Page 225 - ELT_1st September 2020_Vol 373_Part 5

2020 ] STATE OF KARNATAKA v. DREDGING CORPORATION OF INDIA LTD. 663

1992-93 and said assessment order which came to be passed on 17-3-2006 was
affirmed by the Appellate Authority on 11-11-2008. Being aggrieved by the same,
assessee filed an appeal in STA 379/2009 before Karnataka Appellate Tribunal
urging several grounds. Tribunal, after having considered the rival contentions,
by order dated 30-6-2010 which is under challenge, held that dredgers are ocean
going vessel i.e., ship and it cannot be clarified as machinery. It was further held
that dredgers being unscheduled goods, no tax can be levied under KTEG Act.
Hence, this revision petition.
3. We have heard Sri Vikram Huilgol, Learned High Court Govern-
ment Pleader appearing for the State and Sri G. Rabhinathan, Learned Counsel
appearing for the respondent-assessee.
4. It is the contention of Sri Vikram Huilgol, Learned High Court Gov-
ernment Pleader that Tribunal committed an error in arriving at a conclusion that
dredger is to be construed as a ship and the definition extended to ship or vessel
cannot be applied to the dredgers; they do not partake the character of ships or
vessels and on account of the fact that machinery is mounted in a specially built
craft for transportation purposes through high sea for usage of removal of silt
deposited in the approach channel of the port, dredgers cannot be construed as a
ship, but on the other hand, it is to be construed as machinery as defined under
entry 52 of 1st schedule of the KTEG Act. He would also contend that as per the
definition of Webster’s Dictionary, ‘dredger’ is a machine for removing earth
usually by buckets on an endless chain or a suction tube; and ‘ship’ is a large
sewaging vessel or a sailing vessel having a bow spirit and usually through
moist such composed of a lower moist, a top moist and a top gallant moist and as
such, dredger cannot take the place of a ship and thereby, Tribunal committed an
error in considering the ‘dredger’ also as a ship and hence, he prays for answer-
ing the substantial questions of law in favour of the Revenue and against the re-
spondent-assessee.
5. Per contra, Sri G. Rabhinathan, Learned Counsel appearing for the re-
spondent-assessee would support the order of the Tribunal and draws the atten-
tion of the Court to the documents produced before the Tribunal in order to sub-
stantiate or support the order passed by the Tribunal. Hence, he prays for an-
swering the substantial questions of law in favour of the respondent-assessee
and against petitioner-Revenue.
6. Since discussion and adjudication on these two points would over-
lap, we are of the considered view that both questions of law are to be taken up
together for consideration and answering. Hence, they are taken up together.
7. Re-Question Nos. 1 and 2 :
(i) Facts having already been stated hereinabove, repetition of the same
would only burden this order and as such, we desist from repeating
the facts except to the extent required for adjudicating the questions
of law formulated hereinabove.
(ii) The short point which arises for our consideration is,
“Whether the dredger would partake the character or defini-
tion of a machinery as defined under Entry 52 of 1st Schedule of the
‘KTEG Act’ or otherwise?”
Entry 52 of 1st Schedule of KTEG Act reads :
“52. Machinery (all kinds) and parts and accessories thereof
but excluding agricultural machinery.”
EXCISE LAW TIMES  1st September 2020  225