The question is whether clause 255 of the Customs Bill⁽¹⁾, which provides that 'all penalties and forfeitures recovered under any Customs Act shall be applied to such purposes and in such proportions as the Minister may direct' is in harmony with section 81 of the Constitution and section 22 of the Audit Act.

I am of opinion that the words 'revenues or moneys' in section 81 of the Constitution mean 'revenues or moneys in the nature of revenue', and that moneys received by the Executive Government need not be paid into the Consolidated Revenue Fund unless they are in the nature of revenue. See Quick & Garran, p. 811.

A penalty or forfeiture may be in the nature of revenue, but is not necessarily so. If the Act imposing a penalty directs that one half shall be paid to the informer and one half to the Crown, the half which is to be paid to the informer is not revenue at all. Whether a penalty is or is not revenue depends upon the provision made for its application; and if it is not intended to be part of the public revenue it need not be paid into the Consolidated Revenue Fund. The same principle applies to forfeitures.

The clause in question leaves the application to be determined by the Minister. He is to determine how much of the penalty or forfeiture is to go into the revenue. I do not think that this provision is unconstitutional.

Nor is it inconsistent with section 22 of the Audit Act, which only applies to money collected or received 'on account of the Consolidated Revenue Fund'.⁽²⁾

[Vol. 1, p. 77]

(1) Enacted as section 264 of the Customs Act 1901.

(2) This opinion was published in Commonwealth of Australia, Pari. Papers 1903, Vol. II, p. 936.