Joint Hindu Family Business is a distinct type of organisation which is unique to India.

Even within
India its existence is restricted to only certain parts of the country. In this form of business
ownership, all members of a Hindu undivided family do business jointly under the control of the
head of the family who is known as the 'Karta'. The members of the family are known as 'Coparceners'. Thus, the Joint Hindu Family firm is a business owned by co-parceners of a Hindu
undivided estate. Its main features are :

It comes into existence by the operation of Hindu law and not out of contract. The rights and
liabilities of co-parceners are determined by the general rules of the Hindu law.

The membership of this form of business is the result of status arising from the birth in the
family and its legality is not affected by the minority. Originally, only three successive
generations in the male line ( grandfather, father and son) constituted the membership of
this organisation. By the Hindu Succession Act, a female relative of a deceased member or a
male relative of such a female member was made eligible for a share in the interest of the
related member ( called co-parcener) at the time of his death. There is no legal limit to the
maximum number of members.

Registration is unnecessary, but the rights of its members to sue third parties for claims of
debt remains unaffected.

It is managed generally by the Karta. He has the authority to obtain loans against the family
property or in other ways. Other members have no right of management nor to contract
loans binding on the joint-family property.

The manager or the Karta has the last word in the formulation of all policies and in their
execution. He has unquestioned authority in the conduct of the family business.

The Karta has unlimited liability while the liability of the other members is limited to the
value of their individual interests in the joint family.

The firm enjoys continuity of operations as its existence is not subject to the death or
insolvency of a co-parcener or even of the Karta himself. Thus, it has a perpetual life like the
public limited company.

Advantages

Ease of formation

Continuity of operations

Disadvantages

Confined to Joint Hindu families

Relatively limited capital

Limited managerial talents

Unlimited liability of the Karta

A joint family or undivided family is an extended family arrangement prevalent throughout

the Indian subcontinent, particularly in India, consisting of many generations living in the same
home. All the male members are blood relatives and all the women are either mothers, wives,
unmarried daughters, or widowed relatives, all bound by the common relationship. The joint
family status being the result of birth, possession of joint cord that knits the members of the
family together is not property but the relationship. The family is headed by a patriarch, usually
the oldest male called, who makes decisions on economic and social matters on behalf of the
entire family. The patriarch's wife generally exerts control over the kitchen, child rearing and
minor religious practices. All money goes to the common pool and all property is held jointly.
There are several schools of laws. Broadly, systems of laws are very common. Family ties are
given more importance than marital ties. The arrangement provides a kind of social security in a
familial atmosphere.

1 Hindu undivided families

2 Relationships
3 See also
4 References
5 Further reading

Hindu undivided families[edit]

A Hindu undivided family (abbreviation: HUF) is a legal term related to the Hindu Marriage Act.
Due to the development of the Indian legal system, of late, the female members are also given
the right of share to the property in the HUF. The term Hindu undivided family finds reference in
the provisions of the income tax act but the expression is not defined in the act.
There are various aspects of Hindu Law which are relevant for the purpose assessment of
income[1] and wealth in the status of Hindu Undivided Family (HUF) as well as the impact of the
provisions of Hindu Succession Act 1956 as amended by Hindu Succession (Amendment) Act
2005 which are relevant for the purpose of assessment of income and wealth in the status of
HUF under Income Tax Act 1961.
In the case of Surjit lal Chhabra 101 ITR 776 SC wherein the court explained the scope of the
said expression as under:
In the first place, joint family and undivided family are synonymous terms.The expression Hindu
undivided family must be construed in the sense, in which it is understood under the Hindu law.
A joint Hindu family consists of persons lineally descended from a common ancestor and
includes their wives and unmarried daughters. The daughter, on marriage, ceases to be a
member of her father's family and becomes a member of her husbands family.
That the joint and undivided family is the normal condition of Hindu society. The presumption,
therefore, is that the members of a Hindu family are living in a state of union, unless the contrary
is established.

Relationships[edit]
This section
requires expansion.(June 2011)

In joint families in north and central India, between a bride or sister-in-law and her younger
brother-in-law a joking or teasing relationship is common, while the relationship towards an older
brother-in-law is that of respectfulness.[2]
In a traditional joint Hindu family, there is a subservient relationship between the wives of the
brothers; that is to say, the patriarchs wife is addressed as "Badi Bhabhi", meaning eldest
brothers wife. She is traditionally considered the mistress of the house, and is in charge of
running the household affairs and overseeing the servants (if any). The subsequent younger
brothers wives typically seek her advice and permission in regards to any matters/decisions
regarding the household and rearing of the children. In popular culture, Hindi dramas typically
display these relationships as contentious, as the badi bhabhi frequently abuses her position of
power.