Both Parents Eligible For Tuition Fee Rebate

Updated: Jul 25 2004, 06:22am hrs
I am holding shares in joint name with my wife, with me as the first named. Now, if I transpose the holding, with my wifes name in the first position, then will the income tax liability shift to her on sale of shares, or, will it continue to be on me as I have been a joint holder from the date of acquisition.

Naresh Yadav,

You should have mentioned the purpose of the intended action. Merely exchanging the order of the names of the holders is a transposition and can be effected by sending a duly filled transfer deed to the concerned registrar. Normally, no stamp duty is payable for transposition for shares held in physical format, unless the request is for partial transmission. In that case, another folio will have to be allotted and, therefore, stamp duty is payable only on the shares transferred to a different folio. Of course, in the case of demat holding, the shares will have to be transferred from one account to another account with associated demat charges.

For the purpose of IT, the asset belongs to the person who has paid for the asset or acquired it by inheritance or gift, irrespective of the order of the names in which it is held.

I had invested in Sahara India-14 Rs 25,000 at Garhani region Bhojpur (Bihar) on 27.02.1999. I received Rs 48,395 in lieu of Rs 50,000 on 08.04.2004 vide advice no-ADJC20855991. TDS cutting is Rs 1,605. This was not the income of one year. Kindly clarify whether this is right.

Mahendra Tiwari,

Have you declared the interest on accrual basis in your tax returns Have you given Form-15F (Form-15H if you are a senior citizen) to the company These issues need to be looked into. Also another recourse is to file returns and ask for refund for the extra tax cut.

Can you throw some light on the Sec 88 benefit in respect of children tuition fee available with effect from FY 2003-04 Also please clarify as to what will be the supporting document for claiming this rebate from IT department at the time of filing the returns.

Vinod Sankar,

Tuition fees paid, whether at the time of admission or thereafter, to any university, college, school or other educational institution situated within India for the purpose of full-time education of any two children of the assessee, as does not exceed an amount of Rs 12,000 in respect of each such child. However, the eligible amount shall not include any payment towards any development fees or donation or payment of similar nature. Rebate in respect of this payment shall be available within the eligible general limit of Rs 70,000.

The concession is available to each of the parents, if eligible, even in respect of the same child, on their respective payments.

I am a senior citizen and a long-time investor. Since the last 2/3 years, shares purchased are free of tax if kept for a year. Now I read in your column that all shares purchased much earlier have no capital gains to be paid. There is no clarification for the accumulated losses of previous years. What about bonus shares when they are sold

For senior citizens, there is a scheme being launched to give an yield of 9 per cent. Is that to be free of tax and is there any limit on the investment amount.

Kersy Bhagat,

I am afraid you have misunderstood me somewhere. The Budget has proposed the following:

Long-term capital gains tax on shares would be exempt if bought and sold on a recognised stock exchange. Short-term capital gains tax would be @10 per cent. There would be a turnover tax of 0.15% to be levied on the purchaser. However, these changes would only come into effect after the Bill is passed and an announcement is made in the official gazette. If the same happens, carried forward loss from yesteryears will have to be set off against capital gains arising out of assets, other than securities, such as real estate or jewellery or even units.

The new scheme has not yet been announced. Therefore, details as to taxability, etc, are not known.

In a case where an educational institution registered u/s 10(23C)(vi) of the Income Tax Act (as per item (5) in the table in your article), provides a contribution to a trust/society which is a new education society registered with the Registrar of Societies and who have applied (i) with the Director of Exemptions for registration u/s.80G(5)(vi) of the Income Tax Act and is expected to get the exemption shortly and (ii) u/s 12A(a) of the Income Tax Act with the Chief Commissioner of Income Tax for registration thereof.

This educational society has already commenced work of putting up a renowned educational institution namely a public school which shall be commencing its educational activities from the year 2005-06 school session.

The queries:

(a) Whether the contribution made out of the current years receipt of income by the first registered society to the other educational society shall be treated as application of income u/s.10(23C) proviso 11 (earlier 10th proviso deleted from 01.04.2002); and

(b) If it is treated as application, then whether the contribution made before the receipt of grant of registration u/s 80G(5) or 12A can be treated as application of income or the contribution made only after receipt of grant of registration / exemption can be treated as such.

Kshitiz Chhawchharia,

For claiming that the donation to the new education society, it is absolutely necessary that the grant of registration u/s 12A is obtained by the new society before accepting the donation. Registration u/s 80G(5) is not important for the purpose of the donor society to claim it as application of income.

The author may be contacted at