This concludes a three-part series on the Hindu Undivided Family. Part 1 covered members, coparceners and the tax rationale. Part 2 covered the formalities and filings required on the death of the Karta.

Part 2 dealt with process — who signs, what is amended, what must be filed. This instalment deals with substance: who actually ends up owning what. In my experience families handle the paperwork reasonably well and get the arithmetic of shares badly wrong, sometimes for years.

How the deceased's share moves — the point most families miss

Under section 6 of the Hindu Succession Act, a coparcener's interest devolves by testamentary or intestate succession, not by survivorship. His share is fixed by a notional partition deemed to occur immediately before death. That share leaves the HUF and vests in his Class I heirs individually. The balance continues as HUF property — see State of Maharashtra v. Narayan Rao Sham Rao Deshmukh (1985).

Illustration 1 — the Karta dies. HUF corpus ₹4 crore. Karta Ramesh; wife Sunita; son Amit; daughter Priya. He dies intestate.

On notional partition, shares are computed for Ramesh, Amit, Priya and Sunita — a wife takes a son's share on partition — giving ₹1 crore each. Ramesh's ₹1 crore devolves equally on Sunita, Amit and Priya: ₹33.33 lakh each, held in their individual capacity, outside the HUF. The remaining ₹3 crore stays HUF property. Amit becomes Karta, or Priya if she is the elder.

Tax consequences: there is no inheritance tax, and a receipt on inheritance falls outside section 56(2)(x). For the heirs, cost of acquisition is the HUF's cost under section 49(1) and the holding period includes the HUF's under section 2(42A). From the date of death, three-fourths of the rent is HUF income and one-twelfth belongs to each heir.

When a coparcener dies before the Karta

This is the question I am asked most often, and it is almost always framed the wrong way. Suppose Amit, the elder son, dies during Ramesh's lifetime, leaving a widow Neha, a son Sahil and a daughter Diya. Do the three of them "become coparceners" in Ramesh's HUF in Amit's place?

The short answer: coparcenary status is acquired by birth and is never inherited. Nobody steps into a dead coparcener's shoes.

• Sahil and Diya were already coparceners. As Ramesh's grandchildren they fall within three degrees of him and took their interest by birth, on the day each was born — Diya by virtue of the 2005 amendment. Their father's death neither creates nor enlarges that status.
• Neha never becomes a coparcener. A wife or daughter-in-law is a member of the HUF, entitled to maintenance and residence and to be counted in a partition, but she holds no interest by birth and cannot demand partition. What she receives on her husband's death is property, held individually — not status.

This is the distinction flagged in Part 1, and here is where it bites. What does move is Amit's own undivided interest, ascertained by notional partition immediately before his death and passed to his Class I heirs in their individual capacity.

Illustration 2 — a son dies first. Change the facts: Ramesh is alive, and it is Amit who dies, in 2026. Take the corpus at ₹4.8 crore. Notional partition immediately before Amit's death proceeds branch-wise — Ramesh, Sunita (a wife takes a son's share), Amit's branch, and Priya — giving ₹1.2 crore each. Within Amit's branch, Amit, Sahil and Diya share equally at ₹40 lakh each. Amit's interest is therefore ₹40 lakh.

That ₹40 lakh devolves on his Class I heirs — widow Neha, son Sahil, daughter Diya and his mother Sunita, who is a Class I heir and is routinely overlooked — at ₹10 lakh each, held individually.

The outcome:

• ₹40 lakh leaves the HUF; ₹4.4 crore continues as HUF property, with Ramesh still Karta.
• Sahil and Diya each hold a coparcenary interest and, separately, ₹10 lakh of individual property.
• Neha holds ₹10 lakh individually and remains a member with no right to seek partition.
• From the date of death, income on that ₹40 lakh is taxed in four individual hands, and Amit's own final return must be filed by his legal representative under section 159.

When Ramesh himself dies later, section 6(3) directs that the share Amit would have taken is allotted to his surviving children, Sahil and Diya. Neha does not take a second time through that route — a point that causes real friction in families unless it is explained early.

The one thing to take away from this series

An HUF survives its Karta. It rarely survives a decade of silence — no returns, no declaration of the new Karta, no record of who took what on a death. My standing advice: get the notional partition on paper in the year of death itself. Reconstructing it a decade later, when the property is finally being sold, costs many times more.

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Series complete. Part 1 covered members, coparceners and the tax rationale; Part 2 covered the formalities and filings on the death of the Karta.