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doubt in HUF

vijaykumar (Student) (49 Points)

25 October 2007

The family contain mother and son(major)

there is a house property belong to the deceased father from which HP income arise

wheather this property income is taxable under AOP or HUF ?

If huf, then can a lady be a HUF when the son is major ?

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13 Replies

S.RAVICHANDRAN (FINANCE MANAGER) (422 Points)
Replied 25 October 2007

As for HUF is concerned, the karta of the HUF should be the male member of the family only. Thus if the father dies, the elder son becomes the Karta of the new HUF consisting of mother and the son ( Karta ) Thus the property income be taxed as HUF income only.

Suresh Goel (servuce) (335 Points)
Replied 26 October 2007

This income will not belong to HUF. That income will be chargable in the hands to legal heirs.

CA. Dashrath Maheshwari (TaXpert) (15090 Points)
Replied 26 October 2007

An HUF is a family of Hindus. However, under the tax laws, even Jain and Sikh families can set up HUFs. Typically, an HUF will consist of people who have lineally descended from a common ancestor, and includes their wives and unmarried daughters. Do note: in Maharashtra, even married daughters are recognised as HUF members. While the seniormost member is called the karta (manager), the male members are known as coparceners, and the females are referred to as members. In the ordinary sense, an HUF should consist of at least two male members. However, in case the HUF is partitioned, the smaller family that receives the property can constitute an HUF even if it has only one male member.

Vijay K. Agrawal (Service) (608 Points)
Replied 26 October 2007

if HUF was alraedy creted and property is the name of huf then it will be taxable in the name io HUF ( as son will be the Karta). If property is in the name of individual( here father) then after death of individual it will be taxable in the hand of legal heirs. why are you thinking of AOP.

vishal (ca) (70 Points)
Replied 17 November 2007

Hi the question will dependt upon one question how father getz the property whether self earned or ancetral if self earned then taxable in the hands of legal hiers & if ancestral then HUF based on the ans given by Mr. Dashrath

vijay (Tax Advisor) (62 Points)
Replied 03 April 2008

the opinion given by vishalji is correct

(Guest)

Hi Sir,

I am Nirav, CA Student.

I need ur favour for one matter.

We r not finding any case law or proper saction for the case where Karta of H.U.F. died and his Son wants to be Karta to operate Bank Account, where according to Bank Manager he can't operate the Account, and the same need to be closed.

We r sure that Son of Karta can operate bank account as Karta after death of father karta.

So, we need proper case law to convince manager on this matter.

Thaking u in anticipation of fast and favourable response from ur part.

Ramakrishna (Financial Executive) (438 Points)
Replied 19 October 2008

Dear Nirav Sheth!

The advise given by the Bank manager to close the bank account on the demise of the karta of HUF is not correct. So long as the HUF, has the legal status by virute of the existence of the other members, the HUf has the legal sanction to hold any type of assets in the same form of holding. All that needs to be done is to inform the authorites in custody of any such assets of the HUF, like Bank accounts, about the changes that have taken place in the HUF on the demise of the Karta, the details of the new Karta and the composition of the HUF and thegranting of authority to dela with the proceeds in the said accounts/assets to the new Karta.

The idea to close the bank account arose becasue of lack of application of proper legal position at the level of the Bank Manager. Instead of searching for case laws on such issues, it would be better, if you approach the higher authorites/ombudsman for proper redressal of the grievance.

Please post the outcome of your efforts on the suggested lines.

Good Bye! Cheers!!

(Guest)

Sir there is a HUF in the name of my father he Expired some months ago , in my family we are mother and 2 sisters , nw can you plz tell me whether that HUF would be closed or would continue and if it would continue in what name and after my marriage can I have one more HUF in my name with me being karta for both, plz reply its urgent sir

T.S.Mohana Harish (Audit Assistant) (163 Points)
Replied 02 December 2008

in your 1st case your mother will be kartha & ur sister will be member of huf . In 2nd case as u will be maried in that case u will be in the hands of ur husband so u can't have a huf status of ur own only male member can be the kartha of the HUF

T.S.Mohana Harish , harish_ts1984 @ yahoo.com

Hitesh Bhandari (Employed) (33 Points)
Replied 10 July 2010

Hi,

Have a doubt in relation to HUF.

Consider Two HUFs - ABC HUF and ABC and sons HUF

ABC HUF

Karta – ABC

Coparceners

Wife

1^st Son (Born in 1992)

HUF Incorporated in 1992

ABC and sons HUF

Karta – ABC

Coparceners

Wife

2^nd Son (Born in 1997)

HUF Incorporated in 1997

Query:

1. Can there be two HUF with same karta?

2. If yes, shouldn’t the second HUF also have 1^st son as its coparcener

Plz comment on the same as early as possible.

Regards

Nandan Narula (CA Final Student) (938 Points)
Replied 12 July 2010

i completely agree with ramakrishna's views

C.A Trapti varshney (CA (ranker) B.com C.S) (125 Points)
Replied 12 July 2010

in this topic i want to quote a case law............

as per S.C. in Gowli Buddanna V CIT it has been clarified that there need not be more than one male mamber to form a huf as taxable entity under the income tax act. In this case the proerty of the huf does not cease to belong to the family. it shall be treated as huf 's property. However the share of the karta ( deceased father) shall pass on to his legal heir

One thing more i want to clarify that as per amendment in hindu succession act, even daughters will have same rights as that of a son i.e. she will also be a coparcener.