BUSINESS STUDIES UNIT-2 CBSE|PART 3|FORMS OF BUSINESS ORGANISATION|JOINT...

JOINT HINDU FAMILY BUSINESS.





JOINT HINDU FAMILY BUSINESS is a

specific form of business organisation

found only in India.



JOINT HINDU FAMILY BUSINESS is

owned and carried on by the members

of the Hindu Undivided Family (HUF).



The

basis of membership in the business is

birth in a particular family and three

successive generations can be members

in the business.



The business is controlled by the

head of the family.



 the

head of the family is the eldest

member.



the eldest

member is called karta.



so, the whole power lies with karta.



All

members have equal ownership right

over the property of an ancestor and

they are known as co-parceners.



the Features ofJOINT HINDU FAMILY BUSINESS.

The following points highlight the

essential characteristics of the joint

Hindu family business.





1.Formation:

to start JOINT HINDU FAMILY BUSINESS, there should be at least two

members in the family.

The

business does not require any

agreement as membership.The membership is made automatically by birth in the family.

It is governed by the Hindu Succession

Act, 1956.



2.Liability:

liability is the state of being legally responsible for something.it may be assets or organization etc.

so in JOINT HINDU FAMILY BUSINESS.

The karta that is head of the family has unlimited liability and resposibility.

all other members of the business that is co-parceners have limited liability and responsibility.



3.Control:The control of the family

business lies with the karta. He takes

all the decisions and is authorised to

manage the business. His decisions are

binding on the other members.



4.Continuity:

The business

continues even after the death of the

karta as the next eldest member takes

up the position of karta, leaving the

business stable. The business can,

however, be terminated with the

mutual consent of the members.

for example.



     Reliance Industries.

     Founded by Dhirubhai Ambani in 1966 as Reliance Commercial Corporation, Reliance industries is the largest private sector conglomerate company in India. The company was divided between the founder's two sons, Mukesh Ambani and Anil Ambani in 2006.



5.Minor Members:

The inclusion of

an individual into the business occurs

due to birth in a Hindu Undivided

Family. Hence, minors can also be

members of the business.