If I transfer a part of my deposits to my children's accounts (above 18) whether as gift or lending…
1) Will the receipt of such amount be taxable for them?
2) Will they be able to enjoy tax free income/ maturity on the interest thus earned till their respective limits?
Ans: Gift given to a child is not an Income in the hands of the recipient (child). Amount received as a loan is also not an Income.
With reference to income, as per my knowledge, you can not transfer fixed deposits in bank records. Thus, income will continue to be taxed in your hand as the legal owner of deposits for taxation purposes.