HR Products Pty Ltd v Collector of Customs

[1990] FCA 204

Re: H.R. PRODUCTS PTY. LIMITED
And: COLLECTOR OF CUSTOMS
No. WA G37 OF 1989
FED No. 204
Administrative Law - Customs
20 ALD 340

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Lee J.(1)

CATCHWORDS

Administrative Law - appeal on question of law - what constitutes a question of law

Customs - duties - meaning of "programmable controllers" in Customs Tariff Act 1987 - whether meaning as used by electronics trade or industry

Administrative Appeals Tribunal Act 1975 s.44

Customs Tariff Act 1987 s.10, Schedule 3

Acts Interpretation Act 1901 ss.15AA, 15AB

Australian Gas Light Co. v. Valuer General (1940) 40 SR (N.S.W.) 126

Bisley Investment Corporation v. Australian Broadcasting Tribunal 982) 40 ALR 233

Brutus v. Cozens (1973) AC 854

Collector of Customs v. Bell Basic Industries Ltd. (1988) 20 FCR 146

Commonwealth Banking Corporation v. Percival (1988) 20 FCR 176

D. and R. Henderson Manufacturing Pty. Ltd. v. Collector of Customs for the State of New South Wales (1974) 48 ALJR 132

Edwards (Inspector of Taxes) v. Bairstow (1956) AC 14

Farmer v. Cotton's Trustees (1915) AC 922

Federal Commissioner of Taxation v. Broken Hill South Limited 941) 65 CLR 150

Herbert Adams Proprietary Limited v. Federal Commissioner of Taxation (1932) 47 CLR 222

Hope v. The Council of the City of Bathurst (1980) 144 CLR 1

Jedko Game Co. Pty. Ltd. v. Collector of Customs (N.S.W.) (1987) 12 ALD 491

Lombardo v. Federal Commissioner of Taxation (1978) 22 ALR 567

Lombardo v. Federal Commissioner of Taxation (1979) 28 ALR 574

Re Pacific Film Laboratories Pty. Ltd. and Collector of Customs (1979) 2 ALD 144

Marine Power Australia Pty. Ltd. v. Comptroller General of Customs (1989) 89 ALR 561

Sullivan v. Department of Transport (1978) 20 ALR 323

T.N.T. Skypak International (Aust) Pty. Ltd. v. Federal Commissioner of Taxation (1988) 82 ALR 175

Waterford v. Commonwealth (1987) 163 CLR 54

Whitten v. Falkiner (1915) 20 CLR 118

HEARING

PERTH

#DATE 17:5:1990

Counsel for the Applicant: Mr P. Kyle

Solicitor for the Applicant: Kyle and Company

Counsel for the Respondent: Ms C. Francas

Solicitor for the Respondent: Australian Government Solicitor

ORDER

1. The appeal be dismissed.

2. The applicant to pay the respondent's costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is an appeal from a decision of the Administrative Appeals Tribunal ("the Tribunal") which determined the liability for customs duties under the Customs Tariff Act 1987 ("the Act") to be imposed upon articles described as "irrigation controllers" imported by the applicant.

1. The Tribunal found that the articles came within the subheading "8537.10.90 --- Other" of Schedule 3 of the Act and bore duty at 25%. The applicant contended that the articles should have been classified under the subheading "8537.10.10 --- Programmable controllers" which bore no duty.

2. Before determining how the Act applied to the articles, the Tribunal had to ascertain the meaning of several headings and subheadings in Schedule 3 of the Act. The main issue before the Tribunal, however, related to the meaning of the subheading "8537.10.10 --- Programmable controllers".

3. The respondent argued that the applicant's appeal was incompetent in that it was not an appeal on a question of law and, therefore, the Court had no jurisdiction to entertain the application under s.44 of the Administrative Appeals Tribunal Act 1975.

4. This vexing and oft recurring issue as to the distinction between a question of fact and a question of law was well analysed in Lombardo v. Federal Commissioner of Taxation (1979) 28 ALR 574 per Bowen C.J. at pp 575-578 and clearly restated in T.N.T. Skypak International (Aust) Pty. Ltd. v. Federal Commissioner of Taxation (1988) 82 ALR 175 per Gummow J. at pp 182-183. (See also Collector of Customs v. Bell Basic Industries Ltd. (1988) 20 FCR 146 per French J. at pp 155-156.)

5. As stated in those cases, the principles to be extracted from the relevant authorities may be set out as follows:

6. Where the ultimate fact to be determined depends upon the application of a statute to primary facts and no question of construction has been raised the conclusion from the primary facts will generally be a question of fact. (Lombardo v. Federal Commissioner of Taxation per Bowen C.J. at p 576.)

7. The question of what is the meaning of an ordinary English word, or phrase, used in a statute is one of fact not of law and the question of whether a particular set of facts comes within that meaning is also one of fact. (Australian Gas Light Co. v. Valuer General (1940) 40 SR (NSW) 126 per Jordan C.J. at p 137; Federal Commissioner of Taxation v. Broken Hill South Limited (1941) 65 CLR 150 at p 160.)

8. However, that question of fact may become a question of law if the primary facts as found permit only one conclusion as to the application or non-application of the statute and the tribunal fails to reach that conclusion. A question of law will arise because either the evidence was incapable of supporting the tribunal's conclusion or the tribunal misunderstood the law in a relevant respect. (Edwards (Inspector of Taxes) v. Bairstow (1956) AC 14 at p 33.)

9. Furthermore, the question whether the facts as found reasonably admit different conclusions as to whether the facts fell within, or outside, the application of the statute would be itself a question of law, but the correct conclusion would remain a question of fact and no appeal on a question of law would be available in respect of that conclusion alone. (See Jedko Game Co. Pty. Ltd. v. Collector of Customs (N.S.W.) (1987) 12 ALD 491; Hope v. The Council of the City of Bathurst (1980) 144 CLR 1 per Mason J. at pp 7-8; Brutus v. Cozens (1973) AC 854 per Lord Reid at p 861.)

10. The determination of whether or not a word, or phrase, in a statute is to be given its ordinary meaning, or some technical or other interpretation, is part of the determination of a question of construction and involves a question of law. The meaning, or interpretation, of a technical legal term is always a question of law. (See Australian Gas Light Co. v. Valuer General at p 137.)

11. Where a question of construction is involved it will follow that the decision of a tribunal on whether the primary facts as found are within the application of the statute so construed will remain a question of law. As explained by Wickham J. in Lombardo v. Federal Commissioner of Taxation (1978) 22 ALR 567 at p 570 and similarly by Bowen C.J. on the appeal from that decision in Lombardo v. Federal Commissioner of Taxation at p 577, the import of the statement by Lord Parker in Farmer v. Cotton's Trustees (1915) AC 922 at p 932:
    

"In my humble judgment where all the material facts are fully found and the only question is whether the facts are such as to bring the case within the provisions properly construed of some statutory enactment, the question is one of law only"

turns upon the words:

"within the provisions properly construed"

and the application of the principle stated therein depends upon the involvement of a question of construction.

1. In deciding the question of statutory construction, the Tribunal was obliged to consider whether the legislature had used the words in the headings or subheadings according to their ordinary meaning or had applied a more restrictive meaning arising out of a specialized interpretation commonly applied in the relevant trade or industry. That question was a question of law.

2. If the Tribunal determined that the intended meaning of the words was the meaning ascribed to them by trade usage, the question of what was the meaning according to that trade usage was a question of fact to be decided according to the evidence. To establish such a meaning, it would be necessary for the evidence to show the existence of a uniform understanding of the meaning in the relevant trade and to show that such a common understanding existed at the date of enactment of the relevant provision. (See Whitten v. Falkiner (1915) 20 CLR 118 per Isaacs J. at p 127.)

3. The application to the relevant facts of a meaning found to be the meaning commonly understood in the trade for the expression "programmable controllers" would involve a question of law.

4. The questions of law set out in the applicant's notice of appeal, which were augmented in argument by reference to some of the grounds upon which the appeal was based, indicated that the applicant contended that the tribunal had erred in deciding that the Act was to be construed by applying a technical, or trade, meaning to the words "programmable controllers" instead of applying the ordinary meaning of those words; by determining what that meaning was in the absence of appropriate evidence; and by applying such a construction to the Act in determining whether the imported articles fell within the terms of the Act.

5. According to the principles set out above, those contentions raised questions of law and, therefore, the Court had jurisdiction to hear the Appeal on those questions.

6. The Tribunal did not formally hold that the Act limited the meaning of the term "programmable controllers" to the meaning so understood by the relevant trade or industry, however, that conclusion was a sine qua non to the determination made by the Tribunal.

7. Similarly, there was no formal finding of fact that the elements of a definite trade meaning for the term had been established by the evidence. The respondent submitted that such a finding was an essential component of the Tribunal's decision and that it should be accepted that the Tribunal had so found.

8. The provisions of ss.15AA and 15AB of the Acts Interpretation Act 1901 were relevant to the question of law whether the term "programmable controller" was to be given an ordinary meaning, or a meaning attributed to it by trade usage. Section 15AA requires a construction promoting the purpose or object underlying an Act to be preferred to a construction that would not promote that purpose or object and s.15AB permits consideration to be given to material not being part of the Act if it is capable of assisting the ascertainment of the meaning of a provision by confirming that the meaning is an ordinary meaning or by resolving that the meaning is an ambiguous or obscure provision. The Tribunal was not referred to any material not forming part of the Act which may have been considered by the Tribunal to assist in ascertaining the interpretation of the term "programmable controllers", but on the hearing of the appeal the Court was referred to such additional material.

9. A starting point in addressing the question of construction is consideration of the history of the legislative provisions.

10. The Act repealed and replaced the Customs Tariff Act 1982. Until amended by the Customs Tariff Amendment Act 1987, the Customs Tariff Act 1982 did not include the term "programmable controllers" as a specific sub-item within Schedule 3 of that Act.

11. Prior to that amendment, the following relevant items and sub-items were included in Schedule 3 of the Customs Tariff Act 1982.
    (Items omitted)
    

...

1. The Customs Tariff Amendment Act 1987 amended item 85.19 by adding three sub-items as follows:
   

2. Those amendments took effect from 10 March 1987.

3. After presenting the Customs Tariff Amendment Bill 1987 to the House of Representatives, the Minister for Science and Minister Assisting the Minister for Industry, Technology and Commerce stated in his second reading speech on the Bill:
   

"Schedule 11 to the Bill, operative on and from 10 March 1987, implements the Government's decision on the Industries Assistance Commission's Report on the Power Electronics Industry. The Government has decided on a uniform General tariff rate of 20 per cent for most power electronic goods under reference. Static converters, rectifiers and rectifying apparatus become dutiable at a general tariff rate of 25 per cent for one year and then phase to the long term rate of 20 per cent. All programmable controllers become free of duty and subject to bounty assistance."

1. An Explanatory Memorandum circulated with the authority of the Minister for Industry, Technology and Commerce made the following comments on Schedule 11 to the Bill:
   

"Covers - changes to implement the Government's decision on the recommendations made by the Industries Assistance Commission in its Report on the Power Electronics Industry. The Government decided on a uniform General tariff rate of duty of 20% on most power electronic goods under reference.

Static converters, rectifiers and rectifying apparatus are dutiable at a General tariff rate of 25% on implementation for one year and 20% thereafter. Programmable controllers of tariff item 85.19 in Schedule 3 to the Principal Act become free of duty."

1. The Report of the Industries Assistance Commission on the Power Electronics Industry (13 February 1986) was laid before the House of Representatives on the 22nd day of August 1986. It is a "relevant report" for the purposes of para.15AB(2)(b) of the Acts Interpretation Act 1901. The Report was prepared after consideration of submissions received from major participants in the electronics industry, discussions with industry representatives, visits to factories and reference to published material.

2. It is instructive to look at that Report.

3. On 14 February 1985 the Minister for Industry, Technology and Commerce referred to the Industries Assistance Commission for report within twelve months the question of assistance to the industry designing, producing and/or selling power electronic equipment. Appendix A to the Report includes the Minister's letter, to which the reference was attached, forwarded to the Chairman of the Commission. In that letter the Minister stated as follows:
   

"...

Power electronic goods and services, such as these, are based primarily on solid state semi-conductor technology and are used mainly in industrial and commercial applications. They are capable of performing a wide range of electrical/electronic power supply, control and regulating functions and generally cater for higher levels of electrical current than other "electronic" equipment. Relevant functions of the goods and services include the regulation, control and/or conversion of various electrical characteristics of electrical power supplies. Two related goods which the Commission's report should also address are electrical time switches and programmable controllers.

...

As will be evident from the terms of reference, however, the Government is seeking from the Commission more than its advice in relation to future tariff arrangements. The Commission's views are also sought on the nature of the problems and prospects facing the industry and/or the Government to improve the industry's international competitiveness and growth potential."

1. The Commission noted in its Report that the reference was unusual in that none of the goods under reference was specified in "tariff item terms". Item 2(c) of the reference of the Commission was as follows:
   

"2(c) the efficacy of the current definitions of tariff sub-items and statistical keys of relevance to the power electronics industry, in the light of the continuing changes in technology in the industry since previous reviews leading to revisions of relevant parts of Schedule 3 of the Customs Tariff Act 1982."

1. The Report (p 42) noted that under the Customs Tariff Act 1982 as it stood some programmable controllers were classifiable under sub-item "90.28.9 - Other" of Schedule 3 and others under sub-item "85.19.9 - Other". The former attracted no duty and the latter carried a duty rate of 25 per cent. The programmable controllers within the first class were described as the "closed loop control" type in which the control action was made to depend on the measurement of the controlled variable. The latter class of programmable controllers were described as those of the "sequential programme" type defined as a plan which prescribed the actions of a system in a predetermined order and in which some actions depended on the execution of preceding ones or on the fulfilment of certain conditions. The Report noted that component parts of the "closed loop control" type of programmable controllers were dutiable at a rate 25 per cent and that such an impost was a disincentive to the production of such articles by Australian industry.

2. At pp 63-64 of its Report, the Commission stated as follows:
   

"It is difficult to distinguish between the design skills and technologies used in these (electrical and electronics) industries. Similarly, many inputs such as printed circuit boards, electric accumulators, capacitors, diodes, transistors and electronic microcircuits are common to all of these industries. There are also common production processes. This commonality also extends to the use of the goods. A programmable controller and a small computer might equally be used to control motors or other equipment. Final goods such as computers or telecommunications equipment generally include power electronics circuits. The rapid diffusion of technologies is strengthening the relationship between these industries, viewed both from the consumption and production perspectives.

It is likely that this trend will become more marked over time as, for example, solid state technology is increasingly used for functions now served by electro-mechanical devices (for example, in switching). As a result, the distinction between technologies used within different parts of the electrical and electronics industries can be expected to become even more difficult to distinguish.

As a further complication, the assistance regimes existing in related industries will affect the final price of their products (for example, the relative prices of electro-mechanical relays compared to the price of programmable controllers) as well as the relative attractiveness of each as investment choices. In attempting to establish an appropriate assistance regime for the power electronics industry, it is important to recognise the assistance regimes in related industries. Differences in levels of assistance will disturb consumption patterns and the ability of a particular industry to draw or hold resources relative to related industries."

It also noted at p 66:

"Another cost to the community from a regime of widely different rates of duty is the additional uncertainty domestic manufacturers have to face. For example, a domestic manufacturer producing a 'sequential' type of programmable controller (with tariff protection of 25 per cent) may find that he has no practical protection from time to time when an importer is able to import this product free of duty, as a 'closed loop control' type programmable controller or as a computer. It may be very difficult to distinguish visually similar products at the Customs barrier for assessment at the appropriate rate."

and at p 68:

"Rapid technological changes are taking place in the electrical and electronic industries. Worldwide, power electronics manufacture is in the process of rapid change. Developments in technology have changed product characteristics such that old product descriptions and tariff classifications established some years ago may no longer be appropriate. This process will probably continue, making any new product descriptions and tariff classifications introduced soon obsolete. Many new products may have to be placed in 'other' classifications if old descriptions no longer fit them. Where these 'other' classifications attract a lower tariff (for example, 'other' classifications at Free or 2 per cent), use of the new products will be encouraged, but they will have less chance of being manufactured in Australia compared to higher protected products, generally of an older technology."

The Commission recommended that both classes of programmable controllers be treated uniformly and be liable for duty at a minimum rate (p 88) although it noted that on occasions it may be difficult to distinguish between electronic time switches and other electronic devices such as programmable controllers (p 86). That comment may have indicated that some devices known as programmable controllers were not significantly more sophisticated than electronic time switches.

1. It would appear that the effect of the amendments to the Customs Tariff Act 1982 by the Customs Tariff Amendment Act 1987 was to provide for the programmable controllers which would otherwise have been goods classified under the sub-item "85.19.9 - Other" and subject to duty at 25 per cent to be included within the new sub-item "85.19.5 - Programmable controllers" and be free of duty and for the "closed loop control" type of programmable controllers to remain as goods within sub-item "90.28.9 - Other".

2. Perusal of the Report, the second reading speech and the Explanatory Memorandum show that the amendment of the Customs Tariff Act 1982 was intended to provide freedom from duty for the goods known as programmable controllers after submissions thereon from the electronics industry had been considered and reported upon having regard to the role equipment of that type could play in improving the efficiency of industry and its international competitiveness. It was likely, therefore, that in amending the Customs Tariff Act 1982 the legislature intended to apply whatever meaning was attributed to that term by the electronics trade or industry.

3. The effect of the repeal of the Customs Tariff Act 1982 and the implementation of the Act must now be considered.

4. The second reading speech of the Minister presenting the Customs Tariff Bill 1987 to the House of Representatives, the Minister for Science and the Minister Assisting the Minister for Industry, Technology and Commerce, stated that the purpose of the Bill was to implement provisions of the International Convention on the Harmonized Commodity Description of Coding System which provided international uniformity in the classification of goods and customs tariffs. Although the system of classification was changed, there was no indication in the Minister's speech or in the explanatory memorandum to the Customs Tariff Bill 1987 circulated by the Minister for Industry, Technology and Commerce that a new or altered meaning was to be applied to the term "programmable controllers" where it now appears in Schedule 3 of the Act.

5. The relevant headings and subheadings set out in Schedule 3 of the Act are as follows:
   (HEADINGS AND SUBHEADINGS OMITTED)
   

6. Programmable controllers previously referred to in sub-item 85.19.5 of the Customs Tariff Act 1982 are now incorporated in subheadings 8537.10.10 and 8537.20.10 of Schedule 3 of the Act. Programmable controllers formerly included in sub-item 90.28.9 in the repealed Act now appear to be included in subheading 9032.89.90 of Schedule 3 of the Act. Some of the parts able to be used in programmable controllers included under subheadings 8537.10.10 and 8537.20.10 are excluded from liability to duty by subheading 8538.10.10. Pursuant to subheading 8538.90.90, other parts bear duty at 25% . All parts for programmable controllers included within subheading 9032.89.90 are free of duty under subheading 9032.90.10.

7. Sub-section 10(1) of the Act specifies that the Interpretation Rules are to be used for ascertaining the tariff classification under which goods are classified. Sub-section 5(1) of the Act states that "Interpretation Rules" means the General Rules of the Interpretation of the Harmonized System provided for by the Convention (International Convention on the Harmonized Commodity Description and Coding System done at Brussels on 14 June 1983) being the rules, a copy of the English text of which is set out in Schedule 2 of the Act. Rule 1 of Schedule 2 states:
   

"The titles of Sections, Chapters and sub Chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes..."

1. The Notes to Chapter 85 do not refer to headings 8535, 8536 and 8537. Note 6 to Chapter 90 states that heading 9032 applies only to:
   

"(a) Instruments and apparatus for automatically controlling the flow, level, pressure or other variables of liquids or gases, or for automatically controlling temperature, whether or not their operation depends on an electrical phenomenon which varies according to the factor to be automatically controlled; and

(b) Automatic regulators of electrical quantities, and instruments or apparatus for automatically controlling non-electrical quantities the operation of which depends on an electrical phenomenon varying according to the factor to be controlled."

That description appears to apply to the "closed loop control" type of programmable controller.

1. The task of the Tribunal was to ascertain the construction of the Act where it referred to programmable controllers and to determine whether the applicant's irrigation controllers came within that part of the Act so construed.

2. The Tribunal correctly stated that in statutory construction the ordinary meaning of words is not easily displaced and that if a limited meaning arising from trade usage was contended for, the Tribunal had to be careful to see that such a narrower meaning was clearly established by the evidence.

3. The Tribunal said it was conscious of the dictum of Dixon J. in Herbert Adams Proprietary Limited v. Federal Commissioner of Taxation (1932) 47 CLR 222 at pp 228-229 where his Honour said that a narrower meaning of the ordinary meaning of words could only be adopted if it were of uniformly restricted application among a class of persons. The Tribunal then stated that the evidence adduced would have to be carefully assessed to see if that requirement had been met in the case before the Tribunal.

4. In addition, the Tribunal had regard to full and helpful reasons set out out in Re Pacific Film Laboratories Pty. Ltd. and Collector of Customs (1979) 2 ALD 144 and to the principles recited therein.

5. Although words will be taken to have their ordinary meaning and the plain meaning will not be limited, the particular subject matter with which the words deal may require a conclusion that the legislature intended a technical meaning, or a specialized or trade sense, to be applied to them. If evidence establishes the existence of a clearly understood meaning in an area of trade, the combination of that fact with the nature of the legislation may involve a conclusion that the legislature intended the limited meaning to apply in the absence of any indication to the contrary. (See Marine Power Australia Pty. Ltd. v. Comptroller General of Customs (1989) 89 ALR 561 per Lockhart J. at p 572.)

6. As Mason J. said in D. and R. Henderson Manufacturing Pty. Ltd. v. Collector of Customs for the State of New South Wales (1974) 48 ALJR 132 at p 135, a Court may more readily conclude that in a statute such as the Customs Tariff Act items have been described according to common commercial or trade usage and have not been used in the natural ordinary sense.

7. The Tribunal apparently decided that the Act used the meaning for the term "programmable controllers" applied to that term by the relevant trade. Consideration of the relevant headings and subheadings in Schedule 3 of the Act and of the prior history of the legislation assisted by the use of the extrinsic materials referred to shows that the term "programmable controllers" used in the Act was likely to be intended to provide freedom from duty for articles commonly described as, or understood to be, "programmable controllers" by the electronics trade or industry. Therefore, in arriving at that decision the Tribunal did not err in law.

8. Such a meaning may not have been restricted to sophisticated and technologically developed articles capable of performing complex tasks but as determined by the Tribunal the industry attributed to the meaning of the term at least a characteristic of flexibility in the planned instructions, or programme, which governed the use, or operation, of the article.

9. By force of sub-s.43(2B) of the Administrative Appeals Tribunal Act 1975, the Tribunal is required to give reasons for its decision including findings on material questions of fact and a reference to the evidence, or other material, on which those findings were based. The absence of a finding on a material question of fact may indicate that the proceedings of the Tribunal did not follow the proper course. (See Sullivan v. Department of Transport (1978) 20 ALR 323 per Deane J. at p 349.)

10. However, the reasons of the Tribunal must be read as a whole to determine whether the Tribunal has given its attention to relevant considerations and made a determination in compliance with the requirements of the Act. (See Bisley Investment Corporation v. Australian Broadcasting Tribunal (1982) 40 ALR 233 per Lockhart J. at p 251; per Sheppard J. at p 255.)

11. Having regard to the reasons of the Tribunal as a whole, it is apparent that the Tribunal endeavoured to set out a coherent account of how its conclusion had been formed and to display how it had analyzed the evidence it considered to be relevant. When so considered the reasons carry an implied statement by the Tribunal that it was satisfied on the evidence before it that there was a commonly understood meaning for the term "programmable controllers" used in the electronics trade.

12. That finding of fact by the Tribunal cannot be reviewed on appeal unless an error of law by the Tribunal requires the conclusion of fact to be set aside. There is no error of law simply in making a wrong finding of fact. (See Waterford v. Commonwealth (1987) 163 CLR 54 per Brennan J. at pp 77-78; Commonwealth Banking Corporation v. Percival (1988) 20 FCR 176 at p 182.)

13. Where the question of law raised on the appeal from the Tribunal is that the Tribunal reached a conclusion of fact in the absence of evidence capable of supporting it, it is not the function of this Court to review the evidence to see whether the Tribunal's decision may be supported by evidence upon which the Tribunal did not rely or to express the preferred conclusion of its own as an outcome of that review. Nor is a court entitled to start afresh and disregard how the Tribunal has said it has arrived at its conclusions. (See Commonwealth Banking Corporation v. Percival at p 182.)

14. In the present case the Tribunal carefully set out the steps it followed and the reasoning processes it considered it was obliged to observe.

15. The reasons of the Tribunal show that it fully understood its task and set about it in the correct manner. The question is whether the evidence so analysed by the Tribunal was entirely incapable of supporting the conclusion of fact that the term "programmable controllers" had a commonly understood meaning ascribed to it by the electronics trade or industry.

16. The Tribunal had before it evidence from a person experienced in the electronics trade and from an electrical engineer employed for at least ten years in the relevant field. The general import of their evidence was that the electronics trade or industry had developed a specific meaning for the term "programmable controllers", namely a unit able to provide flexibility in the programming of the micro processor contained in the unit by the use of an appropriate programme developed by the end-user or an industry consultant. It was agreed that whilst the applicant's articles may be within the ordinary meaning of the term "programmable controllers" and may have been understood to have been such in earlier days in the trade and industry, that was no longer the case. Although it was not stated directly, it was apparent from the tenor of the evidence that the more limited meaning applied to the term "programmable controllers" by the trade had developed at least by 1987 when the term was introduced in the Customs Tariff Act 1982.

17. The Tribunal accepted that evidence. It is obvious that the evidence was not incapable of supporting the Tribunal's conclusion that there was a meaning applied to that term by the electronics trade or industry which was more limited than the ordinary meaning of the term "programmable controllers". The applicant contended that such evidence had been evidence from witnesses with technical expertise rather than direct evidence from the trade or industry of a common understanding of the meaning of that term. Perusal of the evidence shows that the witnesses were competent to speak of a trade or industry understanding of the meaning of the term and did so. Cross-examination was directed at obtaining concessions that the ordinary meaning of the term would include the applicant's articles rather than challenging the assertions made by the witnesses that the trade applied a more limited meaning to the term.

18. It follows from the foregoing that the Tribunal did not err in law in deciding that the term "programmable controllers", as used in the Act, was intended to bear a meaning other than the ordinary meaning of the term, namely the meaning ascribed to by the electronics trade and relevant industry and that the Tribunal's conclusion of fact as to the meaning applied to the term by the electronics trade was not vitiated by any error of law. The appeal must be dismissed.