Distinguish between a Joint Hindu family business and partnership.



Q.6:- Distinguish between a Joint Hindu family business and partnership.

 

Answer:-



Basis of Comparison Partnership Joint Hindu Family Business
Formation Easy formation with an agreement between partners. Easy formation with less legal formalities than partnership.
Registration Requirement Registration is optional. Exemption from registration.3
Members Minimum members should be 2 and maximum 10 for banking and 20 for others. At least two persons for division of family property with no maximum limit of members.
Capital contribution Limited but more than that can be raised in case of sole proprietorship. The capital contribution comes from ancestral property.
Liability Liability of members is unlimited and joint. Liability is unlimited only for Karta while it is limited for other members.
Control and Management Partners take decisions jointly and content of all partners is needed Karta takes decisions which are binding on other members.
Continuity Stable but affected by status of partners. Stable business, continues even in Karta dies through succession in family.