Gift - Shares and Securitites - from Father

[Jignesh Shah]

Dear Expert, My client has a typical problem. She is working with a Financial Services company. She started investing in stock markets from year2001 onwards. She had her D-mat account in her maiden name with her husband being the joint holder. She invested / traded in the same account till 2006. Then she had some disputes with her husband for some reasons and fearing the worst she transferred the shares in her D-MAT account to her father's account in his single name. This transaction took place in 2008. She closed her D-MAT account. The dividend for the same was credited to a bank account jointly held by her father and her. Now the disputes with her husband are settled. She wants to transfer the shares back from her father's account to her new D-MAT account. Can she take Gift from her father of the shares which she had tranferredr? There has been no transaction in her father's D-MAT account sinc the shares were transferred. Also, her father has not shown the dividend income in his return. The portfolio is worth a significant amount. What is the best way to take the custody of the shares in her account legally?

AI Summary

Shares Transferred During Marital Dispute Can Return as Gift Without Tax; Use Gift Deed on Rs. 100 Stamp Paper. A client, working in financial services, transferred shares from her D-MAT account to her father's account during a marital dispute. With the dispute resolved, she seeks to transfer the shares back to her new D-MAT account. Experts advise that since the father did not declare dividend income, the shares can be transferred back as a gift without tax implications, as the daughter is considered a relative under tax law. A gift deed on a Rs. 100 stamp paper is suggested, and it is noted that the transfer need not be declared in her tax return since it is not considered income.