JOINT HINDU FAMILY BUSINESS AND ITS FEATURES

MAY 9, 2020

DAY 5

2nd period in 11 A  AND 6th period in 11 B

THANK YOU FOR LOGGING IN! GOOD MORNING BOYS!

LET US NOW START THE THIRD FORM OF BUSINESS ORGANISATION WHICH IS JOINT HINDU FAMILY BUSINESS(JHFB).

LEARNING OUTCOMES- At the end of the lesson, students will be able to:
1) Understand the meaning of Joint Hindu Family Business.
2) List the features of hindu family business.
3) Differentiate from the other forms.

WATCH A SMALL VIDEO FIRST TO UNDERSTAND THE TOPIC BETTER.

NOW TAKE DOWN THE NOTES:

Q.17 What do you mean by Joint Hindu Family Business? Explain its features or characteristics. (6)

ANS- It is a form of organisation which is governed by the Hindu Law  wherein the business is owned and carried on by the members of the Hindu Undivided Family. It exists only in India and one of the oldest forms of business organisation in the country. 

FEATURES OF JOINT HINDU FAMILY BUSINESS are as follows:

1.FORMATION:
a) There are two members and a property to be inherited by them. It is governed by Hindu Succession Act, 1956. The basis of membership in the business is birth in a particular family. Three successive generations can be members in the business. 
b) There is no need of an agreement as the membership is by birth. So, the foramtion is very easy.

2. LIABILITY:
a) The liability of the head of the family named Karta who is the eldest male member of the family is unlimited.
b) The liability of all other members who are known as co-parceners who have equal ownership right over the property is limited to the extent of their share in the business.

3. CONTROL:
a) The right to manage and control the business is in the hand of the Karta.
b) All other members of the business are bound by the decisions of the Karta.

4. CONTINUITY:
a) After the death of the Karta, the next eldest member in the family becomes the Karta. So, it is a relatively stable form of organisation.
b) The business can be dissolved through mutual consent of all the members. According to the Hindu Succession(Amendment) Act, 2005, even females have a right over the family business as males have in the coparcenary property.

5. MINOR MEMBERS:
a) The minor members may also be present in JHFB .
b) This is because the membership to the family business is acquired by birth in a particular family. His liability is limited to the share in the business. 

GOD BLESS YOU ALL!