JUDGMENT JUDGMENT judgment of court was delivered by DWARKA PRASAD J.-The following question of law has been referred to this court by Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, under section 256(1) of Income-tax Act, 1961 (hereinafter referred to as "the Act "), by its order dated April 20, 1974: " Whether, on facts and in circumstances of case, Tribunal is justified in cancelling order under section 263 passed by Additional Commissioner of Income-tax? " assessee was registered as firm during assessment year 196869, consisting of following partners: (1) Mirchumal, (2) Laxmandas, (3) Udhavdas, (4) Vasumal, (5) Baldeo, (6) Devidas Minors who were admitted to benefits of partnership. Mirchumal entered into partnership representing Hindu undivided family known as Chanchaldas Sobhrajmal, of which he was karta. Shri Laxmandas and Udhavdas were major members of Hindu undivided family but they joined partnership firm in their individual capacity and were working partners. Baldeo and Devidas, as mentioned above, were minors and they were admitted to benefits of partnership under section 30 of Indian Partnership Act. only other partner, namely, Vasumal, was outsider. assessee-firm claimed registration for assessment year 1968-69, which was allowed by Income-tax Officer but registration of firm was cancelled by Additional Commissioner of Income-tax on ground that firm was not validity constituted and Income-tax Officer was not justified in allowing registration to firm. On appeal by assessee, Income-tax Appellate Tribunal cancelled order passed by Additional Commissioner of Income-tax and held that there was no disability for members of Hindu undivided family in matter of entering into partnership with stranger and fact that two minors were admitted to benefits of partnership had not in any manner invalidated constitution of partnership firm. It was observed by Tribunal that partnership with stranger and members of Hindu undivided family was not invalidated merely because two or more partners were members of Hindu undivided family and represented interest of family. aforesaid question was then referred by Income-tax Appellate Tribunal to this court at instance of Revenue, as question of law arose out of order of Appellate Tribunal dated August 3, 1973. same question about validity of constitution of assessee-firm and as to whether it was entitled to registration under section 185 of Income-tax Act, 1961, which arose out of application for registration relating to assessment proceedings for year 1970-71, came up for consideration before this court in D.B. Income-tax Reference No. 3 of 1976 and was decided by this court on January 18, 1985 (CIT v. Murlidhar & Co. [1986] 160 ITR 885). This court agreed with view taken by Appellate Tribunal and answered question in affirmative. Although question which has been referred in present case is not in identical terms, yet it is substantially based on same finding of fact recorded by Appellate Tribunal. This court in earlier decision dated January 18, 1985 (CIT v. Murlidhar & Co. [1986] 160 ITR 885), held that it was permissible for karta of Hindu undivided family, representing Hindu undivided family, to enter into partnership with any other member of Hindu undivided family, who is taken into partnership as working partner and even if he did not contribute any separate or individual share in capital of firm, and stranger. Reliance was also placed upon another decision of this court in Gulraj Poonam Chand v. CIT [1984] 148 ITR 326. In that case, partnership was formed between karta of Hindu joint family and his son, in which son was taken as working partner, We may also refer to decision of their Lordships of Supreme Court in CIT v. Sir Hukumchand Mannalal & Co. [1970] 78 ITR 18, which was relied upon by Appellate Tribunal. It was held by their Lordships of Supreme Court in aforesaid case that partnership will not be invalidated merely because two or more of its partners were members of Hindu undivided family and represented interest of family. Their Lordships also observed in aforesaid case that it was settled law that while considering application for registration of firm, Income-tax Officer was not concerned in determining in whom beneficial interest in share in partnership vested. It is clear from aforesaid decisions that there was no disability for members of Hindu undivided family in matter of entering into contract of partnership inter se or with stranger, or between some members of Hindu undivided family and some strangers. member of Hindu undivided family is at liberty to contract with any other individual including another member of Hindu undivided family, subject to restrictions provided by Indian Contract Act. This court has already taken view, in case relating to assessee-firm itself for assessment year 1970-71, that assessee-firm was validly constituted and was entitled to registration under section 185 of Act. There is no reason for us to take different view when assessee-firm was constituted in same manner in assessment year 1968-69 as it was constituted in year 1970-71. We, therefore, agree with view taken by Appellate Tribunal and answer question referred to us in affirmative, in favour of assessee and against Revenue. parties are left to bear their own costs. *** ADDITIONAL COMMISSIONER OF INCOME TAX v. MURLIDHAR & CO.