Partnership property can arise without a registered deed, and only the partner's interest is relevant for wealth-tax treatment.

Immovable property may become partnership property when a partner contributes it to the firm's capital stock and the surrounding intention shows it was treated as firm asset; a registered conveyance is not indispensable for that result. Registration is required only where an instrument creates or declares rights in immovable property, so the absence of such a deed does not by itself keep the building in the partner's exclusive ownership. Once treated as partnership property, wealth-tax must reflect only the partner's interest in the firm asset, not the full value of the building as an individual asset.

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Issues: (i) Whether the hotel building could be treated as having been brought into the partnership stock only by a registered deed and, in the absence of such deed, remained the individual property of the assessee. (ii) Whether the entire value of the building was assessable in the assessee's net wealth.

Issue (i): Whether the hotel building could be treated as having been brought into the partnership stock only by a registered deed and, in the absence of such deed, remained the individual property of the assessee.

Analysis: Section 14 of the Indian Partnership Act, 1932 recognizes that property brought into the stock of a firm becomes firm property, and section 5 of the Transfer of Property Act, 1882 permits transfer of property even to oneself with others. Section 17(1)(b) of the Registration Act, 1908 requires registration only where there is an instrument creating or declaring rights in immovable property. On the facts, there was no conveyance instrument, but the decisive question was whether the partner had intended to treat the building as partnership property. The Court accepted the view that immovable property may be introduced into the partnership stock by contribution and intention, without a registered deed, and that the absence of such a deed does not by itself prevent the property from becoming partnership property.

Conclusion: The finding that the building could be transferred to the partnership only by a registered deed was incorrect, and the building did not necessarily remain the assessee's individual property.

Issue (ii): Whether the entire value of the building was assessable in the assessee's net wealth.

Analysis: Once the building is treated as partnership property by reason of its being brought into the firm as part of the capital stock, the assessee's assessable interest cannot be taken as the full value of the building in his individual hands. The assessment had to reflect the assessee's interest in the partnership asset and not ownership of the entire building as a separate individual asset.

Conclusion: The entire value of the building was not assessable in the assessee's hands as his individual wealth.

Final Conclusion: The reference was answered for the assessee by holding that the building could enter the partnership without a registered conveyance and that only the assessee's partnership interest, not the whole building value, was relevant for wealth-tax purposes.

Ratio Decidendi: A partner may contribute immovable property to the stock of a firm without a registered instrument where the surrounding intention shows that the property was treated as partnership property, and such property is not assessable in the partner's individual wealth as though it continued to be exclusively his own.

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