Partner's share in partnership property can qualify for wealth-tax exemption on firm-owned land and building.

For wealth-tax purposes, the legal character of partnership property was treated as such that a partner's share in the firm's assets could be recognised in computing net wealth. The discussion states that, although a firm has no separate legal existence, the partnership property vests in the partners, and a partner may claim exemption under section 5(1)(iv) of the Wealth-tax Act, 1957 in respect of his share in land and building owned by the firm. On that basis, the exemption was extended to the partner's interest in the firm's immovable property.

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Issues: Whether a partner is entitled to exemption under section 5(1)(iv) of the Wealth-tax Act, 1957 in respect of his share in land and building owned by the partnership firm.

Analysis: The question turned on the legal character of partnership property for wealth-tax purposes and whether a partner can be treated as having an identifiable interest in the firm's assets. The Court followed its earlier view that, although a firm has no separate legal existence, the partnership property vests in the partners and the partner's share is relevant while computing net wealth. On that basis, the partner's interest in the land and building of the firm was treated as capable of qualifying for the claimed exemption.

Conclusion: The assessee was entitled to exemption under section 5(1)(iv) of the Wealth-tax Act, 1957 in respect of his share in the land and building owned by the firm.

Final Conclusion: The reference was answered in the affirmative, and the issue was decided in favour of the assessee.

Ratio Decidendi: For wealth-tax purposes, a partner's interest in partnership assets is recognizable, and exemption under section 5(1)(iv) can extend to the partner's share in land and building owned by the firm.

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