Junior Member Can Become Karta Of HUF!

April 2, 2007 by taxworry · Leave a Comment

My father is the Karta of the HUF which has been in operation for a few decades. He is 83 years old. In view of his old age, can he transfer the Karta ship to me? I am 31 years old, married with a child. What is the procedure for the same? Should this be declared to the IT authorities and how do I get a new PAN? Should the old PAN be cancelled?My child is a month old. Should addition of members in the HGUF be declared to the IT authorities? visva.neurosurgeon@gmail.com

It is presumption under Hindu Law, that senior most member can be Karta of the HUF. His position under the law is unchallengeable . He is manager of the assets and income of the HUF. It has been held in Narendrakumar J Modi v. CIT 1976 S.C. 1953 that in case there is agreement among members of HUF , a junior member can become Karta of the HUF.

Therefore , in your case , you can become karta , but before that its better if you get an agreement signed among all HUF members stating that your father , owing to his age , is passing on kartship to you and that other members are agreeing to it.

As far as Income tax Act is concerned , there is not big impact for such change of guard since the income shall always be assessed in the status of HUF . The return can be signed by you. What you should do is to inform the A.O on plain paper that now you have become the Karta of the HUF and that you will be filing returns thereafter.

As far as your son is concerned , he is certainly part of HUF and you can inform the I T Authorities on your own volition, and keep a record of that.

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