ADMINISTRATIVE APPEALS TRIBUNAL - GENERAL ADMINISTRATIVE DIVISION

[2003] AATA 1175

Re Eberle and Chief Executive Officer of Customs

M D Allen, Senior Member

21 November 2003 - Sydney

M D Allen, Senior Member. By application made 17 June 2002, the applicant made an application to review a decision of the respondent that the value for customs duty purposes of a vehicle imported by him and his son into Australia from the United States of America was $A86,488.56.

2 The sum of $A86,488.56 is the equivalent in Australian dollars at the exchange rate applicable at the time of purchase, namely 16 March 1998, of the sum of $US45,000.00 being the sum paid by the applicant for a 1993 Chevrolet Corvette motor vehicle.

3 Duty was paid under protest on 2 January 2002 and an application for review to this tribunal has been made pursuant to s 273GA of the Customs Act 1901 (Cth) (as amended).

4 The dispute between the parties is that the applicant contends that the value of the imported vehicle should be assessed under the "Fall Back Value" prescribed by s 161G of the Customs Act 1901 (Cth) whereas the respondent contends that the valuation should be assessed by the "Transaction Value" method prescribed by s 161 of the said Act.

5 Section 159 of the Customs Act 1901 (Cth) states inter alia that where the Transaction Value of imported goods can be determined, then their customs value is their Transaction Value and that the Fall Back Value cannot be utilised unless value is unable to be determined by using any of the other methods set out in s 159.

6 The respondent conceded that if the tribunal were to find that the Fall Back Value was the correct method of assessment then the value of the vehicle for customs purposes was the value assessed by the applicant's valuer.

7 Transaction Value has the meaning given by s 161 of the Customs Act 1901 (Cth) which reads:

(1) The transaction value of imported goods is an amount equal to the sum of their adjusted price in their import sales transaction and of their price related costs to the extent that those costs have not been taken into account in determining the price of the goods.

(2) …

8 "Import Sales Transaction" is defined by s 154(1) of the Customs Act 1901 (Cth) as:

import sales transaction, in relation to imported goods, means:
(a) where there was one, and only one, contract of sale for the importation of the goods into Australia entered into before they became subject to Customs control and it was also a contract for their exportation from a foreign country - that contract;

(b) where there was one, and only one, contract of sale for the importation of the goods into Australia entered into before they became subject to Customs control and it was not also a contract for their exportation from a foreign country - that contract; or

(c) …

(d) …

(e) …

The phrase "contract of sale for the importation of the goods" is not further defined or explained in the Customs Act 1901 (Cth). It was submitted by the respondent's representative that the phrase at least where it occurs in para (b) above imports a subjective element and it is the intention of the purchaser at the time of purchase that must be ascertained. In other words if, at the time the purchaser bought the subject goods, he had the intention to ultimately import them into Australia, then the Transaction Value method of assessing value for customs purposes applied.

9 An example, although it may also come within para (a), is a person who for his own use, purchases goods over the Internet from a vendor in the United States of America, for example a book. Clearly at the time of purchase (ignoring questions of where the contract is made), the purchaser intends that the goods will be imported into Australia.

10 To read into para (b) of the definition of "Import Sales Transaction", a requirement to assess the intent of the purchaser of the subject goods requires a purposive reading of the legislation. That such a method of statutory interpretation is the accepted method: see CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408 and see generally the address by Spieglman CJ entitled "The Poets Rich Resource: Issues in Statutory Interpretation".

11 I am satisfied that a purposive approach should be adopted in seeking to interpret the Customs Act 1901 (Cth) and that para (b) of the definition of "Import Sales Transaction" in s 154(1) of the said Act implies that a consideration must be given to the intention of the importer of the goods at the time of overseas purchase.

12 It is of course always difficult to ascertain a person's intent but the best evidence as to intent is what the person himself says.

13 In this matter, the applicant in his written statement of evidence (exhibit A4) said that he had been purchasing motor vehicles in the United States of America since 1974. Some were imported into Australia, others remained in the United States. Apparently the applicant, if he holidayed in the United States, would purchase a motor vehicle there for his use and he would during that time decide whether to import it into Australia or to sell it. He also said "If, after owning a vehicle in the USA for some time, I decided to export that vehicle to Australia, I would then apply for the necessary import approvals".

14 At para 8 of his statement, the applicant says that at the time of purchase of the subject vehicle, he had not made any decision about what to do with the vehicle. He then goes on to state in para 9 that in anticipation that he might at some future time wish to import the vehicle into Australia, he decided in August 1998 to apply for a Vehicle Import Approval.

15 This statement is in direct conflict with his earlier statement that he would apply for an import approval when he decided to import the vehicle into Australia rather than re-sell it in the United States.

16 Paragraph 10 of the applicant's statement reads in part:

In early January 2001, I had the vehicle delivered to Los Angeles and placed in storage. Then, in the last week of January 2001, my son and I travelled to Los Angeles to examine the vehicle for the first time, and to decide what we wanted to do with it.

17 Exhibit R2 is a copy of the application for Vehicle Import Approval completed by the applicant and dated 17 August 1998. In a statutory declaration also dated 17 August 1998 attached to that application, the applicant declared:

The vehicle to be imported is a 40th anniversary limited production factory model, one of 213 produced.

We wish to import this vehicle for exhibition, promotion, car shows and display purposes only. The vehicle will not be used in transport in Australia due to the rarity of the above vehicle we do not wish to use this vehicle for normal on road use.

18 Document T9 in the documents prepared for the tribunal pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) is a letter from the applicant's customs broker dated 18 July 2001. In that letter, the broker states:

As advised by Mr Eberle it was his intention to return to the USA to drive the vehicle for a period of three months to enable him to obtain a full import permit and not just a permit for exhibition, which he currently holds …

This statement can be compared with the applicant's statutory declaration made on 14 December 2001 in which he states:

2. When my son and I purchased the Vehicle, our intention was to use the Vehicle for travelling in the United States of America.

3. After the Vehicle was purchased, it was placed in storage in the Untied States, pending travel by myself or other members of my family to the United States.

19 The applicant stated in evidence that he did not discuss with his customs broker why he purchased the car as opposed to the fact that the car had been purchased. I reject this evidence. I do not accept that the customs broker wrote the letter of 18 July 2001 without specific instructions and the passage referring to the applicant's intention to use the vehicle in the United States is corroborated by the applicant's own statutory declaration made 14 December 2001 (T25 p 133).

20 I also note that the statutory declaration of 14 December 2001 suggests quite a different use for the vehicle to that which the applicant stated in his statutory declaration accompanying the application for import in August 1998. If, as stated, the applicant bought the vehicle to leave it in the United States, why was an import permit sought so soon after purchase?

21 Document T15 is a letter written by a member of the Tasmanian Parliament to the Minister for Customs making representations on behalf of the applicant. In that letter, the Parliamentarian says:

Prior to purchasing the vehicle Mr Eberle contacted the import/export manager of Customs in Tasmania, Mr David Hall …

This was denied by the applicant who stated that it was after the purchase that he contacted Customs.

22 Document T22 is a further letter written by the applicant's customs broker and dated 30 November 2001. In that letter, the broker again repeats the allegation that the vehicle was stored in the United States as it was the applicant's intention to return to drive the vehicle in the United States to allow it to be registered in Australia. Again, I do not accept that the broker stated this without instructions.

23 On 14 December 2001, the applicant's then solicitors wrote to the Chief Executive Officer of Customs (T25) stating inter alia that it was the intention of the applicant and his son when they purchased the vehicle to use it when they travelled to the United States. I take it those solicitors who are a large nationwide firm wrote the letter on instructions. This declaration of what was the intent of the applicant at the time of purchase conflicts with the applicant's later statement to this tribunal that he had not made any decision of what he intended to do with the vehicle at the time he purchased it.

24 As I see it, the applicant's story about what he intended to do with the vehicle at the time of purchase has changed over the period he has been in dispute with Customs. As stated above, his evidence of having made no decision of what to do with the vehicle at time of purchase contrasts with the instructions he gave to his customs broker and former solicitors.

25 I am satisfied on the balance of probabilities that the applicant's real intention at the time he purchased the vehicle was that as set out by his customs broker and conforms to actions by the applicant in the past, namely that he intended to use the vehicle in the United States and then import it into Australia as a used vehicle.

26 As the intention of the applicant at the time of purchase was to ultimately import the vehicle into Australia, the transaction was an Import Sales Transaction within the meaning of that term in para (b) of the definition in subs 154(1) of the Customs Act 1901 (Cth) and that pursuant to s 159(2), the customs value of the said goods is their Transaction Value as per s 161. The decision under review is therefore affirmed.