Agrawal, J. - This reference has been made by the ITAT, Jaipur (hereinafter referred to as the 'Tribunal') u/s. 256(1) of Act, 1961, whereby the following questions of law, arising out of the order of the Tribunal dt. 27-7-1972 in I.T.A. No. 3288 of 1970-71 relating to the asst. yr. 1964-65, have been referred for the opinion of this Court :
'1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the deed of partnership by which four of the partners contributed immovable property known as 'Rambagh Palace' as their contribution towards capital with the partners of firm did not require registration under the 'Transfer of Property Act'.
2. Whether, on the facts and in the circumstances of the case the Appellate Tribunal was right in holding that the assessee was entitled to depreciation in respect of the 'aforesaid Rambagh Palace.'
The facts of the case, briefly stated, are that M/s. Amber Corporation, respondent (hereinafter referred to as 'assessee' is a partnership firm. The said partnership was formed vide partnership deed dt. 14-4-1958, w.e.f. 4-12-1957. The firm consisted of four partners, namely, the late H. H. Sawai Man Singhji, Maharaja of Jaipur, and his three sons, Capt. M. K. Bhawani Singh, M. K. Jai Singh and M. K. Prithvi Raj, M. K. Jagat Singh was admitted to the benefit of the partnership. The said partnership was formed to carry on hotel business at Jaipur. The sons of the Maharaja of Jaipur had brought in the building known as the Rambagh Palace, as their contribution of the capital of the firm alongwith the capital of Rs. 25,000 each and the Maharaja contributed his share of capital and cash amounting to Rs. 1,71,388. In the return filed for the asst. yr. 1964-65, the assessee claimed depreciation on the building of Rambagh Palace. The ITO rejected this claim for depreciation. On appeal the AAC accepted the said claim of the assessee, but set aside the assessment to be made afresh according to law. The Tribunal, on appeal, allowed the depreciation for the building of Rambagh Palace. In taking the said view, the Tribunal has placed reliance on the earlier decision of this court in CIT, Delhi and Rajasthan v. Amber Corporation (1974) 95 ITR (Raj) wherein with reference to the asst. yrs. 1959-60 and 1960-61 this court held that depreciation was admissible in respect of the building of Rambagh Palace, for computing the total income of the assessee. Feeling aggrieved by the order of the Tribunal the petitioner CIT moved an application u/s. 256(1) of Act for referring the question of law arising out of order of the Tribunal for the opinion of this court. The Tribunal thereupon referred the questions mentioned above to this court for opinion.
2. We have heard Shri R. N. Suroila, ld. counsel for the revenue and Shri R. N. Suroila, ld. counsel for the revenue and Shri H. P. Gupta ld. counsel for the assessee.
3. In relation to the first question Shri Gupta invited our attention to the decision of this court in CIT, Delhi and Rajasthan v. Amber Corporation wherein the said question was considered by this court and was answered in favour of the assessee. We however, find that the said question was neither raised before the Tribunal nor has been considered by the Tribunal in its order dt. 27-7-1972/ It cannot, therefore be said that the said question arises out of the order of the Tribunal dt. 27-7-1972. The reference in relation to the aforesaid question must, therefore, be held to be incompetent.
4. As regards question No. 2 it may be stated that the said question stands concluded by the judgments of this court reported in and wherein the said question was considered by this court in relation to the asst. yrs. 1959-60 and 1960-61 and 1961-62 respectively and it was answered in favour of the assessee and against the revenue. In the statement of case the Tribunal has mentioned that an appeal was filed by the revenue against the decision of this court reported in . Shri H. P. Gupta. ld. counsel for the assessee has stated that since after the reference was made the said appeal of the revenue has been dismissed in limine by the Supreme Court, thus the matter stands concluded by the judgments referred to above and in view of these judgments question No. 2 must be answered in the affirmative i.e. in favour of these assessee and against the revenue.
5. In the result question No. 1 is returned unanswered on the ground that the reference in relation to the said question is incompetent and question No. 2 is answered in the affirmative i.e. in favour of the assessee and against the revenue.
6. The parties shall bear their own costs.