Difference between Joint Hindu Family Firm and Sole Trading Concern
Basis of Difference
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Joint Hindu Family Firm
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Sole Trading Concern
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Members
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No limit on the maximum number of members in a family business.
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Has only one member (owner).
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Continuity
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It continues even after the death of the Karta. The next eldest member of the family becomes the Karta.
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It comes to an end after the death, lunacy or insolvency of the owner.
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Sharing of profits
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Profits and losses are shared by the coparceners.
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Profits or losses belong to the owner and are not shared with anyone.
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Governance
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It is governed by the Hindu laws & the Hindu Succession Act 1956.
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There is no regulating act.
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Liability
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Liability of all members is limited, but Karta has unlimited liability.
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Liability of the sole proprietor is unlimited.
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Decision making
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All decisions are taken by the Karta.
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All decisions are taken by the sole proprietor.
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