• Partition of HUF

I have 38 years old HUF.All the assets are mutual fund and FDs.The members are myself ,my wife son and daughter.Son and daughter are NRI.I want to dissolve my HUF by doing complete partition.what procedure I should take.There should be equal shares of all members or it can be unequal also.Can son and daughter forgo their shares in partition deed.What action the AO will take after filing the partition deed.
A K Singh
Asked 3 months ago in Taxation from Lucknow, Uttar Pradesh
1) you should give equal shares to all the members of HUF 

2) execute deed of partition have it duly stamped and regsitered

3) A father in his right as patria potetas or otherwise can effect a partition between himself and his son of the joint family property of HUF. However, he has to allot equal shares to the sons.

The father is expected to act bona fide and only aggrieved party can seek relief by way of appropriate proceedings. However, till such a partition is held invalid by a competent court, it must be held as valid.

Apporva Shantilal Shah vs. CIT [1983] 141 ITR 558 (S. C.)

4) Entries showing division of the property in books of account may be good evidence of a partition more particularly in cases where the property may not be capable of physical division. -

5) The Assessing Officer will make an inquiry in to the claim after giving notice to all members of the HUF and if he is satisfied that the claim is correct, he will record a finding that there was a total partition of the HUF and the date on which it has taken place. -
Ajay Sethi
Advocate, Mumbai
23389 Answers
1229 Consultations
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1)2 co parceners can execute specific POA in favour of CA 

2) notice would be issued to all co parceners 

3) 2 co parceners staying abroad can be represented by CA
Ajay Sethi
Advocate, Mumbai
23389 Answers
1229 Consultations
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The HUF partition càn be in this case through a registered partition deed before the subregistrar
As there is no dispute at present.
Prepare a partition deed and get it registered ,the karta.of the HUF can do it if other members are away and consenting to this.
Take the help.of lawyer who does this partition deed preparation nd  documentation.
Only precaution needed is to divide the property movable and immovable equally,if you take the opinion of son and daughter then there will not be a future dispute
Thresiamma G. Mathew
Advocate, Mumbai
1316 Answers
85 Consultations
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1. The partition deed will have to be executed. 

2. A Karta or Manager of a HUF has all the powers to manage the family and its assets, being head of the family. The joint family property vests in the family and its coparceners. On partition Karta gets his share. He is not absolute independent, individual owner of the property. Each coparcener/member has a share, right, title and interest in the ancestral property. One of the coparceners can sell his undivided share to another coparcener thereby increasing his share in the HUF properties. Consent of others is not necessary.

3. The coparceners will have to be represented by a lawyer if the notice is issued.
Ashish Davessar
Advocate, Jaipur
18262 Answers
450 Consultations
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A HUF can be dissolved  due to partition also. 

HUF is a body consisting of persons lineally descended from a common ancestor and  include their wives and unmarried daughters, who  are living together, joint in food, estate.
There should be a family i.e group of persons – more than one 
They should be undivided i.e living jointly and having commonness amongst  them.
A HUF, as such, can consist of a very large number of members including female members as well as distant blood relatives in the male line.  
Birth of a male  (female also as per latest amendment in the year 2005)in a Hindu joint family makes him a Co-parcener of the  HUF.
The relevance of concept  of coparcenary is that only coparceners can ask for partition.  The other male  family members : i.e other than coparceners in a HUF, have no direct claim over HUF property, but can claim only through the coparceners.
Now in your case all the HUF members are entitled to an equal share in the HUF properties.
Partition is the severance of the status of Joint Hindu Family, known as Hindu Undivided Family under tax laws.
Partition under Hindu law, can be total or partial.  In total partition all the members cease to be members of the HUF and all the properties cease to the properties belonging to the said HUF. 
Partition is word of technical import in Hindu Law.  Partition in one sense is a severance of joint status and coparcener of a coparcenary is entitled to claim it as a matter of his individual volition. In this narrow sense all that is necessary to constitute partition is a definite and unequivocal indication of his intention by a member of a joint family to separate himself from the family and enjoy his share in severalty. 
It is at the sweet will of the co-parceners and members as to whether to allot on partition in accordance with the share specified  under the Hindu Succession Act or to allot  lower or more to anyone or more persons.  The  partition in the family could not be considered to be a disposition conveyance, assignment, settlement, delivery, payment or other  alienation of  property.  A member  of a Hindu undivided family has no definite share in  the family property  before  division and he cannot  be said to diminish  directly  or indirectly the value of his property or to increase the value of the  property of any other coparcener by agreeing to take a share lesser than what he would have got if he would  have gone to a court to enforce his  claim.
T Kalaiselvan
Advocate, Vellore
14170 Answers
128 Consultations
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The partition deed is to be signed by all coparseners.Will ITO issue notice to all coparceners.If notice is issued to copra enters can they be represented by CA as two compares era are living in USA.




The partition deed is to be signed by all coparceners.

If the ITO issues notice to the coparceners, this can be att4ned by a CA or the lawyer too. 
T Kalaiselvan
Advocate, Vellore
14170 Answers
128 Consultations
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What other actions I should take before filing the deed.pl advice in detail.Inam a IAS officer sonI want to be very cautious.

You can prepare a partition deed making different schedules of properties  that are proposed to be allotted to the different coparceners as per the mutual agreement among all, get it registered through the sub registrar's office, hand over a copy to all of them after which they can inherit their respective share or schedule of property.
T Kalaiselvan
Advocate, Vellore
14170 Answers
128 Consultations
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