Study On t Hindu Family 3p4f2n

STUDY ON T HINDU FAMILY INTRODUCTION t Hindu Family Business is a form of organization which exists only in India. It is one of the oldest form of organizations and in existence only in some parts of the country. This form of organization has ownership in the hands of of a Hindu undivided family. The business is carried out buy the male of a undivided family. As the name suggests, it is type of organization in which all the of Hindu Undivided Family manage and control the business with the direction of head of the family. It is not a Partnership. It is just like a Partnership where only the of the family can take part. The business is carried on from generation to generation. This kind of business is not governed by the Industrial or company Act but it is governed by the HINDU SESSION ACT, which exist under Hindu law. Before 1956, female of the family were not having equal rights with male but the Hindu Succession Act, 1956, has its provisions for female also.

All of a Hindu undivided family do business tly under the control of the head of the family who is known as the 'Karta'. The of the family are known as 'Co-parceners'. Thus, the t Hindu Family firm is a business owned by co-parceners of a Hindu undivided estate. There are two conditions for existence of t hindu family business. These are: 1.) Minimum two male must be there in the family. 2.) Existence of some ancestral property. Under hindu law there are two systems of inheritance. These are: 1.) Dayabagiha. This system prevails all over India in west Bengal. Under this system the male as well as female can become copartners as well as co_parcners. 2.) Mitakshara. This system prevails all over India except west Bengal. Under this system only male can become coparcners under t hindu family business.

FEATURES (1) Formation: t Hindu Family cannot be formed or created by any contract or agreement because this organization came into existence by the operation of the "Hindu Law". It is not formed by any agreement like partnership firm. Whenever, there is Hindu Undivided Family, there is the scope for t Hindu Family Business. (2) Registration: It is not at all compulsory to this organization because it is the result of Hindu Law. (3) hip: There are two types of i.e Karta and Coparceners. Karta is the elder male member of the family who controls and manages the business. The other family are called as the coparceners. There is no limit on hip because the hip is by birth. (4) Management: The head of the family has full responsibility of the management of t Hindu Family Business. He is free to take any decision without any interference of any co-parceners but he can take advice and help from the family . (5) Liability: The liability of Karta is unlimited because he is the only deciding authority whereas the liability of co-parceners is limited up to their share in the capital of the family. The karta’s liability is unlimited so his personal assets can also be used to pay back the debts of the business. (6) Sharing of Profits and Losses: According to Hindu Succession Act, 1956, all the of Hindu Undivided Family have equal rights to share the profits as well as losses of the business. (7) Legal Status: Any organization gets separate legal status only after its registration with appropriate authorities. In case of t Hindu Family firm registration is not at all compulsory; hence it does not enjoy any legal status. Though, t Hindu Family Business is enlarged form of sole trading concern and it has got due recognition by Income Tax Act, 1961, and t Hindu Succession Act, 1956, then also it does not enjoy separate legal status because of t Hindu Family firm and its are one and the same that is inspirable. (8) Partition: As t Hindu Family Business is totally controlled by Karta, and co-parceners do not have the right to interfere in the decisions of Karta. But, as per Hindu Law any member who is unsatisfied with the decision of kata can demand partition.

(9) Continuity and Stability: This organization enjoys a long and stable life as it is not affected due to death, insolvency, insanity of any of its member. In other words, if Karta dies or becomes incapable of managing the business then the succeeding co-parceners will act as Karta. (10) Flexibility: There is a great deal of flexibility in business operation. The Karta can expand or change the line of business or he can even close down the business. The co-parceners normally agree with the decisions taken by Karta in the conduct of business. (11) Business Secrecy: There is a great deal of business secrecy in this organization. The business secrets are known to co-parceners in general and Karta in particular. It is not obligatory for them to publish their s which results in great deal of privacy and secrecy. (12) Number of : In t hindu family business minimum must be two and maximum there is no limlit. However the hip is restricted to three successive generations. (13) Minor : In t hindu family business a child becomes member by birth so there is no restriction for a minor to become a member of the business.