Clubbed spouse salary income includes standard deduction before inclusion under the Income-tax Act.

Salary income clubbed under section 64(1)(ii) must be taken at the net amount after deductions admissible under the Income-tax Act, including standard deduction under section 16(i). Clubbing does not change the character of the income so as to require inclusion of the gross salary. The income included in the assessee's hands is therefore the amount that would be assessed in the spouse's hands after lawful deductions, and standard deduction remains allowable before clubbing.

---

---

Issues: Whether, for the purpose of section 64(1)(ii) of the Income-tax Act, 1961, the salary income of the assessee's wife was to be clubbed at the gross amount or after allowing standard deduction under section 16(i).

Analysis: The salary income of the wife, if assessed in her hands, would be computed after allowing the deductions available under the Act, including standard deduction. Clubbing such income under section 64(1)(ii) does not alter its character so as to require inclusion of the gross amount. The income to be included in the assessee's hands is the net income after permissible deductions, as excluding deductions before clubbing would be inconsistent with the scheme of the Act.

Conclusion: The question was answered in the affirmative and in favour of the assessee. Standard deduction was allowable before clubbing the wife's salary income under section 64(1)(ii).

---