U. L. Bhat, C.J.— The following question has been referred by Income-tax Appellate Tribunal, at the instance of the Revenue, under section 26 (1) of the Gift Tax Act, 1958 (for short 'the Act') :- "Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the minors who were admitted to the benefits of partnership could not claim his/her share of goodwill on reconstitution of the firm by excluding the minors and consequently not liable to gift-tax ?" 2. M/s Sarda Trading Corporation is a firm constituted as per Partner­ship Deed dated 18.8.1971 with Ramgopal Saharia, Smti Pramila Saharia and Smti Abha Saharia as partners. Subsequently, respondents herein, minor members of the family, were admitted to the benefits of partnership. Partnership was reconstituted on 31.7.73 dropping the minors from the benefits of partnership. Gift Tax Officer issued notice under section 13 (2) of the Act. No return was filed. Notice under section 15 (4; of the Act was issued and the authorised representatives of the respondents were heard. By separate orders, Gift Tax Officer estimated the goodwill, as on the date of reconstitution, at Rs. 2,10,000/-, assessed the share of the minors, treated the same as having been gifted to the partners within the meaning of section 4 (a) and 4 (c) of the Act and assessed gift tax. In appeals preferred by the assessees, Appellate Assistant Commissioner set aside the order holding that : "The firm came into existence during the year 1971-72 and it had earned substantial profit only during the years 1972-73 and 1973-74, that is, upto the date of re-constitution it had earned profit in the low, that for 1972-73 being minimal. Aside from this a consideration of the various aspects do not point to the accretion of goodwill owing to efforts, if any, put by the appellant, whose continuance as it appears, dependent on the major partners." In further appeals to the Tribunal by the Revenue, orders of AAC were affirmed by the Tribunal. 3. Under section 11, Indian Contract Act, 1872, only a person, who is of the age of majority and who is of sound mind and is not otherwise disqualified is competent to contract. 3. Under section 11, Indian Contract Act, 1872, only a person, who is of the age of majority and who is of sound mind and is not otherwise disqualified is competent to contract. Sub-section (1) of section 30, Indian Partnership Act, 1932 states that a person who is a minor may not be a partner in a firm, but, with the consent of all the partners for the time being, he may be admitted to the benefits of partnership. Contract by a minor is void ab initio. A minor can come into the picture only by being admitted to the benefits of partnership with the consent of all the partners. Admission of a minor to the benefits of partnership is dealt by section 30 of the Partnership Act. Such minor has a right to such share of the property and of the profits of the firm as may be agreed upon. He may have access to, and inspect and copy, any of the accounts of the firm. Such minor's share is liable for the acts of the firm but the minor is not personally liable for any such act. He may not sue the partners for an account or payment of his share of the property or profits of the firm, save when severing his connection with the firm, and in such case the amount of his share shall be determined by a valuation made, as far as possible, in accordance with the rules contained in section 48. In such a suit all the partners may elect to dissolve the firm and thereupon the Court shall proceed with the suit as one for dissolution and for settling accounts between the partners, and the amount of the share of the minor shall be determined along with the shares of the partners. At any time within six months of his attaining majority or obtaining knowledge that he had been admitted to the benefits of partnership, whichever date is later, such person may give public notice that he has elected to become, or that he has elected not to become, a partner in the firm, and such notice shall determine his position as regards the firm. If he fails to give such notice, he shall become a partner in the firm on the expiry of the said six months. If he fails to give such notice, he shall become a partner in the firm on the expiry of the said six months. Mode of settlement of accounts between partners is prescribed in section 48 of the Partnership Act. The provision is subject to agreement by the partners. Losses shall be paid first out of profits, next out of capital, and lastly, by the partners individually in the proportions in which they were entitled to share profits. The assets of the firm shall be applied first in paying the debts of the firm to third parties, secondly in paying to each partner rateably towards advances as distinguished from capital, thirdly in paying to each partner rateably what is due to him on account of capital and then the residue shall be divided among the partners. 4. The expression 'goodwill' is not defined in the Partnership Act. It has been described as denoting the benefits, arising from connection and reputation; as every positive advantage as distinguished from negative advantage that has been acquired by the firm in carrying on its business. It represents the public approbation which has been won by the business. Undoubtedly, goodwill forms part of the assets of the firm of partnership. This is clear firm the provisions of section 55 of the Partnership Act, which states that in settling the accounts of a firm after dissolution the goodwill shall, subject to the contract between the partners, be included in the assets and it may be sold either separately or along with other property of the firm. Share in goodwill is capable of being inherited. See KK Shah vs. Khorshed Banu, AIR 1970 SC 1147 . 5. It is thus clear that the rights of partners are those indicated in the provisions of the Partnership Act. But generally speaking, these provisions are subject to contract between the parties. Minor may be admitted to the benefits of partnership, but he cannot become a partner. He cannot sue the partners for an account or payment of his share of the property or profits of the firm except in the context of severing his connection. He has a right to such share of property or the benefits of the firm, as may be agreed upon. A minor admitted to the benefits of partnership need not contribute any capital to the firm, though a guardian of a minor may invest such capital. He has a right to such share of property or the benefits of the firm, as may be agreed upon. A minor admitted to the benefits of partnership need not contribute any capital to the firm, though a guardian of a minor may invest such capital. See The CIT vs. M/s Shah Mohandas Sadhuram, AIR 1966 SC 15 . The order of the Gift Tax Officer does not indicate that he had perused the partnership agreement or the later partnership agreement or the agreement by which the minors were admitted to the benefits of partnership. The order does not disclose that any investment was made in the firm on behalf of minors by their guardians. The Officer proceeded on the assumption that the minors had a right to a share of the assets of the partnership and further assumption that such right included a share in the goodwill. Whether the minors had a share in the assets or a share in the goodwill is a matter to be decided entirely on the terms of the agreement admitting them to the benefits of partnership. That could not be a matter of assumption or presumption. On this conclusion alone, it has to be held that the decisions of the A AC and the Tribunal are correct, even without going into the reasoning adopted by them. 6. In the result, we answer the question in the affirmative, that is in favour of the assessee and against the Revenue. A copy of this judgment under the signature of the Registrar and seal of the High Court will be transmitted to the Appellate Tribunal. There will be no direction as to costs.