Hindu Undivided Family
Hindu Undivided Family
Hindu undivided family (abbreviation: HUF) is a legal term related to the Hindu Marriage Act. Due to the development of Indian Legal System, of late, the female members are also given the right of share to the property in the HUF. In CIT vs Veerappa Chettiar, 76 ITR 467 (SC), Supreme Court had occasion to decide on an issue whether after the death of all the female members in a HUF, the HUF would still exist. HUF as a partner in a partnership firm HUF is a joint family consists of all lineally descended from a common ancestor. Hence, HUF is a group of members of the same family.
The "father", or the "senior member" of the family called "Karta", ordinarily manages the property belonging to Joint Family. Hence, the status of HUF cannot be termed as person.
The partnership is a relationship between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Hence, to become a partner in a partnership firm, the partner should be a natural person or recognized as person by the law (Company - by virtue of Companies Act 1956). Since, HUF is not a "person", but only group of persons belonging to the same family and carrying on the family business, HUF cannot be a partner in a partnership firm.
The Supreme Court of India held (AIR-1930-PC-300 & AIR1956-SC-854) - HUF is an association of persons is "not a person" within the meaning of expression in the Partnership Act. "… it is now well settled that HUF cannot enter into contract of partnership with another person or persons."
The Supreme Court of India, in another case M/s Rasiklal & Co Vs Commissioner of held that "…………. an HUF directly or indirectly cannot become a partner of a firm because the firm is an association of individuals." "…….in law, an HUF can never be a partner of partnership firm."
HUF is person under Section 2(31) (ii) of Income Tax Act 1961. [1] The section reads like: (2)(31) “person” includes" i)an individual,(ii)
Hindu undivided family (abbreviation: HUF) is a legal term related to the Hindu Marriage Act. Due to the development of Indian Legal System, of late, the female members are also given the right of share to the property in the HUF. In CIT vs Veerappa Chettiar, 76 ITR 467 (SC), Supreme Court had occasion to decide on an issue whether after the death of all the female members in a HUF, the HUF would still exist. HUF as a partner in a partnership firm HUF is a joint family consists of all lineally descended from a common ancestor. Hence, HUF is a group of members of the same family.
The "father", or the "senior member" of the family called "Karta", ordinarily manages the property belonging to Joint Family. Hence, the status of HUF cannot be termed as person.
The partnership is a relationship between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Hence, to become a partner in a partnership firm, the partner should be a natural person or recognized as person by the law (Company - by virtue of Companies Act 1956). Since, HUF is not a "person", but only group of persons belonging to the same family and carrying on the family business, HUF cannot be a partner in a partnership firm.
The Supreme Court of India held (AIR-1930-PC-300 & AIR1956-SC-854) - HUF is an association of persons is "not a person" within the meaning of expression in the Partnership Act. "… it is now well settled that HUF cannot enter into contract of partnership with another person or persons."
The Supreme Court of India, in another case M/s Rasiklal & Co Vs Commissioner of held that "…………. an HUF directly or indirectly cannot become a partner of a firm because the firm is an association of individuals." "…….in law, an HUF can never be a partner of partnership firm."
HUF is person under Section 2(31) (ii) of Income Tax Act 1961. [1] The section reads like: (2)(31) “person” includes" i)an individual,(ii)