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Difference between partnership and huf

It is open to the manager of a Joint Hindu family, as representing the family, to agree to become a partner with another person. And therefore any remuneration received by Karta would be the personal income of Karta and not the income of the HUF as there is no real connection between the investment of the assets of HUF and remuneration received by Karta. CIT for A. In fact, this issue was very much under litigation even at the time of old provision, and it was held that salary paid by a firm to its partner who, as Karta represented an HUF in the firm i,e. The Court has observed that the assessment of a firm have to be made strictly in accordance with the provisions of Section 40 b and the law has to be taken as it was.

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SEE VIDEO BY TOPIC: DIFFERENCES BETWEEN PARTNERSHIP AND HUF BUSINESS

Distinction between Partnership and Joint Hindu Family Firm

The following are the top 10 differences between a Partnership business and HUF business. A partnership is a contractual relationship arising out of an agreement among the partners. A Joint Hindu Family Firm on the other hand, is a creation of law. It arises out of status and not out of an agreement.

In a partnership firm, new partner can be admitted into firm only with the consent of all the existing partners, whereas a person becomes a member of the business by birth in the case of a Joint Hindu Jamily firm.

The maximum number of partners is restricted to 10 in the case of banking business and 20 in other cases in a partnership. There is no such restriction as to the maximum number of members in the case of a Joint Hindu Family Firm. In a partnership firm, women are allowed to become the members, whereas woman cannot be a member of a Joint Hindu Family Firm by birth.

A minor can be admitted into the firm only for the benefits of the firm i. In a partnership form of organization the liability of the partner is unlimited, whereas in a Joint Hindu Family Firm, the liability of the karta is unlimited and all the other members are liable only to the extent of their share in the business.

The head of the family exercises full control over the affairs of the business. The other members cannot interfere into the affairs of the business. In a partnership firm, a partner can demand the accounts of the partnership, whereas a member of Joint Hindu Family Firm has no right to call for the accounts. A partnership comes to an end with the death, retirement, insolvency and incapacity of a partner.

But a Joint Hindu Family Firm will be continued in spite of the death or insolvency of a member. The Partnership Act governs the activities of the partners and their rights and liabilities, whereas the provisions of the Hindu Law govern a Joint Hindu Family Firm. Joint Hindu Family vs Partnership. Formation 2. Admission of Members 3. Maximum Membership 4. Female Member 5. Minor Member 6. Liability of the Members 7.

Management of the Business 8. Inspection of Books of Accounts 9. Death of a Member Governing Body. Related Posts. Tags: Joint Stock Company , Partnership.

Difference between Partnership and Joint Hindu family

The following are the top 10 differences between a Partnership business and HUF business. A partnership is a contractual relationship arising out of an agreement among the partners. A Joint Hindu Family Firm on the other hand, is a creation of law.

Hindu Undivided Family carrying on a family business are not partners in the sense that their relationship inter it is not governed by the Partnership Act, , but the Hindu Law while deciding joint ownership in the family business. The only substantial resemblance between the two forms of association seems to be that in each case the members carry on business together. In all other respects, they are wholly dissimilar.

Partnership is the result of an agreement between the parties. In other words it can be said that mutual agreement between persons constituting Partnership is necessary for the establishment of partnership. On the other hand Hindu Joint Family Firm is the result of status, not of agreement. Members of Hindu joint family firm inherit such business in succession.

Difference between Partnership and Co-Ownership

A limited company and other forms of associations have large number of similarities and dissimilarities. Both individuals are subjects and trading is the object. Limited liabilities partnership is called a hybrid between a partnership and company. Limited liabilities Partnership is an alternative corporate business form that gives the benefits of limited liability of a company along with the flexibility of a partnership. LLP is capable of entering into contracts and holding property in its own name. LLP is a distinct legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution. Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity. Follow us on Blogarama.

Distinguish Between – Partnership Firm and Joint Hindu Family Firm

A partnership comes into existence, by means of a contract between partners, whereas, a joint Hindu family hereinafter referred to as HUF arises as a result of status, i. Accordingly, if two or more members of an HUF carry on an inherited business, it is not a partnership because it has been created by status or obtained by birth and not by an agreement. HUF is a unique form of business existing only in India and is governed by the provisions of the Hindu Law. It comes into existence by operation of Hindu Law and not out of contract. The firm is owned by the members of undivided Hindu family, called co-parceners.

Madhusudan Saharay.

It is often referred to as an archaic remnant associated with feudal structures of land and property holdings. This paper is an attempt to arrive at a comprehensive delineation of the role of the HUF in the corporate governance and taxation regime in independent India. The HUF found legal recognition in the late 19 th century, but it was the Income Tax Act under colonial rule in that gave it the status of a separate and distinct tax entity. The legal category of the HUF has existed in the tax code since then.

Difference & Distinguish Between a Company and a Partnership firm

Partnership and co-ownership are two different things. The ownership of a property by more than one person is called co-ownership. If two brothers purchase a property collectively, it will be a case of co-ownership. The property will be disposed off with the consent of all the co-owners.

Distinction between Partnership and Joint Hindu Family 1. Regulating law: A partnership is governed by the provisions of the Indian Partnership Act, Whereas A joint Hindu family business is governed by the principles of Hindu law. Mode of creation: A partnership arises out of a contract, whereas a joint Hindu family business arises by the operation of law and is not the result of a contract. Latest law News. Breaking News. Difference between Partnership and Joint Hindu family.

Differences between Partnership & HUF Business

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Jan 28, - Learn a basic difference between an Limited Liability Partnership and a Difference between Hindu Undivided Family Business and Company.

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Difference Between Partnership and Hindu Undivided Family

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Comments: 1
  1. Akinoll

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