Question

Enumerate the two conditions necessary for formation of Joint Hindu Family Business.

Answer 1

Formation of Hindu Joint Family Business.

1. Membership from Birth:

In Hindu Joint Family Business, there are membership has been self-activated from the member birth. It means members of business are not required for contracting with company. They become a member from their birth, who are known as “Co-parceners”. They have an equal ownership on the hereditary property. In India, there are two systems (Laws) which have different provisions in case of membership. How is the Joint Hindu Family Business formed

(a) Dayabhaga System: In this system, male and female both are required to become Co-parceners of business and it prevails only in West Bengal.

(b) Mitakshara System: In this system, a female cannot become a member of the business, only male members are required and it allows in all over India except West Bengal.

2. Formation of Business:

For formation of the business, there should be at least two members are present at the time of formation and a hereditary property should be formed for Hindu Joint Family Business. Their membership is not created by an agreement in among individuals.