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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Income from Other Sources

Mr. Sameer Joshi, a resident individual, received a house from his friend as a gift. The stamp duty value is Rs 8,00,000 and the property is a capital asset in the donor's hands. Later he sold it for Rs 10,00,000 after 3 years. Which statement about the receipt of the gift is correct?

The full stamp duty value of Rs 8,00,000 is taxable as Income from Other Sources in the year of receipt. The gift is from a non-relative and exceeds Rs 50,000, so the whole value is taxed, not just the excess. The sale is dealt with under capital gains.

  1. ARs 8,00,000 is taxable as Income from Other Sources in the year of receiptCorrect
  2. BNothing is taxable at receipt because immovable property gifts are always exempt
  3. COnly the excess over Rs 50,000, that is Rs 7,50,000, is taxable
  4. DRs 10,00,000 is taxable in the year of sale as Other Sources

Explanation

Immovable property received without consideration from a non-relative is taxable at its stamp duty value when that exceeds Rs 50,000, and the whole value is taxed. It is not exempt and not only the excess. The later sale is a capital gains matter, with cost taken as the value taxed.

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