(1) THE following question of law was referred by the tribunal to. the high court in its opinion under Section 256(1 of the Income Tax Act. The "WHETHER, on the facts and in the circumstances of the case, the pontoons and tugs are covered by the expression ship and therefore entitled to development rebates at a higher rate of 40% instead of 28 on the basis of plant?" Section 32 of the Act deals with the depreciation of buildings, machine plant or furniture, owned by an assessee. Section 33 deals with development rebate. The rebate has to be allowed in respect of a new ship or the machinery or plant which has been owned by the assessee and is which used for the purpose of the business carried on by him subject to vacation conditions laid down in that section. In the case of a ship, the amount rebate allowable is 40% of the actual cost thereof to the assessee. (2) THE only question is whether "pontoons" and "tugs" will come with the word "ship" (sic) has not been defined in the Act. However, in the of rates at which depreciation is admissible, the meaning of ship has given in Appendix 1 of the Income Tax Rules where "ship" was definition "1. Ocean-going ships- (I) Fishing vessels with wooden hull (II) Dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes (III) Other ships 2. Vessels ordinarily operating on inland waters- (I) Speed boats (II) Other vessels" This definition makes it clear that ships would include tugs. There cannot be any dispute as to that. (3) HOWEVER, "pontoons" have not been specifically included within the meaning of "ship". However, having regard to the types of vessels that are entitled to depreciation like dredgers, tugs, barges, survey launches, fishing vessels with wooden hull and also vessels ordinarily operating on inland water, we agree with the view of the High court that an expanded meaning has to be given to "ships" and pontoons will come within that expanded meaning. (4) ACCORDING to the Concise Oxford Dictionary, 1976 Edition, "pontoon" is a flat-bottomed boat used as ferry boat or to carry lifting-gear etc. (4) ACCORDING to the Concise Oxford Dictionary, 1976 Edition, "pontoon" is a flat-bottomed boat used as ferry boat or to carry lifting-gear etc. (5) HAVING regard to the width of the meaning given to the word "ships" in the depreciation table, it is clear that a flat-bottomed boat used as ferry boat will clearly come within the description "vessels ordinarily operating on inland waters". There is no reason why a restricted meaning will have to be given to "ship" for the purpose of Section 33. (6) WE are of the view that the High court has come to a right decision. The appeal is dismissed. There will be no order as to costs.