NRI can’t open new Sr Citizen account
SC Vasudeva
Q. I am 67 years old, hold an OCI card and in receipt of pension from Indian Air Force (Ministry of Defence). I was directed by the bank (SBI) to close my PPF account and the same has been done. I was given to understand by the banks that persons holding OCIs are not allowed to make deposits in Senior Citizens Saving Scheme whereas in your column dated 25/12/2017, you have suggested that this avenue is available. Could you please confirm if this scheme is open for persons holding OCI card? — VK Jaura
A. Senior Citizens Savings Scheme (SCSS) can be continued by an NRI provided the account has been opened before he acquired the status of NRI. It can be continued for a maximum period of five years. It may not be possible for an NRI to open a new account in view of the specific prohibition contained in the rules.
Q. Please clarify whether a gift of Rs 7 lakh by an account-payee cheque by husband to his wife in the current financial year (2017-18) will be taxable in the hands of donee (wife) in the assessment year 2018-19 under new clause (x) of Section 56(2) of the Income-tax Act introduced by the Finance Act 2017-18. The new clause (x) envisages to tax “Deemed gift of certain defined properties/assets in the hands of every person receiving such property/assets subject to certain exception as provided therein”. But the Finance Act of 2017-18 does not define/specify “Deemed Gift” of “Certain defined properties or assets nor it specified “Certain exception as provided there in” referred in new clause (x) of Section 56(2). My queries are as under:
(a) What is meant by ‘deemed gift’?
(b) Is gift of money by husband to his wife by an account-payee cheque ‘deemed gift’? — Avtar Kishan Kapoor
A. (a) Section 56 of the Income-tax Act 1961 (The Act) provides that where a person receives any sum of money, without consideration, the aggregate value of which exceeds Rs 50,000, the whole of the aggregate value of such sum is taxable as income from other sources. The Gift Tax Act 1958, not being in force currently, the amount which is so taxable is referred to as ‘Deemed Gift’ in common parlance. Section 56(2)(vii) of the Act has been amended w.e.f. assessment year 2017-18 to include number of other items which are now covered for the purposes of taxability under Section 56 of the Act.
(b) Gift of money by husband to his wife by an account-payee cheque is not considered to be a deemed gift as the same would be exempt because of the exception provided in Section 56 of the Act. The term ‘relative’ includes wife of the individual. It may also be added that the income from such a gifted amount would be clubbed with the income of the donor in view of the provisions of Section 64 of the Act.
Q. My wife has a SB-cum-sweeping account at an SBI branch. On 8.6.2017, a person fraudulently withdrew/transferred Rs 39,500 from her account. We filed a complaint to the bank concerned and the SSP but neither any action has been taken nor any reply been received so far from the bank/SSP. Please guide us how to proceed further. — Baldev Roy
A. It is presumed that the withdrawal was made on the basis of forged documents. You should approach the consumer court against the SBI branch for allowing a withdrawal on the basis of forged documents from your wife’s account.
