TaxTMI 
TaxTMI 
Gift of HUF properties to coparceners or members with consent of all concerned is preferable.
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....ift of HUF properties to coparceners or members with consent of all concerned is preferable.<br>By: - DEVKUMAR KOTHARI<br>Other Topics<br>Dated:- 3-6-2025<br>CA UMA KOTHARI<br>Gift of HUF properties to coparceners or members with consent of all concerned is preferable. Gift from properties of HUF: Karta of HUF, can make gift to other coparceners, members or even others. However, It must preferably be in accordance with family traditions and must also be reasonable so that it is acceptable to all concerned. This is required to keep balance of interest of coparceners and members and to avoid disputes and allegations of favors. Gifts will be in nature of gift from HUF that means gift from all ....
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....coparceners and members. Because on giving gift valuation of properties remaining with HUF get reduced by the amount of value of gift. Therefore, value of interest of undivided share in properties or value of rights, which a coparcener and / or member can avail from time to time, get reduced. In case gift is given to a coparcener, he gains by the value of gift received as is in excess of value of his share, in property received as gift, in case of dissolution of HUF. Donee coparcener and / or member must continue in his capacity: On giving certain amount as gift, the donee still remain and continue to be coparcener and/ or member of HUF. However, it is preferable to specifically mention this aspect in the document of gi....
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....ft. Gift document must be signed by donor and accepted by donee and requirements of witness must be full filled to constitute a valid gift. Gift with consent of all concerned: In case of gift out of properties of HUF to any coparcener or member or even an outsider, it must preferably be given with consent of all concerned that is coparceners and members whose interest is affected because valuation of remaining properties is reduced. Family tradition is an important factor: Family tradition is an important factor while making gift from properties of HUF. This is because in case of HUF, its Karta and Coparceners considered as whole it is very common that on marriage of daughters gifts are given ( voluntarily or under pressure....
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....s) which can be sometimes disproportionate of share in family properties. In case of middle class families there can be cases in which daughters are given gifts even out of borrowed funds. The share of sons remain reduced. In some situations sons are socially and ethically required to even to repay loans taken at the time of sisters. Similarly, as per tradition and status lot of gifts are to be given to married daughters/ sisters even long after marriage e.g. on marriage of children of daughter/ sister. Therefore, when family has properties and sons require seed capital or to improve capital base, it may be desirable to grant gifts to sons out of properties of HUF to balance value of gifts given to daughters and sis....
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....ters and remaining with HUF, in which married daughters and sisters continue to be coparceners. Another traditional aspect is that the businesses of HUF or other units in which HUF has a share as partner or shareholder must remain within the family instead of going to families of married daughter or sisters who remain coparcener even after her marriage and becoming part of family of her husband and in laws. There can be different traditional and family aspects in different families depending on the size of family, life of family ( starting from date of coming into existence of HUF), generations continuing to be members and coparceners of family etc. CONSENT OF ALL CONCERNED: Therefore, it is desirable that gift out of family....
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.... properties must be given with utmost care and caution and to avoid present and future disputes within family or extended families/ relations and also new members to be included in future. Draft gift deed: A draft gift deed is appended below: DECLARATION OF GIFT FROM PROPERTIES OF HUF I, K son of xx being Karta of xx HUF residing at xxx , Kolkata - 700 0xx do hereby solemnly affirm and declare as follows:- * That I am the Karta of aforesaid HUF which consists of myself, my son S and his&n....
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....bsp; children C1 C2 and my two married daughters D1 , D2 as coparceners and my wife KW and wife of my son SW as members of said HUF. * That all major coparceners on their own behalf and in case of minor coparceners their mother, and all members have taken an unanimous decision to gift certain properties ( as mentioned in Schedule) to S (donee) out of natural love and affection which we all have towards the donee 'S' and with a view to built-up his stronger capital base and in accordance....
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.... with our family tradition. * That being Karta of the HUF, I have authority to make and declare this gift out of properties of HUF, which is made with consent of all coparceners and members. * That the items of property gifted are narrated in Schedule with the estimated amount of cost / actual cost and year of acquisition. * That the delivery and possession of the said items of property gifted are accepted by the S, donee. * That the above gift has been made out of my free will as well as free will and desire of all coparceners and the family members and out of properties of said HUF and in accordance with our family traditions and believes. * That S donee, is....
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.... now the absolute owner of the said items of properties gifted. * That S Donee , other coparceners and members shall continue to have their share and / or interest and rights in other properties of the HUF, in accordance with the tradition of family and law prevailing from time to time. * That donor HUF is assessed to Income Tax under the PAN No. .................... * That S donee is assessed to Income Tax under the PAN No. .................... That the above statements are true to the best of my knowledge and belief and are made for clarity and to record in writing and to avoid any misunderstan....
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....ding in future. Received delivery and accepted gift by Delivery given by : &....
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....nbsp; Karta of xxx HUF ( S donee) Donor.....
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.... Consented and mutually witnessed by other family members: 1. KW wife of Karta, member.................................... 2. D 1 elder daughter of Karta, coparcener 3. D 2 Younger daughter of Karta, coparcener 4. SW on behalf of her minor children as mother and natural guardian. a. &n....
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....bsp; .b. Independent witnesses: Reply By deepak gulati as = Sir what about Income tax on these Gifts, whether this will be taxable or exempt Dated: 4-6-2025 Reply By DEVKUMAR KOTHARI as = Dear sir, Gift from 'group of relatives' to a relative is gift from relative to relative hence S.56 is not attracted. Besides being exempt u.s. 10.2, and also capital receipt will not be taxable. Furthermore, in my view relative is a related and reciprocal term. When any member of HUF is considered relative of member, then by implication HUF is also relative of member of HUF. You may search and find judgments on this website. The gift declaration by HUF with consent of all coparc....
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....ners and members is also in nature of a family settlement. Let us have brain storming and explore all aspects. Dated: 5-6-2025<br> Scholarly articles for knowledge sharing by authors, experts, professionals ....