What are the powers and liabilities of a Karta in a Joint Hindu family? Can the mother or any other female member be a Karta in a Joint Hindu family?

Question: What are the powers and liabilities of a Karta in a Joint Hindu family? Can the mother or any other female member be a Karta in a Joint Hindu family? [BJS 1984]

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Answer

A Karta is a person in whom others in the family repose confidence, so between the Karta and the family members, there is a fiduciary relationship because there is always a need for a manager to look after the welfare of minor members and females in a joint Hindu family. Such a manager of the joint Hindu Family is known as the Karta of the family, and he enjoys immense powers in respect of the management of the affairs of the family and its property.

He is the senior-most male member of the family, and as the head or manager of the family, he is the representative of the family and acts for or on behalf of the family. As Karta is the representative of the family in a Joint Hindu Family, he is responsible for the family and all the matters concerning it. He is supposed to keep a check on the income and assets of the joint property. He is also accountable for the other family members and their shares and sums under the joint family.

Powers of a Karta

In the case of Suraj Bunsi Koer v. Sheo Prasad, 1880 ILR 5 Cal. 148, it was established that the position of Karta in a Hindu Undivided Family is equivalent to that of a manager who is in charge of handling the property-related affairs of the family. Thus, we can conclude that a Karta is the overall head of the family, and he has various responsibilities and powers under his name. A few of the powers of Karta are mentioned below-

1. Power over income and expenditure

Karta exercises extensive control over the income and expenditure of the joint family. Since his position is not like the trustee or agent, he is not bound to economize or save like a trustee or agent provided he spends the income of the family for the benefit of the members of the family, e.g., for maintenance, education, marriage, sraddha and other religious ceremonies of the coparceners and of the members of their respective families.

2. Power to manage the joint family business

Karta has the power to manage the joint family business. In this respect, he can take all such steps which are just and necessary for the promotion of the business.

3. Power to contract a debt for family purposes

Karta can enter into contracts incurring debts for family purposes and family business, which will bind the other coparceners to the extent only of their interest in the joint family property. Such debt contracts could bind the adult coparceners personally also if they were parties to the contract expressly or impliedly or they subsequently ratify the contract and in the case of minors if they ratify on attaining majority.

4. Power to enter into a contract

Karta has the power of making contracts, giving receipts, entering into compromises, and discharging contracts ordinarily incidental to the business of the family.

5. Power to refer to arbitration

Karta may refer to arbitration as any matter involving the interest of a joint Hindu family, and the other members of the family, including minors, are bound by the reference and consequently by the award made upon it.

6. Power to enter into a compromise

Karta can enter into a compromise in any matter relating to joint family property. He, however, has no power to give up debt due to joint family and give up a valuable item without any return or consideration, though he has a right to settle accounts with the debtors and to make a reasonable reduction either towards interest or towards principal in the interest of the family.

7. Power to give discharge

Karta has the power to give a valid charge to the debt due to joint family. Where one of the members of a joint family is a minor, he cannot claim the benefit of Section 7 of the Limitation Act.

8. Power to acknowledge debts

Karta has the power to acknowledge a debt or make a part payment of it, so as to extend the period of limitation. But he cannot execute a fresh promissory note or a bond so as to revive a time-barred debt.

9. Power to represent in suits

Karta may represent the joint family in the event of a suit by or against the family so that other members are not the necessary parties to the same. The Karta himself be sued or he can institute a suit with respect to any property or other matters of the joint family. Whenever a decree is passed against him, that would bind all other members of the family, if, as regards minor members, he acted in the litigation in their interest, and in the case of major members, he acted with their consent.

10. Power of alienation

Karta can alienate for value the joint family property so as to bind the interests of the other coparceners provided it is made with the consent of all the existing coparceners; they being all adults; for legal necessity; or for the benefit of the estate. He does not enjoy the absolute power to alienate joint family property. Some strict restrictions have been provided over his powers in this respect. The expression “for pious purposes” has been so often used in different contexts in Hindu law. The powers of Karta cannot extend in this context.

Liabilities of a Karta

It is the duty of Karta to look over all reasonable wants of the members and to ensure their satisfaction. If he fails in doing his duty, the members can also enforce legal actions against him. It was held in Raghunanda v. Brozo Kishoro, 1876 1 Mad 69, that an undivided Hindu family is joint in all senses, like in estate, food, or worship. Therefore Karta not only handles the concerns of the joint property but also to whatever else is related to that joint family. The following are the duties and liabilities of Karta in a joint family:

1. Duty to render accounts

Karta’s prime duty is to render accounts to the other coparceners regarding the income from the joint family property and the expenditures thereon. But he is not under any obligation to account for his past dealings with the family property unless there is clear proof of misappropriation or fraudulent use of the family funds or estate by him. He is liable to account only at the time of partition and then only for the family property as it exists at the time. But this does not mean that the parties are bound to accept the statement of the Karta as to what the property consisted of.

2. Duty to realize debt due to the family

It is an important duty of the Karta to make sincere efforts to realize the debt due to the family. But he cannot give up any debt, although he has got the full power to settle accounts with the debtor and to make a reasonable reduction either towards interest or towards principal in the interest of the family

3. Duty to spend reasonably

It is the duty of the Karta to spend the joint family funds only for the purposes of the family. It is not his duty to save by resorting to the economy unnecessarily. He must spend reasonably. If he spends unreasonably and it is not approved by other members of the family, the remedy would be to demand partition.

4. Duty not to start a new business without the consent of other coparceners

The Karta must obtain the consent of other coparceners before starting a new business, as he cannot impose the risk of a new business upon the minor as well as adult members of the joint family.

5. Duty not to alienate coparcenary property except for legal necessity and benefit to the estate

It is the duty of the Karta to obtain the consent of adult coparceners before alienating the joint family property. But if he alienates the property for legal necessity or for the benefit of the estate, he need not obtain the consent of other coparceners. Whether the transaction is justified on the grounds of legal necessity or benefit to the estate, the real question to be considered is whether it is a fair and proper transaction, such as a prudent owner would enter into with the knowledge available to him at the time.

Mother or any female member as Karta

Since ancient times the concept of Karta has always been seen as male-dominated. This resulted in only males succeeding as Karta in Hindu Undivided families, and the trend continued in the post-independence era as well. The Mitakshara School says that in marriage, the wife entails ownership rights to her husband’s property; similarly, daughters have this right at birth. But under Mitakshara law, there is a distinction between males and females, which says that the status of the women is bound to the family. Their rights over such properties can arise only when they belong to the family.

Under this school, only lineal male descendants have a right by birth to familial property. And till 2005, even the coparcenary was exclusive to male members only.

In the case of Pandurang v. Pandurang, AIR 1947 Nag 178, it was held by the Nagpur High Court that the mother can become Karta if there is no other adult coparcener, whereas the Supreme Court does not agree with this view in the case of Commissioner of Income Tax v. Seth Govind Ram Sugar Mills, AIR 1966 SC 24.

It was in 2005 when the amendment was brought in the Hindu Succession Act with the aim to remove gender discriminatory provisions regarding the right to property. It was indeed a great initiative by the Supreme Court to provide equal rights to both daughters and sons.

The major achievement was including all daughters, especially the married daughters as coparceners in the HUF by amending the provision which excluded the rights of daughters from the coparcenary property. A female member, the daughter of a coparcener, shall by birth become a coparcener in the same way as the son. This was upheld in the case of Shreya Vidyarthi v. Ashok Vidyarthi & Ors., AIR 2016 SC 139.

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