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Judgment
M. Katju J.
This is an Income Tax reference u/s 256(1) of the Income Tax Act, 1961, in which the following questions have been referred to us for our opinion :
"1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the tractor was not a road transport vehicle ?
Whether the Tribunal was legally correct in directing the Inspecting Assistant Commissioner of Income Tax (Asst.) that the investment allowance should be allowed to the assessee according to the provisions of Section 32A ?"
The assessee is a U.P. Government undertaking which had been established for industrial and agricultural development of Western U.P. The previous year for the relevant assessment year 1978-79 ended on June 30, 1977.
The assessee gave tractors on hire. These tractors were fitted with trolleys and they were exclusively used for hiring purpose by the assessee. The assessee claimed investment allowance on these tractors.
The Inspecting Assistant Commissioner did not allow the claim for investment allowance as he held that the tractor can be combined with a trolley and hence used as a transport vehicle. This decision was confirmed by the Commissioner of Income Tax (Appeals). On further appeal, the Tribunal has decided in favour of the assessee and held that the investment allowance should be allowed to it
Section 2(30) of the Motor Vehicles Act, 1939, defined "tractor" as follows :
"Tractor means a motor vehicle which is not itself constructed to carry any load (other than equipment) used for the purpose of propulsion but excludes a road roller."
The assessee submitted that though a tractor may be a motor vehicle within the above definition, it was not required to be registered nor was it (though it was registered) required to be driven by a person holding a licence, as it was neither a vehicle for carrying goods or passengers nor was it driven at a place to which the public has a right to access. Hence, he submitted that the tractors for which investment allowance was claimed were not road transport vehicles.
It may be mentioned that the second proviso to Section 32A(1) states :
"Provided further that no deduction shall be allowed under this section in respect of,-- ...
(b) any office appliances or road transport vehicles."
The short question which arises in this case therefore is whether the tractors in question are road transport vehicles ?
The expression "road transport vehicles" has not been defined in the Income Tax Act and hence we have to give it the meaning in common parlance. In our opinion, road transport vehicles would mean vehicles which are used for transportation of goods or passengers on roads. A tractor is not basically used for transportation of goods or passengers on roads. It is machinery used for tilling agricultural land. No doubt sometimes some people can ride on a tractor but that is not its main purpose. As is well known, tractors are agricultural machinery for tilling the land. The view taken by the Tribunal following the decision of the Madras High Court in State of Madras v. Marshall Sons and Co, (India) Ltd. [1954] 5 STC 305 : AIR 1954 Mad 884, appears to us to be correct.
It is a well settled principle of interpretation that the popular or common-sense meaning of words or expressions should be preferred, vide Airfreight Ltd. Vs. State of Karnataka and Others, ; Davis Vs. Sebastian, etc.
In the absence of a statutory definition of a word or expression, the common parlance meaning should be applied vide ASPINWALL and CO. LTD. Vs. Commissioner of Income Tax, State of Kerala Vs. V. Padmanabhan,
In Municipal Corporation of Greater Bombay Vs. Mafatlal Industries and others, etc., , it was held that the plain and ordinary meaning of a word or expression should be ascribed to it unless the context otherwise requires.
In our opinion the words "road transport vehicle" as used in common parlance refer to buses, trucks, taxis, etc., but would certainly not include tractors.
For the reasons given above, the question referred to us is answered in the affirmative, that is in favour of the assessee and against the Department.