Coles Supermarkets Australia Pty Ltd v Commissioner of Taxation

BETWEEN: COLES SUPERMARKETS AUSTRALIA PTY LTD Applicant

AND: COMMISSIONER OF TAXATION Respondent

JUDGE: MOSHINSKY J DATE OF ORDER: 25 SEPTEMBER 2019

1. Within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs).
2. If the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions (of no more than three pages) in support of those proposed orders. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BETWEEN: COLES SUPERMARKETS AUSTRALIA PTY LTD Applicant

AND: COMMISSIONER OF TAXATION Respondent

JUDGE: MOSHINSKY J DATE OF ORDER: 25 SEPTEMBER 2019

1. Within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs).
2. If the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions (of no more than three pages) in support of those proposed orders. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BETWEEN: COLES SUPERMARKETS AUSTRALIA PTY LTD Applicant

AND: COMMISSIONER OF TAXATION Respondent

JUDGE: MOSHINSKY J DATE OF ORDER: 25 SEPTEMBER 2019

1. The applicant have leave nunc pro tunc to rely on the further submission filed on 18 September 2019.
2. Within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs).
3. If the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions (of no more than three pages) in support of those proposed orders. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BETWEEN: COLES SUPERMARKETS AUSTRALIA PTY LTD Applicant

AND: COMMISSIONER OF TAXATION Respondent

JUDGE: moshinsky J DATE OF ORDER: 25 SEPTEMBER 2019

1. Within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs).
2. If the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions (of no more than three pages) in support of those proposed orders. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BETWEEN: COLES SUPERMARKETS AUSTRALIA PTY LTD Applicant

AND: COMMISSIONER OF TAXATION Respondent

JUDGE: moshinsky J DATE OF ORDER: 25 SEPTEMBER 2019

1. Within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs).
2. If the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions (of no more than three pages) in support of those proposed orders. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 There are five proceedings before the Court. The applicant in each proceeding, Coles Supermarkets Australia Pty Ltd (Coles), is the representative member of the Coles GST Group. The group includes Eureka Operations Pty Ltd (Eureka), which carries on the business of retailing fuel and operating convenience stores trading as "Coles Express". The proceedings are appeals under Pt IVC of the Taxation Administration Act 1953 (Cth) (the Tax Administration Act) from objection decisions made by the respondent (the Commissioner). 2 The proceedings concern claims for "fuel tax credits" and "decreasing fuel tax adjustments" under the Fuel Tax Act 2006 (Cth) in respect of fuel that evaporated or leaked at Coles Express stores. The proceedings arise in the context of an overall legislative scheme whereby fuel tax arises under a series of statutes including the Excise Act 1901 (Cth), the Excise Tariff Act 1921 (Cth), the Customs Act 1901 (Cth) and the Customs Tariff Act 1995 (Cth). Within that framework, the Fuel Tax Act provides a single system of credits and adjustments that reduce the incidence of tax on fuels. 3 The proceedings concern the following monthly tax periods: (a) July 2012 to June 2015; and (b) August 2017. 4 Coles contends that a certain proportion (approximately 0.3%) of the fuel it acquired during those tax periods was lost through evaporation or leakage. It claims fuel tax credits or decreasing fuel tax adjustments in respect of the fuel that evaporated or leaked (and thus was not sold to customers). 5 The Commissioner contends that Coles is not entitled to any fuel tax credits or decreasing fuel tax adjustments. Further, in respect of the tax periods from July 2012 to January 2014, the Commissioner contends that any entitlement to fuel tax credits has ceased pursuant to s 47-5 of the Fuel Tax Act. 6 The following issues arise for determination (although, as explained below, not all issues arise in respect of each tax period): (a) whether, for the purposes of s 41-5 of the Fuel Tax Act, the relevant fuel was acquired "for use in carrying on [the relevant] enterprise", such that Coles was entitled to a fuel tax credit in respect of the fuel lost by evaporation or leakage (the Fuel Tax Credit Issue); (b) (in the alternative to issue (a)) whether, under s 44-5 of the Fuel Tax Act, Coles is entitled to a decreasing fuel tax adjustment on the basis that fuel acquired for retail sale, but subsequently lost by evaporation or leakage, was used in a way that was different from that intended at the time of its acquisition (the Decreasing Fuel Tax Adjustment Issue); and (c) if Coles was entitled to fuel tax credits pursuant to s 41-5 for any of the tax periods from July 2012 to January 2014, whether Coles has ceased to be entitled to those fuel tax credits by reason of the operation of s 47-5 of the Fuel Tax Act (the Section 47-5 Issue). 7 For the reasons that follow, I have concluded that the three issues should be determined as follows: (a) Coles is not entitled to a fuel tax credit under s 41-5 in respect of fuel that evaporated or leaked during the relevant tax periods. (b) Coles is not entitled to a decreasing fuel tax adjustment under s 44-5 in respect of fuel that evaporated or leaked during the relevant tax periods. (c) In light of my conclusion in respect of the Fuel Tax Credit Issue, it is unnecessary to determine the Section 47-5 Issue. Nevertheless, I make some observations about this issue.

Procedural matters 8 As set out above, the proceedings raise three issues: the Fuel Tax Credit Issue; the Decreasing Fuel Tax Adjustment Issue; and the Section 47-5 Issue. 9 A fourth issue, raised in proceeding No. VID 1364 of 2018, is no longer the subject of dispute. That issue was whether, to the extent that Coles is entitled to a decreasing fuel tax adjustment pursuant to s 44-5 of the Fuel Tax Act with respect to any or all of the tax periods from July 2012 to September 2014, such decreasing fuel tax adjustment is to be attributed to: (a) the September 2014 tax period; or (b) each of the monthly tax periods from July 2012 to September 2014. Coles now accepts the Commissioner's position in relation to this issue, namely that s 65-10 of the Fuel Tax Act operates so that any decreasing fuel tax adjustments are to be attributed to each of the monthly tax periods from July 2012 to September 2014. Accordingly, proceeding No. VID 1364 of 2018 falls away. 10 The following table, arranged chronologically in terms of the tax periods, shows the issues that arise in each of the remaining four proceedings. Tax periods fuel evaporated or leaked Proceeding No. Fuel Tax Credit Issue Decreasing Fuel Tax Adjustment Issue Section 47-5 Issue July 2012 - January 2014 VID 1366 of 2018 Yes Yes Yes February 2014 - April 2014 VID 1368 of 2018 No Yes No May 2014 - June 2015 VID 1365 of 2018 No Yes No

August 2017 VID 1367 of 2018 Yes Yes No

11 In relation to the tax periods between February 2014 and June 2015, the relevant fuel tax credits were claimed in Business Activity Statements lodged in 2018, which are not before the Court. This is why the Fuel Tax Credit Issue does not presently arise for determination in relation to those tax periods. 12 At the hearing, both parties were content for me to determine each of the three issues set out in [6] above as a matter of principle. The parties indicated that they would then formulate appropriate orders in each proceeding to give effect to my judgment. 13 Subsequent to the hearing, the Full Court of this Court handed down judgment in Linfox Australia Pty Ltd v Federal Commissioner of Taxation [2019] FCAFC 131 (Linfox). The judgment is potentially relevant to the Section 47-5 Issue. The parties to the present proceedings sought, and were granted, leave to file supplementary submissions in relation to the judgment of the Full Court.

Evidence 14 The proceedings were heard together and an order was made that evidence in one proceeding be evidence in each other proceeding. 15 At the hearing, Coles relied on the following two affidavits: (a) an affidavit of Timothy Lane, a chartered accountant and employee of Eureka, dated 13 February 2019; and (b) an affidavit of Belinda Robinson, the Fuel Stock Manager for Eureka, dated 13 February 2019. Neither deponent was cross-examined. 16 Exhibit "TCL-01" to the affidavit of Mr Lane is an Excel spreadsheet (provided on a USB stick) entitled "Fuel tax credits P2 F18 (Aug 17) worked example". The spreadsheet calculates fuel that evaporated or leaked in the month ending 31 August 2017. During the hearing, the Commissioner handed up an extract (comprising 32 A3-size pages) from that exhibit. This extract was marked for identification as "MFI-R1". I will refer to it as the Calculation Spreadsheet Extract.

Key legislative provisions 17 It will be convenient to set out the key legislative provisions before setting out the facts. Both parties were content for me to use the compilation of the Fuel Tax Act prepared on 1 January 2017. 18 Section 2-1 of the Fuel Tax Act sets out an overview and the purpose of the Act. It provides: 2-1 Overview and purpose of the fuel tax law This Act provides a single system of fuel tax credits. Fuel tax credits are paid to reduce or remove the incidence of fuel tax levied on taxable fuels, ensuring that, generally, fuel tax is effectively only applied to: (a) fuel used in private vehicles and for certain other private purposes; and (b) fuel used on-road in light vehicles for business purposes. Liability for fuel tax currently arises under the Excise Act 1901, the Excise Tariff Act 1921, the Customs Act 1901 and the Customs Tariff Act 1995. The administrative aspects of this Act (such as your rights, obligations and payment arrangements) are aligned as closely as possible to the administrative aspects of other indirect taxes (primarily, the GST), and other taxes administered by the Commissioner, to reduce your compliance costs. 19 Chapter 3 of the Fuel Tax Act deals with fuel tax credits. Within that chapter, Div 41 deals with fuel tax credits for business taxpayers and non-profit bodies. Section 41-5, contained within that Division, relevantly provides as follows: 41-5 Fuel tax credit for fuel to be used in carrying on your enterprise (1) You are entitled to a fuel tax credit for taxable fuel that you acquire or manufacture in, or import into, the indirect tax zone to the extent that you do so for use in *carrying on your *enterprise. Note 1: Other provisions can affect your entitlement to the credit. (For example, see Subdivision 41-B.) Note 2: Fuel is taken to have been used if it is blended as specified in a determination made under section 95-5. Registration for GST (2) However, you are only entitled to the fuel tax credit if, at the time you acquire, manufacture or import the fuel, you are *registered for GST, or *required to be registered for GST. 20 The expression "taxable fuel" is defined in the Dictionary to the Act (set out in s 110-5) as follows: taxable fuel means fuel in respect of which duty is payable under: (a) the Excise Act 1901 and the Excise Tariff Act 1921; or (b) the Customs Act 1901 and the Customs Tariff Act 1995; but does not include fuel covered by: (c) item 15, 20 or 21 of the Schedule to the Excise Tariff Act 1921; or (d) any imported goods that would be classified to item 15 of the Schedule to the Excise Tariff Act 1921, if the goods had been manufactured in the indirect tax zone. Note: Item 15 of the Schedule to the Excise Tariff Act 1921 deals with certain petroleum based oils and greases. Item 20 of that Schedule deals with certain stabilised crude petroleum oils. Item 21 of that Schedule deals with certain condensate. 21 Division 44 deals with increasing and decreasing fuel tax adjustments. A decreasing fuel tax adjustment operates in favour of the taxpayer. Section 44-1 explains that a taxpayer's entitlement to a fuel tax credit for taxable fuel is "worked out on the basis of what the fuel is intended for when you acquire, manufacture or import the fuel". It then explains that "[i]f you use or supply the fuel differently, or you do not use or supply the fuel at all, you have an increasing or decreasing fuel tax adjustment". 22 Section 44-5 compares the amount of an entity's original entitlement to a fuel tax credit under s 41-5 to what its entitlement would have been had the fuel been acquired for the use to which it was in fact applied. In other words, s 44-5 operates on the hypothesis that the taxpayer originally acquired the fuel for the use to which it was ultimately put. Section 44-5 provides: 44-5 Increasing and decreasing fuel tax adjustments for change of circumstances (1) You have a *fuel tax adjustment if you use fuel, or make a *taxable supply of fuel, and the *amount of the fuel tax credit to which you would have been entitled for the use or supply would have been different from the amount to which you are or were entitled if one or both of the following were to apply: (a) you had originally acquired, manufactured or imported the fuel to use or make a taxable supply in the circumstances in which you did use, or make a taxable supply of, the fuel; (b) an alteration of a kind referred to in subsection 43-6(2) that: (i) under that subsection, had been taken to have effect as if it is an amendment of an Act; and (ii) under subsection 43-6(3) ceased to be taken to have that effect; had never been proposed as mentioned in subsection 43-6(2). (2) The *amount of the adjustment is the difference between the 2 amounts. Note: Division 65 sets out which tax period or fuel tax return period the fuel tax adjustment is attributable to. Decreasing fuel tax adjustments (3) The *fuel tax adjustment is a decreasing fuel tax adjustment if the *amount to which you would have been entitled is greater than the amount to which you are or were entitled. Increasing fuel tax adjustments (4) The *fuel tax adjustment is an increasing fuel tax adjustment if the *amount to which you are or were entitled is greater than the amount to which you would have been entitled. Example: You acquire taxable fuel to use in a harvester in carrying on your farming enterprise, so you are paid a fuel tax credit for the fuel. Later on, you use the fuel to transport wheat in a vehicle of more than 4.5 tonnes travelling on a public road. As your fuel tax credit would have been reduced by the amount of the road user charge, you have an increasing fuel tax adjustment of the difference between the 2 amounts. 23 I note for completeness that the form of s 44-5 set out above (based on the 1 January 2017 compilation) was introduced in 2014 and the earlier wording was different. However, at the hearing before me, the parties indicated that the difference in wording did not affect the issues to be determined and both parties were content for me to use the compilation as at 1 January 2017. 24 Chapter 4 of the Fuel Tax Act contains what are described as "common rules". Section 60-1 explains that a taxpayer's "net fuel amount" reflects how much the taxpayer or the Commissioner must pay. A positive net fuel amount reflects how much a taxpayer must pay the Commissioner; a negative net fuel amount reflects how much the Commissioner must pay the taxpayer. A net fuel amount is worked out for each tax period. Section 60-5 deals with working out the net fuel amount: 60-5 Working out your net fuel amount Your net fuel amount for a *tax period or a *fuel tax return period is worked out using the following formula: Total - Total fuel + Total increasing - Total decreasing fuel tax tax credits fuel tax adjustments fuel tax adjustments

where: total decreasing fuel tax adjustments is the sum of all *decreasing fuel tax adjustments that are attributable to the period. Note: Division 65 sets out which tax periods or fuel tax return periods fuel tax adjustments are attributable to. total fuel tax is nil. Note: Fuel tax is currently assessed under the Excise Act 1901, the Excise Tariff Act 1921, the Customs Act 1901 and the Customs Tariff Act 1995. total fuel tax credits is the sum of all fuel tax credits to which you are entitled that are attributable to the period. Note: Division 65 sets out which tax periods or fuel tax return periods fuel tax credits are attributable to. total increasing fuel tax adjustments is the sum of all *increasing fuel tax adjustments that are attributable to the period. Note: Division 65 sets out which tax periods or fuel tax return periods fuel tax adjustments are attributable to.

Factual findings 25 The following factual findings are based on the affidavits of Mr Lane and Ms Robinson.

Coles Express's operations 26 Eureka's operations are generally referred to as being undertaken on behalf of "Coles Express". Accordingly, for ease of expression, I will refer to Coles Express rather than Eureka. 27 As at August 2017, Coles Express operated 703 retail fuel sites and convenience store locations across Australia. Coles Express operates its business of retailing fuel under an alliance with Viva Energy Australia (Viva). Under Coles Express's alliance arrangement with Viva, Viva owns and is responsible for arranging and paying for maintenance of fuel tanks and on-site fuel equipment on the majority of Coles Express's sites. As at August 2017, there were 42 sites located on property owned by an entity within the Coles group and on those sites a Coles group entity owned the on-site fuel equipment. Those 42 sites are known within Coles Express as the "PAD Sites" (PAD Sites).

Measurement of fuel 28 Coles Express monitors data sent by on-site fuel equipment at all sites. A contractor, Environmental Management Systems (EMS), helps identify stock loss after fuel has been delivered into a tank. As Coles Express owns the fuel in each on-site tank it bears the risk of fuel losses. Such fuel losses are due to leakage from underground tanks or lines, evaporation, and pump nozzles over or under dispensing fuel (as described in more detail below). 29 Coles Express purchases its fuel for all sites from Viva. Coles Express stores its fuel for sale to customers in tanks at each site. Each fuel type is contained in a separate tank or compartment within a tank. The tanks are one component of what is referred to as the Underground Petroleum Storage System (UPSS), which also includes fill boxes, dispensers, sumps, free-venting systems and piping used to deliver fuel to customers. 30 Each tank, with the exception of the tanks at a single site located in Mount Isa, Queensland, contains an Automatic Tank Gauge (ATG). There are various different models of ATGs. The same data points are extracted from each of the different ATG models used at Coles Express's sites. 31 The ATGs used in Coles Express's business are configured to measure fuel levels and temperature inside a tank. The ATGs provide data that is used to perform leak detection and fuel reconciliation. The ATGs also record the time and volume of a delivery of fuel and detect how much water is in the bottom of a tank. 32 The only Coles Express site that does not have ATGs installed is the site at Mount Isa, where opening and closing fuel balances for the tanks are recorded from a digital tank gauge, which is different from the ATGs. 33 Every 30 minutes, data is provided from the ATGs and the results are recorded into Coles Express's information systems. The process for recording both ATG and manually-read data is explained further below.

Delivery of fuel to Coles Express 34 When the fuel in a tank drops below a certain level, this will trigger a request for Viva to schedule a delivery of fuel. Following a request, a Viva truck will deliver fuel to the relevant Coles Express site. 35 Coles Express takes title as the fuel passes into the tank. 36 When a truck is loaded at the Viva terminal and the delivery is confirmed, Coles Express receives an invoice from Viva for the full amount of fuel as loaded into the truck at the terminal. The invoice shows a volume of fuel measured at ambient temperature and pressure at the time it was loaded at the Viva depot. The full details of invoices and accompanying ATG data is maintained in Coles's accounting system, which is based on SAP software.

Delivery of fuel from tanks to Coles Express's customers 37 The device used to dispense fuel to customers on Coles Express's forecourts is known as a "pump" (Pump). A Pump is made up of equipment including a nozzle, dispenser hose, dispenser, fuel meter as well as smaller pumps and/or turbines. 38 A Pump contains multiple "arms", which deliver fuel of different types into a customer's car. The Pumps used in the majority of Coles Express's sites operate on a pressure pump system and a limited number operate a suction pump system. 39 Within Coles Express, regardless of whether a pressure pump system or a suction pump system is used, a fuel meter measures the amount of fuel sold to the customer as the fuel flows through the Pump. In both PAD Sites and other sites, the fuel meter transmits data directly to Coles Express's point-of-sale system. 40 Coles Express receives information from each fuel meter into the point-of-sale system in real time. It is recorded in Coles's accounting system and used in Coles Express's fuel reconciliations.

Reconciliation of fuel loss at Coles Express's operating sites 41 During the normal course of business, ATG volume measurements, which are called "dips", and delivery data are transmitted to and available from a web-based information system called "Efuels" (Efuels) provided by Premier Technologies Pty Ltd. 42 Each day, Coles Express receives: (a) a "delivery file" from Premier Technologies Pty Ltd, based on the same data as available in Efuels, recording the ATG data. Coles Express inputs that data into the SAP accounting software; and (b) a "TAF File" from Viva which includes all deliveries recorded as having been made by Viva. Coles Express inputs that data into the SAP accounting software. 43 A matching process is undertaken to compare the volume invoiced by Viva recorded in the "TAF File" and the amount recorded by the ATG in the "delivery file". If an invoice has no corresponding ATG delivery then an investigation is also undertaken to identify a corresponding unmatched delivery. Coles Express has procedures to accurately reconcile the deliveries recorded by the ATG with invoices.

Process for dealing with ATG malfunctions 44 In the event that an ATG is not functioning, a site must carry out manual tank dips and enter the tank dips to Efuels by calling a particular phone number each day. If an ATG is not functioning, fuel deliveries must also be entered by the site by calling the same phone number and providing the details on the driver delivery docket.

Investigating fuel loss 45 Under the fuel alliance agreement, Viva has contractual responsibility for leak detection for the UPSS at Coles Express's operating sites. 46 In the documents annexed to Ms Robinson's affidavit, there is a reference to Statistical Inventory Reconciliation Analysis (SIRA). SIRA is undertaken by performing an assessment of inventory information including fuel delivery, dispensing and retention volumes. The analysis aims to define discrepancies in inventory that may be indicative of product loss from the UPSS or increases in volume which may indicate water intrusion. 47 At Coles Express's sites, EMS provide the SIRA. All sales data, ATG readings and delivery invoices are sent to EMS each day. EMS are responsible for using SIRA to identify fuel loss or gain. EMS are responsible for investigating leaks of fuel greater than 18 litres per day. There are two stages to this investigation known as "Product Loss Investigation Part A" (PLIP A) and "Product Loss Investigation Part B" (PLIP B). 48 PLIP A is an investigation of the physical site looking for fuel leaking onto the ground or looking for signs of theft. This is performed by Coles Express's staff. 49 Where PLIP A does not identify the source of the fuel discrepancy, PLIP B is triggered. PLIP B involves a tank and line equipment integrity test, which is a test conducted to evaluate whether a UPSS is leaking to the environment or is not providing containment as originally designed. PLIP B is carried out by EMS with the assistance of Gilbarco Veeder-Root (also known as Veeder-Root) (the manufacturer of the ATGs) and Viva.

Explanations for lost fuel 50 Coles Express has identified the following possible reasons for fuel in the tank being less at closing than it should be: (a) under-delivery by Viva; (b) over-calibration (i.e. too much fuel being dispensed to customers); (c) theft directly from a tank; (d) evaporation; (e) line integrity; and (f) tank integrity. 51 Coles Express has identified the following possible reasons for fuel in the tank being more than it should be at closing: (a) over-delivery by Viva; (b) under-calibration (i.e. not enough fuel being dispensed to customers); and (c) water in tanks artificially inflating the reading. 52 Under-delivery and over-delivery are quantified and reconciled by the process described above under the sub-heading "Reconciliation of fuel loss at Coles Express's operating sites". 53 Fuel loss or gain due to over-calibration or under-calibration results in the recalibration of the Pumps at the site. 54 Coles Express records any theft of fuel delivered through a Pump (e.g. customers filling their vehicles and driving off) separately. The fuel is measured as it flows out of the Pump by the fuel meter; the Coles Express point-of-sale system records that this fuel has not been paid for. In rare cases, fuel can be stolen directly from a tank. Such theft is able to be detected quickly due to the volume required to be stolen for it to be profitable and the requirement to use physical machinery, such as trucks. 55 Variances in fuel levels due to water in tanks, which increase the apparent fuel reading, are detected and measured by the ATG readings of water in the tanks. 56 Within the fuel industry, a tank or line that does not leak any fuel is referred to as being "tight". Factors that can influence how tight a tank or line is include the material it is made from, its age, physical damage sustained and decay over the usual course of its working life. 57 In addition to leakage, each tank at a Coles Express site has a permanent opening for free-venting. This allows vapours to be continually vented during normal operation to prevent build-up of vapour. 58 After accounting for each source of loss set out previously, the remaining loss is due to evaporation (e.g. from the process of free-venting to prevent build-up of vapours or when a tank is uncovered during dispensing or during refuelling) or the tank not being tight (e.g. leakage and seepage). Once Coles Express has corrected for the other sources of the loss discussed above, the remaining loss is recorded as loss due to evaporation or tank and line integrity. 59 Ms Robinson deposes, and I accept that, when ordering fuel, Coles Express is aware that it will not be able to sell all fuel ordered to customers, as evaporation and leakage are a normal part of the business of retailing fuel. The amount of fuel that evaporates or leaks is calculated each month through Coles Express's reconciliation processes by reference to the data recorded by the ATGs.

Daily and monthly fuel reconciliations 60 Each day, Coles Express reconciles the volume in each tank nationwide in a process referred to as the "Fuel Reconciliation Report" (the Fuel Reconciliation Report). The Fuel Reconciliation Report is based on the ATG readings and the volume of fuel delivered by Viva. It compares the closing dip amount against the book stock. The book stock is a "calculated dip" - that is, a dip reading that is calculated on the basis of data and not directly measured from a tank - using the product of: (a) opening dip reading; minus (b) tank sales; plus (c) Viva invoiced deliveries. 61 At month end, the output of the Fuel Reconciliation Report is the basis of the calculation of fuel that has evaporated or leaked. The output of the Fuel Reconciliation Report at month end is referred to as the "SAP FP Loss". 62 To calculate the fuel lost through leakage and evaporation each month, the SAP FP Loss has an amount added to it called the "Matching Variance". The Matching Variance is the difference between the ATG recorded amount of each delivery and the docketed amount delivered by Viva. The docket is relied upon in preference to the ATGs for the volume of the delivery because it is not affected by fuel being sold to customers or sloshing during delivery.

Fuel loss due to evaporation or leakage during the relevant tax periods 63 As noted above, Coles operates an accounting system based on SAP software. The accounting system records values provided by ATGs for fuel volumes inside each tank, and data from fuel sales and fuel deliveries at each site. The accounting system also records and separately tracks manual adjustments made during the month, which are entered by the stock accounting team. Using these data sources, the accounting system tracks the opening, expected closing and actual closing balances of fuel by tank and type at each site. To calculate the fuel that evaporates and leaks each month, a report is run in Coles's accounting system. 64 When Coles calculates fuel loss, it does not distinguish between evaporation and leakage. 65 The volume of fuel that was calculated as having evaporated or leaked during each month in the period July 2012 to June 2015 is set out in [13] of Mr Lane's affidavit. I note that there is considerable variation in the fuel loss figures from month to month. 66 The volume of fuel that was calculated as having evaporated or leaked during August 2017 is set out in [12] of Mr Lane's affidavit. Further details of the fuel loss during that month are provided in [55]-[56] of Ms Robinson's affidavit, as follows: (a) In August 2017, 89,310,771 litres of diesel and 203,607,831 litres of petrol were delivered to Coles Express sites. (b) Across all Coles Express sites in August 2017, 171,236 litres of diesel evaporated or leaked from its tanks and 485,617 litres of petrol evaporated or leaked from its tanks. This amounts to a stock loss of 0.19% of diesel delivered and 0.24% of petrol delivered for the month. 67 No issue arises in the proceedings concerning Coles's calculations of the fuel lost due to evaporation or leakage. 68 Coles estimates that, on average, approximately 0.3% of fuel acquired by Coles Express from Viva evaporates or leaks before it can be sold. However, as submitted by the Commissioner, more precise figures can be calculated by comparing the tables at [4] (total fuel sales) and [21] (loss of fuel to evaporation and leakage) in attachment 1 to the PriceWaterhouseCoopers private binding ruling request dated 1 June 2016 (item 49 in the documents filed pursuant to r 33.03 of the Federal Court Rules 2011 in proceeding No. VID 1366 of 2018). On the basis of these figures, yearly average losses due to evaporation and leakage in the financial years ended 30 June 2013, 30 June 2014 and 30 June 2015 were 0.289%, 0.272% and 0.237% respectively. 69 Based on a table annexed to the Commissioner's written submissions, the fuel lost due to evaporation and leakage, and the adjustments claimed by Coles in respect of that loss, in respect of the relevant tax periods can be summarised as follows: Tax periods Fuel (litres) lost by way of evaporation or leakage Adjustment claimed by Coles July 2012 - January 2014 25,248,855 $9,630,671 February 2014 - April 2014 3,877,279 $1,478,909 May 2014 - June 2015 14,216,082 $5,473,705

August 2017 657,472 $264,961

Additional matters 70 Coles's claims for fuel tax credits or decreasing fuel tax adjustments are based on its calculations of the actual losses due to evaporation or leakage at the end of each month, rather than, for example, an amount expected to be lost by way of evaporation or leakage at the time of delivery of the fuel. 71 It is apparent from the facts set out above that Coles Express is unable to identify, at the time of delivery of fuel by Viva, the amount of fuel that will be lost by way of evaporation or leakage from the delivery. 72 It is apparent from the figures set out in the Calculation Spreadsheet Extract that the fuel loss due to evaporation and leakage varies from tank to tank and from month to month. Indeed, some tanks in some months experience a gain rather than a loss. 73 There is no evidence to suggest that, when Coles Express ordered fuel from Viva, it ordered a particular volume and then added 0.3% (or any other figure) due to anticipated fuel loss due to evaporation or leakage.

The Fuel Tax Credit Issue 74 The first issue, referred to as the Fuel Tax Credit Issue, is whether, for the purposes of s 41-5 of the Fuel Tax Act, the relevant fuel was acquired "for use in carrying on [the relevant] enterprise", such that Coles was entitled to a fuel tax credit in respect of the fuel lost by evaporation or leakage.

The parties' submissions 75 Coles contends that it is entitled to a fuel tax credit pursuant to s 41-5(1) in respect of the fuel that it lost through evaporation or leakage during the relevant tax periods. Coles contends that it is entitled to a fuel tax credit on the basis that it acquired the relevant fuel "for use in carrying on [its] enterprise" within the meaning of s 41-5(1) (set out above). 76 Coles's submissions in support of this contention can be summarised as follows: (a) The words of ss 41-5 and 44-5 of the Fuel Tax Act must be construed in light of their ordinary meaning, context and purpose: s 15AA of the Acts Interpretation Act 1901 (Cth); Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 (Consolidated Media Holdings); Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 (Alcan) at [47]. The statutory wording must be considered by reference to the language of the instrument viewed as a whole. Where the ordinary meaning of the words within their context and purpose is clear, the Court should give effect to that meaning: Alcan at [47]; Federal Commissioner of Taxation v Unit Trend Services Pty Ltd (2013) 250 CLR 523 at 539-540. (b) Coles purchases and stores large volumes of taxable fuel for re-sale in carrying on its enterprise. A portion of that taxable fuel evaporates or leaks. The fuel that evaporates or leaks has been used in "carrying on [Coles's] enterprise" within the ordinary meaning of s 41-5. (c) The Macquarie Dictionary states that the ordinary meaning of "use" includes: to expend or consume in use: his car uses a lot of oil. The example provided in the ordinary definition of "use" - "his car uses a lot of oil" - is somewhat analogous to the situation of Coles in the present case. Motor oil in a car is a lubricant in a closed system. A car consumes motor oil when it leaks or evaporates. In the same way, Coles uses fuel when it leaks or evaporates from the UPSS without being sold to customers. (d) The context and purpose of the legislative scheme of which the Fuel Tax Act is part and a jurisprudential analysis of the word "use" confirm this result. (e) The objects of Ch 3 of the Fuel Tax Act, which includes the fuel tax credit and fuel tax adjustment provisions, is to ensure that "fuel tax is effectively only applied to: (a) fuel used in private vehicles and for certain other private purposes; and (b) fuel used on-road in light vehicles for business purposes" (s 40-5(1)) and "[t]o do this, a fuel tax credit is provided to reduce or remove the incidence of fuel tax applied to: (a) fuel used in *carrying on your *enterprise (other than fuel used on-road in light vehicles)" (s 40-5(2)). Section 41-1 of the Fuel Tax Act provides that a credit is available, "where you acquire … fuel to use in carrying on your enterprise (whether the fuel is used as fuel or otherwise)." The fuel that evaporates and leaks is used in Coles's enterprise and is not used on-road in light vehicles. The fact that fuel that evaporates or leaks is not used as a source of energy is not relevant to the entitlement to a fuel tax credit by reason of the parenthetical clause in s 41-1 of the Fuel Tax Act. Coles's interpretation is consistent with the objects and purpose of the Fuel Tax Act. (f) Jurisprudentially, the word "use" has a wide meaning: Macquarie University v Ryde Municipal Council [1977] 1 NSWLR 304 (Macquarie University) at 313. While "use" takes some of its meaning from context, it retains a "commonly understood meaning in ordinary parlance": New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (2016) 260 CLR 232 at [34]. A "use" can be passive. An item may have multiple uses: Sweet v Parsley [1970] AC 132 at 151, 155; Macquarie University at 313-314. "Use" is not a test of direct benefit (Council of the City of Newcastle v Royal Newcastle Hospital (1957) 96 CLR 493 at 514; Marshall v Director General, Department of Transport (2001) 205 CLR 603 at [22], [34]) and passive use (i.e. through evaporation) is "use". To comprise "use", one of multiple "uses" does not have to be the dominant "use" provided it is a basic or recognised "use": Sweet v Parsley at 151, 155; Macquarie University at 313-314. (g) Evaporation is explicitly recognised as "use" in the Revised Explanatory Memorandum to the Fuel Tax Bill 2006 (Cth) (the Revised EM). The Revised EM states that the term "use" is "intended to take its ordinary meaning and apply in a broad sense, as long as the use of the fuel is within the confines of the conduct of carrying on an enterprise" (at [2.33]) and that "[f]uel is 'used' if it ceases to exist after an action to use it, either as a fuel or in the production of another thing" (at [2.34]). The Revised EM states at [2.37] that: 'Use' will also include the loss of fuel through evaporation and temperature changes in the course of carrying on a taxpayer's enterprise. (h) While Coles purchases fuel hoping to sell it to the maximum extent possible, it knows that evaporation and leakage will inevitably occur. Naturally, it takes steps to minimise such evaporation and leakage. The words "to the extent that" in s 41-5 of the Fuel Tax Act, as well as the Revised EM at [2.86]-[2.88], explicitly recognise that the acquisition of fuel should be apportioned between eligible (e.g. evaporation) and ineligible (e.g. sale) uses. 77 The Commissioner's contentions (as set out, for example, in his appeal statement in proceeding No. VID 1366 of 2018) may be summarised as follows: (a) The term "use" is not defined and so takes its ordinary meaning. The ordinary meaning of use is broad. The term must be construed within the context of the Fuel Tax Act. (b) The evaporation of fuel may constitute a use within the meaning of s 41-5 of the Fuel Tax Act when it has occurred as an ordinary incident of putting it into service in carrying on an enterprise. By contrast, a loss of fuel that is not incidental but accidental would not be a use. (c) The entitlement to fuel tax credits pursuant to s 41-5 of the Fuel Tax Act depends upon fuel being acquired "for use"; that is, for the purpose, object or intention of using that fuel in carrying on an enterprise. How the fuel is in fact used is irrelevant for the purposes of s 41-5. What constitutes an ordinary incident of putting fuel into service must involve some application of the fuel in the object of expending it. That is, fuel that is not actually applied in some way to be expended is not used. (d) Where fuel evaporates, that will only be a use where it arises as part of putting the fuel to a use that is recognised by the Fuel Tax Act. The loss occurs as an incident of the use. Further, fuel vapours escaping from a tank or an engine during locomotion, for example, are likely to bear the same character as the use to which the combusted fuel was put. Thus the loss is incidental to the use. (e) In order to sell fuel, Coles Express stores it at the service stations which it operates. The evaporation of the fuel occurs while it is stored. The evaporation of the fuel thus occurs as a consequence of or incidentally to that storage of fuel, not a consequence of expending fuel. As the storage does not result in expending the fuel, it is not a use of that fuel within the meaning of s 41-5. 78 The Commissioner submits that: the entitlement to credits pursuant to s 41-5 depends upon fuel being acquired "for use". The word "for" invites a consideration of purpose. The relevant purpose is that for which the fuel was acquired. That purpose must be "carrying on [the relevant] enterprise"; this is confirmed by the statement in s 44-1 that "[y]our entitlement to a fuel tax credit for taxable fuel is worked out on the basis of what the fuel is intended for when you acquire, manufacture or import the fuel"; how the fuel is in fact used is thus irrelevant for the purposes of s 41-5. 79 The Commissioner submits that: the term "use" (in its various grammatical forms) is not defined in the Fuel Tax Act and so takes its ordinary meaning; in determining what the term "use" means in the context of the Fuel Tax Act, the task is not to adopt a particular dictionary definition; the term "use" is protean, and must be construed in its particular statutory context; the sale of fuel for consideration does not generally constitute a "use" under the Fuel Tax Act; therefore, the acquisition of fuel for resale does not constitute a "use" within s 41-5; s 41-5 provides for an entitlement to a fuel tax credit in circumstances where, and to the extent that, the fuel is acquired for use in carrying on an enterprise; consistently with that provision, ss 44-5 and 44-10 (fuel tax adjustments) juxtapose "use" and "taxable supply" of fuel; as such, "use" and "taxable supply" are mutually exclusive for the purposes of the Fuel Tax Act. 80 The Commissioner submits that: a "use" of fuel for the purposes of the Fuel Tax Act involves the application of it to a particular end, in an active sense; one cannot conclude that fuel has been "used" within the meaning of s 41-5 simply from the fact that there has been a diminution in the quantity of fuel between two points in time; this sense of the term "use" is consistent with that which was contemplated by Parliament, as is apparent from the Revised EM (see [2.34]); according to that meaning, the word "use" will generally not include a loss, as a loss would not usually entail the application or employment of a thing to a particular end but entails being unable to use it, having lost it; if "use" is conceived of in that way for the purposes of the Fuel Tax Act, a loss of fuel is to be contrasted with, and will not constitute, a "use" of that fuel; contextual support for this conception of "use" within the Fuel Tax Act may be found in Div 44.

Consideration 81 The question is whether the fuel that was acquired by Coles Express, and subsequently evaporated or leaked, was acquired "for use in carrying on [its] enterprise" for the purposes of s 41-5(1). This raises a question of construction, not only of the words "for" and "use", but of the entire phrase "for use in carrying on your enterprise". 82 The general principles of statutory construction are well established: see, for example, Alcan at [47] per Hayne, Heydon, Crennan and Kiefel JJ; Consolidated Media Holdings at [39] per French CJ, Hayne, Crennan, Bell and Gageler JJ. The task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision: see Alcan at [47] and cases cited therein. 83 The word "for" in s 41-5(1) invites a consideration of intention or purpose. That this is the case is confirmed by the statement in s 44-1 that a taxpayer's entitlement to a fuel tax credit for taxable fuel is "worked out on the basis of what the fuel is intended for when you acquire, manufacture or import the fuel" (emphasis added). How the fuel is in fact used is thus irrelevant for the purposes of s 41-5 (but may be relevant for the purposes of s 44-5, discussed below in relation to the Decreasing Fuel Tax Adjustment Issue). 84 The term "use" (in its various grammatical forms) is not defined in the Fuel Tax Act. In determining its meaning, the task is not simply to adopt a particular dictionary definition: see Robert Bosch (Australia) Pty Ltd v Secretary, Department of Industry, Innovation, Science, Research and Tertiary Education (2012) 206 FCR 92 at [68] per Kenny, Edmonds and Robertson JJ. See also Moreton Resources Ltd v Innovation and Science Australia [2019] FCAFC 120 at [146]. 85 As the Commissioner submits, the term "use" is protean and must be construed in its particular statutory context. I will set out some general meanings of the word "use" before returning to the particular statutory context (which, as discussed below, suggests a particular meaning). 86 In Macquarie University, Mahoney JA said at 313-314: It has frequently been pointed out that "use" is a term having an ordinary meaning which is both wide … and wanting in precision … The heart of the term lies in the notion of the thing in question being employed or availed of, but, according to the context, it may differ in meaning as to how or by whom the thing may be employed within its intended meaning. Thus, although "use" denotes in general being employed or availed of, the context may indicate that its meaning is limited to use only in a particular manner. (Case references omitted; emphasis added.) 87 This meaning of the word "use" is reflected in some dictionary definitions. For example, the first entry for the word "use" in The Shorter Oxford English Dictionary on Historical Principles (Oxford University Press, 3rd ed, 1973) includes: The act of using a thing for any (esp. a profitable) purpose; the fact, state, or condition of being so used; utilization or employment for or with some aim or purpose; application or conversion to some (esp. good or useful) end. 88 Similarly, the entry for "use" in the Macquarie Dictionary (6th ed, 2013) includes (as the first two definitions for "use" as a noun): 11. the act of employing or using, or putting into service: the use of tools. 12. the state of being employed or used: this book is in use. 89 However, the particular statutory context of the Fuel Tax Act is important. The Act establishes a single system of fuel tax credits, which are paid to reduce or remove the incidence of fuel tax levied on taxable fuels under customs and excise legislation (see s 2-1, set out above). As explained in s 41-1, fuel tax credits are provided under Subdiv 41-A to business taxpayers who are registered for GST in two situations. In summary: (a) The first situation is where the taxpayer acquires fuel to use in carrying on its enterprise (whether the fuel is used as fuel or otherwise). (b) The second situation is where the taxpayer acquires fuel to: (i) make a taxable supply to a private user for domestic heating; (ii) package the fuel for the purpose of making a taxable supply of it for use other than in an internal combustion engine; or (iii) make a taxable supply of LPG into certain kinds of tanks. 90 It is apparent from this summary that the word "use" for the purposes of the Act does not include the making of a taxable supply of fuel. The Act provides fuel tax credits in two situations: where the fuel is acquired for use in carrying on an enterprise (s 41-5); and where the fuel is acquired to make a taxable supply in three specific situations (s 41-10). It follows from this scheme that the making of a taxable supply of fuel is outside the concept of "use" for the purposes of the Act; otherwise, the making of a taxable supply of fuel might qualify for a fuel tax credit outside of the specific situations referred to in s 41-10. In light of the above, I consider that, for the purposes of the Act, the term "use" takes its ordinary meaning, save that it does not include making a taxable supply of fuel, which does not constitute a "use" within the meaning of the Act. 91 For example, in the present case, Coles Express acquired fuel for re-sale to its customers. If the ordinary meaning of "use" were applied without the qualification indicated above, one might say that Coles Express acquired such fuel for "use" in carrying on its enterprise; fuel that is acquired for re-sale to customers is, at least arguably, to be employed or availed of in carrying on Coles Express's enterprise. However, for the reasons discussed above, such a use (if it be such) is outside the concept of "use" for the purposes of the Fuel Tax Act. 92 This analysis is consistent with [2.34] of the Revised EM, which states: Fuel is 'used' if it ceases to exist after an action to use it, either as a fuel or in the production of another thing. As such, a sale of fuel is not a use of the fuel and a taxpayer will not be considered to have used fuel if they sell the fuel to another entity. For example, an oil company would be entitled to a fuel tax credit for fuel that they acquire or manufacture in, or import into Australia for use in exploration for, or the extraction of a petroleum product. They would not be entitled to a fuel tax credit for the product that they actually extract, refine and sell to a distributor or retail outlet. (Emphasis added.) 93 I turn now to consider more directly the issue concerning evaporation and leakage. The key facts and matters may be summarised as follows. Coles Express acquired fuel from Viva for the purpose of re-selling that fuel to Coles Express's customers. At the time Coles Express acquired the fuel, it knew that a small portion of the fuel would, in most if not all cases, be lost through evaporation or leakage during the process of delivery and storage. At the time of delivery, Coles Express could not quantify precisely how much would be lost through evaporation or leakage; nevertheless, it knew that a small portion would be lost in this way. It may be inferred that the evaporation was an inevitable part of the process of delivery and storage of the fuel. In relation to leakage, the evidence does not go into any detail as to whether Coles Express had control over the amount of fuel lost through leakage. It may be inferred that Coles Express had some control over the extent of leakage by virtue of having control over the factors referred to in [56] above. 94 The question is whether, in these circumstances, Coles Express acquired the relevant fuel (that is, the portion of the fuel that was subsequently lost through evaporation or leakage) "for use in carrying on [its] enterprise" within the meaning of s 41-5(1). Coles's submissions identify the relevant "use" of this portion of the fuel as being evaporation and leakage (rather than re-sale). In my view, however, it is artificial to divide the total amount of fuel acquired by Coles into two portions and to ascribe separate uses to those portions. That is, it is artificial to describe the portion of fuel that was, in fact, re-sold as being acquired for re-sale, and the remaining portion as having been acquired for a separate and distinct "use", being evaporation or leakage. The evaporation was an unwelcome, and unavoidable, part of the process of delivery and storage of the fuel for the purposes of re-sale. In relation to leakage, this was an unwelcome, and to some extent probably unavoidable, part of the same process. The evaporation and leakage were, therefore, wholly incidental to the process of re-sale of the fuel. In these circumstances, I consider it appropriate to characterise the purpose of acquisition of the portion that evaporated or leaked in the same way as the purpose of acquisition of the bulk of the fuel, namely for use in making a taxable supply. For the reasons discussed above, this is not a "use" for the purposes of s 41-5(1). I note for completeness that, even if it were appropriate to characterise evaporation and leakage as a separate or distinct "use", Coles has not established that Coles Express acquired the relevant portion of the fuel for that purpose. That is because, as discussed above, at the time of delivery, Coles Express could not actually quantify how much fuel would be lost through evaporation or leakage. Thus, the purpose or intention element of s 41-5(1) is not established. 95 The present situation may be contrasted with a situation in which evaporation of fuel occurs in the context of a situation in which the bulk of the fuel is acquired for use in carrying on the taxpayer's enterprise. Take, for example, a situation in which a farmer acquires fuel for use in a tractor for business purposes. Prima facie, the farmer is entitled to a fuel tax credit as the fuel is acquired for use in carrying on the farmer's enterprise. Assume that the farmer knows at the time of acquisition of the fuel that a small portion will be lost through evaporation during delivery and storage of the fuel (for the purpose of use in the tractor). In these circumstances, I do not have any difficulty in seeing the relevant fuel (that is, the fuel that will evaporate) as acquired for use in carrying on the farmer's enterprise. In this example, the evaporation is incidental to a "use" of the fuel for the purposes of the Act. It would be artificial to distinguish between the portions of the fuel that do and do not evaporate, and to ascribe different "uses" to them. 96 Thus, although in some contexts the evaporation or leakage of fuel may constitute "use" of the fuel in carrying on an enterprise, in the present context, where the evaporation and leakage were wholly incidental to an application of the bulk of the fuel that did not constitute a "use" of the fuel for the purposes of the Act, I do not consider the relevant fuel to have been acquired for use in carrying on Coles Express's enterprise for the purposes of s 41-5(1). 97 Coles relies on an example provided in the Macquarie Dictionary, namely "his car uses a lot of oil". Coles submits that a car consumes oil when it leaks or evaporates and that, in the same way, Coles uses fuel when it leaks or evaporates from the UPSS. However, in that example, the evaporation or leakage is incidental to a use of the oil (as lubricant in a closed system). In contrast, in the present case, the evaporation or leakage is incidental to an application that does not constitute a "use" for the purposes of the Act, namely re-sale of the fuel. 98 The analysis in the foregoing paragraphs is consistent with the Revised EM. Paragraph [2.34] has been set out above. The relevant section of the Revised EM continues: 2.35 The term 'use' is also intended to cover the blending of fuel with other products to create a fuel blend that no longer constitutes a fuel that can be used as a fuel in an internal combustion engine. Where a fuel blend cannot be used as a fuel in an internal combustion engine, the manufacturer of the blend, and not the end user, is entitled to claim a credit for any fuel tax paid on the constituents of the blend. Some examples of these types of blend are paint and certain solvents, printing inks, cleaning agents, adhesives and the like. For the discussion on fuel blends that can be used as a fuel in an internal combustion engine, refer to paragraphs 1.41 and 1.42. 2.36 In circumstances where it is unclear whether certain blends constitute a fuel that can be used as a fuel in an internal combustion engine, the Commissioner is able to make a determination that blends of fuel and other products do not constitute a fuel. In these circumstances the manufacturer of the fuel blend and not the end user is considered to have used the fuel and is entitled to claim a fuel tax credit for any fuel tax paid on the constituents of the blend. [Section 95-5] 2.37 'Use' will also include the loss of fuel through evaporation and temperature changes in the course of carrying on a taxpayer's enterprise. 99 The reference to loss of fuel through evaporation in [2.37] needs to be read in the context of the preceding paragraphs, which discuss fuel that is acquired for use in carrying on the taxpayer's enterprise. In the context of fuel that is acquired for use in carrying on the taxpayer's enterprise, it is unsurprising, and consistent with the scheme of the Act, to treat the loss of fuel through evaporation and temperature changes as a "use" of the fuel for the purposes of the Act. However, that is very different from a situation in which fuel is acquired for re-sale, which does not constitute a "use" of the fuel for the purposes of the Act. I do not read [2.37] of the Revised EM as addressing that very different situation. Thus, read in context, I do not consider [2.37] to advance Coles's case or to be inconsistent with the approach indicated above. 100 In support of its contention that evaporation or leakage in the circumstances of this case constitutes a "use" of fuel, Coles relies heavily on the overview and purpose of the Fuel Tax Act as set out in s 2-1 (see [18] above) and the object of Ch 3 as set out in s 40-5 (which is to similar effect as s 2-1). Section 2-1 states that the Act provides a single system of fuel tax credits, and that fuel tax credits are paid to reduce or remove the incidence of fuel tax levied on taxable fuels "ensuring that, generally, fuel tax is effectively only applied to: (a) fuel used in private vehicles and for certain other private purposes; and (b) fuel used on-road in light vehicles for business purposes". Coles emphasises that the fuel that evaporates or leaks in the circumstances of this case is not used in either of the ways referred to in paragraph (a) or (b) in s 2-1 (nor is it used for re-sale). Accordingly, in Coles's submission, adopting a purposive approach, fuel tax should not apply to such fuel. The difficulty with this submission is that s 2-1 uses the word "generally". It is not purporting to lay down an invariable rule (or purpose) that fuel tax will only apply in the categories of cases referred to in paragraphs (a) and (b) of s 2-1. The Act provides a system of fuel tax credits with a number of exceptions. The effect is that fuel tax applies in circumstances that go beyond the cases referred to in paragraphs (a) and (b) of s 2-1. Thus, in my view, ss 2-1 and 40-5 provide limited assistance in relation to the meaning of the word "use". 101 I note that Coles submits that the Commissioner attempts to impermissibly read words into s 41-5(1) of the Fuel Tax Act. Coles points to the statement in the Commissioner's appeal statement that: "Where fuel evaporates, that will only be a use where it arises as part of putting the fuel to a use that is recognised by the [Fuel Tax Act]". Coles submits that the Commissioner impermissibly seeks to re-write the provision such that it states that a fuel tax credit is available "for use in carrying on your enterprise [other than an enterprise involving sale of fuel]". I do not consider the construction of "use" adopted above to involve reading any words into s 41-5(1). Rather, it involves construing the word "use" - and the phrase "for use in carrying on [the taxpayer's] enterprise" - in the context of the Act as a whole. 102 I note for completeness that the words "to the extent that" in s 41-5(1) recognise that the acquisition of fuel can and should be apportioned between eligible and ineligible intended uses where such can be identified at the time of acquisition. However, in the present case, for the reasons set out above, the loss of fuel through evaporation or leakage is not a "use"; accordingly, it cannot be the subject of such apportionment. 103 For these reasons, I conclude that Coles Express did not acquire the relevant fuel (that is, the fuel that subsequently evaporated or leaked) "for use in carrying on [its] enterprise" for the purposes of s 41-5(1). Accordingly, Coles is not entitled to fuel tax credits under s 41-5(1) for the fuel that evaporated or leaked during the relevant tax periods.

The Decreasing Fuel Tax Adjustment Issue 104 This issue arises in the alternative to the Fuel Tax Credit Issue. If, contrary to its submissions in relation to the Fuel Tax Credit Issue, it is held that Coles is not entitled to a fuel tax credit under s 41-5(1) in respect of the relevant fuel, Coles contends that it is entitled to a decreasing fuel tax adjustment pursuant to s 44-5 of the Fuel Tax Act in respect of the fuel that was lost through evaporation or leakage during the relevant tax periods. The issue may be stated as whether, under s 44-5, Coles is entitled to a decreasing fuel tax adjustment on the basis that fuel acquired for retail sale, but subsequently lost by evaporation or leakage, was used in a way that was different from that intended at the time of its acquisition.

Coles's submissions 105 Coles's submissions in relation to this issue can be summarised as follows: (a) Section 44-5(1)(a) of the Fuel Tax Act provides that Coles has a fuel tax adjustment if Coles uses fuel and the amount of the fuel tax credit to which Coles would have been entitled on acquisition of that fuel would have been different if Coles had originally acquired the fuel to use in the circumstances in which the fuel was actually used. Relevantly, the application of this provision is that where: (i) Coles acquires fuel for re-sale and is not entitled to a fuel tax credit; and (ii) Coles subsequently uses fuel through evaporation and leakage; and (iii) had Coles acquired the fuel for use through evaporation and leakage rather than re-sale, it would have been entitled to a fuel tax credit, then Coles is required to make a fuel tax adjustment in respect of the fuel that evaporated or leaked. (b) The statutory wording looks to what fuel tax credit entitlement would have existed if "you had originally acquired … the fuel to use … in the circumstances in which you did use the fuel". (c) The expression "circumstances in which you did use … the fuel" looks at the actual use of the fuel and then determines whether a fuel tax credit would be available if the fuel had been acquired only for that use. Correctly read, the statutory text "you had originally acquired … the fuel to use … in the circumstances in which you did use … the fuel" deems - for the purpose of notionally applying s 41-5 of the Fuel Tax Act - the purpose of acquisition to be the actual use of the fuel by Coles. In this case, that use is "evaporation". (d) Examples in the Revised EM show different permissible methods of accounting for fuel tax credits and fuel tax adjustments: see examples 2.10 and 2.12. (e) Coles acquires fuel knowing that some will evaporate or leak, but does not precisely quantify that amount prior to the leakage or evaporation occurring. This can lead to two different results under the Fuel Tax Act: (i) when Coles acquires some of the fuel for use through leakage or evaporation, an entitlement to a fuel tax credit arises for the fuel that will leak or evaporate and which Coles is required to estimate; and/or (ii) Coles is required to make a decreasing fuel tax adjustment after calculating the amount of fuel that has actually leaked or evaporated. (f) Dixon J's influential analysis of accounting methods in income tax matters in Commissioner of Taxes (South Australia) v The Executor Trustee and Agency Company of South Australia Ltd (1938) 63 CLR 108 (Carden's Case) at 154 is that: In the present case we are concerned with rival methods of accounting directed to the same purpose, namely, the purpose of ascertaining the true income. Unless in the statute itself some definite direction is discoverable, I think that the admissibility of the method which in fact has been pursued must depend upon its actual appropriateness. In other words, the inquiry should be whether in the circumstances of the case it is calculated to give a substantially correct reflex of the taxpayer's true income. (g) Similarly, an accounting method that is calculated to give a substantially correct reflex of the fuel lost to evaporation or leakage should be used. The affidavit of Ms Robinson shows the recording and reconciliations to quantify the amount of fuel that has evaporated or leaked. Coles Express is unable to identify the specific amount of fuel that will be lost each month upon purchase and intends to re-sell the majority, which is not eligible for a fuel tax credit. (h) As such, it is most appropriate that if Coles does not claim a fuel tax credit, it instead has a decreasing fuel tax adjustment after the amount of fuel that has evaporated or leaked has been ascertained. This would be consistent with the statutory wording of s 44-5, the purpose of the Fuel Tax Act, the examples in the Revised EM referred to above, and the method of accounting for fuel tax purposes that gives a "substantially correct" (Carden's Case at 154) reflection of Coles's fuel tax position. 106 It is not necessary to set out the Commissioner's submissions.

Consideration 107 The drafting of s 44-5 (set out at [22] above) is not straightforward. However, there is no real issue between the parties as to how the section works. The real issue concerns the meaning of the word "use". 108 As noted above, s 44-5 compares the amount of the entity's original entitlement to a fuel tax credit under s 41-5 to what its entitlement would have been had the fuel been acquired for the use to which it was in fact applied. In other words, s 44-5 operates on the hypothesis that you originally acquired the fuel for the use to which it was ultimately put. 109 Section 44-5 operates when there has been a use of fuel and then compares two amounts of fuel tax credits: (a) the "are or were entitled amount", being the amount of fuel tax credits the taxpayer is or was entitled to under s 41-5 based on the taxpayer's intended use of the fuel, at the time of acquisition. This could be a positive amount if the fuel was acquired with the intention of using it in carrying on the taxpayer's enterprise. Alternatively, it could be zero if s 41-5 had operated such as to deny any entitlement to a fuel tax credit - for example, if the fuel was acquired for sale or the intended use was not a use falling within the scope of s 41-5; and (b) the "would have amount", being the amount of fuel tax credits the taxpayer would have been entitled to under s 41-5 had the taxpayer's actual use of the fuel been its intended use at the time of acquisition. 110 Thus, by contrast with Div 41, Div 44 is concerned with the actual, not intended, use of fuel. As Jagot J (sitting as a presidential member of the Administrative Appeals Tribunal) stated in Linfox Australia Pty Ltd v Federal Commissioner of Taxation [2019] AATA 222 (affirmed on appeal) at [13]: Division 44 concerns increasing and decreasing fuel tax credits, in effect, acknowledging that fuel may be acquired for one purpose and not used for that purpose, enabling adjustments to be made as necessary. 111 In a situation where the actual use would have given rise to a higher fuel tax credit amount than the entitlement based on the intended use, the "would have amount" of fuel tax credits will be greater than the "are or were entitled amount" of fuel tax credits. In that situation, the taxpayer would fall within the scope of s 44-5(3) and be entitled to a decreasing fuel tax adjustment (i.e. a favourable adjustment) to the extent of the difference. 112 Section 44-5 can only operate to the benefit of Coles to the extent that it was not entitled to a fuel tax credit with respect to evaporated or leaked fuel under s 41-5(1). 113 The resolution of the question whether Coles is entitled to a fuel tax adjustment under s 44-5 turns on the meaning of the word "use" in s 44-5. That is because the provision requires a comparison between the "are or were entitled amount" and the "would have amount" (as explained above), and the "would have amount" is the amount of fuel tax credits Coles would have been entitled to under s 41-5(1) had Coles Express's actual use of the fuel been its intended use at the time of acquisition. 114 The word "use" is used in the same sense in s 44-5(1) as it is in s 41-5(1). This is necessarily the case as the two provisions are interlinked in the way described above. Accordingly, in my view, "use" in s 44-5(1) has the meaning discussed above in relation to the Fuel Tax Credit Issue. That is, the term "use" takes its ordinary meaning, save that it does not include making a taxable supply of fuel. In my view, for the reasons discussed above, it is artificial to ascribe different uses to the portion of fuel that was re-sold to Coles Express's customers and the remainder of the fuel, which evaporated or leaked. The evaporation or leakage of fuel was wholly incidental to Coles Express making a taxable supply of fuel, in the sense that it was an unwelcome, and unavoidable, part of that activity. Accordingly, it is appropriate to characterise the portion of the fuel that evaporated or leaked in the same way as the fuel that was re-sold to Coles Express's customers. In other words, the portion that evaporated or leaked was not "used" in carrying on the enterprise for the purposes of the Act. It follows that the "would have amount" is zero and that Coles is not entitled to a decreasing fuel tax adjustment under s 44-5 with respect to the fuel that evaporated or leaked.

The Section 47-5 Issue 115 In light of my conclusion in relation to the Fuel Tax Credit Issue, the Section 47-5 Issue does not need to be determined. (This issue only arises if Coles is otherwise entitled to a fuel tax credit in respect of fuel that has been lost through evaporation or leakage.) Nevertheless, for completeness, and given the detailed submissions on this issue, I will make some observations about the issue. 116 The Section 47-5 Issue is raised in one proceeding (proceeding No. VID 1366 of 2018), which relates to the tax periods between July 2012 and January 2014. In its monthly fuel tax returns for that period, Coles did not quantify fuel tax credits for fuel that was lost through evaporation or leakage at Coles Express stores. Nor did Coles quantify fuel tax credits for the fuel that was lost through evaporation or leakage during the tax periods between July 2012 and January 2014 in any of its subsequent fuel tax returns. However, in August 2016, Coles objected to the deemed assessments constituted by its fuel tax returns for the tax periods between July 2012 and January 2014. In its objections, Coles claimed an entitlement to fuel tax credits for the fuel lost through evaporation and leakage during those tax periods. 117 The issue is whether, assuming (contrary to my earlier conclusion) that Coles is otherwise entitled to fuel tax credits pursuant to s 41-5(1) for fuel that evaporated or leaked during the tax periods between July 2012 and January 2014, Coles has ceased to be entitled to those fuel tax credits by reason of the operation of s 47-5. The Commissioner contends that Coles has ceased to be entitled to the fuel tax credits; Coles contends that it has not ceased to be entitled to those credits.

The relevant statutory provisions 118 Division 47 of the Fuel Tax Act deals with a time limit on entitlements to fuel tax credits. Section 47-5 provides as follows: 47-5 Time limit on entitlements to fuel tax credits (1) You cease to be entitled to a fuel tax credit to the extent that it has not been taken into account, in an *assessment of a *net fuel amount of yours, during the period of 4 years after the day on which you were required to give to the Commissioner a return for the tax period or fuel tax return period to which the fuel tax credit would be attributable under subsection 65-5(1), (2) or (3). (2) Without limiting subsection (1), you also cease to be entitled to a fuel tax credit for taxable fuel you acquire, manufacture or import, to the extent that you did not give to the Commissioner under section 61-15 during the period of 4 years after the day on which the acquisition, manufacture or importation occurred a return that takes the fuel tax credit into account. Note: Section 47-10 sets out circumstances in which your entitlement to the fuel tax credit does not cease under this section. The word "assessment" is defined in the Dictionary to the Fuel Tax Act as having the meaning given by the Income Tax Assessment Act 1997 (Cth). The expression "net fuel amount" is defined as having the meaning given by s 60-5 of the Fuel Tax Act (set out above): 119 As described below, a self-assessment system applies to the Fuel Tax Act. In broad terms, the Commissioner is treated as having made an assessment of the net fuel amount for each tax period upon having received a taxpayer's fuel tax return for that period. 120 Pursuant to Div 61 of the Fuel Tax Act, a taxpayer must give the Commissioner a fuel tax return for each tax period, which returns are to include its calculation of its "net fuel amount" for each tax period. The fuel tax return is due on the same date as the GST return for the same tax period, being on or before the twenty-first day of the following month or such further period as the Commissioner allows: Fuel Tax Act, s 61-15; A New Tax System (Goods and Services Tax) Act 1999 (Cth) (the GST Act), s 31-10. 121 Division 65 of the Fuel Tax Act deals with attribution rules. Section 65-5 sets out attribution rules for fuel tax credits. Section 65-5(1) relevantly provides that, where fuel is acquired, fuel tax credits are attributable to the same period that the input tax credit for the fuel is attributable to under the GST Act. Section 65-5(4) provides as follows (omitting a Note to the subsection): (4) If your return for a *tax period or *fuel tax return period does not take into account a fuel tax credit that is attributable to the period mentioned in subsection (1), (2) or (3), then the credit: (a) ceases to be attributable to that period; and (b) becomes attributable to the first period for which you give the Commissioner a return that does take it into account. 122 As noted above, a self-assessment system applies to the Fuel Tax Act. The key provisions are contained in Div 155 of Sch 1 to the Tax Administration Act. Section 155-5 provides that an "assessable amount" means (among other things) a net fuel amount. Section 155-15 provides that the Commissioner is treated as having made an assessment of the net fuel amount for each tax period upon having received a taxpayer's fuel tax return for that period (see Item 2 in the table in s 155-15(1)). Pursuant to s 155-15(2)-(4), the assessment is treated as having been made on the day the fuel tax return is received by the Commissioner in the amount stated by the taxpayer, and the taxpayer's fuel tax return is treated as being a notice of the assessment signed by the Commissioner and given to the taxpayer on the same day. Section 155-60 relevantly provides that, despite anything in Subdiv 155-B, the Commissioner may amend an assessment of an assessable amount at any time to give effect to a decision on a review or appeal. Section 155-90 provides that a taxpayer may object, in the manner set out in Pt IVC of the Tax Administration Act, against an assessment of an assessable amount if the taxpayer is dissatisfied with the assessment. 123 Section 14ZZQ(1) of the Tax Administration Act (located within Pt IVC) provides that, when the order of the court in relation to the decision becomes final, the Commissioner must, within 60 days, take such action, including amending any assessment or determination concerned, as is necessary to give effect to the decision.

Consideration 124 In the discussion that follows, I will assume (contrary to the conclusion set out above in relation to the Fuel Tax Credit Issue) that, subject to the effect (if any) of s 47-5, Coles would be entitled to fuel tax credits for fuel that evaporated or leaked at Coles Express stores. 125 It is common ground that any fuel tax credit (for fuel that evaporated or leaked) is attributable to the tax period in which the fuel was delivered. 126 The Commissioner's position is that Coles has ceased to be entitled to the fuel tax credits for the tax periods between July 2012 and January 2014 pursuant to both s 47-5(1) and s 47-5(2). The Commissioner contends that the subsections each create independent time limits after which the entitlement to fuel tax credits ceases. The Commissioner contends that: for each of the monthly tax periods from July 2012 to January 2014, there was an assessment of Coles's net fuel amount upon receipt by the Commissioner of the monthly fuel tax return for that month; and that those assessments did not take into account in any way any claim for fuel tax credits by Coles with respect to the evaporation or leakage of fuel. 127 The Commissioner submits that the effect of s 47-5(1) is that: Coles ceased to be entitled to any fuel tax credits for each of the monthly periods from July 2012 to January 2014 four years after the due dates for the monthly fuel tax returns for each period expired (that is, dates from approximately August 2016 to February 2018) unless those fuel tax credits were "taken into account" in a subsequent or amended assessment of its net fuel amount before the expiry of the four year periods; no such further or amended assessments have been made of Coles's net fuel amounts for the periods from July 2012 to January 2014 insofar as they relate to the fuel in question; accordingly, due to the operation of s 47-5(1), Coles has ceased to be entitled to any fuel tax credits attributable to those periods. 128 As for s 47-5(2), the Commissioner submits that: Coles also ceased to be entitled to any fuel tax credits for each of the monthly tax periods from July 2012 to January 2014 four years after the acquisition of fuel occurred, unless Coles gave to the Commissioner a return under s 61-5 that "takes the fuel tax credit into account"; no such returns were given by Coles to the Commissioner with respect to fuel tax credits for acquisitions made in the periods from July 2012 to January 2014 insofar as they relate to the fuel in question; accordingly, due to the operation of s 47-5(2), Coles has ceased to be entitled to any fuel tax credits for acquisitions of fuel in those periods. 129 Coles accepts that, when it filed its fuel tax returns for the tax periods between July 2012 and January 2014, it did not quantify a fuel tax credit for fuel that leaked or evaporated. Coles submits that it was unaware of any potential entitlement at that time. This submission is made in [36] of Coles's written submissions and is said to be supported by [8] of Mr Lane's affidavit. That paragraph does not establish that Coles was unaware of any potential entitlement during the July 2012 to January 2014 tax periods. However, nothing turns on whether this fact is established. 130 Coles advances two main contentions. The first contention is that, notwithstanding that it did not quantify the fuel tax credit in its fuel tax returns for the relevant tax periods, the fuel tax credit was nevertheless "taken into account" for the purposes of s 47-5. Coles submits that the judgment of the Full Court in Linfox supports this contention. Secondly, Coles contends that s 47-5 of the Fuel Tax Act, when understood in its historical context, is designed to place a four-year limit on the process of claiming a fuel tax credit in a later fuel tax return (the situation dealt with in s 65-5(4)); s 47-5 is not intended to affect the objection and appeal processes dealt with in Pt IVC of the Tax Administration Act. Thus, according to this contention, it is sufficient that Coles objected to the relevant assessments within the four-year period allowed for objections and claimed the fuel tax credits in its objections. 131 The Commissioner submits that Coles's contentions are incorrect. The Commissioner submits that: so far as s 47-5(1) is concerned, while it is the case that s 155-15(4) of Sch 1 to the Tax Administration Act deems the taxpayer's filed fuel tax return to be a notice of assessment signed by the Commissioner and given to the taxpayer on the same day, there is no such deeming provision with respect to objections; the mere filing of an objection to an assessment does not give rise to either a new assessment of the net fuel amount for the period or an amendment to a prior assessment of the net fuel amount; the objection process is entirely distinct from and separate to the process of return and assessment; accordingly, the filing of an objection does not give rise to an assessment. The Commissioner further submits that the filing of an objection is distinct from the process of giving a return, and filing an objection to a return does not amount to giving a return, still less a return under s 61-15. 132 At the hearing of the proceeding, senior counsel for Coles handed up a written submission on the legislative history of s 47-5 of the Fuel Tax Act. In brief terms, this explained that between 1 July 2006 and 30 June 2012, the Fuel Tax Act operated as a 'self-actuating' system under which taxpayers were entitled to a refund of the net fuel amount reported in their return without the Commissioner assessing their net fuel amount. Under the self-actuating system, there was no requirement for the Commissioner to issue an assessment unless requested. It was in that context that, in 2010, s 47-5 was first introduced. The section (together with s 47-10) was introduced by the Tax Laws Amendment (2009 GST Administration Measures) Act 2010 (Cth) (the 2010 Amending Act). The cessation of entitlements to fuel tax credits under s 47-5 was accompanied by the introduction of a 'stop the clock' mechanism under s 105-55(1) of Sch 1 to the Tax Administration Act. The legislative scheme following these amendments remained a self-actuating system. Having set out that history, Coles submits that: when it was introduced, s 47-5 did not operate to prevent entitlement to a credit following an objection as, in order for an objection to be made under the self-actuating system, a taxpayer would have had to have claimed the credit, received a lesser refund, requested an assessment, and objected to that assessment; as such, the limitation imposed by s 47-5 was intended to be irrelevant to a taxpayer's entitlement pursuant to an objection. 133 Coles's written submission on the legislative history then describes the change to a self-assessment system, which was effected by the Indirect Tax Laws Amendment (Assessment) Act 2012 (Cth) (the 2012 Amending Act). The 2012 Amending Act: removed the 'stop the clock' notification possible under s 105-55(1); introduced s 47-5 in its current form; introduced s 61-5, requiring the Commissioner to make an assessment of a net fuel amount via the deemed assessment rules in s 155-15 of Sch 1 to the Tax Administration Act; introduced the ability to object to the net fuel amount as an "assessable amount"; and introduced s 155-60 in Sch 1 to the Tax Administration Act, which provides that the Commissioner may amend an assessment of an assessable amount at any time due to an objection decision or court order in relation to the same. After referring to extrinsic materials in relation to these changes, Coles submits that: it would be expected that, if s 47-5 were intended to curtail the effectiveness of objection rights under Div 155 of Sch 1 to the Tax Administration Act, this would have been expressly stated in the legislation or the Explanatory Memoranda to the 2010 Amending Act or the 2012 Amending Act; the fact that there is no express statement to this effect is consistent with the interpretation that, once a return is lodged and an assessment objected to, s 47-5 has no work to do; this is consistent with a legislative history where s 47-5 was introduced to limit perpetual asymmetric entitlements to fuel tax credits when compared to fuel tax liabilities and, as revised by the 2012 Amending Act, to prevent taxpayers benefitting from a longer period to claim a credit by not lodging returns or claiming credits via a return in a timely manner; s 47-5 therefore has no work to do in respect of an objection lodged under a separate branch of the statutory scheme where there is no asymmetry between the Commissioner's recovery rights and the taxpayer's rights to fuel tax credits. 134 Coles further submits that: read in the context of a statutory scheme which initially provided for an unlimited recovery period for fuel tax credits but not fuel tax liabilities, and then a four-year period in which credits and liabilities could be recovered via self-actuated returns that were lodged and then potentially objected to, the correct reading of s 47-5 is that: (a) section 47-5 is intended to prevent an ongoing entitlement to claim credits in a later return where a return has not been lodged or credits not claimed; (b) Div 155 of Sch 1 to the Tax Administration Act provides for a separate dispute resolution mechanism (i.e. objection and review) once a return has been lodged or a default assessment issued; and (c) once a return has been lodged and objected to, there is no scope for the operation of s 47-5 to disentitle a taxpayer to fuel tax credits as the rights of the Commissioner and the taxpayer are, relevantly, preserved and protected by ss 14ZY, 14ZZP and 14ZZQ of the Tax Administration Act and s 155-60 of Sch 1 to that Act. See also the Explanatory Memorandum accompanying the Indirect Tax Laws Amendment (Assessment) Bill 2012 at [1.29], [1.81], [1.113]. 135 The Commissioner was given leave to, and did, file a written submission in response. In brief terms, the Commissioner submits that there is no inconsistency between s 47-5 and Div 155 of Sch 1 to the Tax Administration Act that would require an adjustment to the meaning of s 47-5. The Commissioner submits that a taxpayer's substantive right to claim fuel tax credits is susceptible to extinguishment in accordance with the provisions of s 47-5 if a return has not been lodged in which credits are claimed. The Commissioner submits that a taxpayer's entitlement to claim a fuel tax credit (or the extinguishment of any such entitlement) would constitute taxable facts forming part of the subject-matter of the objection, review or appeal, referring to Federal Commissioner of Taxation v Thomas (2018) 357 ALR 445 at [84]-[85] per Gageler J. The Commissioner submits that there is no warrant for reading additional words into s 47-5. However, I do not consider this to be the effect of Coles's submissions. The Commissioner also submits that contextual features of s 47-5 are inconsistent with Coles's submissions. In summary, the Commissioner submits that s 47-5 means what it says, and operates to extinguish claims to fuel tax credits upon the expiration of the four-year limitation period. 136 The judgment of the Full Court in Linfox was handed down after the hearing of the present matter. The parties were given leave to, and did, file supplementary submissions addressing the implications of Linfox for the present proceedings. 137 As noted above, Coles's first contention is that, notwithstanding that it did not quantify the fuel tax credit in its fuel tax returns for the relevant tax periods, the fuel tax credit was nevertheless "taken into account" for the purposes of s 47-5. Had it been necessary to decide the point, I would have rejected this contention. The fuel tax credit was not an integer used by Coles in calculating its net fuel amount in its fuel tax returns for the tax periods between July 2012 and January 2014. Indeed, Coles submits that it was not aware of the potential entitlement to a fuel tax credit for the fuel that evaporated or leaked during that period. Nor were the fuel tax credits for that period included in any subsequent fuel tax return. In these circumstances, the fuel tax credit was not "taken into account" in an assessment within the four-year period referred to in s 47-5. 138 The situation in the present case is quite different from that considered in Linfox. In that case, the fuel tax credits were an integer in the calculation of the taxpayer's net fuel amount. As noted in Linfox at [122], the taxpayer in that case made a self-assessment, deemed to be an assessment, under which it calculated its net fuel amount by reducing the amount of its fuel tax credits by the amount of the road user charge for the fuel. (The taxpayer later contended that it should not have so reduced its fuel tax credits.) The question was whether, in these circumstances, the fuel tax credits had been "taken into account" in the assessment. The Full Court held that the fuel tax credits had been taken into account in the assessment: Linfox at [128]-[134]. The Full Court expressed the view, at [134], that "the assessment of the net fuel amount includes the calculation of the total fuel tax credits which in turn includes the amount by which the taxpayer's fuel tax credit for the fuel is reduced by the amount of the road user charge". The Full Court continued: "That the assumed error was in relation to the road user charge, and therefore affected the calculation of the total fuel tax credits, does not seem to us to have the result that the fuel tax credit has not been taken into account, to the extent of the erroneous reduction, in an assessment of the net fuel amount". The present case is quite different. Here, the fuel tax credit was not included as an integer in calculating the net fuel amount in Coles's self-assessment. 139 Coles's second contention is that s 47-5 of the Fuel Tax Act, when understood in its historical context, is designed to place a four-year limit on the process of claiming a fuel tax credit in a later fuel tax return (the situation dealt with in s 65-5(4)); and that s 47-5 is not intended to affect the objection and appeal processes dealt with in Pt IVC of the Tax Administration Act. In my view, there is some force in this contention. For the reasons given by Coles in its submissions, summarised above, there is a persuasive argument that: s 47-5 is intended to prevent an ongoing entitlement to claim credits in a later return where a return has not been lodged or credits not claimed; Div 155 of Sch 1 to the Tax Administration Act provides for a separate dispute resolution mechanism (i.e. objection and review) once a return has been lodged or a default assessment issued; and once a return has been lodged and objected to, there is no scope for the operation of s 47-5 to disentitle a taxpayer to fuel tax credits as the rights of the Commissioner and the taxpayer are, relevantly, preserved and protected by ss 14ZY, 14ZZP and 14ZZQ of the Tax Administration Act and s 155-60 of Sch 1 to that Act. Acceptance of the Commissioner's submissions would present the difficulty that a taxpayer could lawfully object to an assessment and find that, when a court came to consider the matter outside of the four-year period, an entitlement to a fuel tax credit would be denied, notwithstanding that the credit was attributable to the period to which the assessment and objection related. For example, it may be that, in relation to a contentious issue concerning a fuel tax credit, a taxpayer wishes to self-assess on the basis of the Commissioner's position on the issue, and then object against the deemed assessment. In this scenario, if the Commissioner's submissions are correct, the taxpayer's entitlement to the fuel tax credit would depend on whether or not the matter was determined (by the Commissioner or on review or appeal) within the four year period. Thus, while I accept that s 47-5 is expressed in unqualified terms, consideration of the legislative history, including that it was introduced during the period when a self-actuating system applied, is generally supportive of Coles's contention.

Conclusion 140 For these reasons, I have concluded as summarised in [7] above. At this stage, I will make orders in each proceeding that, within 14 days, the parties file any agreed minute of proposed orders to give effect to the reasons (including as to costs); and that, if the parties cannot agree, within 21 days each party file and serve a minute of proposed orders to give effect to the reasons (including as to costs) together with an outline of submissions. I certify that the preceding one hundred and forty (140) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moshinsky.