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8. Total income to include income of any other person
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8. Total income to include income of any other person.—(1) The total income of any person, being a transferor, shall include the following, namely :—
(a) any income accruing to any other person, by virtue of a transfer, whether revocable or not, without transfer of the asset from which the income accrues ; or
(b) any income accruing to any other person, by virtue of a revocable transfer of an asset.
(2) The provisions of clause (b) of sub-section (1) shall not apply in a case where—
(a) any income accrues from an asset transferred to any trust, if the transfer is not revocable during the life time of the beneficiary of the trust ; or
(b) any income accrues from an asset transferred to any other person, not being a trust, if the transfer is not revocable during the lifetime of such other person.
(3) In this section,—
(a) a transfer shall be deemed to be revocable if—
(i) it contains any provision for the re-transfer, directly or indirectly, of the whole or any part of the income or assets to the transferor ; or
(ii) it, in any way, gives the transferor a right to re-assume power, directly or indirectly, over the whole or any part of the income or assets ;
(b) a transfer shall include any settlement, trust, covenant, agreement or arrangement.
Clause 8 provides that the total income of a person being a transferor, shall include the income of any other person if such income accrues to any other person by virtue of a transfer, without transfer of the asset from which the income accrues ; or the income accrues to any other person by virtue of a revocable transfer of an asset.
However, such income shall not be included in the total income of the transferor in a case where any income accrues from an asset transferred to any trust or any other person, if the transfer is not revocable during the lifetime of the beneficiary of the trust or during the lifetime of such other person.
The clause further provides that a transfer shall be deemed to be revocable if it contains any provision for the re-transfer, directly or indirectly, of the whole or any part of the income or assets to the transferor or it, in any way, gives the transferor a right to re-assume power, directly or indirectly, over the whole or any part of the income or assets. For the purpose of this clause, a transfer shall include any settlement, trust, covenant, agreement or arrangement.
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