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The following are some of the limitations of a joint Hindu family business:
  1. Limited Resources: The common problem faced by the joint Hindu family is of limited capital, which is largely dependant on the ancestral property and throws limits for growth or expansion of business.
  2. Unlimited Liability of Karta: The karta is not only loaded with the responsibility of decision making and running the business, but also distressed due to unlimited liability. The business debts can be repaid using his personal property.
  3. Dominance of Karta: The family members might sometimes oppose the decisions of karta. This may create conflicts amongst the members and may even lead to loss of control and split in the family unit.
  4. Limited Managerial Skills: Given that the karta cannot be a specialist in all areas of management, the business might suffer due to his unwise decisions. His incapability in decision making may lead to meager profits or sometimes even losses for the organisation. The joint Hindu family business is on the decline because of the diminishing number of joint Hindu Families in the country.

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