Saturday, March 31, 2012

TAX TALK-02.04.2012-THE HITAVADA

TAX TALK-02.04.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“INCOME TAX: BUILDER TO DEMOLISH THE EXISTING HOUSE & RECONSTRUCTS FLATS”

Query 1]

We are in discussion with a builder to demolish the existing house & reconstruct flats on the same plot with an understanding that he gives us 2 flats in the building, one in my name and the other in my father’s name, plus some cash to my father. The possession of the Flats is likely to be given by the builder within 15 months from the date of agreement. However, to ascertain the economic viability vis-à-vis the tax liability of the project, please guide me on the following points:

i. How to calculate the capital gain tax? We are at a very preliminary stage of discussions and yet to determine the cost of the existing property that the Builder may give as also the cost of Flats that he may charge us from.

ii. Will the exemption u/s 54 (LTCG) be available to both of us by way of investment in Flats, if so, to what extent?

iii. I am in service and a regular Income Tax payer. Will I be subjected to any additional tax liability (as the property is owned by my father)?

iv. Will there be any other tax liability under Income Tax Act or any other taxation authority to either of us?

v. Any advice you may like to give on anything I may have missed.

It may be further noted that

1. My father is aged 85years and I am 52.

2. What should be the right time to execute the agreement with the builder to address the issue of gain accruing and the investment made in one financial year only? [Dilip Athlay-dilipsbi@rediffmail.com]

Opinion:

1. It carries sense to have a proactive approach as far as tax planning is concerned. We are very pleased to see the same in your query. After the document are signed & sealed, assessee is left with very little option but to bear the consequences.

2. To be precise, your father is the owner of a house property which he will be transferring to the builder. Against the property so proposed to be transferred, the sale consideration will be in the form of 2 Flats plus some amount in cash.

3. What your father is transferring is a residential house property (& not plot or Vacant land) & the fact should be so mentioned in the document, as a result of which your father can claim an exemption u/s 54. If the property transferred is any property other than residential house property, then exemption is not available u/s 54, even though exemption could be claimed u/s 54F. In normal course, in the situation like one mentioned in your query, having an exemption u/s 54 is better than an exemption u/s 54F.

4. As a tax planning measure, both the flats to be re-purchased, your father should advisably have first name & both the flats should ideally be attached to each other so as to be capable of being used as a one unit. This will ensure unquestionable capital gain exemption on purchase of two flats. Your name could be incorporated in the flat document as a co-owner for administrative or future perspective. It would be better if you avoid any financial involvement in the transactions from your end so as to infer that your father is the absolute owner of the house property & your name is incorporated therein for the name sake only.

5. At any point of time in the transactions, any income or profit is not accruing or arisng in your hands & so even the distinct possibility of tax liability in your hand does not arise.

6. The important question: Timing of the transactions. Ideally, the transactions should be done initial part of the financial year. Earlier the better so that your father gets maximum time period to comply with the exemption provision of the Income Tax Act.

7. The tough task that remains, How to compute the capital gain in such cases. It requires various supplementary details like the year/cost of acquisition & additions, the Stamp duty Valuation of the house property which is proposed to be given to the Builder/ Developer, the Market value of the 2 Flats your father will be getting, the amount of cash your father is getting, etc. Further, the year of taxability & the amount of capital gain would be dependent on the drafting of the agreement with the builder & the terms, conditions and stipulations incorporated therein.

8. However, if the cash received by your father is less than the cost of acquisition & improvement (after Indexation), there will not be any capital gain tax liability on him as he will be eligible for an exemption u/s 54 of the Income Tax Act-1961.

9. To enable you & our various readers, to take a proper safeguard in claiming an exemption u/s 54, we are highlighting few striking stipulations u/s 54 as under: -
a) The capital gain should arise from the transfer of long-term capital assets being buildings or lands appurtenant thereto, being a residential house.
b) The transferor must be an individual or the Hindu Undivided Family.
c) The transferor must purchase a residential house within a period of one year before or two years after the date of transfer; or, in the alternative, the assessee must construct a residential house within a period of three years from the date of the transfer of the original house.
d) The amount invested in the purchase or construction of new residential house should either be equal to or more than the gain, or where it is less than the amount of capital gain, the shortfall would be taxable as LTCG.

TAX TALK-02.04.2012-THE HITAVADA

TAX TALK-02.04.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“INCOME TAX: BUILDER TO DEMOLISH THE EXISTING HOUSE & RECONSTRUCTS FLATS”

Query 1]

We are in discussion with a builder to demolish the existing house & reconstruct flats on the same plot with an understanding that he gives us 2 flats in the building, one in my name and the other in my father’s name, plus some cash to my father. The possession of the Flats is likely to be given by the builder within 15 months from the date of agreement. However, to ascertain the economic viability vis-à-vis the tax liability of the project, please guide me on the following points:

i. How to calculate the capital gain tax? We are at a very preliminary stage of discussions and yet to determine the cost of the existing property that the Builder may give as also the cost of Flats that he may charge us from.

ii. Will the exemption u/s 54 (LTCG) be available to both of us by way of investment in Flats, if so, to what extent?

iii. I am in service and a regular Income Tax payer. Will I be subjected to any additional tax liability (as the property is owned by my father)?

iv. Will there be any other tax liability under Income Tax Act or any other taxation authority to either of us?

v. Any advice you may like to give on anything I may have missed.

It may be further noted that

1. My father is aged 85years and I am 52.

2. What should be the right time to execute the agreement with the builder to address the issue of gain accruing and the investment made in one financial year only? [Dilip Athlay-dilipsbi@rediffmail.com]

Opinion:

1. It carries sense to have a proactive approach as far as tax planning is concerned. We are very pleased to see the same in your query. After the document are signed & sealed, assessee is left with very little option but to bear the consequences.

2. To be precise, your father is the owner of a house property which he will be transferring to the builder. Against the property so proposed to be transferred, the sale consideration will be in the form of 2 Flats plus some amount in cash.

3. What your father is transferring is a residential house property (& not plot or Vacant land) & the fact should be so mentioned in the document, as a result of which your father can claim an exemption u/s 54. If the property transferred is any property other than residential house property, then exemption is not available u/s 54, even though exemption could be claimed u/s 54F. In normal course, in the situation like one mentioned in your query, having an exemption u/s 54 is better than an exemption u/s 54F.

4. As a tax planning measure, both the flats to be re-purchased, your father should advisably have first name & both the flats should ideally be attached to each other so as to be capable of being used as a one unit. This will ensure unquestionable capital gain exemption on purchase of two flats. Your name could be incorporated in the flat document as a co-owner for administrative or future perspective. It would be better if you avoid any financial involvement in the transactions from your end so as to infer that your father is the absolute owner of the house property & your name is incorporated therein for the name sake only.

5. At any point of time in the transactions, any income or profit is not accruing or arisng in your hands & so even the distinct possibility of tax liability in your hand does not arise.

6. The important question: Timing of the transactions. Ideally, the transactions should be done initial part of the financial year. Earlier the better so that your father gets maximum time period to comply with the exemption provision of the Income Tax Act.

7. The tough task that remains, How to compute the capital gain in such cases. It requires various supplementary details like the year/cost of acquisition & additions, the Stamp duty Valuation of the house property which is proposed to be given to the Builder/ Developer, the Market value of the 2 Flats your father will be getting, the amount of cash your father is getting, etc. Further, the year of taxability & the amount of capital gain would be dependent on the drafting of the agreement with the builder & the terms, conditions and stipulations incorporated therein.

8. However, if the cash received by your father is less than the cost of acquisition & improvement (after Indexation), there will not be any capital gain tax liability on him as he will be eligible for an exemption u/s 54 of the Income Tax Act-1961.

9. To enable you & our various readers, to take a proper safeguard in claiming an exemption u/s 54, we are highlighting few striking stipulations u/s 54 as under: -
a) The capital gain should arise from the transfer of long-term capital assets being buildings or lands appurtenant thereto, being a residential house.
b) The transferor must be an individual or the Hindu Undivided Family.
c) The transferor must purchase a residential house within a period of one year before or two years after the date of transfer; or, in the alternative, the assessee must construct a residential house within a period of three years from the date of the transfer of the original house.
d) The amount invested in the purchase or construction of new residential house should either be equal to or more than the gain, or where it is less than the amount of capital gain, the shortfall would be taxable as LTCG.

Friday, March 23, 2012

TAX TALK-26.03.2012-THE HITAVADA

TAX TALK-26.03.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“REMEDY IF THE TDS CERTIFICATE IS NOT ISSUED OR NOT REFLECTED IN 26AS”

Query 1]

I am a retired bank officer not drawing any pension since I opted for the PF option. I have deposited the terminal benefits i.e., PF, Gratuity, etc in cumulative fixed deposits. Interest with original deposits is refunded on maturity in a Public Sector Bank. I am not depositing any Form No. 15G/15H with the bank but let the bank recover TDS on interest earned by me. I have following queries:

1. Some of my deposits have matured and credited to my a/c after deduction of TDS on following dates viz 01/11/2011, 08/11/2011, 30/11/2011, 13/12/2011, 23/02/2012, but the amount of TDS is not reflected in the Form 26AS in my PAN till date. Also the bank has not issued me the TDS certificate till date. Is there any rule under I.T. Act stipulating the time by which the TDS certificate is to be issued by the bank and the time limit within it is to be reflected in my Form 26AS for view? Where should I approach to redress this issue? Because of this delay, I was not able to arrive at the exact Income- Tax liability to pay the Advance Tax before 15th March2012.

2. In case of one private sector bank where I have some FD’s, Interest on my cumulative Fixed deposits were paid on 12/05/2011 & 30/06/2011, the TDS were also reflected in my Form 26AS on 07/06/2011 and 07//7/2012. Not only this, I have received TDS Certificate i.e., Form no 16A on 22/07/2011.

3. What private sector bank is doing, the PS Bank is not following. Please apprise us about the respective clauses/rules for issuance of TDS Certificate by the Income-Tax department so that I could approach the concerned PSB for remedy. [apteashok@gmail.com]

Opinion:

1. The person deducting the tax at source is duty bound to:

a. Deposit the tax deducted at source within prescribed time to the Government Treasury.

b. File the Quarterly TDS return in respect of the Tax Deducted

c. Issue the TDS Certificate to the Deductee within a prescribed time.

2. For non compliance of each and every part mentioned above, there is a separate penalty and consequences under the Income Tax Act-1961 as under:
a] For non issuance of TDS Certificate within a prescribed time, penalty is imposable u/s 272A (2) @ Rs. 100/- per day during which the failure continues. However, the amount of penalty cannot exceed the amount of tax deductible/deducted.
b]
For non filing of TDS Return also, there is a penalty provision of Rs 100 per day.
[The recent Finance Bill-2012 has proposed a fee of Rs. 200/- per day for late filing of TDS Return. Besides, a penalty of Rs. 10,000/- to Rs. 1,00,000/- is proposed for non filing or inaccurate filing of TDS return. The amendment is proposed w.e.f 01.07.2012].

3. Without Quarterly TDS Return being filed by the Deductor, you will not be entitled for the Tax Credit in respect of TDS done from payment made to you. Also, unless and until the TDS return is filed by the Deductor, deductee will not be able to view the TDS Credit in Form No. 26AS.

4. There is a general grievance that in many cases the Bank and other Tax Deductor are either not filing the quarterly TDS return (or are not issuing the TDS certificate) despite many requests & reminders by the Deductees.

5. In such cases, Deductee can follow the following approach:

i. Write a letter to the Deductor incorporating:
a] The details of payments done and the tax deducted therefrom.
b] Provision of Section 203 which requires the Deductor for issue of tax certificate within one month from the date of tax deduction

ii. Keep the proof of letter issued to the Deductor

iii. If despite this, the certificate is not issued, write a letter to Joint Commissioner or Addl. CIT of TDS wing who has jurisdiction over the Deductor mentioning the detailed facts elaborated above.

  1. We advise all our readers to regularly track all the tax deducted & deposited in your account [i.e. Tax Credit in Form No. 26AS] by registering your PAN at www.incometaxindia.gov.in. In the absence of availability of TDS in form No. 26AS it would be difficult for the Assessing Officer to grant the TDS Credit.

Sunday, March 18, 2012

TAX TALK-19.03.2012-THE HITAVADA

TAX TALK-19.03.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“IS IT NECESSARY TO PURCHASE THE PROPERTY JOINTLY?”

Query 1]

I and my mother jointly owned a house in Nagpur. On 1st February, 2012 we sold this property for Rs. 40, 00,000/-. We both got Rs. 20,00,000/- each. My mother is a senior citizen aged about 78 years.

Sir, my question is to save Capital Gain from this deal:

1. Is it necessary to purchase a property jointly or can we purchase property individually?

2. What is the time limit to purchase a property?

3. Can we keep the amount in Fixed Deposit till we purchase a new house.?

4. We are not interested in depositing the amount in Capital Gain Bond.
[Kundan Chauhan-ramdas.s@rediffmail.com]

Opinion:

1. Exemption is admissible even if the property is purchased individually:
It is not at all necessary to purchase a joint property to claim an exemption from LTCG. By purchasing two separate property individually also, one can have an exemption from LTCG.

2. Time limit to Purchase the Property:
Exemption u/s 54 (or u/s 54F, if the asset sold is not a residential house property) is available if the Assessee invests amount of LTCG for purchase of another residential house property
a] within O
ne year before or two years after the date of transfer; or
b] constructs a residential house within a period of three years from the date of the transfer of the original house.

3. Scheme of Deposits:
a] Although under section 54/54F, the assessee is allowed 2 years to purchase or 3 years for construction of the house property, but the capital gain on transfer of the original assets is taxable in the previous year in which the transfer took place. The return of income of that previous year is to be filed before the specified date. Hence, the assessee will have to take a decision for the purchase/ construction of the house property before the date of furnishing of the return otherwise the capital gain would be taxable.
To avoid the above situation, the Income Tax Act has specified an alternative in the form of a Deposit under the Capital Gain Deposit Accounts Scheme-1988 (CGDAS).
The amount of the capital gain, which is not utilized by the assessee for purchase or constructions of the new house before the date of furnishing the return of income, should be deposited by him under the Capital Gain Accounts Scheme, before the DUE DATE of furnishing the return. After Deposits, the amount already utilized by the assessee for purchase/ constructions of the new house, along with the amount so deposited, shall be eligible for exemption under section 54/54F in the year in which LTCG has arisen.
b] The investment in the PLAIN FIXED DEPOSITS may not enable you to claim an exemption. Ensure to keep the amount in the CGDAS.
However, one can keep the amount in the plain fixed deposits after the sale of the property and can divert it in the CGDAS before the due date of filing the return of income.
It may be noted that under CGDAS also, two types of accounts can be opened as under:
a] Deposit Account-A – This is a saving account.
b] Deposit Account-B- This is a term deposit account.


4. INVESTMENT IN CAPITAL GAIN BONDS:
Exemption can be claimed either by investing in the bonds u/s 54EC or U/s 54 by investing in the house property. Assessees have the choice.

Query 2]

My father has had an investment of about Rs. 4 Lacs wherein he has nominated me as nominee. My father expired last month. Now I want to claim the death maturity. Is the amount so received be added in my taxable income? If yes, then is there any investment or savings I can resort to for saving the taxes? [Arindam Lai arindam.lai@rediffmail.com]

Opinion:

1. The amount received by you as a nominee is not at all taxable.

2. The income on the investment of Rs. 4 Lacs from the date of deposits to the date of death would be treated as income of your father only & not your income.

3. You may be required to file the return of income of your father in a representative capacity if his income till the time of his death exceeds the basic exemption limit.

Query 3]

The amount of LTCG has been deposited in a public sector bank for 3 years under capital gain deposit account scheme. Will it be taxable after maturity period if the maturity amount is not invested /utilized for purchase of land/building etc? The Bank is deducting TDS from the annual accrual of interest on the above deposit. Please advise.

[G.P.Mahananda- gouramahananda@yahoo.com]

Opinion:

1. In case the amount of LTCG invested in the CGDAS is not so utilized for purchase or construction of house property, it would be treated as income under the head “Capital Gain” of the previous year in which the period of 3 years from the date of LTCG expires and will be taxable as LTCG of that previous year.

2. The assessee shall be eligible to withdraw the amount from CGDAS after getting approval of the Assessing Officer by submitting an application in Form G prescribed under the scheme.

3. At the time of withdrawal, the amount deposited in the CGDAS would be taxable as LTCG and interest received under this account is taxable as “Income from Other Sources”

TAX TALK-12.03.2012-THE HITAVADA

TAX TALK-12.03.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“CLAIMING EXEMPTION U/S 54 & 54F SIMULTANEOUSLY FOR SINGLE PROPERTY PURCHASES”

Query 1]

Mr. X had two Property 1st a Residential Property (used for own residence) and another commercial building (rented to a Nationalized bank).

1st property was sold in the financial year 2009-10 and 2nd property was sold in the financial year 2010-11 and then he build up just one Residential house with high (entire) Investment. Hence in order to save Tax on capital gain, can we claim exemption u/s 54 for the 1st house sold in the FY 2009-10 and u/s 54F for the commercial plot sold in the FY 2010-11 against the one house Built.

In short, I want to know whether we can claim exemption under two different sections for two different years for the purchase of single residential property as we were required to sell both properties so that we can a better house. [Rohit Sharma- rohit4334@gmail.com]

Opinion:

The basic question is whether exemption u/s 54 for the 1st year & u/s 54F for 2nd year for the Purchase of the same property is admissible or not? There is nothing in the Act that prohibits claim under section 54 & 54F simultaneously. In fact, conditions under both the section is different and therefore both these provisions are for different situation. Hence, if conditions of the said provisions are fulfilled, claim of exemption shall lie even if only one property is purchased to claim the LTCG arisen on sale of different assets. It is settled principal that section 54 and 54F are relief mechanism and therefore, if the conditions are fulfilled, the exemptions are allowable. There is no bar in section 54 or in Section 54F against claiming exemption for the second, third or any number of time for the same property if the cost of the property is within the limit arisen to the Assessee. Reliance may be placed on the judgment in the case of Anagha Ajit Patnekar v ITO (2006) 9 SOT 685 (Mum).

Query 2]

I am the employee of the University. Last year, I got sixth pay arrears (Financial Year 10-11). But after Audit verification, it came to know that extra arrears payment was made. So, this total extra amount was divided into 10 equal parts and are deducted from the monthly payment of financial year 2011-12. In 2010-11, I have paid the income tax on whole amount received. This year (2011-12) I have submitted my income tax statement to the office after deducting the extra amount received from the total salary received this year (2011-12). Therefore my questions are:

1. Whether the step is correct?

2. Can I get the income tax back which I have already paid for the extra arrears?

3. If so, please tell the procedure or

4. What else can I do?
[Prajakta Kuralkar-pskuralkar@rediffmail.com]

Opinion:

1. There is nothing in the Income Tax Act-1961 to cover the situations elaborated by you. However, the basic guiding principle is “Same income cannot be taxed twice”. You can opt for the mode mentioned by you in the query subject to the condition that your DDO admits the same.

2. Basis of charge in respect of salary income is fixed by section 15 of the Income Tax Act-1961. It is chargeable to tax either on due basis or on receipt basis, whichever matures earlier. In our opinion, levy of income tax on the salary paid to you in the FY 2010-11 was as per the provision of the I.T. Act. To compensate the income tax implication on the same, you can claim relief under Section 89(1) by splitting the income year wise. The required particular for relief u/s 89 is required to be worked out in Form No. 10E. Section 89 gives relief to the salaried Assessee where the arrears of salary is received or the salary is received in Advance

Query 3]

1. If gift in the form of cash is given to nearest relative, whether the amount of cash is deductible from the income of the income tax payer? If so what is the section and the limit of amount deductible?

2. Are there any procedural formalities or papers to be attached to income tax return? [aarati.parhatay@rediffmail.com]

Opinion:

1. The gift given to relative is NOT deductible in computing the income tax.

2. No papers are as such required to be attached with the income tax return showing the amount of gift done to the relatives.

Friday, March 16, 2012

TAX TALK-19.03.2012-THE HITAVADA

TAX TALK-19.03.2012-THE HITAVADA

TAX TALK

BY CA. NARESH JAKHOTIA (Chartered Accountant)

“IS IT NECESSARY TO PURCHASE THE PROPERTY JOINTLY?”

Query 1]

I and my mother jointly owned a house in Nagpur. On 1st February, 2012 we sold this property for Rs. 40, 00,000/-. We both got Rs. 20,00,000/- each. My mother is a senior citizen aged about 78 years.

Sir, my question is to save Capital Gain from this deal:

1. Is it necessary to purchase a property jointly or can we purchase property individually?

2. What is the time limit to purchase a property?

3. Can we keep the amount in Fixed Deposit till we purchase a new house.?

4. We are not interested in depositing the amount in Capital Gain Bond.
[Kundan Chauhan-ramdas.s@rediffmail.com]

Opinion:

1. Exemption is admissible even if the property is purchased individually:
It is not at all necessary to purchase a joint property to claim an exemption from LTCG. By purchasing two separate property individually also, one can have an exemption from LTCG.

2. Time limit to Purchase the Property:
Exemption u/s 54 (or u/s 54F, if the asset sold is not a residential house property) is available if the Assessee invests amount of LTCG for purchase of another residential house property
a] within O
ne year before or two years after the date of transfer; or
b] constructs a residential house within a period of three years from the date of the transfer of the original house.

3. Scheme of Deposits:
a] Although under section 54/54F, the assessee is allowed 2 years to purchase or 3 years for construction of the house property, but the capital gain on transfer of the original assets is taxable in the previous year in which the transfer took place. The return of income of that previous year is to be filed before the specified date. Hence, the assessee will have to take a decision for the purchase/ construction of the house property before the date of furnishing of the return otherwise the capital gain would be taxable.
To avoid the above situation, the Income Tax Act has specified an alternative in the form of a Deposit under the Capital Gain Deposit Accounts Scheme-1988 (CGDAS).
The amount of the capital gain, which is not utilized by the assessee for purchase or constructions of the new house before the date of furnishing the return of income, should be deposited by him under the Capital Gain Accounts Scheme, before the DUE DATE of furnishing the return. After Deposits, the amount already utilized by the assessee for purchase/ constructions of the new house, along with the amount so deposited, shall be eligible for exemption under section 54/54F in the year in which LTCG has arisen.
b] The investment in the PLAIN FIXED DEPOSITS may not enable you to claim an exemption. Ensure to keep the amount in the CGDAS.
However, one can keep the amount in the plain fixed deposits after the sale of the property and can divert it in the CGDAS before the due date of filing the return of income.
It may be noted that under CGDAS also, two types of accounts can be opened as under:
a] Deposit Account-A – This is a saving account.
b] Deposit Account-B- This is a term deposit account.


4. INVESTMENT IN CAPITAL GAIN BONDS:
Exemption can be claimed either by investing in the bonds u/s 54EC or U/s 54 by investing in the house property. Assessees have the choice.

Query 2]

My father has had an investment of about Rs. 4 Lacs wherein he has nominated me as nominee. My father expired last month. Now I want to claim the death maturity. Is the amount so received be added in my taxable income? If yes, then is there any investment or savings I can resort to for saving the taxes? [Arindam Lai arindam.lai@rediffmail.com]

Opinion:

1. The amount received by you as a nominee is not at all taxable.

2. The income on the investment of Rs. 4 Lacs from the date of deposits to the date of death would be treated as income of your father only & not your income.

3. You may be required to file the return of income of your father in a representative capacity if his income till the time of his death exceeds the basic exemption limit.

Query 3]

The amount of LTCG has been deposited in a public sector bank for 3 years under capital gain deposit account scheme. Will it be taxable after maturity period if the maturity amount is not invested /utilized for purchase of land/building etc? The Bank is deducting TDS from the annual accrual of interest on the above deposit. Please advise.

[G.P.Mahananda- gouramahananda@yahoo.com]

Opinion:

1. In case the amount of LTCG invested in the CGDAS is not so utilized for purchase or construction of house property, it would be treated as income under the head “Capital Gain” of the previous year in which the period of 3 years from the date of LTCG expires and will be taxable as LTCG of that previous year.

2. The assessee shall be eligible to withdraw the amount from CGDAS after getting approval of the Assessing Officer by submitting an application in Form G prescribed under the scheme.

3. At the time of withdrawal, the amount deposited in the CGDAS would be taxable as LTCG and interest received under this account is taxable as “Income from Other Sources”