Taxation of Stridhan.

In the case of "Maya Gopinathan vs Anoop SB 2024 INSC 334," the Hon'ble Supreme Court provided insightful guidance on the definition of "Stridhan": 

Gifts at the Time of Marriage: Gifts bestowed upon the bride by her husband, parents, or relatives from her husband's or parents' side during the marriage constitute her Stridhan. 

Pre-Marriage and Post-Marriage Properties: Properties gifted to a woman before marriage, during marriage, during the departure ceremony, or thereafter are categorized as her Stridhan properties. These properties are her absolute possessions, granting her full rights to dispose of them as she pleases.

Husband's Control and Moral Obligations: The husband holds no authority over his wife's Stridhan property. Although he may utilize it in times of distress, he bears a moral responsibility to restore the property or its equivalent value to his wife. Consequently, Stridhan property remains solely owned by the wife, and the husband possesses no title or independent control over it.

Tax Implications on Stridhan

In light of the legal elucidation on Stridhan, the following tax implications arise:

Taxation of Gifts: Typically, any money or property received without consideration is taxable and must be reported as "income from other sources" in income tax returns.

 Exemption for Marriage Gifts: Gifts received during marriage, including gold received by the bride, are exempt from taxation. This encompasses ornaments, articles, utensils, furniture sets, etc. Streedhan received during marriage is specifically excluded from taxation under Section 56(2)(x) of the Income Tax Act.

Verification of Sources: If questioned by tax authorities regarding the possession of gold disproportionate to her income, the bride must provide evidence of its acquisition, such as a will or gift deed if inherited. 

Limits on Gold Possession: Specific restrictions apply to the amount of gold individuals can possess without proof of source. Married women can hold up to 500 grams, unmarried women up to 250 grams, and men up to 100 grams without documentation.