Are gifts from NRIs to residents taxable?

I am an NRI who is living in Dubai for the past six years. I had acquired shares of an unlisted Indian firm using surplus fund from my NRO account in India. I wish to gift the shares to my father, who is a resident of India. Will this transfer attract any tax in India?

- Harshal Bhuta

Under Indian income tax law, transfer of assets between specified relatives (father and son) qualifies as exempt transfer and does not trigger capital gains tax for sender or invoke anti-abuse provisions relating to receipt of property below its fair market value, and has no tax implication for receiver. So, gifting share to your father will not attract capital gains tax irrespective of their value.