Vessel classification turns on whether navigation is subsidiary; a self-propelled speed boat was correctly placed under the navigation-based heading.

Tariff classification of a vessel depends on whether navigation is merely subsidiary to another principal function. A self-propelled speed boat that could carry passengers and cargo in fair weather and move independently for surveying purposes was held not to fall under the heading reserved for vessels whose main function is other than navigation. In the absence of evidence that special equipment made surveying or sounding its principal function, navigation remained integral to the vessel's operation. The Revenue's classification was therefore incorrect and unsustainable, and the assessee was entitled to classification under Chapter Heading 8906 00 90.

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Issues: Whether the imported speed boat was classifiable under Chapter Heading 8905 90 90 or Chapter Heading 8906 00 90 of the Customs Tariff Act, 1975, and whether the classification adopted by Revenue could be sustained.

Analysis: The decisive test was the nature of the vessel's main function. Chapter Heading 8905 90 90 applies only where navigation is subsidiary to the principal function. The vessel was found to be self-propelled, capable of carrying passengers and cargo in fair weather, and able to move independently for surveying activity. No material showed that it was fitted with special equipment making surveying and sounding its principal function. Since movement and navigation were integral to the vessel's operation, navigation was not merely subsidiary.

Conclusion: The vessel was not classifiable under Chapter Heading 8905 90 90. The classification adopted by Revenue was incorrect and unsustainable, and the assessee was entitled to classification under Chapter Heading 8906 00 90.

Final Conclusion: The impugned order was set aside and the appeal succeeded on the question of classification, with the consequential benefit flowing from the correct tariff entry.

Ratio Decidendi: For tariff classification of a vessel, the decisive enquiry is whether navigation is the subsidiary attribute or the primary function; where the vessel is self-propelled and navigation is integral to its use, it cannot be classified under a heading reserved for vessels whose main function is other than navigation.

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