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Hindu Undivided Family (H.U.F) or Joint Hindu Family form of Business

Joint Hindu Family form is a peculiar form of business firm exists in India. It is different from sole proprietorship and partnership firm in many ways. However it runs in the form in which Proprietorship firms run and its merits and demerits are also similar to that.


Hindu Undivided Family (H.U.F) Firms are governed by Hindu Law in India. There are two schools of Hindu Law:

Mitakshra law is applicable all over India, except West Bengal and Assam

Dayabhaga System is applicable to West Bengal and Assam only
Hindu Undivided Family (H.U.F) Firms are created by the operation of Hindu Law and they arise out of status and not out of contract. A joint Hindu Family consists of all persons lineally descended from a common ancestor who includes their wives and unmarried daughters, under Mitakshara System. One inherits an interest in the ancestral property by birth only, and is known as coparcener.

The Business of Hindu Undivided Family or Joint Hindu Family is managed by a senior member of the family who is known as "Karta" or "Manager". Karta is responsible for the business and have full control over the business and acts as custodian for the profit of the firm.

Liability of "Karta" of Hindu Undivided Family (H.U.F) form of Business
Karta is liable not only to the extent of his share in the property of the family but he may also be held personally liable.


Liability of Other members in Hindu Undivided Family (H.U.F) form of Business
Other members of a H.U.F can be held liable to the extent of their share in the family only.

Authority of Karta of Hindu Undivided Family (H.U.F) form of Business cannot be questioned

Authority of Karta of H.U.F cannot be questioned by other members of the family. This helps for smooth running of a H.U.F. But the Karta may mis use the power and may mis manage the firm.

Remedy before members of H.U.F
The remedy before other members of Hindu Undivided Family (H.U.F) form of business is to demand partition of the family property.

Most important feature of Hindu Undivided Family (H.U.F) firm is that it is dissolved by the death of a coparcener. Unless the partition takes place in the family, it has fair stability. Thus, it has a perpetual legal existence like a company.

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