The application allows you to upload files directly from your phone and also open docs directly in Gmail.
Using the app and your phone’s camera, you can turn photos with text into editable Google documents with the power of optical character recognition (OCR). Just create a new ‘Document from Photo’ or select the camera icon from the widget, and your converted document will appear in your documents list shortly after you snap the picture. You can also convert photos already stored on your phone by sharing them with the Google Docs app. OCR does a pretty good job capturing unformatted text in English but won’t recognize handwriting or some fonts – stay tuned, it will get better over time!
Via Google Docs Blog.