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TMI Blog2014 (4) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... e revisionist contended that the term "machinery" in Item No. 2 of the schedule under Act, 2007 would not cover "electronic goods" and, therefore, the items imported by assessee i.e., the "electronic goods" are not taxable under Act, 2007. 4. Per contra, learned Standing Counsel said that the term "machinary" is a very wide term which would include within its ambit even "electronic goods" and unless there is something to suggest that "electronic goods" are intended to be excluded from the term "machinery", there is no reason to do so by a simple process of interpretation since the entries in schedule are to be given a natural and wider meaning (in the absence of anything to read it narrowly) and whatever would be covered by term "machinery", that would be included in Item No. 2 of the schedule and is taxable under Act, 2007. 5. In order to consider whether the equipments or so called "electronic goods" which as claimed by revisionist-assessee, do not come within the ambit of Act, 2007, as do not answer the description of "machinery" under Item 2 of the schedule, it would be appropriate to have a glance over the kind of equipments which have been imported by assessee in the case i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by common people, using simple techniques like taking water from Well with the help of animal like Buffalo or Ox (called Rahet) and so on. Similarly, wheels of bullock cart constitute a simple machine making movement convenient and simple. In Roman civilization, the idea of simple machine is said to have originated by Greek Philosopher, Archemedes, around 3rd century BC, who studied simple machines, i.e., lever, pulley, and screw. The Greek's understanding was probably limited to the statics of simple machines, the balance of forces, and did not include dynamics. It is claimed that Italian Scientist Galileo Galilei in 1600, explained that a simple machine do not create energy but only transforms. At that stage dynamic theory of simple machine was only worked out. 11. With the advent of heat engines, device designed to convert energy into useful mechanical motion and it gives rise to another kind of "machine", i.e., engines or motors. Herein heat engines including internal combustion engines and external combustion engines burn fuel to create heat, which is then used to create motion. Electric motors convert electrical energy into mechanical motion. These electrical machines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its parts (including spare parts) and, therefore, the view taken by authorities below cannot be said to be erroneous. 16. Even otherwise, I find support in taking above view from certain authorities where the term "machinery" has been considered and explained. In the context of fiscal statute, the term "machinery" has come up for consideration by various Courts time and again. It would be useful to have a glance over some of such authorities. 17. In Nutley and Finn, In re (1891) W.N. 61, Kekewich, J. held that speaking generally machinery included everything which by its action produced or assisted in production. 18. In Chamberlayne Vs. Collins (1894) 70 L.T. (N.S.) 217 the term "machinery" implies the application of mechanical means to the attainment of some particular end by the help of natural forces. 19. Privy Council's decision in Corporation of Calcutta Vs. Chairman of the Cossipore and Chitpore Municipality, AIR 1922 PC 27 laid down certain guidelines to understand what the word "machinery" would means and said: "(i) The word "machinery" must mean something more than a collection of ordinary tools. It must mean something more than a solid structure built upon the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Apex Court considered it in Commissioner of Income Tax, Madras Vs. Mir Mohammad Ali, AIR 1964 SC 1693 and held that a diesel engine itself is a machinery. It relied on the earlier decision of Privy Council in Corporation of Calcutta Vs. Chairman of the Cossipore and Chitpore Municipality (supra). 22. In K.B. Dani Vs. State of Karnataka, 1979(44) STC 276 (Karnataka) a question arose whether Tractor Trailer is a machinery or necessary of a machinery for the purpose of levy of tax under the Karnataka Sales Tax Act, 1957. It also relied on Corporation of Calcutta Vs. Chairman of the Cossipore and Chitpore Municipality (supra). 23. The Division Bench also quoted the definition of "machinery" and "machine" given in Webster's Third New International Dictionary, which reads as under: "Machine, engine, apparatus, appliance signify, in common, a device, often complex, for doing work beyond human hand or mind; machine applies to a construction or organisation whose parts are so connected and interrelated that it can be set in motion and perform work as a unit (those most practical machines of our modern life, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply of power at a given point. No intelligent person considers it a machine. The scissors therefore could be considered as an implement and no a machinery. A wheelbarrow used to remove any debris or mud, etc., is likewise in common parlance not considered as a machinery. Similarly, take the case of hand-pulled cart. By applying or supplying power it does not work as a combined effect of the movement of its parts as in the case of tailoring machine or typewriter. When pulled all that happens is it moves along with with the puller and stops when the stops. The tractor-trailer, just as a hand-pulled cart, moves when attached to a tractor and dragged by it and it stops when not dragged. The tractor-trailer is a mere receptacle made to contain specifications and is mounted on wheels. The tractor, which is a machinery, drags it, whether loaded or unloaded. In the trailer there is no systematic arrangement of several parts which move and function in the designed manner to perform any work, on the supply of force to it. It does not multiply or convert the force supplied to it for any such purpose. It only moves when dragged by a machine, otherwise it remains stationary. No intelligent p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible by human physical efforts or power, i.e., without help of such devices. The supply of power could be either by natural forces or human or animal energy or electronic energy or any other type of energy. The mere fact that such a device is considered to be an "electronic equipment" would not make any difference for the reason that the term "electronic" means that it is operated by flow of electrons. The term "electron" has been defined as a stable elementary particle with an indivisible charge of negative electricity, found in all atoms and acting as a carrier in solids. In common parlance the term "electronic" is applied to a system or appliance which is operated by a flow of electron. In McGraw-Hill, Dictionary of Scientific and Technical Terms (Second edition), the term "electronic" has been defined as pertaining to electron devices or to circuits or systems utilizing electron devices, including electron tubes, magnetic amplifiers, transistors, and other devices that do the work of electron tubes. 28. This Court considered the items in question which have been imported by assessee, hence has no hesitation or doubt in holding that these items form "machinery" used for the pur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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