Commissioner WEA Records I v | AnT Cone Deny "YEnraCorpy jelsira Corp a

• By sec. 3 (1) of the Sales Tax Assess- ment Act (No. 1) 1930-1931, the word " manufacturer " is defined as meaning "a person who engages, whether exclu- sively or not, in the manufacture of goods, and includes a printer, publisher, lithographer or engraver; and where one person makes goods for another, wholly or in part, out of materials sup- plied by that other, and the goods are not required for the private, domestic,

or other personal use of that other, the person supplying the materials shall be deemed to be the manufacturer, and the person so making the goods shall not be deemed to be the manu- facturer." The word "goods" is defined as including "commodities" ; the word " manufacture" as including "production," and the word " manu- factured " as including " produced."

Evidence Act their fees were fixed by private arrangement, and in general approximated to those chargeable under the Act.

Held, that the defendants were not engaged in the manufacture or production of goods or commodities within the meaning of the Sales Tax Assessment Act (No. 1) 1930, and were, therefore, not obliged to register or give security thereunder.

Informations were laid by Joseph Adams, Deputy Commissioner Taxation, against Harriet May Rau and Arthur Rau, trading as "A. & M. Rau," at 440 Little Collins Street, Melbourne, in the State of Victoria, charging them that on 19th December 1930, 20th March 1931 and 25th May 1931, they, being persons carrying on business as manufacturers within the meaning of the Sales Tax Assessment Act (No. 1) 1930, did (1) fail to become registered under Part III. of the said Act as required by the said Act, and (2) fail to give security to the Commissioner as required by the said Act. 'E information contained an averment by the informant that 'on the respective dates shown above the defendants were engaged in business as professional shorthand writers and typists.

_ The defendants carried on business in Victoria as shorthand writers d under the provisions of the Evidence Act 1928 (Vict.). 'Their business consisted of reporting judicial proceedings, and conferences and meetings of various bodies. Their fees consisted ofa charge for attendance, including the taking of notes, and a her fee calculated by the folio for transcripts supplied to their clients. Sometimes, with their clients' consent, they supplied transcripts to other persons at a fee calculated by the folio.

ers of the Court of Petty Sessions. His Honor adjourned the ication, directed that it be made to the Full Court of the High and that notice thereof be given to the defendants.

'The application now came on for hearing by the Full Court. 'You, XLV 38

the preparation of transcripts. For work done otherwise than under the H. C. or A.

B. M. Mitchell K.C. (with him Gallagher), for the applicant. The test is not whether a person is a manufacturer in the ordinary sense of the word, but whether, having regard to the scope of the Sales Tax Assessment Act, he is a manufacturer within the meaning of that Act (Dominion Press Ltd. v. Minister of Customs and Excise (1)). According to sec. 3 of the Act a " manufacturer " includes a producer, and " goods" includes commodities. Shorthand writers and typists are producers of the transcript, which is a commodity. Such transcripts are sold by the shorthand writers and typists, the charges therefor being based upon a certain rate per folio just as an ordinary trader charges a price per unit for his goods. The question as to whether the defendants will be called upon to pay sales tax is immaterial. No article or activity is exempt from the operation of the Act unless it is specifically mentioned in the Schedule thereto, and no reference is made in such Schedule to transcripts. The special reference in the definition of "manufacturer" in sec. 3 of the Act to printers, publishers, lithographers and engravers does not operate to exclude the defendants, as such words were inserted for more abundant caution. For the purposes of the Act the defendants are producers equally with those specifically referred to (Bank of Nova Scotia v. The King (2) ). The defendants are not paid merely for services rendered. With the consent of the parties the transcripts are available for sale to other persons.

Gavan Durry C.J. The applications will be refused, and the applicant must pay the costs of the motion. We shall publish our reasons later on.

The following written judgments were delivered :- -

Gavan Durry ©.J., Starke, Dixon anp McTiernan JJ. This was a motion on notice by the Deputy Commissioner of Taxation for orders nisi to review an order of the Court of Petty Sessions at Melbourne dismissing informations for offences against the Sales Tax Assessment Act (No. 1) 1930-1931 (Nos. 25 and 62 of 1930 and No. 25 of 1931). The Court refused the motion but deferred the statement of its reasons.

dants that, being persons carrying on business as manu- 8, they did fail to become registered under the statute and did fail to give security to the satisfaction of the Commissioner as

'ions now contained in sec. 123 of the Victorian Evidence Act , by the Chief Justice of the Supreme Court as fit and proper to be shorthand writers for the purpose of taking down in nd and transcribing, or causing to be transcribed, any nee in any cause, matter, inquiry or proceeding civil or criminal. shorthand writers are for the time being officers of the

e Their notes and transcripts are prima facie vidence of such proceedings (sec. 127), and may be signed as deposi- by witnesses (sec. 128). The fees payable to licensed short-

escribed by regulations made by the Governor-in-Council (sec. The regulations prescribe fees for attendance at the proceed- gs, including the taking of notes, and fees calculated by the folio w the transcript of the notes and for additional copies. The defendants carry on a business four-fifths of which in volume con- 'ists of reporting judicial proceedings pursuant to these provisions, and about one-fifth of reporting the proceedings of Royal Commis- , of domestic tribunals, and of meetings and conferences of tions and other bodies. The usual course is for shorthand ers to ascertain from the solicitors of one or other of the parties 'in what causes their services are likely to be required and to attend Generally, on the application of counsel, they are appointed the presiding Judge to take the evidence. Sometimes, however, ley are appointed in a cause even although the parties do not shorthand note, if the Judge is of opinion that the evidence d be taken in shorthand. In either case the Judge usually

orders that the costs of the shorthand writers shall be borne equally by each side de die in diem and that the ultimate incidence of the costs shall be reserved until he deals with the costs of the proceed- ings. In most cases the evidence only is reported. The notes are taken by relays of shorthand writers, and, as each shorthand writer is relieved, he returns to his office and dictates his notes to a typist. When he returns to the Court he delivers a copy of the notes trans- cribed to the Judge, and a copy or copies to each of the parties. The notes and transcript are in the complete control of the Judge and the parties, and no copies are supplied by the shorthand writers to anybody unless with the consent of the parties. Notes are never disposed of to the public. If, as sometimes happens, a shorthand report is made for one party and the Court is not asked to appoint shorthand writers for the case, the shorthand writers regard them- selves as responsible to that party alone. Usually the shorthand manuscript is retained by the shorthand writers, but in some matters described as confidential, presumably heard in camera, the short- hand notes and the typed transcript are all handed over. The fees fixed by the regulations are not always charged, although they are not exceeded. Work is sometimes done for the Federal and State Governments at a fixed rate per day, and sometimes for private conferences lower rates are charged. When they are employed in an arbitration, the shorthand writers are appointed by the arbitrator, as a Judge would appoint them, and the work is carried out much as if the proceedings were a trial. Except in the case of Govern- ment work, paper, carbons and other material required are supplied by the shorthand writers. Occasionally, the defendants say, they are instructed to take shorthand notes and not to supply a transcript, and sometimes to make copies of documents.

Upon these facts the Deputy Commissioner of Taxation claims that the defendants are persons who carry on a business as manu- facturers within the meaning of sec. 13 of the Sales Tax Assessment Act (No. 1) 1930-1931 and who must register and give security pur- suant to sec. 11. The result of the definitions contained in sec. 3 (1) is that the word " manufacturer" means a person who engages, whether exclusively or not, in the manufacture or production of

including commodities; the word includes a printer, pub- ithographer or engraver ; if goods are made, in whole or in , by one person out of materials supplied by another, the supplier is the manufacturer, unless the goods are required for the supplier's _ private, domestic or other personal use. In that case, according to an amendment in sec. 18 (1), the person making the goods shall be deemed to have sold them when they are delivered to the supplier for the amount charged for making the goods and for any additional _ The question is whether the defendants engage in the manu-

• facture or production of goods or commodities. The reference to printers and to persons making goods out of materials supplied is relied upon by the Deputy Commissioner as evidence of the wide
• meaning which the words "' manufacture," " production," " goods " and " commodities " were intended to bear, but these descriptions do not directly apply. The defendants do not " print" their transcripts, and they do not make them out of materials supplied by others, except occasionally when they do work for the Crown, _ and if they did the supplier, it seems, would be the manufacturer. In support of an enlarged meaning of the words " manufacture " and " production," reliance is placed also upon some of the excep- tions made by sec. 20. Primary products from cultivation, from poultry, from bees and from fisheries are exempted, and, among the list of things contained in a schedule of exemptions, are things _ Which might not, perhaps, be considered goods or commodities and d not be regarded as obtained by manufacture or possibly by production. These provisions were used in aid of a contention which was, in effect, that " manufacture " and " production " were 'meant to include anything done which caused, or helped to cause, to come into existence some new entity capable of sale.

_ We do not think that it is possible to formulate abstract definitions of such general terms. It may be conceded that they were not 'intended to bear any restricted meaning, and that whatever accord- ee to the received usages of English speech may be called the q acture or production of goods or commodities is within the statute. But it is necessarily unsafe to reason from what is expressly excluded from the operation of such a statute in order to fix the

connotation of the general description by which the subjects are defined. For it must always be uncertain whether the exemption is introduced as a definite exception of something which otherwise would be included, or by way of contrast, and to ensure that the general description was not enlarged, or simply because the Legislature was as uncertain of the precise application of the description as those who are called upon to interpret and apply it. The definition should receive an operation according to the natural and ordinary meaning of its terms, neither widened nor narrowed by inferences sought to be drawn from special provisions, exclusions and exemptions. After all, it is a taxing Act and its ambit should not be enlarged by anything less than the clearest implication. In applying the definition doubtful cases must be decided as they arise. No paraphrase of what the Legislature has said can provide a substitute for the definition of the statute. If a substitute is found necessary, only the Legislature can supply it.

In this case we cannot think that the description "' manufacture or production of goods or commodities" can properly be applied to any part of the business or operations in which the shorthand writers engage. The work they are required to perform is to make a record of judicial proceedings, or some other oral transaction, and to provide transcripts of the record to the persons concerned therein. The service which they perform cannot first be disintegrated and then part of it examined while the rest is excluded entirely from consideration. Doubtless the transcript " produced " by the typist from the shorthand writer's dictation is a new entity, and is not the same thing as the pieces of paper on which it was made. Doubtless it is capable of sale. But it is brought into existence, not for sale as a commodity, but for the purpose of enabling the employers to have the benefit of services given in the course of a skilled vocation. The fact that some part of the remuneration is determined by the number and length of the transcripts does not necessarily mean that they are sold as commodities for a price, but only that in fixing the reward for the services the fact is recognized that the transcript shows how much oral matter has been taken in shorthand and how much shorthand has been transcribed. It

employment as the manufacture and production of transcripts.

Evarr J. The respondents carry on business in Victoria as licensed shorthand writers. For a certain fee they attend Court _ proceedings and conferences by prior arrangement with interested parties, and they take down the notes in shorthand. They then transcribe their notes and furnish their clients, and (with their -lients' consent) other parties, with typewritten records of the "proceedings at a certain price per folio.

It is said that they are, in part at least, engaged in the manufacture or production of goods or commodities and that sec. 11 of the Commonwealth Sales Tax Assessment Act (No. 1) requires them to be registered as being a " manufacturer or wholesale merchant."

_ In my opinion the respondents are in nowise engaged in the manufacture or production of goods or commodities. Their ranscripts come into existence as materials to be provided in the rse of rendering skilled services. They do not ' produce" or "manufacture," their transcripts are not accurately described as "goods" or " commodities," nor are they engaged in the business selling transcripts.

The medical practitioner who provides the service of taking -rays and furnishes copies of the skiagraph to the patient, although he causes a new thing or entity to come into existence, is not a producer of goods. Nor is the artist who makes an etching for a ent and provides him with a dozen copies, a manufacturer of commodities.

hould be dismissed with costs. Applications refused, with costs. _ Solicitor for the applicant, W. H. Sharwood, Crown Solicitor for e Commonwealth. Solicitors for the respondents, Arthur Phillips & Just, Melbourne,

ould be a misuse of English to describe a shorthand writer's H.C. or A.