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TMI Blog1969 (7) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Tribunal, Delhi Bench "A", New Delhi (hereinafter called "the Tribunal"), for the opinion of this court under section 66(1) of the Indian Income-tax Act, 1922 (hereinafter called "the Act"). "Whether, on the facts and in the circumstances of the case, the assessee was entitled to depreciation under section. 10(2)(vi) of the Indian Income-tax Act, 1922, in rest of the building known as Rambagh Palace?" In paragraph 3 of the statement of the case, it has been stated that Messrs. Amber Corporation, Jaipur the assessee, was a partnership firm which carried on a hotel business at Rambagh Palace (at Jaipur) and land appurtenant thereto was valued at Rs. 25,00,000. The four sons of Maharaja Man Singh brought in the building (Rambagh Palace ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, the above-mentioned question has been referred to this court for its opinion. The terms of the partnership deed which are relevant for answering this question are contained in clauses 5, 6, 7 and 8 which are quoted herein below verbatim: "5. The capital of the partnership shall consist of the Rambagh Palace and a sum of Rs. 25,000 to be brought in by each of them, the parties of the second, third and fourth parts and the said minor. Whatever additional capital required for the purpose of the partnership shall be brought in by the party of the first part. 6. The net profits of the partnership shall be divided between the partners in the shares following: Maharaja Shri Sawai Mansinghji Saheb 24 cents Capt. Maharaj Kumar Bhawani Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en observed as follows: " The whole concept of partnership is to embark upon a joint venture and for that purpose to bring in as capital money or even property including immovable property. Once that is done whatever is brought in would cease to be the exclusive property of the person who brought it in. It would be the trading asset of the partnership in which all the partners would have interest in proportion to their share in the joint venture of the business of partnership. The person who brought it in would, therefore, not be able to claim or exercise any exclusive right over any property which he has brought in, much less over any other partnership property. He would not be able to exercise his right even to the extent of his share i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the agreement by the partners. This being the position, a stipulation can be inserted in the partnership deed providing, that the Rambagh Palace would go to the four sons of the Maharaja at the time of dissolution. It does not mean that, before dissolution, it would not be the partnership property. Rambagh Palace is part of the capital contributed by the partners and it became the partnership property. It is not that the four sons of the Maharaja did not intend to contribute as capital the palace itself but only the use thereof. There are cases in which the contribution is only of the use of a building and not of the building itself. Reference in this connection may be made to section 20 of the English Partnership Act, 1890, which relates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was thus an asset of the firm on which depreciation was rightly allowed by the Tribunal. An argument has been addressed to us that the partnership deed is not registered and, therefore, the four sons of the Maharaja could not have conveyed their Rambagh Palace as their contribution in the firm without the partnership deed being registered. It is said that the document, is inadmissible in evidence and, therefore, it cannot be held that Rambagh Palace was part of the capital contributed by the four sons of the Maharaja. The question referred to us does not expressly say that we have to answer this point. On the other hand, in paragraph 3 of the statement of the case, it has been expressly stated that the palace was brought in by the four so ..... X X X X Extracts X X X X X X X X Extracts X X X X
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