topic-clubbing-of-income-jan26

1. Where a member of a HUF has converted or transferred his self-acquired property for inadequate consideration into joint family property, income arising there from is taxable:

a) As the income of the transferor-member

b) In the hands of the HUF

c) In the hands of the Karta of the HUF

d) None of the above

None

2. Mr Rajeev transfers a house property to his minor child without adequate consideration, then income from such house property shall be:

a) Computed in the income of Mr Rajeev as per Sec 27 and exemption of ₹ 1,500 shall be allowed

b) Computed in the income of Mr Rajeev as per Sec 27 but exemption of ₹ 1,500 shall not be allowed

c) Clubbed in the income of Mr Rajeev as per Sec 64(1A)

d) Clubbed in the income of Mr Rajeev as per Sec 64(1A) and exemption of ₹ 1,500 shall be allowed

None

None

3. Salary of Mrs V will be taxable in the hands of:

a) Mr V

b) Mrs V

c) Father or Mother of Mr V, whosoever has higher income

d) Father or Mother of Mrs V, whosoever has higher income

None

4. Calculate the taxable income for Mr V.

a) ₹ 8,84,600

b) ₹ 9,34,600

c) ₹ 4,55,000

d) ₹ 6,31,000

None

5. Calculate the taxable income for Mrs V.

a) ₹ 3,16,000

b) ₹ 2,00,000

c) ₹ 5,21,600

d) None of the above

None

6. Mr Aarav gifted a house property valued at ₹ 50L to his wife, Geetha, who in turn has gifted the same to her daughter-in-law Deepa. The house was let out at ₹ 25K per month throughout PY 24-25. Compute income from house property for AY 25-26. In whose hands is the income from house property chargeable to tax?

a) ₹ 3,00,000 in the hands of Mr Aarav

b) ₹ 2,10,000 in the hands of Mr Aarav

c) ₹ 2,10,000 in the hands of Geetha

d) ₹ 2,10,000 in the hands of Deepa

None

7. Ram owns 500, 15% debentures of Reliance Industries Ltd of ₹ 500 each. Annual interest of ₹ 37,500 was declared on these debentures for PY 2024-25. He transfers interest income to his friend Shyam, without transferring the ownership of these debentures. While filing return of income for AY 2025-26, Shyam showed ₹ 37,500 as his income from debentures. As tax advisor of Shyam, do you agree with the tax treatment done by Shyam in his return of income?

a) Yes, since interest income was transferred to Shyam therefore, after transfer it becomes his income.

b) No, since Ram has not transferred debentures to Shyam, interest income on the debentures is not a taxable income of Shyam.

c) Yes, if debentures are not transferred, interest income on debentures can be declared by anyone, Ram or Shyam, as taxable income depending upon their discretion.

d) No, since Shyam should have shown the income as interest income received from Mr Ram and not as interest income earned on debentures.

None

8. On 20.10.2024, Pihu (minor child) gets a gift of ₹ 20L from her father’s friend. On the same day, the amount is deposited in Pihu’s bank account. On the said deposit, interest of ₹ 13,000 was earned during PY 2024-25. In whose hands the income of Pihu shall be taxable? Also, compute the amount of income that shall be taxable.

a) Income of ₹ 20,11,500 shall be taxable in the hands of Pihu’s father.

b) Income of ₹ 20,13,000 shall be taxable in the hands of Pihu’s father.

c) Income of ₹ 20,11,500 shall be taxable in the hands of Pihu’s father or mother, whose income before this clubbing is higher.

d) Income of ₹ 20,13,000 shall be taxable in the hands of Pihu’s father or mother, whose income before this clubbing is higher.

None

9. Mr Hari is 65 years old residing in Agra. During FY 19-20, he purchased a house property in Kamla Nagar for ₹ 25L. This house property was self-occupied by him till FY 21-22. In FY 22-23, he shifted to Delhi and the house property in Kamla Nagar was let out to Mr Kishore. His income from house property was ₹ 5L pa (computed). During FY 24-25, Mr Hari earned LTCG of ₹ 2.50L, casual income of ₹ 10L, agricultural income of ₹ 3L and profits from business of ₹ 4L. During the same year, he transferred house property situated in Kamla Nagar to Mrs Neelam (his son’s wife) without any consideration. Subsequently, income from house property was received by Mrs Neelam for FY 24-25. Compute GTI of Mr Hari for AY 25-26:

a) ₹ 16.50 lacs

b) ₹ 21.50 lacs

c) ₹ 19.50 lacs

d) ₹ 24.50 lacs

None

10. Mrs Shivani, wife of Mr Anurag, is a partner in a firm. Her capital contribution of ₹ 5L lakhs to the firm as on 1.4.2024 included ₹ 3.5 lakhs contributed out of gift received from Anurag. The firm paid interest on capital of ₹ 50,000 and share of profit of ₹ 60,000 during FY 2024-25. The entire interest has been allowed as deduction in the hands of the firm. Which of the following statements is correct?

a) Share of profit is exempt but interest on capital is taxable in the hands of Mrs Shivani.

b) Share of profit is exempt but interest of ₹ 39,286 is includible in Mr Anurag’s income and interest of ₹ 10,714 is includible in Mrs Shivani’s income.

c) Share of profit is exempt but interest of ₹ 35,000 is includible in Mr Anurag’s income and interest of ₹ 15,000 is includible in Mrs Shivani’s income.

d) Share of profit to the extent of ₹ 42,000 and interest on capital to the extent of ₹ 35,000 is includible in the hands of Mr Anurag.

None

11. Mr Arvind gifted a house property to his wife, Ms Meena and a flat to his daughter-in law, Ms Seetha. Both the properties were let out. Which of the following statements is correct?

a) Income from both properties is to be included in the hands of Mr Arvind by virtue of Section 64.

b) Income from property gifted to wife alone is to be included in Mr Arvind’s hands by virtue of Section 64.

c) Mr Arvind is the deemed owner of house property gifted to Ms Meena and Ms Seetha.

d) Mr Arvind is the deemed owner of property gifted to Ms Meena. Income from property gifted to Ms Seetha would be included in his hands by virtue of Section 64.

None

12. Pankaj gifted an amount of ₹ 3L to his wife, Pinky and ₹ 2L to his daughter, Rinky aged 20, on 1st April 2021. Both Pinky and Rinky invested the amounts on the same date in Government of India 11% Taxable Bonds. The interest accrues yearly and is reinvested in the same bonds. Determine what will be the amount taxable in hands on Pinky for AY 2025-26?

a) ₹ 4,473

b) ₹ 12,132

c) ₹ 33,000

d) Nil

None

13. Mrs Bhawna, wife of Mr Sonu, is a partner in a firm. Her capital contribution of ₹ 10 lakhs to the firm as on 31.3.2024 included ₹ 6 lakhs contributed out of gift received from Sonu. On 1.4.2024, she further invested ₹ 2 lakh out of gift received from Sonu. The firm paid interest on capital of ₹ 1,20,000 and share of profit of ₹ 1,00,000 during FY 2024-25. The entire interest has been allowed as deduction in the hands of the firm. Which of the following statements is correct?

a) Share of profit is exempt but interest on capital is taxable in the hands of Mrs Bhawna.

b) Share of profit is exempt but interest of ₹ 80,000 is includible in the income of Mr Sonu and interest of ₹ 40,000 is includible in the income of Mrs Bhawna.

c) Share of profit is exempt but interest of ₹ 72,000 is includible in the income of Mr Sonu and interest of ₹ 48,000 is includible in the income of Mrs Bhawna.

d) Share of profit to the extent of ₹ 60,000 and interest on capital to the extent of ₹ 72,000 is includible in the hands of Mr Sonu.

None

14. Mr Raj Makes a gift of ₹ 25,000 to his wife, Mrs Rama, on 27.03.2024. Mrs Rama, on 2.4.2024, invests ₹ 75,000 (25,000 out of gift and 50,000 of her own) in a partnership firm as capital which is her total capital contribution in the firm. The partnership firm has been conducting its business since FY 2021-22. During the year ended 31.03.2025, she earns an interest of ₹ 12,000 and salary of ₹ 1,20,000 from the firm. What amount shall form part of total income of Mr Raj for PY 2024-25?

a) ₹ 3,000 as interest on capital from firm

b) ₹ 3,000 as interest on capital from firm and ₹40,000 as salary from firm

c) ₹ 4,000 as interest on capital from firm and ₹40,000 as salary from firm

d) Nil

None

15. Mrs Archana, wife of Mr Raj, started a business of trading in beauty products on 15.5.2024. She invested ₹ 5 lakhs in the business on 15.5.2024 out of gift received from her husband, Mr Raj. She further invested ₹ 4 lakhs from her own savings on 15.12.2024. She earned profits of ₹ 1,50,000 from her business for FY 2024-25. Which of the following statements is correct?

a) Share of profit of ₹ 1,50,000 is includible in the hands of Mrs Archana.

b) Share of profit of ₹ 66,667 is includible in the hands of Mr Raj and share of profit of ₹ 83,333 is includible in the hands of Mrs Archana.

c) Share of profit of ₹ 83,333 is includible in the hands of Mr Raj and share of profit of ₹ 66,667 is includible in the hands of Mrs Archana.

d) Share of profit of ₹ 1,50,000 is includible in the hands of Mr Raj.

None

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Topic - Clubbing Of Income (Sections 60 to 65)

Topic -
Clubbing Of Income (Sections 60 to 65)