Question

Distinguish between the following:

Sole Trading concern and Joint Hindu Family Business.

Answer 1

Sole trading concern	Joint Hindu family business
A business which is owned, managed and controlled by one individual called sole trader for earning profit is called sole trading concern.	The ancestral business which is continued and conducted by the members of a Hindu Undivided Family under the direction of the senior most member for earning profit is called Joint Hindu Family firm.
Since, sole trading concern is owned and managed by a single person, there cannot be more than one member.	The minimum or maximum number of coparceners is not regulated by Hindu law. It changes With the number of births and deaths in the family.
The business assets (properties) are entirely owned by the sole proprietor himself.	All the members of the Hindu Undivided Family are the joint owners of the ancestral business property.
The liability of a sole trader is unlimited. It means if the assets of the business are insufficient to pay its liability then the property of the sole trader will be attached and sold to pay business debts.	The liability of each coparcener is limited to the extent of his share in the Co parceners. However, the liability of the Karta is unlimited.
The financial resources of the sole trader are very limited in comparison to the Joint Hindu Family Firm.	The financial resources of a Joint Hindu Family Firm are relatively more than that of sole trading concern.
The sole trading concern lacks stability because the survival and continuity of business are affected by death, lunacy (madness), or insolvency of a sole trader.	The Joint Hindu Family Firm is comparatively more stable because in the case of the death of the Karta, the family business is taken over and continued by the next senior-most family member.