DEATH OF THE KARTA OF HUF

This query is : Resolved

MONIKA SALHOTRA (Querist)
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13 December 2024 An HUF consisted of Karta, his wife and three married daughters.
After the death of the Karta, what will be position of the HUF? How and who can file the ITR of the HUF, as not able to register the HUF under wife as representative assessee.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

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13 December 2024 Whether the husband as karta of HUF had not filed any return earlier?
if no, whether he had registered PAN in e-filing site?

PARAS CHHAJED

PARAS CHHAJED

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14 December 2024 After the death of Karta the HUF will continue to exist as it has 3 coparcners being daughters though they are married but continue to be members and coparceners of the HUF of their father. Generally, the eldest male member is the Karta of HUF but since there is no surviving male member the eldest daughter may be the Karta of HUF. There is no need to register as a representative assessee for HUF as the HUF continues to exist. The only requirement is that you update the Karta details on the ITD portal and then return can be filed by the new Karta.

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MONIKA SALHOTRA

MONIKA SALHOTRA (Querist)
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16 December 2024 Thanks for the reply.
Since there is no income, the surviving members wish to dissolve the HUF.
Please highlight on the procedure to dissolve the HUF.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)
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16 December 2024 An HUF can only be dissolved on the partition of the property. The family must execute a deed of partition and distribute properties amongst the members (karta and coparceners) of the HUF. Based on the assets comprised in the HUF property, requisite documents will have to be executed, such as the share transfer forms in case of physical shares of companies, or conveyance deed in case of immovable property with the registration of the same with the concerned sub-registrar, to record the transfer of the said properties. ll family members must be part of the deed. The deed should spell out all the properties that are part of the HUF and that are being divided amongst the family members. The division of assets must be in line with the provisions of the Hindu Succession Act. All family members must agree to the dissolution through the partition. Signatures of all members on the partition deed are necessary to make it legally binding. The Income Tax Act stipulates that for the partition to be considered valid, an application or claim must be made before the Income Tax Assessing Officer (AO). The AO will then conduct an inquiry to ensure the partition is genuine. Once satisfied, the AO issues an order under Section 171(3) of the Income Tax Act, acknowledging the partition, after which the HUF ceases to be assessed as an HUF. After the partition is complete, the family members can write to the assessing officer to surrender the HUF's Permanent Account Number (PAN), as the HUF will no longer exist as a separate taxable entity.

MONIKA SALHOTRA

MONIKA SALHOTRA (Querist)
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16 December 2024 Thanks for the inputs

Dhirajlal Rambhia online

Dhirajlal Rambhia online

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16 December 2024 You are welcome.