Generally speaking, “relative”, with reference to any person, means any one who is related to another. Your family members are also called your relatives.Your immediate family includes your father, mother and siblings. Your extended family includes all of the people in your father and mother’s families. Your sibling is your brother or sister.
In the Indian legal context, we may rely upon the word ‘relative’ defined under section 2(77) of the Companies Act, 2013 read with rule 4 of the Companies (Specification of definitions details) Rules, 2014. According to the rule 4 of the Companies (Specification of definitions details) Rules, 2014, “A person shall be deemed to be the relative of another, if he or she is related to another in the following manner”, namely:-
Father: Provided that the term ‘Father’ includes step-father
Mother: Provided that the term ‘Mother’ includes step-mother
Son: Provided that the term ‘Son’ includes step-son
Son’s Wife
Daughter
Daughter’s Husband
Brother: Provided that the term ‘Brother’ includes step-brother
Sister: Provided that the term ‘Sister’ includes step-sister
According to the above definition, we may interpret father, mother, son, brother, and sister including stepfather, stepmother, stepbrother, step-sister, stepson, son-in-law, daughter-in-law, are close relatives. Surprisingly stepdaughter is not included in the list of close relatives under section 2(77) of the Companies Act, 2013. Whatever may be the reason; the plain interpretation of the section indicates that the stepdaughter is not a relative.
The term ‘relative’ defined for the purpose of remittance under LRS scheme:
A resident individual can remit up to USD 2, 50,000 per FY towards the maintenance of close relatives abroad under Liberalised Remittance Scheme (LRS). RBI has narrowed down the term ‘relative’ to as defined in Section 2(77) of the Companies Act, 2013. This is to check the outflow of funds and prevent misuse of facilities.
The term ‘relative’ defined for the purpose of GIFT:
The gift received from a ‘relative’ is not taxable in the hands of the recipient under section 56 of the Income Tax Act. The persons who are considered as ‘relatives for this purpose are;
- Spouse of the individual;
- Brother or sister of the individual;
- Brother or sister of the spouse of the individual;
- Brother or Sister of either of the parents of the individual;
- Any lineal ascendant or descendant of the individual;
- Any lineal ascendant or descendant of the spouse of the individual;
- Spouse of the person referred to in clauses (2) to (6);
In case of HUF – Any member of the HUF
