Hi I am an NRI having a demat account with a broker. as there are some limitations with nri trading especially pledging the stocks and using it as margin for options trading. Even derivatives trading itself is a cumbersome and money intensive process.
So I am planning to open a resident account for my brother in law and gift the shares I hold to his demat account to proceed with pledge/option trade, etc.
Is this a genuine/acceptable method to use the share value for income generation? And what is the tax liability if the shares are gifted?
And the costs involved in transfer?
And some day when I need money/sell share, I want to get the share/money as gift from him 
Tax experts can answer this…by the way today modern world never anticipate that you shall get back your gifted assets back without going through hassle
Thanks Roshan. Tax experts - do you have any comments on tax implications/gift limits?
Your brother in law will have to treat it as a loan. He can’t treat it as a gift, as it would be like an income for him and then he will have to pay taxes on this gift. If you transfer to your sister/father/mother as gift, there is no tax to it.
But yeah he can show it as a loan and do whatever with it. Transferring shares will incur off market DP charges which your broker charges.
When you get back the loan, you will have to pay tax on whatever additional money you get.
Thanks Nithin. Appreciate your response.
