Satish Chandra, C.J.
1. M/s. Sohan Lal & Sons, the assessee, is a partnership firm. It consisted of four major partners and Mahesh Kumar (minor) was admitted to its benefits. In the assessment year 1967-68, the ITO found that this firm was carrying on business in three names, M/s. Agarwal Metal Stores, M/s. Agarwal Hardware Stores and M/s. Oudh Iron Stores. The firm was maintaining three sets of accounts for each of the aforesaid three businesses. He further found that Mahesh Kumar (minor) had been allocated his share of the loss suffered in the Agarwal Metal Stores business. The assessee explained that Agarwal Metal Stores was one of the businesses of the assessse-firm. There was enough profit in the other two businesses, namely, Oudh Iron Stores and Agarwal Hardware Stores, to cover the loss suffered in Agarwal Metal Stores and no loss had been allocated to Mahesh Kumar (minor). The ITO did not accept this explanation and found that the minor had been allocated a share in the loss. He rejected the application for registration of the firm for the year 1967-68. On appeal, the AAC held that Mahesh Kumar (minor) had not been admitted only to the benefits of the partnership. The partnership was hence not a legally valid firm which could be granted registration. He also affirmed the finding of the ITO that the minor had been allocated his share in the loss. The appeal was dismissed. The assessee took the matter to the Tribunal. The Tribunal held that the deed of partnership if read as a whole abundantly made it clear that the four major partners had admitted Mahesh Kumar (minor) to its benefits. The document contemplated division of profits and losses of the firm as a whole and not of the individual businesses separately. Since the overall result of the three businesses was profit, it cannot be said that share in the loss had been allocated to Mahesh Kumar (minor) in contravention of the terms of the partnership deed.
2. At the Tribunal stage another objection was taken on behalf of the department that no one had specifically signed the deed of partnership acting on behalf of the minor. The Tribunal repelled this. It held that the document had been signed by Sohan Lal, who was the father and guardian of the minor, Mahesh Kumar. He should be deemed to have signed on behalf of the minor also. The deed was not defective on this score. The assessee's claim for registration under Section 185 of the I.T. Act was hence allowed.
3. At the instance of the CIT, the Tribunal has referred the following questions of law for our opinion :
' 1. Whether, on a correct interpretation of the partnership deed dated April 1, 1966, the Tribunal was right in holding that Shri Mahesh Kumar had been admitted to the benefits of the partnership
2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that allocation of loss of Agarwal Metal Stores to the minor did not violate the provisions of the deed as the net result of the three businesses carried on by the assessee was a profit
3. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the partnership deed was valid even though it had not been signed by anybody specifically on behalf of the minor '
4. A perusal of the deed of partnership shows that Mahesh Kumar has specifically been mentioned as a minor having 20% share in the profits. In para. 9 of the partnership deed, it is clearly written that the loss in the firm was to be shared by the four major partners only. We fail to see how Mahesh Kumar was not admitted to the benefits of the partnership. The first question, therefore, fails.
5. The first para, of the partnership deed reveals the name and style of the firm as M/s. Sohan Lal & Sons. Paragraph 2 gives the names of the various branches of the firm, namely, Agarwal Metal Stores, Agarwal Hardware Stores and Oudh Iron Stores, In para. 8 shares of the partners in the firm are specified. In para. 9, it is stated that the loss in the partnership was to be shared by the major partners only. It is, thus, apparent that the firm controlled the various businesses. These businesses had no identity apart from the firm. The shares of the partners were to be determined after compiling the results of the working of the three blanches. Hence, even if, while computing the profits, the firm dealt with the results of each business at an initial stage and in that process notionally allocated a share to the minor in the loss, it, will not make the document of the partnership defective so as to disentitle registration. Overall performance of the firm by including the result of the three branches was a profit. The minor in fact got a share in the profit. He did not get any share of the loss. The Tribunal was right in taking the view that the provisions of the partnership deed were not violated, because no part of the loss was allocated to the minor. The second question also fails.
6. In respect of the third question, the minor's father did sign the deed. Merely because he did not add the phrase ' on behalf of the minor ', it will not make the deed defective. It was admitted that the minor was admitted to the partnership. The guardian of the minor has signed the document. It should be deemed that he had signed the document on behalf of the minor.
7. In the result, all the three questions referred to us are answered in the affirmative, in favour of the assessee and against the department. As no one appears on behalf of the assessee, there will be no order as to costs.