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CMA Intermediate · Direct and Indirect Taxation · Clubbing of Income

Mr. Harish and his wife, Geeta, are governed by the community of property system under the Portuguese Civil Code in Goa. For the tax year, the couple's house property income is ₹2,40,000, Harish's salary is ₹9,00,000 and Geeta's salary is ₹3,00,000. Under the Income-tax Act, 2025, what is Harish's income under these heads before any deductions?

Harish's income is ₹10,20,000. Under section 10, the house property income of ₹2,40,000 is divided equally between the spouses, giving him ₹1,20,000, while salary is taxed only in the hands of the spouse who earned it, so his own ₹9,00,000 is added.

  1. A₹10,20,000Correct
  2. B₹9,00,000
  3. C₹11,40,000
  4. D₹12,00,000

Explanation

Under section 10, income other than salaries is divided equally, so each spouse gets ₹1,20,000 from house property. Salary is included in the hands of the spouse who actually earned it. Harish's income is ₹9,00,000 + ₹1,20,000 = ₹10,20,000.

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