The Gift-Tax Act, 1958
5. Exemption in respect of certain gifts.
- Gift-tax shall not be charged under
this Act in respect of gifts made by any person-
- of immovable property situate outside
the territories to which this Act extends ;
- of immovable property situate outside
the said territories unless the person-
- being an individual, is a citizen of
India and is ordinarily resident in the said territories, or
- not being an individual, is resident in the said territories,
during the previous year in which the gift is made;
(iia)
being an individual
who is not resident in India, to any person resident in India, of foreign
currency or other foreign exchange [as defined, respectively, in clause (c)and
clause (d) of section 2 of the Foreign Exchange Regulation Act, 1947] (7 of
1947.) remitted from a country outside India in accordance with the provisions
of the said Act, and any rules made there under, during the period com-mencing
on the 26th day of October, 1965 and ending on the28th day of February, 1966, or
such later date as the Central Government may, by notification in the Official
Gazette, specify in this behalf.
Explanation.-For the purposes of this clause, the expression"resident in India" shall have the meaning assigned to it in the lncome-tax
Act;]
- of property in the form of savings
certificates issued by the Central Government, which that Government, by
notification in the Official Gazette, exempts from gift-tax ;
(iiia)
[(iiia) of property,
in the form of National Defence Gold
Bonds, 1980, not exceeding the value of such Bonds for an aggregate weight of
five kilogrammes of gold in any previous year :
- Provided that the exemption conferred by this clause shall be available only to
a person who has initially subscribed to the said Bonds;]
(iv) to the Government or any local authority. 3[or any authority referred to
in clause (20A) of section 10 of theIncome-tax Act]
- Ins. by Act 13 of 1966, s.41 (w.e.f. 1-4-1966).
- Ins. by Act 41 of 1965, s.7.3 Ins. by Act 66 of 1976, s. 28 (w.e.f. 1-4-1977).
- to any institution or fund established 5[or deemed to
be established] for a charitable purpose to which the provisions of 1[section
80G] of the Income-tax Act apply;
(va)
to such temple,
mosque, gurdwara, church or other place as has been notified by the Central
Government for the purposes of 3[clause (b) of sub-section (2) of section 80G of
the Income-tax Act] ; or(ii) by way of settlement on trust, of property the
income from which, according to the deed of settlement, is to be used
exclusively in connection with the temple, mosque, gurdwara, church or other
place specified therein and notified as aforesaid;]
- for any charitable purpose not falling within clause
- made at any time before the 1st day of April, 1958.;or
- made at any time after that date subject, in respect of each, such gift, to
a maximum of rupees one hundred in value and, in respect of such gifts in any
one previous year to the same donee, to a maximum of rupees five hundred in
value in the aggregate ;
- to any relative dependent upon him for support and
maintenance, on the occasion of the marriage of the relative, subject to a
maximum of rupees ten thousand in value in respect of the marriage of each
such relative;
- to his or her spouse, subject to a maximum of
4[rupees fifty thousand] in value in the aggregate in one or more previous
years, the expression "spouse" in this clause, where there are more
wives than one, meaning all the wives together;
- of policies of insurance or annuities to any person
(other than his wife) who is dependent upon him for support and maintenance,
subject to a maximum of rupees ten
- Subs. by Act 32 of 1971, s. 37, for "section 88" (w.e.f. 1-4-1968).
- Ins. by Act 10 of 1965, s. 71 (w.e.f. 1-4-1965).
- Subs. by Act 32 of 1971, s. 37, for certain words (w.e.f. 1-4-1972).
- Subs. by Act 5 of 1964, s. 52, for "rupees one lakh" (w.e.f. 1-4-1964).
- Ins. by Act 21 of 1973, s. 21 (w.e.f. 1.4.1974).
871.thousand in value in the
aggregate in one or more previous years of the benefits in respect of each such donee ;
- under a will;
- in contemplation of death;
- for the education of his children, to the extent to which the gifts are
proved to the satisfaction of the Gift -
tax Officer as being reasonable having regard to the circum-stances of the case ;
- being an employer, to any employee by way of bonus, gratuity or pension
or to the dependents of a deceased employee to the extent to which the payment
of such bonus, gratuity or pension is proved to the satisfaction of the
Gift - tax Officer as being reasonable having regard to the circumstances of the
case and is made solely in recognition of the services rendered by the
employee;
- in the course of carrying on a business, profession or vocation, to the
extent to which the gift is proved to the satisfaction, of the Gift-tax Officer
to have been made bona fide for the purpose of such business, profession or
vocation;
- to any person in charge of any such Bhoodan or
Sampattidan movement as the Central Government may, by notification, in the
Official Gazette, specify;
2 * * *Provided that such gifts are in accordance with the practice, usage or
tradition of the family to which the person making the gift belongs.
- [(1A) Any reference in clause (v) or clause (vi) of sub-section(1) to charitable purpose in relation to a gift made on or after the1st day of April, 1964 shall be construed as not including a purpose, the whole
or substantially the whole of which is of a religious nature.]1 Ins. by Act 15 of 1965, s. 21 (w.e.f. 1.4-1964).
- Omitted by Act 54 of 1972, s. 6 (w.e.f. 1-4-1973)872.(2) Without prejudice to the provisions contained in sub-section
(1), gift-tax shall not be charged under this Act in respect of gifts made by
any person during the previous year, subject to a maximum of rupees 1[five
thousand] in value.
- Notwithstanding anything contained in subsection (1) or sub-section (2), where either spouse makes any gifts out of any such gifts received
by that spouse as fall within clause (viii) of sub-section(1), the gifts so made shall be deemed to be taxable gifts made by that spouse
and nothing contained in sub-section (1) or subsection (2)shall apply in relation to any such gifts.
Explanation.-For the purposes of this section,-
- an individual shall be deemed to be ordinarily resident in the territories
to which this Act extends during the previous year in which the gift is made if
during that year he is regarded as a resident but not as not ordinarily
resident 2[within the meaning of section 6 of the Income-tax
Act, subject to the modification that references in that section to India shall
be construed as references to the territories to which this Act extends];
- a Hindu undivided family, firm
or other association of persons shall be deemed to be resident in the
territories to which this Act extends during any previous year unless, during
that year, the control and management of its affairs was situated wholly
outside the said territories:
- a company shall be deemed to
be resident in the territories to which this Act extends during the previous
year, if-
- it is a company formed and registered under theCompanies Act, 1956, (1 of 1956.) or is an existing company within the meaning
of that Act ; or
- during that year, the control and management of that company was situated
wholly in the said territories;
- "gifts made in contemplation
of death" has the same meaning as in section 191 of the Indian Succession Act,
1925.(39 of 1925.)
- Subs. by Act 19 of 1970, s.
27, for "ten thousand" (w.e.f.1-4-1971).
- Subs. by Act 53 of 1962, s. 4, for certain words (w.e.f. 1-4-1963).
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