Gift from Relative of members of HUF should also be tax free!

Gift from Relative of members of HUF should also be tax free!

Someone Asked on Yahoo Group-Answered By Me

A relative of Karta of HUF gives gift of Rs. 4,00,000 to HUF. Whether the above gift is exempt or taxable u/s 56(2)(vi). Can HUF have relation with relative of Karta of HUF. If taxable, can HUF avail benefit of sec 80C and basic exemption limit for purpose of taxation.

On plain reading of Explanation to Section 56(2)(vi) , it seems that the word relative is Explained only to be associated with Individual . The explanation states as follows :

"Explanation.For the purposes of this clause, relative means

(i) spouse of the