Partnership property and depreciation: immovable property contributed as capital becomes firm asset without registration, supporting depreciation claim.

A partner's contribution of immovable property to partnership capital is treated as bringing the asset into the firm's property, without requiring a separate registered transfer. The contributing partner loses exclusive rights over the property once it becomes part of the partnership assets. On that basis, the firm is entitled to claim depreciation on the building as a partnership asset. The Rajasthan High Court treated these points as settled by earlier binding authority, answered the issues against the Revenue, and held that no referable question of law arose.

---

---

Issues: Whether immovable property contributed by a partner as capital to a firm required registration or effected a transfer in law, and whether the firm was entitled to depreciation on such property.

Analysis: The questions were held to be concluded by earlier binding decisions that a partner's contribution of immovable property to the partnership capital does not amount to a transfer requiring registration. The property so brought in becomes partnership property and the contributing partner cannot claim exclusive rights over it. It was also held that when the building forms part of the partnership assets, the firm is entitled to depreciation on that asset.

Conclusion: The issues were answered against the Revenue and in favour of the assessee.

Final Conclusion: No referable question of law arose, and the Revenue's request for reference failed.

Ratio Decidendi: Property introduced by a partner into the assets of a firm as capital becomes partnership property without requiring registration, and the firm may claim depreciation on that asset.

---