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CA Intermediate · Taxation · Income of Other Persons included in Total Income of Assessee

Rohit gifted ₹4,00,000 to his major son Aman, who is financially independent. Aman used the amount to buy a fixed deposit that earned ₹32,000 interest during tax year 2026-27. Under the clubbing provisions of the Income-tax Act, 2025, how much of this interest is included in Rohit's total income?

Nil of the interest is included in Rohit's income. Clubbing on gifts applies to transfers to a spouse or son's wife, not to a major son. The ₹32,000 interest is taxable in the hands of Aman, the major son, who owns the deposit.

  1. A₹32,000
  2. BNilCorrect
  3. C₹16,000
  4. D₹4,00,000

Explanation

Clubbing of income from assets transferred without adequate consideration applies to transfers to the spouse, a son's wife, or to any person for the benefit of those persons. A gift to a major son is not covered. The interest of ₹32,000 is therefore taxed in Aman's hands. Including it in Rohit's income would wrongly extend clubbing to a major son.

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