Is it possible to define hook functions in template.php instead of the module? Theme functions are defined in the template.php but is it possible to define hook functions in there? for example There is a content type called phone-book, its add content form ID is phone-book-node, I want it to redirect to my custom page when it is submitted. so I created this function in the template.php :

function MYTHEME_form_phone_book_node_form_alter(&amp;$form, &amp;$form_state, $form_id) {
$form_state['redirect'] = 'go/some/where';
}


but it doesn't work. I don't know if it is totally impossible to define such hook functions inside template.php or something is wrong with my code.
Yes, you can implement any alter hook in a theme, as well as  hook_theme() and preprocess hooks.

Adding $form_state['redirect'] won't do anything there, though. You need to do that in a submit handler:

function MYTHEME_form_phone_book_node_form_alter(&amp;$form, &amp;$form_state, $form_id) {
  $form['#submit'][] = 'MYTHEME_phone_book_node_form_submit';
}

function MYTHEME_phone_book_node_form_submit($form, &amp;$form_state) {
  $form_state['redirect'] = 'go/some/where';
}


To ensure that your hook is running, get the Devel module installed and add dpm('alive'); in there. Then clear the caches (to be sure) and refresh the page a couple of times. If you don't see the debug message, the hook isn't being called, and it might be named incorrectly.