CUSTOMS DUTY WHETHER REFUNDABLE WHEN COLLECTED UNDER INCORRECT PRACTICE
CUSTOMS ACT 1901, ss. 163. 166. 167
The Minister for Trade and Customs:
The Minister for Trade and Customs forwards the following memorandum re section 166 of the Customs Act 1901:
I will be glad to be advised as to the full meaning of section 166.
Will it not apply to a case in which the practice before alteration was incorrect?
Or does it only apply to cases in which an alteration is a relaxation of the proper duty?
The mischief of an interpretation limiting the meaning to that last stated will be to reopen accounts for a long time back, and to secure refunds to persons who have probably recouped themselves by sales with the duties added.
Can it be held that the true construction of section 163 or of the regulations thereunder precludes these claims when no exception has been taken at the time, or within the prescribed time, to the payment? Section 167 prescribes the course to be taken where a duty is disputed.
I have previously advised (opinion of 18 November 1902(1)
, in reference to cotton drills) that section 166 does not apply to a practice which is based on a patent misconception of the law.
I see no reason to vary that opinion; but I am not disposed to extend it to every case in which the practice before alteration was 'incorrect'. In my opinion there is no claim to a refund by reason of an alteration of an incorrect practice unless the duty was paid through patent misconception of the law.
Section 163 cannot be taken as precluding the claim where no exception has been taken at the time; and the fact that a deposit might have been made under section 167 does not affect the question.
A regulation dated 19 September 1902 provides that claims for refunds, etc. under section 163 may be made-
not later than three days after the goods have passed from the control of the Customs or the duty has been paid, or such further time not later than one week from such passing or payment as the Comptroller-General shall, in writing, see fit to allow. But unless made as aforesaid no such claim shall be received or allowed.
Section 163 is imperative that a refund 'shall be made'-the only qualification being that it shall be made in manner prescribed.
In my opinion the power to prescribe the manner of making the refund includes the power to prescribe a reasonable time within which a claim must be made. The time prescribed by the regulation is very short. I am not sufficiently informed to judge whether it is unreasonably short.
Assuming the time prescribed to be reasonable, I think that a claim for refund is precluded unless brought within the prescribed time.
[Vol. 4, p. 18]
(1) Opinion No. 109.