Partnership registration survives where a minor becomes partner on majority, no benami is shown, and salary terms are incidental.

A minor admitted to the benefits of partnership who attains majority may become a partner without a fresh deed where the profit-sharing arrangement and liability for losses remain unchanged, and a departmental circular supported that position. A later reference to representation by another person did not make the partner a benamidar, because the deed had to be read as a whole and showed her as contracting in her own right. Payment of salary to a partner, even if not expressly mentioned in the deed, did not by itself invalidate the firm for registration, as such an arrangement could arise orally without altering the partnership terms.

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Issues: (i) Whether the assessee firm was required to execute a fresh partnership deed when the minor partner attained majority and elected to become a partner. (ii) Whether the reference to representation by another person in the later deed rendered the partner a benamidar and justified refusal of registration. (iii) Whether the payment of salary to a partner not specifically provided for in the deed destroyed the validity of the firm for registration purposes.

Issue (i): Whether the assessee firm was required to execute a fresh partnership deed when the minor partner attained majority and elected to become a partner.

Analysis: Under the Partnership Act, a minor admitted to the benefits of partnership, on attaining majority, may elect to become a partner, and where there is no change in the profit-sharing arrangement and no assumption of liability for losses, a fresh instrument is not necessarily required. The relevant departmental circular also supported the view that a fresh deed was unnecessary in such circumstances.

Conclusion: The absence of a fresh partnership deed upto 31 October 1975 did not justify refusal of registration.

Issue (ii): Whether the reference to representation by another person in the later deed rendered the partner a benamidar and justified refusal of registration.

Analysis: The later deed, read as a whole, showed that the partner had signed in her own right as a contracting party. A stray reference to representation by another person did not override the operative effect of the deed, especially when that other person was not a signatory. The surrounding terms also did not support an inference that the partner was a benamidar.

Conclusion: The partner was not a benamidar, and this was not a valid ground to refuse registration.

Issue (iii): Whether the payment of salary to a partner not specifically provided for in the deed destroyed the validity of the firm for registration purposes.

Analysis: The departmental circular relied on by the assessee indicated that the firm should not be denied registration merely because a partner was paid salary not specifically mentioned in the deed. Such payment could also arise under an oral arrangement and did not necessarily alter the profit-sharing terms so as to invalidate the firm for registration.

Conclusion: The salary payment did not furnish a valid ground for refusal of registration.

Final Conclusion: The assessee firm was entitled to registration for both assessment years, and the objections raised by the tax authority did not sustain the refusal.

Ratio Decidendi: Where a minor partner attains majority and there is no change in the profit-sharing arrangement or liability for losses, a fresh deed is not indispensable for registration; a deed must be construed as a whole to determine real partnership status; and incidental salary arrangements not specifically recited in the deed do not by themselves defeat registration.

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