On 20.10.2023, Piya (minor child) gets a gift of 20,00,000 from her father's friend. On the same day, the amount is deposited as fixed deposit in…

CA Intermediate · Taxation · MTP · January 2025
On 20.10.2023, Piya (minor child) gets a gift of 20,00,000 from her father's friend. On the same day, the amount is deposited as fixed deposit in Piya's bank account. On the said deposit, interest of 13,000 was earned during the P.Y. 2023-24. In whose hands the income of Piya shall be taxable? Also, compute the amount of income that shall be taxable if both parents pay tax under default tax regime.
(A) Income of 20,11,500 shall be taxable in the hands of Piya's father.
(B) Income of 20,13,000 shall be taxable in the hands of Piya's father.
(C) Income of 20,11,500 shall be taxable in the hands of Piya's father or mother, whose income before this clubbing is higher.
(D) Income of 20,13,000 shall be taxable in the hands of Piya's father or mother, whose income before this clubbing is higher.

Suggested Answer and Working Notes:

Correct Answer: Option (D)

Income of 20,13,000 shall be taxable in the hands of Piya's father or mother, whose income before this clubbing is higher.

Topics: Paper 3B: Goods and Services Tax, Paper 3A: Income Tax Laws

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