income tax implications of a wrong credit in my savings account

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  1. mon

    mon New Member

    My savings account has been wrongly credited by an amount every month by the sender in fy15-16.
    This has been noticed by me only in june 16.This amount should actually have been credited to my another family member.The sender says you settle between family members.
    My questions are
    1> how do I treat this amount while filing my returns for fy 15-16.
    2>Can I simply transfer the amount from my savings account to that of my family member.will this resolve the issue considering that it would reflect in next financial year.
    3> Can my other family member treat this as his income for fy 15-16 and file his returns accordingly though the amount is not credited in his account.
    pl advise
     
  2. ZED

    ZED Well-Known Member

    This is not your income at all. As per S.72 of the Indian Contract Act, if any money is received by mistake then it is ought to be returned. If that person has told you to give it to your family member(to whom the money is actually due) then it's fine because you are doing it on his behalf. Better have this is written (like in email) that he asked you to give the money to your family member.

    Further, this case will also fall under Diversion of Income by overriding title and hence can not be treated as your income. [You do not have title over the money, the title is of the relative]

    Only the unexplained credit/income can be taxed, this is a genuine and explained one and hence there shall be no penalty either.

    Ask them to transfer in the correct account the next time.

    That family member should show that amount as income.
     
  3. mon

    mon New Member

    Thank you so much
     
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