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Forms Of Business Organization

Question

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Distinguish between a Joint Hindu Family Business and Partnership.

Solution

Basis	Joint Hindu Family Business	Partnership
Formation	The business belongs to particular family and	Quite easy.
Membership	The basis of memership in the business is birth in a particular family.	Any person can became its member. Maximum —2 Maximum —10 Banking firms 20 other firms
Liability of Members	The liability of Karta is unlimited but the liability of members is limited.	Unlimited.
Management	The business is controlled by the head of the family who is the oldest member and is called Karta.	Managed by Partners.
Secrecy	Karta maintains secrecy.	Relatively maintained.
Suitability	It is a specific form of business fond only in India. It is a type of business which is owned and carried on by the members of HUF.	For small and medium sized business.
Act	It is governed by the Hindu law.	It is governed by Partnership Act 1932.

Some More Questions From Forms of Business Organization Chapter

Define company.

What do you understand by a Private Company?

What do you understand by a Public Company?

Under what circumstances, is a partnership form of business organisation suitable ?

Write a short note on 'implied agency', one of the important characteristics of partnership and also true test of partnership.

Would you say that the sole proprietorship involves a lengthy and expensive procedure for its registration?

Explain whether the liability of a sole proprietorship is limited to the extent of his share in business.

Only the Karta has unlimited liability in HUF. Explain.

Define 'Partner by Holding Out'.

Explain how the company is an artificial person.

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