Karnataka High Court
Bharat Earth Movers Limited vs Union Of India And Ors. on 1 January, 1800
Equivalent citations: 1978(2)ELT15(KAR)
JUDGMENT
1. This petition under Articles 226 and 227 of the Constitution had comeup in the first instance before Venkataramaiah, J. who referred it to aDivision Bench.
2. In this petition, the petitioner has prayed for quashing the ordermade by the Deputy Collector of Central Excise, Bangalore (hereinafterreferred to as the Deputy Collector) in the appeal from the demand madeon the petitioner by the Inspector of Central Excise, Kolar Range, Kolar(hereinafter referred to as the Inspector of Central Excise).
3. The petitioner is a Government Company manufacturing earth movingmachinery and vehicles including Haulpak Rear Dumps and Tractor RearDumps. The Inspector of Central Excise issued a demand notice to thepetitioner calling upon it to pay excise duty on Haulpak Rear Dumps andTractor Rear Dumps manufactured by it. The petitioner disputedexigibility of excise duty on these two types of vehicles and appealed tothe Dy. Collector, who dismissed the appeal holding that these two typesof vehicles are exigible to excise duty.
4. The Central Excise authorities have held that Haulpak Rear Dump andTractolr Rear Dump manufactured by the petitioner come within thedescription of `Motor Vehicles' as defined in item 34 in the FirstSchedule to the Central Excises and Salt Act, 1944 (hereinafter referredto as the Central Excises Act). The relevant protions of that item read:-
5. In this petition Mr. S.C. Sundraswamy, learned counsel for thepetitioner, contended that neither Haulpak Rear Dump nor Tractor RearDump can be regarded as Motor Vehicle as defined in item 34 of the FirstSchedule to the Central Excises Act, inasmuch as neither of them isadapted for use upon roads. On the other hand, the learned AdvocateGeneral maintained that these vehicles are adapted for use upon roads andhence are exigible to excise duty as Motor Vehicle.
6. There is no dispute between the parties that these two types ofvehicles are mechanically propelled vehicles. But, the parties are atissue as to whether they are adapted for use upon roads.
7. Mr. Sundraswamy referred to the illustrated brochures in respect ofthese two types of vehicles, supplied by the petitioner (marked asExhibits F and E respectively) in vehicles have been stated as follows:- Haulpak Rear Dump Length 6.15 Metres Width 3.76 Metres Height (Ladden) 3.31 Metres Net weight 22.811 Kg. Gross weight 54.583 Kg.
Tractor Rear Dump Length 8.99 Metres Width 3.55 Metres Height (Ladden) 3.45 Metres
8. Mr. Sundraswamy submitted that the dimensions and weights of these twotypes of vehicles are so large that it is unsafe to permit them to ply onordinary roads. He also invited out attention to the Karnataka MotorVehicles Rules, 1963, which prohibit vehicles exceeding certain maxima oflength, width, height and weight, playing on roads except when exemptedby the Government by notifications issued under Rule 316 of those Rules.
9. We were also referred to the booklet published by the Indian RoadsCongress containing permissible maximum dimensions and weights ofdifferent types of vehicles from the point of safety on roads. Accordingto this booklet, such permissible maxima are : Height 12' 6'' Width 8' Weight --73,279 Lbs.
10. Mr. Sunderswamy maintained that as the respective lenghts, widths andheights and weights of these two types of vehicles exceed the maximaprescribed by the Karnataka Motor Vehicles Rules and also maximarecommended by the Indian Roads Congrssm they (these two types ofvehicles) cannot be reagrded as suitable fo use upon roads, that they aresuitable for use in project areas and mining areas only and that hencethey do not come within the ambit of the term `Motor Vehicle' in item 34of the First schedule to the Central Excise Act.
11. On the other hand, the learned Advocate General maintained that thereis no reason why the word `road' occurring in the definition of `MotorVehicle' in item 34 in the First Schedule to the Central Excise Act,would be restricted to public roads only and that even if these two typesof vehicles are suitable for use upon private roads formed in mining andproject areas, they should be reagrded as motor vehicles for the purposesof levy of excise duty.
12. In the dictionary, the several meanings of the word `road' includeline of communication between places for use of foot passengers, ridersand `vehicles', `highway' and `prepared tract'. In its wider sense, theword `road' includes a private road also while in its narrower sense itrefers to a public road to which the public have a right of access.
13. In Messrs Bolani Cres Limited Vs. State of Orissa (A.I.R. 1968Orissa), question arose whether certain machineries and vehiclesincluding Dumpers came within the ambit of the definiteion of `MotorVehicle' in sub-section (18) of section 2 of the Motor Vehicles Act, 1939, andwere liable for registration under Sec, 22 of that Act and were alsoliable to be taxed under Sec, 6 of the Bihar and Orissa Motor VehiclesTaxation Act, 1930. Dealing with the question whether the word `road'occurring in Sec. 2(18) of the Motor Vehicles Act would include privateroads also, this is what the Division Bench of the Orissa High Courtstated at page 6 :
"The word `roads' has not been defined in the Act for the purpose of sec.2(18). If a vehicle is fit and suitable for being used on a road, it isimmaterial whether it runs on a private road or a public road unless itis that is of special type adapted for use only in factories or enclosedpremises and incapable of running on any other type of road or publicroads."
The above view of the Orissa High Court was followed by a Division Benchof this Court in Dalmia Cements (Bharat) Limited. Vs. Regional TransportOfficer, Bellary (A.I.R. 1970 Mysore 49) while considering the questionwhether Dumpers were liable for registration under Sec. 22 of the MotorVehicles Act.
14. In Civil Appeals Nos. 1816 and 1817 of 1968 from the aforesaiddecisions of the Orissa High Court and this Court, the court did notapprove the interpretaion on Sec.2(18) of the Motor Vehicles Act by thesetwo High Courts. Jaganmohan Reddy, J., who delivered the judgment of theSupreme Court, said that the expression `adapted for use' occurring inSec. 2(18) of the Motor Vehicles Act should be construed as suitable orfit for use. His Lordship observed that in construing a word occurring ina statute, the dictionary meaning of the word in not always its most aptmeaning. Having regard to the definition of the word `public place' insection 2(24) of the Motor Vehicles Act and the character of that Act, hisLordship said that the word `road' on section 2(18) of the Act would mean apublic road and that a motor vahicle which is not adapted for use uponroads to which that public have no rifhts of access, is not a motorvahicle within the meaning of Sec. 2(18) of that Act.
15. The definition of the term `Motor Vehicle' in Item 34 of the Firstschedule to the Central Excises Act, is the same as the definition of theterms in Sec.2(18) of the Motor vehicles Act, as it stood before it wasamended by Central Act 10 of 1956. As the Central Excises Act is a laterenactment, it is reasonable to infer that the Legislature intended thatterm in the Central Excise Act, should have that same meaning as thatterm had in the Motor Excise Act should have that same meaning as thatterm had in the Motor Vehicles Act as it stood before it was amended byCentral Excise Act 10 1956. If follows that excise duty levied under Item34 of the First Schedule to the Central Excises Act, has not applicationto a motor cahicle which is not suitable for use on public roads.
16. In the impugned order the Deputy Collector has taken the view thatthe word `road' in Item 34 of the First Schedule to the Central ExcisesAct, covers all kinds of roads including private roads. In that view, hehad not go into the question whether or not Haulpak, Rear Dump andTractor Rear Dumps are suitable for being used upon public roads. Hencehis order is clearly unsustainable. He should be directed to examine thisquestion and then to decide afresh whether these two types of vahiclesare exigible to excise duty.
17. In case the Dy. Collector holds that these two types of vehicles areadapted for use upon public roads, and hence come within the ambit ofItem No. 34 of the First Schedule to the Central Excise Act, he shouldfurther examine whether any parts of these two types of cehicles shouldnot be taken into account for the purposes of that item as provded in theexplanation to that item. n the result, we quash the order of theDeputy Collector of Central Excise, dated 25.2.1971 (Annexure II) anddirect him to decide the appeal afresh in the light of the aforsaidelucidation of law and after giving an opportunity to the petitioner toproduce materials and to adduce evidence in support of its contentions.
18. In the circumstances of the case, parties are directed to bear theirown costs.