VUDGMENT No. 2071/7 SS CATCHWORDS ADMINISTRATIVE LAW ~- appeal from Administrative Appeals Tribunal - classification of goods under customs tariff - whether torches having rechargeable assembly of batteries built into them are "lamps having provision for the incorporation of batteries". Customs Tariff Act 1982 Schedule 3 ARLEC PTY LTD v COLLECTOR OF CUSTOMS No. VG 324 of 1987 Woodward, Jenkinson and Ryan JJ. 2 May 1988 Melbourne IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY No. VG 324 of 1987 GENERAL DIVISION ON APPEAL FROM THE GENERAL ADMINISTRATION DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL BETWEEN: ARLEC PTY LTD Applicant and COLLECTOR OF CUSTOMS Respondent MINUTES OF ORDER COURT: Woodward, Jenkinson and Ryan JJ DATE: 2 May 1988 PLACE: Melbourne THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. The applicant pay the respondent's costs. (NOTE: Settlement and entry of orders is dealt with in 0.36 of the Federal Court Rules.) IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY No. VG 324 of 1987 ee GENERAL DIVISION ON APPEAL FROM THE GENERAL ADMINISTRATION DIVISION OF THE ADMINISTRATIVE APPEALS TRIBUNAL BETWEEN: ARLEC PTY LTD Applicant and COLLECTOR OF CUSTOMS Respondent COURT: Woodward, Jenkinson and Ryan JJ DATE: 2 May 1988 PLACE: Melbourne REASONS FOR JUDGMENT THE COURT This is an appeal, on a question of law, from a decision of the Administrative Appeals Tribunal. In the decision appealed from the Tribunal was called upon to determine a number of issues, but only one of those is the subject of appeal to this Court. The question to be determined is which of two sub-~items in Schedule 3 to the Customs Tariff Act 1982 applies to the goods the subject of this appeal. The relevant item in Schedule 3 is 85.10 under the heading PORTABLE ELECTRIC BATTERY AND MAGNETO LAMPS, OTHER THAN LAMPS FALLING WITHIN 85.09. Nothing turns on the reference to 85.09. The two sub-items listed under this item are: §85.10.1 - Lamps having provision for the incorporation of batteries, and 85.10.9 - Other. The general rate of duty under 85.10.1 is 25%, that under 85.10.9 is 2%. The question which the Court has to determine is whether the lamps in question are properly described as "having provision for the incorporation of batteries". It is agreed between the parties that this raises a question of law. The Tribunal described the imported goods in the following terms: "Each Arlec torch was imported packed in a box suitable for its retail sale; in that box with it there was included a lead of insulated wire with a plug at each end designed to enable it to be plugged, at one end, into the cigarette lighter socket on the dashboard of a motor vehicle and, at the other, into a socket in the body of the torch so as to conduct 12 volt DC current from the battery of the vehicle to the torch for the purpose of recharging its rechargeable batteries. During the course of the hearing samples of the Arlec torch and the Sanyo search light {not relevant to this appeal] were opened so as to reveal the manner in which' the rechargeable batteries within them were packed. Those in the Arlec torch were packed tightly in the handle of the torch, which was closed and held secure by a number of screws; there were three batteries, two welded to one another and the third joined to them by a wire soldered onto them. The assembly of batteries was connected to a wire which was itself soldered onto the circuitry board and also to the light bulb. Although the compartment could be readily opened with a screw driver, the batteries, which were .not of standard size, could not be replaced by the ordinary user. The torch is of light plastic; Mr O'Shannassy [the chief engineer of the applicant] gave evidence that the batteries were likely to outlast the body of the torch or at least to last to a time when the user decided to throw it away because it was dirty and possibly broken." It was submitted by counsel for the applicant that the lamps in question did not have "provision for the incorporation of batteries". He said this was so, first, because if anything was 'incorporated' it was a battery pack, rather than individual 'batteries' and, secondly, because, at the time of importation, there was no longer any room for the incorporation of batteries ~ they being in the lamp already. The first of these arguments was not advanced very firmly by counsel for the applicant. He asserted that in the relevant item of the Schedule "battery means batteries in the conventional sense of a disposable-type battery, not a rechargeable-type battery. .... It really boils down to the characteristics displayed by the rechargeable pack." He went on to concede that it would make no difference whether a torch using conventional batteries was imported with those batteries in it or not; it would still be a lamp "having provision for the incorporation of batteries". As to this submission we need only say that we can see no reason why a distinction should be drawn between batteries supplied separately and those which are joined together by welding, or the soldering of wires, into an assembly or pack. There is no suggestion in item 85.10 of any distinction between standard and rechargeable batteries, and there can be no doubt that the three objects joined together in an assembly in the Arlec torch are "batteries" in the ordinary sense of that term. So far as the second limb of the applicant's argument is concerned, it seems to us that the clear intention of the item is to distinguish between those lamps which have provision for their own internal power source, in the form of batteries, and those which do not. We believe that, in its ordinary meaning, the phrase "having provision for the incorporation of batteries" describes lamps which are so designed and constructed that they can be powered by internal batteries. The use of the word "incorporation" shows that the batteries must be capable of being placed in the body of the lamp if the lamp is to fall within sub-item 85.10.1. Although it is true that the applicability of the different provisions of Schedule 3 falls to be determined at the place and time of entry of the goods (see Blackwood Hodge (No 2) v Collector of Customs New South Wales (1980) 3 ALD 38), we believe that the ordinary meaning of the sub-item invites enquiry as to whether, as made, the lamps are designed for the incorporation of batteries. In our view it attributes an unnaturally restrictive degree of futurity to the word "provision" to treat the sub-item as not applying to lamps which have batteries already incorporated in them. It can more sensibly be said that the batteries in them are evidence that they are lamps "having provision for the incorporation of batteries". It seems highly unlikely that the distinction argued for by the applicant, between lamps designed to take replaceable batteries, and lamps with rechargeable batteries permanently incorporated, was the distinction intended by the Parliament between sub-items 85.10.12 and 85.10.9 - particularly as there is another and more logical distinction clearly available. This is that any 'lamps which can be operated by the use of internal batteries, whether rechargeable or replaceable, fall within 85.10.1, whereas others which are useless by themselves and require to he attached to an outside power source, such as a car battery, for their operation, fall within 85.10.9 and attract the much lower rate of duty. The issue is not one which lends itself to any more lengthy examination of the words used or to recourse to dictionaries or authority. For these reasons the appeal should be dismissed with costs. I certify that the five (5) preceding pages are a true and accurate copy of the Reasons for Judgment herein of The Court Associate to The Hon Mr Justice Woodward Dated: 2 May 1988 Counsel for the Applicant: Mr H. Jolson Solicitors for the Applicant: Rees, Beckwith and Co. Counsel for the Respondent: Mr G. Nettle Solicitors for the Respondent: Australian Government Solicitor