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Division of immovable asset held under individual huf

SamSue (Partner) (61 Points)

30 August 2016

Hello All!

When there are a cople of properties (land) registered in the name of an individual in HUF status and he wants to divide them amongsts his brothers and himself. Post division the property should be registered in individual status (Not in HUF).

I would appreciate your inputs regarding:

1. Is this above-mentioned process possible and/or allowed?

2. If yes, what are the tax implications for the individual owning the porperties in HUF status and post the division?

3. Any other steps that he should be aware

Thanks,

Sam Sue

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3 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 30 August 2016

He cannot divide HUF property among his brothers, as his brothers are not co-parceners of his huf. Is he Karta of his Father's huf? and do the properties belong to his father's huf?

SamSue (Partner) (61 Points)
Replied 30 August 2016

Thanks Mr. Rambhia,.

For the last two questions you raised, the answer is No.

However, he is the kartha of his own HUF.

If he still wants to pursue the Property division, what are the options available for him. Kindly advise. Thanks.

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 30 August 2016

No other option but partition of HUF and divide the property amongst the co-parceners. i.e. himself, wife and his children. No tax liability of partitioned capital receipts in the hands of the individuals.