Clubbing, Aggregation & Set Off — Topic Index
Chapters: V, VI, VII Sections: 96–109 Old Act equivalent: Sections 60, 61, 63, 64, 65, 66, 68, 69, 69A, 69C, 69D, 115BBE, 70, 71 Status: ✅ Fully ingested — sections 96–109 completed (14 sections)
Overview
This folder covers three consecutive chapters of the Income Tax Act, 2025:
Chapter V — Income of Other Persons (Clubbing): Sections 96–100 Anti-avoidance provisions for diversion of income. Transfer of income without asset transfer. Revocable transfers. Clubbing of spouse, minor child, son’s wife, and HUF conversion income.
Chapter VI — Aggregation of Income: Sections 101–107 Total income aggregation. Unexplained credits (cash credits), investments, assets (including VDA), expenditure, and hundi transactions. All taxed at penal rate under section 195 (~78.5%).
Chapter VII — Set Off of Losses: Sections 108–109
Intra-head set off (same head). Inter-head set off (across heads).
Note: carry forward (sections 110–121) is in the deductions/ folder.
Key changes from the 1961 Act:
- Old sections 60, 61, 63, 64, 65 → new sections 96–100
- Old sections 66, 68, 69, 69A, 69C, 69D → new sections 101–107
- Old section 115BBE (penal rate) → new section 107 → section 195
- Old sections 70, 71 → new sections 108, 109
- VDA explicitly included in “asset” for section 104
- House property loss inter-head set off capped at Rs. 2,00,000
Chapter V — Clubbing (Sections 96–100)
| Section | Heading | Old Equivalent | Ingested |
|---|---|---|---|
| 96 | Transfer of income without transfer of assets | 60 | ✅ |
| 97 | Chargeability — revocable transfer of assets | 61 | ✅ |
| 98 | ”Transfer” and “revocable transfer” defined | 63 | ✅ |
| 99 | Clubbing — spouse, minor child, son’s wife, HUF | 64 | ✅ |
| 100 | Liability of person whose income is clubbed | 65 | ✅ |
Chapter VI — Aggregation / Unexplained Income (Sections 101–107)
| Section | Heading | Old Equivalent | Ingested |
|---|---|---|---|
| 101 | Total income | 66 | ✅ |
| 102 | Unexplained credits (cash credits) | 68 | ✅ |
| 103 | Unexplained investment | 69 | ✅ |
| 104 | Unexplained asset (money, bullion, VDA) | 69A | ✅ |
| 105 | Unexplained expenditure | 69C | ✅ |
| 106 | non-banking mode borrowing | 69D | ✅ |
| 107 | Charge of tax (penal rate via s.195) | 115BBE | ✅ |
Chapter VII — Set Off (Sections 108–109)
| Section | Heading | Old Equivalent | Ingested |
|---|---|---|---|
| 108 | Set off — same head of income | 70 | ✅ |
| 109 | Set off — other head of income | 71 | ✅ |
Key Cross-References
- Clubbing: s096–s100 → income assessed in transferor’s hands
- Unexplained income: s102–s106 → taxed at penal rate via s107 → s195
- Set off sequence: s108 (intra-head) → s109 (inter-head) → s110+ (carry forward)
- House property loss: s109(1)(b) caps at Rs. 2,00,000 → excess to s110
- Capital gains: s108(2) intra-head only; s109(2) no inter-head set off
- Business loss: s109(1)(a) — cannot set off against salary
- Carry forward: see deductions/ folder (sections 110–121)