Theoretical Overview
The Joint Hindu family is patriarchal, with Karta as the head of the family. Karta is the family’s senior male member who acts as the family’s representative. The Karta and the other family members have a fiduciary connection since every family needs a head member who takes care of the welfare of minor members and females in a Joint Hindu Family. Karta’s role is unique in a Hindu family. Karta is in charge of the entire family and its property, and any decision made by Karta must be followed by all members of the Hindu Joint Family. In a Hindu Joint Family, no one is equal to Karta. The Karta’s powers and position are greater than those of any other member of the Hindu Joint Family. Among the other members of the joint family, no one can compare to Karta.
Who can be a Karta?
- Senior most Male Member
It is the right of the senior most male member to become a Karta. Kartas are always family members; no outsiders or strangers can become Kartas. If the senior most male member of the family is still living, he will remain as Karta; if he dies, the second most senior member of the family will take over. Karta assumes his post with the approval or cooperation of all coparceners.
- Junior Male Member
If the coparceners agree, a junior can also become the Karta family. A junior male member of the family can be a Karta of the family if an agreement is reached with the coparceners.
- Female member as Karta
According to Dharmasastra, if the family has been without a male member, the female can act as a Karta in that case. If there are male members present but they are minors, tehn also, females can also act as Kartas.
Position of Karta
- Karta’s position is special (sui generis). His position is independent, and no one in the family can be compared to him.
- He and the other members do not have a principal/agent/partner relationship. He is not like a commercial firm’s manager. Needless to say, he is the family’s head and acts on behalf of the other members, yet he is not like a partner because his powers are nearly unlimited. Without a doubt, he is the master of the joint family’s magnificent show and supervises all of its activities and operations. His managerial power is so broad and practically sovereign that any manager of a business firm pales into insignificance. Although the Karta has a fiduciary relationship with the other members, he is not a trustee.
- He is responsible to no one. The only exception to this rule is that he is held accountable in cases of fraud, misappropriation, or conversion.
- He is not obligated to invest, save, or economize. He has the authority to use the resources any way he sees fit unless he is not accountable for the aforementioned charges.
- He is not required to distribute the revenue from the joint property equally among the family members. He has the ability to distinguish between people and is not required to be impartial. The only requirement is that he pays everyone so that they may obtain basic essentials such as food, clothing, education, and shelter.
- A Karta, no matter how powerful he is, cannot be a despot. He is related to other members of the family by blood. After all, he is a person with limited abilities. He has obligations to members. Any coparcener can request a partition at any moment. He receives no compensation for his services and bears numerous onerous responsibilities to the family and its members. His full legal standing can only be grasped if we understand the scope of his powers and liabilities.
Powers of a Karta
- Powers of Management
Karta has complete managerial authority. No one can criticize Karta’s duties, such as his ability to manage or mismanage the property, family, and business in any way he sees fit. Karta cannot deny any member the right to maintain and occupy the property. Karta is not responsible for any positive failures.
- Rights to Income or Remuneration and Expenditure
The Karta must get the revenue from the Joint Hindu family property as a whole. The Karta is then responsible for allocating funds to members in order to meet their needs. Karta is in charge of spending the money. His authority is limited to spending the funds on family matters such as management, maintenance, marriage, education, and so on.
- Rights to Represent Joint Family
In legal, religious, and social affairs, the Karta represents the family. The Karta’s acts and decisions are binding on the members. Karta has the authority to enter into any transaction on behalf of the family.
- Right to Compromise
Karta has the authority to mediate management or family property issues. He is capable of settling family debts, ongoing lawsuits, and other transactions. Only on the basis of malafide can heirs challenge the Karta’s compromises in court.
- Power to refer a Dispute to Arbitration
Karta has the authority to send management and family property conflicts to arbitration. If the arbitration award is valid, it will be binding on the members of the joint family.
- Power to Contract Debts
The Karta has the implicit authority to contract debts and pledge the family’s credits and property. Such actions are certain to be replicated by family members. Even if Karta takes a loan for family purposes or for family companies, the combined family is obligated to repay the loan.
- Power to enter into Contracts
Where contracts are enforceable against the family, the Karta can enter into them. The contracts bind all members of the joint family.
- Power of Alienation
No one among the family members can alienate joint family property. But Karta has the power to alienate the property under three circumstances.
- Legal Necessity
- Benefit of estate
- Indispensable duties
Legal Necessity
This term has not been expressly defined in any judgment or in any law. It includes all the things which are deemed necessary for the members of the family.
Benefit of estate
The benefit of Estate means anything which is done for the benefit of the joint family property. Karta as a manager can do all those things which are helpful for family advancement.
Indispensable Duties
These terms refer to the performing of religious, pious, or philanthropic deeds. Marriage, grihapravesham, and other obligatory tasks are examples. A Karta may alienate a portion of his or her property for charitable purposes. In this instance, Karta’s power is limited, as he can only alienate a small percentage of the family property, whether mobile or immovable.
- Loan on Promissory Note
If Karta takes a loan for a family purpose or executes a promissory note, all members, including those who are not parties to the note, will be sued if the loan is not paid. However, Karta is individually liable for the loan.
Duties of Karta
- Maintenance
Maintenance is provided for all members of the Hindu Joint Family, whether coparcenary or not. The Karta is responsible for maintaining the well-being of all members. No member of the family can be denied the right to maintenance, and if they are, they can sue to reclaim their right and arrears of maintenance.
- Marriage
Karta has a duty to marry off the family’s unmarried members, especially daughters, because their marriage is regarded sacred in Hindu law. It was established in the case of Chandra Kishore v. Nanak Chand that it is Karta’s duty to bear all the expenses of the marriage from the joint family money, or if the expenses are incurred from other sources, he must reimburse them when asked.
- Render accounts
In Hindu law, a Karta is not required to keep the family business account, but he is required to give the accounts if any coparceners demand it at the time of division. He is responsible for any misappropriation or fraud.
- Representation
The Joint Hindu Family is represented by the senior-most member of the family, known as Karta. The family does not have a corporate identity; instead, it operates through its Karta. The Karta is obligated to undertake responsibilities such as paying all taxes, dues, and so on behalf of his family. Karta might be sued on behalf of his family as well.
Liabilities of Karta
- Liability to maintain
The Karta of the Hindu Joint Family is responsible for maintaining all members of the joint family. All members of the Joint Hindu Family are entitled to support and residence. If Karta is unable to maintain them, he can be sued, and the member can receive their maintenance arrears.
- Liability to spend reasonably
The Karta can also spend money from the shared family account. However, such power is subject to some constraints, including as Karta’s inability to utilize the funds for illegal purposes and his obligation to spend them prudently. If any of the coparceners are dissatisfied with Karta’s spending, he or she might launch a lawsuit to find out the facts.
- Liability not to alienate property
Only in exceptional circumstances, such as legal necessity, the benefit of the estate, or the performance of essential obligations, is Karta permitted to transfer the Joint Hindu Family Property. Aside from that, the Karta is not permitted to alienate the Joint Family Property. If he illegally alienates the property, the coparceners have the right to contest the alienation.
- Liability not to start a new business
The Karta of the family is obligated not to start a new company without the prior consent/permission of the Joint Hindu Family coparceners. The Karta can establish a new enterprise if the coparceners have expressed or inferred their consent.
- Liability to render accounts
The Karta is under no responsibility to keep the accounts up to date as long as the family remains joint. However, as soon as the split occurs, Karta is required to submit the accounting of Joint Family Property.
Relevant Sections
Section 6 of the Hindu Succession Act,1956:
Section 6 of the Hindu Succession Act, 1956 provides for the devolution of property of intestate succession. It provided that the property shall be devolved on male coparceners who have interest in the coparcenary property, such interest in the male coparceners was only limited to three degrees i.e male son, grandson, and a great-grandson. The interest is devolved by way of survivorship. The Hindu Succession Act, of 1956 specifically excluded females from acquiring any share of interest in the property, the wife was not considered as a direct bloodline of the deceased.
Section 6 of the Hindu Succession Act, 1956 after the 2005 Amendment:
The 1956 Act was amended in 2005 and a major change bought in the amendment was in Section 6 which aimed to remove gender bias. Section 6 of the 2005 Amendment Act provided for equal rights of both sons and daughters as they both are coparceners. The Mitakshara coparcener liabilities would be equally applicable to the daughter. The Act was made applicable to three degrees of female coparceners as well – daughters, granddaughters, great grand-daughters. Thus, Section 6 aimed at giving equal rights to daughters as coparceners as sons have.
Section 23 of the Hindu Succession Act, 1956: Where a Hindu intestate has left surviving him or her both male and female heirs specified in class I of the Schedule and his or her property includes a dwelling-house wholly occupied by members of his or her family, then, notwithstanding anything contained in this Act, the right of any such female heir to claim partition of the dwelling-house shall not arise until the male heirs choose to divide their respective shares therein; but the female heir shall be entitled to a right of residence therein: Provided that where such female heir is a daughter, she shall be entitled to a right of residence in the dwelling-house only if she is unmarried or has been deserted by or has separated from her husband or is a widow.
Section 23 of the Hindu Succession Act, 1956 after the 2005 Amendment: This section has been amended by the amending Act of 2005. As a result, the disabilities of female heirs were removed.
Important Case Laws
1. Nopany Investments (Pvt) Ltd. v. Santokh Singh (2008)- In this case the Karta of the family was staying in the United Kingdom and thus was not able to manage the family and the property and so, with the consent of all the coparceners and family members his younger brother was appointed as the Karta although there were members older to him.
2. Mrs. Sujata Sharma vs Shri Manu Gupta (2016)- In this case the Delhi High Court enlarged the scope of Section 6 of the Hindu Succession Act, 1956, and stated that a female can also become the Karta of the family.
3. Dev Kishan v. Ram Kishan (2002)- In this case when the Karta mortgaged and sold the joint family property for the purpose of marriage of the two minor daughters the court held that such action was an unlawful alienation as being violative of Child Marriage Restraint Act, 1929.
4. Chandra Kishore v. Nanak Chand (1975)- In this case, it was held that Karta is responsible for managing the expenses of the marriage of the daughter from the joint family estate. And in case marriage expenses are met from outside they are to be reimbursed from the joint family funds.
5. Sushila Devi Rampura v. Income tax Officer (1959) – It was held that where the male members are minors, their natural guardian is their mother. The mother can represent the HUF for the purpose of assessment and recovery of income tax.
Important Legal Maxims
Actio personalis moritur cum persona: This maxim means that a personal right and/or cause of action dies with the death of the person. But in Hindu joint family, a debt that was borrowed by the Karta has to be repaid by the combined family after his death.
Points to Remember
1. Karta in a Joint Hindu family holds an extraordinary position with reference to its understanding and complexity. Every joint family should have a Karta to boost the cohesive aspect of such a family with reference to its dealings and ventures.
2. Looking at Karta’s position, it can be stated that he has fewer liabilities and greater powers. Karta is in a unique position when it comes to determining his place.
3. The decisions or statements given by the Karta are binding on the parties and they are bound to do it.
4. Section 6 of the Hindu Succession Act, 1956 gives equal rights to daughters as sons. Hindu Succession Act, 1956 does not accept a woman as a Karta, except in two circumstances- if there is an absence of a male member of the family or in case there is a male member in the family but he is a minor.
5. Previously, it was believed that a daughter could not be a coparcener in joint family property, however, this belief was disproved following the passage of the Hindu Succession Amendment Act, 2005. This Amendment Act granted daughters the same rights as sons (right of coparcenary). As declared by the Delhi High Court in Sujata Singh vs Shri Manu Gupta, Section 6 of the Hindu Succession Act, 1956 has been brought to its logical conclusion and now the female member of the family can also become the Karta of the family.
6. Because Karta has enormous powers, several checks have been established on him to ensure that he does not abuse his power. Even if someone abuses his power, the law provides sufficient sanctions to ensure that he does not abuse his power in this manner in the future.
7. It is so established that the Karta serves as the Hindu Undivided Family’s manager or guardian. He is not a trustee or an agent. He has the authority not only to manage, but also to handle accounts, provide maintenance, engage into contracts, take loans, and pay debts.
8. Overall, all family members are obligated to accept what Karta says unless and until it is detrimental to them.
9. If the karta engages in any behavior that is detrimental to the interests of family members, the law provides many remedies. The remedies seek to keep Karta from engaging in such illegal and immoral activities.
10. Centralization is the key to good management and this is provided by the Karta.