Question

In case of HUF what are liabilities of coparcener and Karta?

• A. Both have unlimited liability
• B. Coparcener's liability is limited while Karta's liability is unlimited
• C. Karta's liability is limited while Coparcener's liability is unlimited
• D. Both have limited liability

Answer 1

Answer: (B)

Coparcener's liability is limited while Karta's liability is unlimited

Joint Hindu family business is regulated by the Hindu succession act. According to it the business is owned and managed by the karta, the head of the family and the members of the family are its co parceners. Hence, the head of the family business is called as karta. The liability of coparcener is limited whereas the liability of karta is unlimited.