Chargeable Income Under Income from Other Sources - Section 56(1) and (2) - Income Tax - Ready Reckoner - Income Tax

SECTION 56 :- INCOME FROM OTHER SOURCES Section 56(1) :- This is the residual head of charge of income. A source of income which does not specifically fall under any one of the four heads of income (i.e. Salaries, Income from House Property, PGBP or Capital gains) is to be computed under Section 56 under the head INCOME FROM OTHER SOURCES . Some income taxable under section 56(2) under the head IOS are: Dividend Winnings from Lotteries, Crossword Puzzles, Horse races, Card games, Gambling or Betting Income from interest from securities [note:1] Income from Machinery, plant or furniture let on hire (if the same is not taxable as business income) [note:2] Any sum received under Keyman Insurance Policy Any sum received by assessee from employees as contribution to PF, if it is not taxable u/h PGBP Any sum of money exceeding twenty-five thousand rupees is received without consideration by an individual or a Hindu undivided family from any person on or after the 1st day of September, 2004 but before the 1st day of April, 2006. Any sum of money, the aggregate value of which exceeds fifty thousand rupees, is received without consideration, by an individual or a Hindu undivided family, in any previous year from any person or persons on or after the 1st day of April, 2006 but before the 1st day of October, 2009. Where an individual or a Hindu undivided family receives, in any previous year, from any person or persons on or after the 1st day of October, 2009 but before the 1st day of April, 2017, any sum of money, immovable property or a property other than immovable property. [subject to many restrictions]. Gift (In some cases) Interest received on compensation or enhanced compensation Forfeiture of advance received for transfer of a capital asset to be taxed u/h Income from other sources Where a firm or a company not being a company in which the public are substantially interested, receives, in any previous year, from any person or persons, on or after the 1st day of June, 2010 but before the 1st day of April, 2017, any property, being shares of a company not being a company in which the public are substantially interested. Where a company, not being a company in which the public are substantially interested, receives, in any previous year, from any person being a resident, any consideration for issue of shares that exceeds the face value of such shares. Where any person receives, in any previous year, from any person or persons on or after the 1st day of April, 2017, a sum of money, immovable property or any other property [subject to conditions]. NOTE:- 1. Interest on securities - I nterest on securities is taxable under the head Income from other sources if the same is not taxable as business income under section 28 .If books of account in respect of such income are maintained on cash basis ,then the interest is taxable on receipt basis .If, however, books of account are not maintained or are maintained on the basis of mercantile on the basis of mercantile system of accounting ,then interest on securities is taxable on accrual basis. 2 . I ncome from Machinery, plant or furniture let on hire (if the same is not taxable as business income)- Income from machinery ,plant or furniture belonging to the assessee and let on hire is taxable as income from other sources if the same is not chargeable to tax under the head Profits and gains of business . When an assessee lets on hire machinery machinery , plant or furniture and also building and letting of building is inseparable from the letting of machinery , plant or furniture ,the income from the letting of building is taxable as income from other sources if same s not chargeable to tax under the head Profits and gains of business or Profession