Question

A Hindu undivided family consisting of 11 major members and 2 minor members, carries on a family banking business.
(a) Is there anything wrong?
(b) Can such members be called partners?

Answer 1

Part (a) Section to which the given! problem relates: Section 11 of the Companies Act, 1956.
Decision: No.
Reason The statutory limit of 10 persons does not apply to a joint family
Part(b) Section to which the given problem relates: Section 5.
Decision: No.
Reason: The relation of partnership arises from contract and not from status. Such members are called coparceners.