Chief Executive Officer of Customs v Carlton & United Breweries Ltd [1997] FCA 433

C A T C H W O R D S EXCISE - Excise Tariff Act - Schedule - spirits - spirituous beverage - alcoholic beverage derived from product of distillation mixed with water and flavouring - low concentration of alcohol - whether a dutiable spirituous beverage. STATUTORY INTERPRETATION - revenue statutes - approach to construction - trade usage - ordinary meaning. Excise Tariff Act 1921 s.2, s.5, s.154 Distillation Act 1901 s.6 Spirits Act 1906 National Food Authority Act 1991 Quick and Garran's The Annotated Constitution of the Australian Commonwealth, The Australian Book Company, 1901. Collector of Customs v. Agfa Gevaert Ltd (1996) 141 ALR 59 Herbert Adams Pty Ltd v. Federal Commissioner of Taxation 1932) 47 CLR 222 Ex parte Chum Gun (1909) 26 WN (NSW) 43 Peterswald v. Bartley (1904) 1 CLR 497 CHIEF EXECUTIVE OFFICER OF CUSTOMS v. CARLTON AND UNITED BREWERIES LIMITED VG 386 of 1996 French J Melbourne 7 May 1997

IN THE FEDERAL COURT ) OF AUSTRALIA ) VICTORIA DISTRICT REGISTRY ) GENERAL DIVISION ) No. VG386 of 1996 On appeal from the General Administrative Division of the Administrative Appeals Tribunal constituted by Deputy President G.L. McDonald and Mr R.C. Gilham Member B E T W E E N : CHIEF EXECUTIVE OFFICER OF CUSTOMS Applicant and CARLTON AND UNITED BREWERIES LIMITED Respondent MINUTE OF ORDER JUDGE MAKING ORDER: French J DATE OF ORDER: 7 May 1997 WHERE MADE: Melbourne THE COURT ORDERS THAT: 1. The application is dismissed. 2. The Applicant to pay the Respondent's costs of the application. Settlement and entry of these orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT ) OF AUSTRALIA ) VICTORIA DISTRICT REGISTRY ) GENERAL DIVISION ) No. VG386 of 1996 On appeal from the General Administrative Division of the Administrative Appeals Tribunal constituted by Deputy President G.L. McDonald and Mr R.C. Gilham Member B E T W E E N : CHIEF EXECUTIVE OFFICER OF CUSTOMS Applicant and CARLTON AND UNITED BREWERIES LIMITED Respondent INTRODUCTION In October 1994, Carlton and United Breweries Limited ("CUB") made a public announcement that it was to launch a new alcoholic beverage called "Subzero Alcoholic Soda". In November 1994, a delegate of the Collector of Customs decided that the product was subject to excise duty as a "spirituous beverage" under the Schedule to the Excise Tariff Act 1921. Demands for payment were made accordingly. CUB made deposits of the excise duty with the Collector under s.154 of the Excise Act on 29 November and 5 December 1994 respectively. On 26 May 1995, CUB made an application to the Administrative Appeals Tribunal under s.162C(2) of the Excise Act 1901 for review of the delegate's decision to make the demands for payment. The stated reason for the application was that the demands under review were in error because they were made on the basis that the product was excisable at the rate applicable to a spirituous beverage under the Schedule to the Excise Tariff Act when it was not a spirit and therefore not a spirituous beverage. The application was heard by a Deputy President and Member of the Administrative Appeals Tribunal on 30 May 1996 and on 7 June 1996 the Tribunal set aside the decision under review. The matter was remitted to the Chief Executive Officer of Customs with a direction that Subzero Alcoholic Soda was not a spirituous beverage for the purposes of cl.(H) of Article 2 of the Schedule to the Excise Tariff Act 1921. An appeal is now brought under s.44 of the Administrative Appeals Tribunal Act against the Tribunal's decision. Statutory Framework Section 5 of the Excise Tariff Act 1921 imposes duties of excise as specified, and in accordance with, the Schedule to that Act. In Article 2 of the Schedule under the general heading "Spirits" there appear the following items: "2. Spirits - (A) Brandy $21.74 per litre of alcohol (C) Fruit Brandy $25.47 per litre of alcohol (D) Whisky $25.47 per litre of alcohol (F) Rum $25.47 per litre of alcohol (G) Liqueurs: (1) As prescribed by By-law $25.47 per litre of alcohol (2) Other $26.15 per litre of alcohol (H) Spirituous beverages: (1) As prescribed by By-law $25.47 per litre of alcohol (2) Other $26.15 per litre of alcohol (J) Spirit for fortifying Australian wine or for fortifying Australian grape must, subject to regulations Free (M) Spirit for industrial and scientific purposes, n.e.i., subject to regulations Free (N) Methylated spirits, subject to regulations Free (O) Spirits, n.e.i. $26.15 per litre of alcohol (P) Spirit for scientific or educational purposes subject to regulations - (1) For use in Universities Free (2) For use in approved Technical Colleges or other educational institutions prescribed by By-law Free (Q) Spirit for use in public hospitals, or for use in the manufacture of medicinal preparations for use in public hospitals and universities, subject to regulations Free (R) Denatured ethanol for use as a fuel in internal combustion engines, as prescribed by By-law Free