Partnership property and seized-material disclosure rules clarify registration, depreciation, and voluntary disclosure eligibility.

Immovable property contributed by partners as capital becomes partnership property without requiring a registered instrument under the Registration Act, 1908, and the firm's claim to depreciation on the building is not defeated by the absence of registration in its name. In relation to the Voluntary Disclosure of Income and Wealth Ordinance, 1975, a declaration concerning seized material depends on the books or documents belonging to the declarant and being seized in a search, not on the search having taken place in the declarant's own premises; on the stated facts, a declaration under section 3 was unavailable and section 8(1) did not apply outside section 3 declarations.

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Issues: (i) Whether immovable property contributed by partners as capital to the partnership required registration under the Registration Act, 1908, and whether depreciation on the building was admissible; (ii) Whether a declaration in respect of seized material could validly be made under section 3 of the Voluntary Disclosure of Income and Wealth Ordinance, 1975, and whether section 8(1) of that Ordinance applied.

Issue (i): Whether immovable property contributed by partners as capital to the partnership required registration under the Registration Act, 1908, and whether depreciation on the building was admissible.

Analysis: Property and rights brought by partners into the common stock become partnership property. A contribution of immovable property to the firm does not, by itself, require a registered instrument for transfer to the partnership. On the same footing, the firm's entitlement to depreciation on the building is unaffected by the absence of registration in the firm's name.

Conclusion: The issue was decided against the assessee and in favour of the Revenue only to the extent that no registration requirement was attracted, while the assessee remained entitled to depreciation.

Issue (ii): Whether a declaration in respect of seized material could validly be made under section 3 of the Voluntary Disclosure of Income and Wealth Ordinance, 1975, and whether section 8(1) of that Ordinance applied.

Analysis: Section 14(1) applies where books or documents belonging to a person are seized as a result of search under section 132 of the Income-tax Act, 1961, and does not require the search to have been conducted in the declarant's own premises. The decisive factors are ownership of the seized material and seizure in the course of a search. A declaration under section 3 was therefore not available on these facts, and section 8(1) applied only to declarations made under section 3, not to declarations falling under section 14.

Conclusion: The declaration was not validly made under section 3, and section 8(1) did not apply.

Final Conclusion: The reference was answered for the Revenue on the declaratory issue, while the earlier partnership and depreciation questions stood covered by the settled position on partnership property and transfer of capital assets to the firm.

Ratio Decidendi: Immovable property contributed by partners as capital becomes partnership property without requiring registration, and a declaration under the voluntary disclosure scheme must be tested by the statutory conditions governing seized material and the relevant sub-section under which it is made.

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