Davies Coop & Co Ltd v Federal Commissioner of Taxation [1948] HCA 50

Davies Coop & Co Ltd v Federal Commissioner of Taxation [1948] HCA 50

Cardboard cones and tubes, used by Davies Coop and Co Ltd either in its manufacturing process or sold with yarn, are exempt from sales tax as 'aids to manufacture' under the statutory definition. They are not excluded as 'plant.' Further, if a purchaser quotes a certificate, the vendor is not liable for tax, regardless of any error or unlawfulness in the quotation.

Parties
Appellant; Defendant: Davies Coop and Company Limited; Respondent; Plaintiff: Federal Commissioner of Taxation
Jurisdiction
Australia
Judgment Date
18 August 1948
Procedural Posture
Sales Tax Recovery Action and Appeal / High Court Appeal From a Judgment of Starke J.
Outcome
Appeal allowed. Judgment for the defendant (Davies Coop and Company Limited).
Legal Topics
Sales Tax, Tax Exemptions, Definition of 'aids to Manufacture', Role of Quotation of Certificates in Tax Law
Tax Law Sales Tax Tax Exemptions Definition of 'aids to Manufacture' Role of Quotation of Certificates in Tax Law

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Parties

Davies Coop and Company Limited

Appellant; Defendant

Federal Commissioner of Taxation

Respondent; Plaintiff

Procedural Posture

Sales Tax Recovery Action and Appeal / High Court Appeal From a Judgment of Starke J.

Legal Issues

  1. 1 Whether cardboard cones and tubes used by a manufacturer in winding yarn are exempt from sales tax as 'aids to manufacture' under the Sales Tax (Exemptions and Classifications) Act 1935-1944 and associated regulations
  2. 2 Whether an erroneous or unlawful quotation of a sales tax exemption certificate by a purchaser is sufficient to exempt the vendor from liability for sales tax

Ratio Decidendi

Cardboard cones and tubes, used by Davies Coop and Co Ltd either in its manufacturing process or sold with yarn, are exempt from sales tax as 'aids to manufacture' under the statutory definition. They are not excluded as 'plant.' Further, if a purchaser quotes a certificate, the vendor is not liable for tax, regardless of any error or unlawfulness in the quotation.

Court Disposition

Appeal allowed. Judgment for the defendant (Davies Coop and Company Limited).

Orders

  • Judgment for the plaintiff (Commissioner of Taxation) set aside.
  • Judgment entered for the defendant with costs.