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CS Executive · Tax Laws and Practice · Income from Other Sources

Under the Income-tax Act, 2025 (applicable from the June 2027 session), Meera, a salaried individual, receives Rs. 40,000 in cash from a friend who is not a relative on her birthday, and no other gifts during the tax year. What is the amount chargeable under section 92(2)(m) as income from other sources?

Nothing is chargeable. Section 92(2)(m)(i) taxes money received without consideration only if the total in the tax year exceeds Rs. 50,000. Meera received Rs. 40,000, which is within the limit, so no amount is taxed as income from other sources.

  1. ARs. 40,000
  2. BRs. 0Correct
  3. CRs. 10,000
  4. DRs. 50,000

Explanation

Section 92(2)(m)(i) applies only when the total of sums of money received without consideration exceeds Rs. 50,000, and then the whole sum is taxed. Here the total is Rs. 40,000, which does not exceed the limit, so nothing is chargeable. Taxing only the excess (Rs. 10,000 is not the rule) is wrong, because the Rs. 50,000 limit is a threshold and not an exemption.

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