Legal experts say that the Delhi High Court (HC) judgment that a woman can be the head, or karta, of a Hindu Undivided Family (HUF) is a logical step in the amendment of the law which gives equal rights to daughters in the inheritance of their parents’ wealth.
Lawyer Akanksha Kaul, who was the amicus curiae (friend of the court) in the matter, said “This judgment seems like the logical step forward after the amendment of 2005, given that the objective of the amendment was to give equal rights to daughters and sons. Once a woman has the right to be a coparcener (one who has equal right in ancestral property), there cannot be any bar to her also becoming a karta, even if the woman is married.”
A division bench of the HC recently passed the judgment, noting that if women are coparceners, they can also become the karta of a HUF. The rules of succession among Indian Hindus are governed by the Hindu Succession Act, 1956. The law was amended in 2005, when discriminatory provisions against women were removed. The amendment entitled daughters to an equal share in the property / wealth of their parents.
Achyut Ajit Kumar, partner at Traya Law, said, “Now that the courts have confirmed women’s inheritance as well as managerial (karta) rights, this can be considered as the culmination of the legislative intent behind the 2005 amendment.” He noted that the interpretation of the amendment had paved the way towards ameliorating the inequities perpetrated by entrenched societal norms.
What is an HUF?
An HUF is a family where all members are lineally descended from a common ancestor, and includes the wives and daughters of the male descendants. An HUF cannot be created under a contract; it is created automatically in a Hindu family. The karta is the head of an HUF.
An HUF is separately assessed under the Income Tax Act. The karta is usually the eldest member of the family, and once the karta passes away or retires, the eldest child becomes the next karta. Individuals born in an HUF automatically become its members. However, there was little clarity on whether a woman who is the eldest member of the family could be named the karta.
“The karta is only the eldest among the coparceners. A woman cannot be deprived of the right to manage the HUF merely because of her gender and / or marital status. Not only would such an interpretation be discriminatory, but also contrary to section 6 of the Act, that confers equal rights as coparcener to a daughter as well as the son,” Kaul said.
A woman who is married to a member of the family automatically becomes a member of the HUF by marriage. Women have rights in both matrimonial and parental HUFs. The judgment goes on to clarify that even if a woman is married, she can be the karta of her parental HUF.
“This judgment has put to rest all argument which suggested that after marriage a woman would become an active member of her husband’s HUF, and therefore cannot remain connected with her parental HUF. This also holds that mere ability to perform religious rituals like shraadh, mukhagni, etc., cannot become a prerequisite for recognising the karta of an HUF,” said Shambhu Saran, partner at Singhania and Partners LLP.
The judgment contends that merely because men have religious sanction to perform certain rites, they do not have inherent rights to become the karta in a HUF. “Today we have female priests and women performing last rites. The recognition of women as kartas may also help the cause of women who wish to perform certain rituals,” said Kaul.
Benefits of an HUF
An HUF can be engaged in business as well. Since it is a separate legal entity, it enjoys a basic tax exemption and has its own PAN card. In addition to this, HUFs are allowed to invest in tax-saving fixed deposits and equity-linked savings schemes (ELSS) to earn tax benefits under section 80C of the Income Tax Act.
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