Q.Distinguish between a Partnership Firm and a Joint Hindu Family Business.

The sharpest contrast is how membership arises and how liability is distributed among owners.

Basis of formation: a Partnership Firm is created by an AGREEMENT between the partners; a Joint Hindu Family Business is not created by agreement at all — membership arises automatically by BIRTH into the Hindu Undivided Family.

Governing law: a Partnership Firm is governed by the Indian Partnership Act, 1932; a Joint Hindu Family Business is governed by Hindu Succession Act principles and Hindu Law, not the Partnership Act.

Membership: a partner must have the legal capacity to contract (a minor can only be admitted to the benefits of partnership); a coparcener requires no such capacity — even an infant becomes a coparcener by birth.

Management: in a Partnership Firm, every partner has an equal right to take part in management (mutual agency); in a Joint Hindu Family Business, only the Karta manages the business — ordinary coparceners have no independent right to manage.

Liability: in a Partnership Firm, every partner's liability is unlimited AND joint-and-several; in a Joint Hindu Family Business, only the Karta's liability is unlimited, while ordinary coparceners are liable only to the extent of their own share in the joint family property. …