Can A Daughter Claim Her Share In HUF Property? Here’s What The Law Says

Hindu Undivided Family (HUF) is a provision under Indian law and the taxation system that promotes families to pool assets and attain benefits from it. However, several cases have surfaced on social media platforms where daughters are treated unfairly because they live abroad, have their own assets, or are married. Under the Hindu Succession (Amendment) Act, 2005, daughters have the same rights as sons in property and can seek to claim their share. A daughter cannot be denied her legal share just because the head of the family doesn’t wish her to get any shares.

The issue concerns whether a father has the right to refuse his daughter’s demand for a share in HUF property when the family wishes to continue holding its assets jointly. It also highlights the concerns about whether a daughter can separate her assets without the entire family having to divide the property.

The legal principles that govern HUF property state that a daughter who is a coparcener can seek partition of eligible joint family assets. However, the nature of the property, ownership structure and tax provisions must be considered before one proceeds.

“Under the Hindu Succession Act, 1956 (as amended in 2005) and reaffirmed by the Supreme Court of India in landmark rulings like Vineeta Sharma v. Rakesh Sharma (2020), a father cannot deny his daughter her legal share in Hindu Undivided Family (HUF) coparcenary property. Personal family disputes, including a daughter marrying against her parents' wishes, have no legal bearing on her coparcenary rights,” says Vivek Kumar, Advocate, Delhi High Court.

Daughters Have Equal Rights In HUF Property

The Hindu Succession (Amendment) Act, 2005, amended Section 6 of the Hindu Succession Act, 1956, to grant daughters equal rights in Mitakshara Joint Hindu family property. A daughter becomes a coparcener by birth and avails the same rights, liabilities and responsibilities as a son. This allows her to claim an interest in eligible HUF property and seek partition to separate her share.

Can A Father Refuse To Divide HUF Property?

A father cannot refuse his daughter’s claim to seek her share of the assets just because he wants the family to retain its assets jointly or for any other interpersonal reasons. A coparcener can seek partition to separate their share from the family property. However, this does not mean that the HUF needs to be dissolved. Other family members can continue to hold their respective interests jointly.

For instance, if a daughter seeks partition while her father, brother and other eligible members wish to continue the HUF, her share can be separated without needing every member to divide their interests. The exact division depends on the number of stakeholders in the HUF.

Income Tax Implications Of Partial Partition

Under HUF law, it is permitted to seek separation of the shares, however the income tax treatment is entirely different. Under Section 171 of the Income-tax Act, 1961, the tax department does not recognise a partial partition of an HUF for tax purposes where the statutory conditions apply. Even if a daughter receives the assets after the partition, the HUF may continue to be assessed for tax purposes as before. This can create complications when determining the tax liability on income generated by the assets allotted to the separating member.

What Should Families Check?

Before any HUF proceeds with division of assets, they should determine what is under the HUF and what is personal. Just because member A of an HUF owns an asset, it does not automatically become a shared asset. They should also determine and examine the ownership records, partition deeds, succession documents and any relevant court orders, as these factors can affect and change the daughter’s entitlement and division.