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TMI Blog1990 (12) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as machinery became the property of the partnership firm of Jagdishprasad Agarwal and Smt. Kaushalyadevi Agarwal. Depreciation was allowed to said firm on said property. Subsequently, Agarwal Family Trust through its trustee Shri Omprakash Agarwal joined the said partnership firm and a new deed of partnership dated 21-3-1981 was drawn up. The properties of the partnership were revalued at the market rate and the accounts of Jagdishprasad Agarwal and Kaushalyadevi were credited as a result of said revaluation. Subsequently, the firm was dissolved vide deed of dissolution dated 1-5-1981 and after dissolution Agarwal Family Trust through the trustee Shri Omprakash Agarwal carried on the said business. On dissolution the factory as wel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... executed by Smt. Kaushalyadevi, she would continue to be the legal owner of the property. It was further submitted that depreciation can be granted only if the assessee was shown to be legal owner of the asset in question. Reliance was placed on certain decisions on behalf of the Department. The submission on behalf of the assessee, on the other hand, was that the property in question belonged to the firm and depreciation had been duly granted to the firm prior to entry of the assessee trust as partner in the firm. It was further submitted that since the property was received on dissolution of the firm it could not be said that there was transfer of property. Consequently, no registered deed was necessary and assessee was entitled to depre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of transfer of property, it was not exhaustive of the modes of transfer of property and that there could be a mode other than that mentioned in the Transfer of Property Act by which property could be lawfully transferred by its owner in favour of another. Throwing of property into hochpot of HUF was one such recognised mode of transfer. Section 14 of the Partnership Act embedded another such provision and that provision was a special provision which could not be said to be in derogation of or in conflict with any provision of Transfer of Property Act viz. section 5 or 54 thereof. Under section 14 of the Partnership Act the contribution by a partner of his separate immovable property by throwing the same into the stock of the partnership fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the two decisions of Patna High Court mentioned above in which it was held that for a transfer of this nature no registered deed was required. Thus, the Supreme Court has confirmed the view of the Patna High Court to the effect that no registered document was necessary when a partner contributes immovable property as his capital contribution to the partnership firm. Similar view has been expressed by Rajasthan High Court in two decisions viz. CIT v. Amber Corpn. [1974] 95 ITR 178 and CIT v. Amber Corpn. [1980] 127 ITR 29 (Raj.). 8. For the reasons given above, I hold that when Kaushalyadevi contributed the immovable property in question to the partnership firm as her capital contribution as a partner and when the said firm treated the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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