The term HUF stands for ‘Hindu Undivided Family’. An HUF is a family which consists of all persons lineally descended from a common ancestor and includes their wives and unmarried daughters. The family continues to exist even after the death of the common ancestor and the next eldest male member becomes the head of the family which will be known as “Karta” of H.U.F.

Even on the death of all the male members, the HUF continues to exist. The term ‘Hindu Undivided Family’ (HUF) is defined under Hindu Law, so it can’t be created by an agreement between two parties, nor can it be formed by group of people who do not constitute the family.

Formation of Hindu undivided family (H.U.F.) is one of the most arising forms of business in India, used by most micro and small businesses operating in the unorganised sectors.