The Karta is traditionally the senior most male coparcener of the Hindu Undivided Family (HUF). He is the person who takes care of the day-to-day expenses of the family looks after the family and protects the joint family properties. He remains to be Karta even if he becomes aged, infirm, or ailing. Where a senior most member is not Karta, for any reason, the next senior male member takes over as Karta. [Man vs. Gaini ILR (1918) 40 All 77]. However, if the senior most member gives up his right, a junior coparcener can become Karta of the HUF, with the consent of all other members as held by Supreme Court in Narendra Kumar J. Modi Vs CIT (1976) 105 ITR 109 (SC).
Karta is a person who has the authority to manage the affairs and assets of HUF. The term HUF or Joint Hindu Family is not mentioned or defined in any act. However, the IT Act 1961 makes a HUF a taxable entity under section 2/31.
POWERS OF KARTA
- Karta is a person who has the authority to manage the affairs and assets of HUF.
- He controls the Joint family business & turns out to be the custodian of the finances.
- He has the power to enter into contracts, acknowledge the debt, and borrow money for & on behalf of HUF
- He has the power to spend money for the family and is not liable to submit the account to anybody.
- He has the power to partition the joint family property on his own.
- He has the power to gift away the movable properties of HUF within a reasonable limit for natural love & affection.
- He has the power to transfer immovable properties for religious purposes or the benefit of the family.
- He has the power to enter into a compromise settlement on behalf of HUF.
- He has the power to represent in suits on behalf of HUF.
- He can open and operate a bank account/demat account on behalf of HUF.
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Sir, whether Kartha has powers to appoint signatories to operate the bank accounts. Or when Kartha is live with his consent other family can operate the bank accounts. Or Huf a/c can operate by all the members of the family.
Kindly answer sir.
HUF accounts can be operated by more than one signatory. The bank account has a feature of ‘one or more signatory’ on an account. This makes it easy. By default, the head of the family (senior-most male coparcener of the family). However, a Junior coparcener can be a Karta of HUF with the consent of all the coparceners. Under the Hindu law, the Karta could decide to alienate the family estate:
At the time of legal necessity or emergency (आपत्काले)
For the benefit of the estate of the family (कुटुम्बर्थे)
To perform indispensable or religious duties (धर्मार्थे)
A Karta may also alienate property without the consent of the coparceners for the performance of indispensable duties. To avoid disputes in such cases Karta normally takes the consent of all the major coparceners before alienating family estate.