transfer of assets: When the income therefrom is
regarded as that of transferor

All income arising to any person by virtue of a transfer whether revocable or not and whether effected
before or after the commencement of this Act shall, where there is no transfer of the assets from which the
income arises, be chargeable to income-tax as the income of the transferor and shall be included in his
total income.

Section 60 is applicable if the following conditions are satisfied:

1. The taxpayer owns an asset.


2. The ownership of asset are not transferred by him. In other words, he has retained the ownership
of the asset.
3. The income from the asset is transferred to any person under the settlement, trust, covenant,
agreement or the arrangement.
4. The above transfer may be revocable or may not be revocable.
5. The above transfer may be effected any time (maybe before the commencement of the Income-
Tax Act or after the commencement of the Act, i.e. before or on or April, 1962).

If the above conditions are satisfied, the income from the asset would be taxable in the hands of the
transferor.

❏ Income for the purpose of Section 64 includes losses.1


❏ Section 60 does not apply if corpus itself is transferred.2

❖ Illustration:
X owns 4,000 14 per cent debentures of A Ltd. of Rs. 100 (annual interest being Rs. 56,000). On April 1,
2018 he transfers interest income to Y, his friend, without transferring the ownership of these debentures.
Although, during 2018-19, he transfers interest income to Y, his friend, without transferring the ownership
of these debentures. Although, during 2018-19, interest of Rs, 56,000 is received by Y, it is taxable in the
hands of X, as he has transferred income without transferring the ownership of the asset.

1
P. Doriswamy Chetty 183 ITR 559 (SC).
2
Grandhi Narayana Rao 173 ITR 593 (AP).

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Section 61- When the income therefrom is regarded as that of transferor-Revocable transfer
of Assets-
All income arising to any person by virtue of a revocable transfer of assets shall be chargeable to income
-tax as the income of the transferor and shall be included in his total income.

By virtue of section 61, if an asset is transferred under a “revocable transfer”, income from such asset is
taxable in the hands of the transferor. The transfer for this purpose includes any settlement, trust,
covenant, agreement or the arrangement3.

In the following cases, a transfer is a revocable transfer :-

A. If an asset is transferred under a trust and it is revocable during the lifetime of the beneficiary.
Illustration- X transfers a house property to trust for the benefit of A and B. However, X has a
right to revoke the trust during the lifetime of A and/ or B. It is a revocable transfer and income
arising from the house property is taxable in the hands of X.

B. If the asset is transferred to a person and it is revocable in the lifetime of transferee.


Illustration- X transfers a house property to A. However, X has a right to revoke a transfer during
the lifetime of A. It is a revocable transfer and income arising from the house property is taxable
in the hands of X.

C. If an asset is transferred before April 1, 1961 and it is revocable within six years.
Illustration- X transfers an asset on March 31, 1961. It is revocable on or before June 6, 1963. It
is a revocable transfer. Income arising from the asset is taxable in the hands of X. Conversely, if
X transfers an asset before April 1, 1961 and it is revocable after six years (say on April 10,
1967), it is not taken as a revocable transfer.

D. If the transfer contains any provision for the re-transfer of the asset (or income therefrom) to the
transferor, directly or indirectly, wholly or partly4.
Illustration- X transfers an asset. Under the terms of transfer, on or after April 1, 1998, he has a
right to utilise the income of the asset for his benefit. However, he has not exercised his right as

3
Section 63(b).
4
S.63(a)(i).

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yet. On or after April 1, 1998, income of the asset would be taxable in the hands of X, even if he
has not exercised the aforesaid right.

E. If the transferor has any right to re-assume power over the asset (or income therefrom) directly or
indirectly, wholly or partly5. If there is provision to reassume power, the transfer will be revocable and the
actual exercise of power is not necessary6.
Illustration: X transfers an asset. Under the terms of transfer, he has a right to use the asset for
the personal benefits of his family members whosoever he wants. Till date, he has not exercised
this right. It is a revocable transfer. The entire income from the asset would be taxable in the
hands of X.

In C.T. Senthilnathan Chettiar V. State of Madras7, the Supreme Court held that where the assessee can at
any time reassume power over the assets or the income by just cancelling or altering the terms of deed,
trust was revocable. Similarly, in V. Venugopala Varma Rajah v. CIT8, the Apex Court ruled that where
no absolute right is given to transferee and the asset can revert back to transferor in certain circumstances,
transfer is revocable.

Section 64-Income of other persons included only in the individual’s total income
Income of the individuals to include income of -
(A) Spouse and Son’s wife
(B) Minor child
(C) HUF

S. 64(1)(ii)- When an individual is assessable in respect of remuneration of spouse- Remuneration of


spouse from a concern in which the other spouse has substantial interest

In computing the total income of an individual, there shall be included all such sums as arises directly or
indirectly to the spouse of such individual by way of Salary, commission, fees or any other form of
remuneration whether in cash or in kind from a concern in which the individual has substantial interest.

5
Section 63(a)(ii).
6
CIT v. S.Raghbir Singh [1965] 57 ITR 408(SC).
7
[1968] 67 ITR 102 (SC).
8
[1972] 84 ITR 466 (SC).

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Provided that nothing in this clause shall apply in relation to any income arising to the spouse where the
spouse possesses technical or professional qualifications and the income is solely attributable to the
application of his or her technical or professional knowledge and experience

This section is applicable if the following conditions are satisfied:


1. The taxpayer is an individual
2. He or she has a substantial interest in a concern.
3. Spouse of the taxpayer (i.e., husband or wife of the taxpayer) is employed in the above-mentioned
concern.
4. The spouse is employed in the concern without any technical or professional knowledge or
experience.

❏ However, the remuneration arises to the spouse is solely attributable to the application of technical or
professional qualification, knowledge and experience of the spouse, such remuneration will not be
clubbed.9
❏ Where both husband and wife have substantial interest in a concern and both are in receipt of income by
way of salary etc., from the said concern, such income shall be included in the case of the husband or
wife, whose total income excluding such income is greater.

❏ For the purpose of this clause, An individual shall be deemed to have substantial interest in a concern –

I. If the concern is a company, he by himself or together with his relatives beneficially holds equity
shares carrying not less than 20% of voting power at any time during the previous year.
II. In any other case, he by himself or together with his relatives is entitled to at least 20% of the
profits of such concern at any time during the previous year.

❏ ‘Relative’ in relation to an individual means the husband, the wife, brother or sister or any lineal
ascendant or descendant of that individual.

❏ For the purposes of clubbing the income under this S.64 (1)(ii), salary has to be computed in
accordance with the provisions of sections 15 to 17 of the IT Act, 1961.

9
Yashwant Chhajta v. CIT [2013] 214 Taxman 280 (HP).

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❏ The expression “concern” covers both business concern and professional concern and both proprietary
and non-proprietary concerns.

❏ “Professional qualification” means fitness to do job or undertake an occupation or vocation requiring


intellectual skill or requiring manual skill as controlled by intellectual skill and which is such that a
person should be able to take out a living therefrom independently, though the salary does not cease to
be product of professional skill merely because particular employment is accepted.

It is not necessary to confine the word “technical” to qualifications having technical subjects. Technical
qualification may take within its fold everything connected with specialisation in particular subject, be it
science, technology or commerce or business management.

The word “technical or professional qualification” do not necessarily relate to technical or professional
qualifications acquired by obtaining a certificate, diploma or a degree or in any other form from a
recognised body like a university or an institute10. However , contrary opinion expressed by some other
courts, it is respectfully submitted , requires reconsideration.

The words “ technical or professional” must receive a liberal construction as that term is not defined in
the section itself or elsewhere in the Act. The word “technical” is a term of wide import . Any task
required to be performed on an orderly and methodical manner which require some skill and knowledge
for performance and which also involves some degree of complexity, can be regarded as “technical”. The
fact that ordinarily the term “technical” is used in relation to things mechanical or electrical or anything
associated with machinery does not warrant limiting the scope of the term in Section 64. Similarly, the
word “profession” is again a term of wide import. The varieties of profession are endless.

It is therefore, necessary to consider the term “technical and professional qualifications and experience”
in the context of the facts which are required to be considered in a given case. Regard must , therefore, be
had to the nature of the business carried on by the concern and the mind of technical or professional
qualifications, knowledge and experience possessed by the spouse to whom the payment is made from the
concern for the services rendered by that person.11

10
Batta Kalyani v. CIT [1985]20 taxman 378 (AP).
11
CIT v. R. Jayalakshmi [1998]101 Taxman 350(Mad.)

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Section 64(1)(iv)- When an individual is assessable in respect of income from assets transferred to
spouse- Income accruing or arising from the assets transferred by one spouse to another without
adequate consideration
In computing the total income of an individual, there shall be included all such income as arises directly
or indirectly , subject to the provisions of Section 27(i), to the spouse of such individual from assets
transferred directly or indirectly to the spouse of such individual otherwise than for adequate
consideration or in connection with an agreement to live apart.

The following conditions should be satisfied-


1. The taxpayer is an individual.
2. He/she has transferred an asset (other than a house property).
3. The asset is transferred to his/her spouse.
4. The transfer may be direct or indirect.
5. The asset is transferred otherwise than (a) for adequate consideration, ot (b) in connection with an
agreement to live apart.
6. The asset may be held by the transferee-spouse in the same form or in a different form.
If the above conditions are satisfied, any income from such asset shall be deemed to be the income of the
taxpayer who has transferred the asset.
The income from the asset transferred must be calculated in the same way as it would be if the asset has
not been transferred. Exemption, deduction or tax incentives in respect of such income can be claimed by
the transferor.

❏ Natural love and affection may be a good consideration but that would not be adequate consideration for
the purpose of this section 64 (1).12

❏ The relationship of husband and wife should subsist both at the time of transfer of asset and at the time
when income is accrued in order to attract clubbing provision. It means that transfer of asset before
marriage is outside the scope of this section. Similarly , if transferor– spouse dies, the income , though
continued to be enjoyed by the transferee, cannot be included in the income of deceased transferor, heir,
administrator or executor , as widow or widower is not a spouse .13

12
Tulsidas Kilachand v. CIT [1961]42 ITR 1 (SC).
13
Vinodkumar Ratilal v. CIT [1975] 100 ITR 564 (Guj).

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❏ The word “spouse “ does not include illegal wife.14 Wife , in these provisions , means a lawfully wedded
wife and child, a legitimate child. Income of a prospective wife or an illegitimate child is not affected by
these provisions.15

❏ If any property is acquired by the wife out of an allowance given by her husband for her personal
expenses ( called pin money), the clubbing provisions shall not apply. 16

❏ Where the assessee made payments of premium on policy taken in the name of his wife, the maturity
proceeds were invested and income earned thereon in the name of his wife. The assessing officer
clubbed such income in the hands of the assessee. The Gujarat high court upheld such action. The court
held that proximity between asset and income had to be considered irrespective of time lag between
transfer of asset and actual income derived.17

❏ Income from assets transferred by a non resident individual to his wife is subject to clubbing provisions
of Section 64 only if income from such asset accrues and is received in India 18

❏ Deemed owner u/s 27 (i) : Where a house property is transferred without an adequate consideration by
an individual to his or her spouse, the transferor shall be deemed owner of the house property and shall
be subject to tax under the head Income from house property.

Capital gains: If there is any capital gain on the transfer of such house property, such capital gain shall,
first be computed in the hands of the transferee and thereafter the same will be clubbed with the income
of the transferor as per the provisions of this section 64(1)(iv).

Section 64 (1)(vi)- When an individual is assessable in respect of income from assets transferred to
son’s wife- Income from assets transferred to son’s wife without adequate consideration-
In computing the total income of an individual, there shall be included any income which arises from
assets transferred directly or indirectly by an individual to the son’s wife after 1st June 1973, otherwise
than for adequate consideration.

14
Executors of will of T.V. Krishna Iyer v. CIT [1966] 38 ITR 144(Ker).
15
Thomas (P.J.P)v. Cit [1962] 44ITR 897 (Cal).
16
R. Dalmia v. CIT {1982} 133 ITR 169 (Del).

17
Damodar K.Shah v. CIT [2001] 119 Taxman 882 (Guj).
18
CIT v. F.Y. Khambaty [1986] 159 ITR 203 ( Bom). CA.Hemavathi Ramachandran FCA DISA CISA 6

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The conditions for the applicability of section 64(1)(vi) are given below:-
1. The taxpayer is an individual.
2. He/she has transferred an asset after May 31,1973.
3. The asset is transferred to his/her son’s wife.
4. Transfer may be direct or indirect.
5. The asset is transferred otherwise than for adequate consideration.
6. The asset may be held by the transferee in the same form or in a different form.

If the above conditions are satisfied, then income from the asset is included in the income in the income
of the taxpayer who has transferred the asset.

Common issues in Sec 64(1) (iv) and (vi) :

(A) Pre – marital transfers: The relationship of Husband and wife / Father in law, mother in law and
daughter in law for the purpose of Sec 64 should subsist both at the time of transfer and at the time of
accrual of income.19
As per Section 56(2)(vi), any sum of money , the aggregate value of which exceeds Rs.50000, received
without consideration by an individual or HUF in any previous year from any person or persons on or
after 01-04-2006, subject to certain exceptions is taxable under the head Income from other sources. In
this case transferee spouse is taxable.
As per Section 56(2)(vii), Any sum of money, the aggregate value of which exceeds Rs.50000 is received
without consideration or property (whether movable or immovable) is received without consideration or
movable property is received for an inadequate consideration by an individual or HUF on or after 01-10-
2009, if the amount of such gift or inadequate consideration exceeds Rs.50000 subject to certain
exceptions is taxable under the head Income from other sources. In this case transferee spouse is taxable.

(B) When asset transferred without adequate consideration is invested in business by the transferee:
Where the assets transferred by an individual to the spouse or son’s wife are invested by the transferee-
● In any business , ( not being as capital contribution in a firm), proportionate income arising to the
transferee attributable to the investment ; and
● In the nature of capital contribution in a firm, any interest receivable by the transferee attributable
to such investment. Shall be included in the total income of the individual. For this purpose, the

19
Philip John Plasket Thomas v. CIT {1963}49 ITR 97(SC).

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proportion shall be with reference to the value of investment aforesaid as on the first day of the
previous year to the total investment in the business by the transferee as on that day.

(C) Income for clubbing purpose includes losses.

(D)Whether income from accretion to asset be clubbed : Income on the asset transferred is clubbed but
not the income on the accretion to the asset. For e.g, If debentures are gifted by the husband to the wife,
interest income on those debentures shall be clubbed. If the interest on debenture is deposited , the interest
on deposit shall not be clubbed in the hands of the husband. It is taxable in the hands of the wife.

(E)When asset transferred without adequate consideration has changed the shape and identification:
Where an asset transferred by spouse is converted in to another form, income derived from such
converted asset shall be clubbed. For e.g., Mr.A gifts a sum of Rs.50,00,000 to Mrs.A on the occasion of
wedding anniversary . Mrs.A invest this sum in a fixed deposit , which derives interest income of
Rs.25,000 p.m. The interest income so derived shall be clubbed in the hands of Mr.A, despite the fact that
it is the income from converted asset.

Section 64(1)(vii)-When an individual is assessable in respect of income from assets transferred to a


person for the benefit of spouse-Income from assets transferred to any person / persons or AOP for
the immediate or deferred benefit of spouse -
In computing the total income of an individual, there shall be included all such income arising directly or
indirectly to any person or association of persons from the assets transferred by that individual otherwise
than for adequate consideration to the extent to which the income from such asset is for the immediate or
deferred benefit of his/her spouse.
One has to satisfy the following conditions to satisfy this section:
1. The taxpayer is an individual.
2. He/she has transferred an asset.
3. The transfer may be direct or indirect.
4. The asset is transferred to a person or an association of persons.
5. It is transferred for the immediate or deferred benefit his?his spouse.
6. The transfer is without adequate consideration.

If the aforesaid conditions are satisfied then income from such asset to the asset to the extent of such
benefit is taxable in the hands of the taxpayer who has transferred the asset.

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Example: X transfers government bonds without consideration to an association of persons subject to the
condition that the interest income from these bonds will be utilised for the benefit of Mrs.X. Interest from
the bonds shall be included in the income of X.

Section 64(1)(viii)- When an individual is assessable in respect of income from assets transferred
to a person for the benefit of son’s wife-Income from assets transferred to any person / persons or
AOP for the immediate or deferred benefit of son’s wife -
In computing the total income of an individual, there shall be included all such income arising directly or
indirectly to any person or association of persons from the assets transferred by that individual otherwise
than for adequate consideration to the extent to which the income from such asset is for the immediate or
deferred benefit of his/her son’s wife.

For the applicability of this section the following conditions have to be satisfied:
1. The taxpayer is an individual.
2. He/she has transferred an asset after May 31,1973.
3. The asset is transferred to any person or an associate of persons.
4. Transfer may be direct or indirect.
5. The asset is transferred for the immediate or deferred benefit of his/her son’s wife.
6. The asset is transferred otherwise than for adequate consideration.

If the above conditions are satisfied, then income from the asset to the extent of such benefit is included in
the income of the taxpayer who has transferred the asset.
Example- Mrs. X transfers an industrial undertaking to an association of persons subject to the condition
that out of the annual income i.e., Rs 30,00,000, a sum of Rs 5,00,000 shall be utilised for the benefit of
daughter-in-law of Mrs. X. In this case, Rs 5,00,000 shall be included in the income of Mrs. X.

Section 64(1A)- When an individual is assessable in respect of income of his minor child-Income of
Individual to include income of Minor child
1. In computing the total income of an individual, there shall be included all such income arises or accrues
to his minor child.

2. However, income shall not be included if it arises or accrues to a Minor child on account of any
● Manual work done by him ; or

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● Activity involving application of his skill , talent or specialized knowledge and experience.

3. If the minor child is suffering from any disability of the nature specified in Sec 80 U , the income of
such child shall not be included in the hands of the parent but shall be assessed in the hands of the child.

4. The income of the minor child shall be included-


a. Where the marriage of his parent subsists, in the income of that parent whose total income
(excluding this income ) is greater.
b. Where the marriage of his parent does not subsist, in the income of that parent who maintains the
minor child in the previous year.

5. Child includes a step child and an adopted child of that individual.

6. Income of the minor married daughter is clubbed in the hands of the parent. However , where Sec 27
applies, clubbing of income from property gifted by the parent does not arise.

7. Even though income derived by the minor from the manual work or from activity involving skill and
talent can not be clubbed, there is no provision to avoid clubbing of income earned on investment made
out of such income.

8.Where any such income is once included in the total income of either parent, any such income arising in
any succeeding year shall not be included in the total income of the other parent , unless the assessing
officer is satisfied, after giving that parent an opportunity of being heard, that it is necessary to do so.

9. Exemption u/s 10(32) : If the income is included in the hands of the parent under Section 64(1A), then
the assessee is entitled to claim exemption under Sec 10(32) to the extent of Rs.1500 per child.

Section 64(2)- What is tax implication of conversion of self-acquired property into joint family
property and subsequent partition- Income of individual to include income of HUF
Where, in the case of an individual being a member of a Hindu undivided family, any property having
been the separate property of the individual has, at any time after the 31st day of December, 1969, been
converted by the individual into property belonging to the family through the act of impressing such
separate property with the character of property belonging to the family or throwing it into the common
stock of the family or been transferred by the individual, directly or indirectly, to the family otherwise

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than for adequate consideration (the property so converted or transferred being hereinafter referred to as
the converted property), then, notwithstanding anything contained in any other provision of this Act or in
any other law for the time being in force, for the purpose of computation of the total income of the
individual under this Act for any assessment year commencing on or after the 1st day of April, 1971,—

(a) the individual shall be deemed to have transferred the converted property, through the family, to the
members of the family for being held by them jointly ;

(b) the income derived from the converted property or any part thereof shall be deemed to arise to the
individual and not to the family ;

(c) where the converted property has been the subject-matter of a partition (whether partial or total)
amongst the members of the family, the income derived from such converted property as is received by the
spouse on partition shall be deemed to arise to the spouse from assets transferred indirectly by the
individual to the spouse and the provisions of sub-section (1) shall, so far as may be, apply accordingly :

Provided that the income referred to in clause (b) or clause (c) shall, on being included in the total
income of the individual, be excluded from the total income of the family or, as the case may be, the
spouse of the individual.

Explanation 1.—For the purposes of sub-section (2),—

"property" includes any interest in property, movable or immovable, the proceeds of sale thereof and any
money or investment for the time being representing the proceeds of sale thereof and where the property
is converted into any other property by any method, such other property.

Explanation 2.—For the purposes of this section, "income" includes loss.

The following transactions are covered by Section 64(2)

I. Where an individual (being member of a Hindu undivided family) converts (after December
31,1969) his self-acquired property belonging to the family. It is done by impressing such
property with the character of joint family property or throwing such property into common stock
of the family.
II. When such an individual transfers his self-acquired property, directly or indirectly, to the family
otherwise than for adequate consideration.

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❏ Clubbing before partition- Income from the converted property or property transferred for less than
adequate consideration is chargeable to tax in the hands of the the transferor (before partition of the
family).
Example: X transfers his self-acquired property yielding an annual income Rs. 60,000 to his Hindu
undivided family, consisting of X. Mrs. X, his major son Y and minor son Z. Income of Rs. 60,000 will
be included in the income of X (and not of the HUF) by the virtue of this section.

❏ Clubbing after partition- If the property converted or transferred by an individual is subsequently


transferred amongst the members of the family, the income derived from such converted property, as is
received by the spouse of the transferor will be included in the income of the transferor.

A Hindu father, being the Karta of HUF, is vested with the power of making, within reasonable limits,
gifts of ancestral movable property, without the consent of his sons, for the purposes prescribed by texts
of law, as gifts through affection, support of family, relief from distress and so forth. He also has power to
make a gift, within reasonable limit, of ancestral immovable property, for ‘pious purposes’. The alienation
should, however, be an act inter vivos and not by will.
In CGT v. Tej Nath20, the Karta made gifts in favour of his sons and other members of the family. The
Court held the gifts to be invalid. In S.V. Sunderasan v. Asstt. CED21, held that settlement of land in
favour of a coparcener was held to be invalid by the Madras High Court.

Section 65 -Liability of person in respect of income included in the income of another person-
Where, by reason of the provisions contained in this Chapter or in clause (i) of section 27, the income
from any asset or from membership in a firm of a person other than the assessee is included in the total
income of the assessee, the person in whose name such asset stands or who is a member of the firm shall,
notwithstanding anything to the contrary contained in any other law for the time being in force, be liable,
on the service of a notice of demand by the Assessing Officer in this behalf, to pay that portion of the tax
levied on the assessee which is attributable to the income so included, and the provisions of Chapter
XVII-D shall, so far as may be, apply accordingly :

Provided that where any such asset is held jointly by more than one person, they shall be jointly and
severally liable to pay the tax which is attributable to the income from the assets so included.

20
(1972) 86 ITR 96 (P & H) (FB).
21
(1983) 144 ITR 916 (Mad).

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According to Sec 65, wherever clubbing provision is attracted, the person in whose name assets stands
shall be liable , on the service of a notice of demand by the assessing officer, to pay that portion of the tax
levied on the assessee which is attributable to the income so clubbed.

Where any such asset is held jointly by more than one person, they shall be jointly and severally liable to
pay the tax on the income from such assets.

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BIBLIOGRAPHY
Websites used:
● www.scconline.com
● www.incometaxindia.gov.in
Books used:
● Dr. Vinod K. Singhania and Dr. Monica Singhania, Student’s Guide to Income Tax Act
Including GST, Taxmann, 60th Edition, 2019-20
● The Income-Tax Act, 1961 (43 of 1961) as amended by The Finance Act 2019,
Professional Book Publishers, 2019-20

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