Distribution Group Pty Ltd v Commissioner of Taxation

REASONS FOR JUDGMENT 1 The applicant has applied to the Court for a declaration that one of its products, the ATCO safety isolating transformer TM50A-2 ("the ATCO device"), is an "adaptor" within the meaning of subitem 43(3)(a) of Sch 1 to the Sales Tax (Exemptions and Classifications) Act 1992 (Cth) ("the Act"). If the ATCO device is an adaptor it is exempt from sales tax by reason of s 24(a) of the Sales Tax Assessment Act 1992 (Cth). 2 Item 43 of Sch 1 to the Act, describes the goods that are exempt from sales tax in the following manner: "(1) The following goods, if they are of a kind ordinarily used as part of fixed electrical installations in consumers' premises: (a) electrical fittings (including electronically operated electrical fittings); (b) electrical accessories (including electronically operated electrical accessories); (c) electrical materials (including electrical conduit). (2) Subitem (1) does not cover: … (i) condensers, converters, starters and transformers; (j) neon signs and other luminous discharge lighting equipment including florescent light equipment including fluorescent light equipment; (k) sensors, thermostats, light dimmers or other equipment for controlling equipment; … (3) The following goods, if they are of a kind ordinarily used in connection with fixed electrical installations in consumers' premises; (a) adaptors; (b) plugs; (c) electrical safety devices for the protection of persons." 3 The applicant and the respondent each called an expert witness to give evidence as to the features of the ATCO device. The applicant relied on the evidence of Mr Peter John Collins, an experienced electrical engineer. The respondent relied on the evidence of Professor Mareels, a Professor of Electrical and Electronic Engineering at the University of Melbourne. Although both witnesses drew attention to different features of the ATCO device, and drew different conclusions as to how it should be characterised for the purposes of Item 43, there was little dispute between them about those features. 4 The ATCO device transforms electrical current sourced from the 240 volt mains supply system in Australia in order to supply that current to an extra low voltage 12 volt halogen light. The transforming function of the ATCO device was described by Professor Mareels as follows: "It transforms electricity sourced from the electric mains in Australia (being 240 volt (V) alternating current (AC) at 50 hertz (Hz)) to the different type of electrical power required for the operation of a low voltage halogen lamp (12 V, 50 watt (W)). Under normal conditions, the TM50A-2 transforms the 240V primary voltage to the 11.4V AC secondary voltage to operate the halogen lamp." 5 The ATCO device was described by Professor Mareels as a double insulated safety isolating transformer that conforms to Australian/New Zealand Standard 3108:1994 ("AS/NZS 3108") standard. In explaining those terms Professor Mareels stated in his report that: "The adjective 'safety' is defined in the AS/NZS 3108 standards. It refers to the secondary voltage being below 50V AC. Here the secondary voltage is 11.4V AC, much less than 50V AC. For this reason the description 'safety' is applied. The adjective 'isolating' means that there is no continuous conductive pathway from the primary side to the secondary side of the transformer. That is, there is no electrical connection between primary and secondary sides. Here the primary and secondary windings are electrically insulated and hence the descriptor isolating is applicable. The description 'doubly insulated' is also applicable, as the TM50A-2 possesses both basic and supplementary insulation. Particular features of the TM50A-2 as a transformer include the following. There is a clear separation of the primary side (supply or mains side) and secondary side (load side, or lamp side) of the transformer. These are located physically at opposite ends of the unit. Cable connections can be effected simply and are designed to minimise wiring errors. The TM50A-2 is ready wired at the primary side and equipped with a normal plug (two pin variety) to be inserted into a mains outlet." 6 The ATCO brochure in respect of transformers explains their operation as follows: "A transformer transfers electrical energy from one circuit to another through the medium of a magnetic field. The transformer may step up the voltage, step it down or deliver energy at the same voltage. … The Safety Isolating Transformer is one of the most widely used of all transformers. It is designed to achieve an accurate voltage ratio within a specific load range. There is no direct connection between the windings. They are only connected by the intangible lines of magnetic flux in the core. In some types of circuits the transformers may have 1:1 ratio - that is to say no step-up or step-down function. The only reason for this transformer is to isolate the load currents from the supply." 7 The ATCO device has a flat underside which enables it to be affixed to the area in the ceiling above the halogen light to which it is supplying electricity or to merely rest on its own weight in that area. The device is connected to the halogen downlight fitting by separated and segregated terminal leads which run from the fitting to the terminal points in the ATCO device. Two screws affix the leads to the device. The leads run from the standard extra low voltage downlight halogen light fitting, which is usually installed into a ceiling through a hole cut through the plaster at the point where the light is to be placed. The light fitting is then able to be clamped or otherwise affixed to the ceiling. The ATCO device is plugged into a socket outlet in the 240 voltage mains supply system, which is part of the fixed electrical installations in consumers' premises, by a flexible lead cord with a two pin plug which plugs into the outlet. 8 The ATCO devices are required to comply with AS/NZS 3108, which, inter alia, sets out the standards for safety isolating transformers. As the devices are also to be used in connection with electrical installations in buildings, structures and premises they are also required to comply with the standards in Australian/New Zealand Safety Standard AS/NZS 3000:1991 ("AS/NZS 3000"). 9 The applicant claims that the ATCO devices, which are sold at retail outlets, adapt 240 volt mains supply electricity for use in 12 volt halogen light fittings in consumers' premises. The applicant contends that, as the function of the device is to adapt the mains supply for use in halogen lights, it is properly identified and characterised for the purposes of subitem 43(3)(a) as an adaptor. The applicant also claims that the short circuit and overload protection features of the device, which disconnect supply should a fault develop, greatly reduce the probability of fire and subsequent dangers to persons and property. As a consequence, so it is said, the devices are also properly identified or characterised for the purposes of subitem 43(3)(c) as electrical safety devices for the protection of persons. 10 The respondent disputes the applicant's identification and characterisation of the ATCO devices. The respondent claims that the devices are ordinarily used as "part of" fixed electrical installations in consumers' premises, rather than "in connection" with fixed electrical installations in such premises, with the consequence that, if they are to be exempt, they must fall within Item 43(1). The respondent then contends that the devices do not fall within Item 43(1) as, although they may be electrical accessories, they are not covered by subitem (1) as they are transformers: see subitem 43(2)(i). In his written but not in his oral submissions the respondent also relied on subitem 43(2)(j) and (k) but these subitems do not appear to have any application in the present case. 11 The respondent's claim that the ATCO device is part of consumers "fixed electrical installations" is based on his contention that such installations include the entire electrical systems constituted by the 240 volt mains supply system together with any ATCO devices and halogen light fittings connected to that supply, albeit as a 12 volt connection. In the alternative, the respondent claims that the ATCO device and the halogen light fitting that it serves are an additional and discrete fixed electrical installation in a consumer's premises. 12 Finally, the respondent claims, that if the device is not ordinarily used as part of a fixed electrical installation but rather, is used in connection with such an installation, then it is properly identified or characterised as a transformer, rather than an adaptor, as its essential function is to transform electrical current. It was contended that, in so far as the device has other features, they are merely incidents of a transformer, which is required to comply with the safety standards set out in AS/NZS 3108 and AS/NZS 3100. 13 If the ATCO devices are properly characterised as adaptors, rather than transformers, it may be of little significance whether they gain their exemption under Item 43(1) as electrical accessories that are not exempted by Item 43(2), or as adaptors that fall within subitem 43(3)(a). Nonetheless, it is appropriate to first consider whether the ATCO device is a device that is part of a fixed electrical installation and is governed by Items 43(1) and (2), or is used in connection with such an installation and is therefore governed by Item 43(3) 14 The compound expression "fixed electrical installations" in the previous Item 90C(1) of Sch 1 to the Sales Tax (Exemptions and Classifications) Act 1935 (Cth) was to be given its ordinary and grammatical meaning: see Telstra Corporation Limited v Commissioner of Taxation (1996) 68 FCR 566 ("Telstra Corporation") per Ryan J at 568, and per Heerey J at 571. Lindgren J, in explaining why he concluded that main distribution frames were fixed electrical installations, at 585 stated, inter alia, that they were: "fixed installations which, according to ordinary parlance, are designed to accommodate fittings and accessories which deal with electricity". 15 In my view the same approach is to be adopted to the same expression in Item 43(1). It appears to be common ground that the 240 volt mains supply system in consumers' premises is, or is part of, a fixed electrical installation. AS/NZS 3000 at 1.4.43 states that an electrical installation usually commences at the point of supply and finishes at a point (in wiring) but does not include portable or stationary electrical equipment connected by plug and socket outlets. That definition accords with the ordinary usage or parlance of the phrase "electrical installations". However, whether such installations are "fixed" involves questions of fact and degree. 16 The ATCO device is a portable unit that is connected by a flexible cord and plug and socket outlet to the 240 volt fixed electrical installation in a consumer's premises. The device may be, but is not required to be, affixed to the area above the ceiling where it would usually be placed. It is usually connected by two separate and segregated lead wires to a 12 volt halogen light clamped into the ceiling. The device is portable and when used may rest on its own weight or be affixed. The above matters make it appropriate to state in ordinary parlance that the ATCO device is an item of a kind that is ordinarily used in connection with a fixed electrical installation, being the 240 volt power supply system. It is inappropriate to characterise the device as "part of" that fixed electrical installation. Thus, in ordinary parlance the ATCO device is an item "of a kind ordinarily used in connection with fixed electrical installations in consumers' premises" (see Item 43(3)), rather than an item "of a kind ordinarily used as part of" such installations (see Item 43(1)). 17 The alternative argument of the respondent was that the ATCO device and the single light fitting it serves are a discrete fixed electrical installation. The following facts suggest that is not so. The device is sold as a portable unit that may be, but is not required to be, affixed to the ceiling of the premises in which it is placed. The usual form of halogen light fitting that has electricity supplied to it by the ATCO device is affixed to the ceiling by a clamp, although it is easily removed. The connection between the fitting and the device is effected by two separate and segregated lead wires. In these circumstances, even if each halogen light fitting was to be regarded as part of a consumer's fixed electrical installation it is still more appropriate to characterise the ATCO device as an item used in connection with, rather than as part of, that fitting. In that regard it is relevant to note that the phrase "in connection with" is one of the widest import: see Telstra Corporation at 580. 18 Thus, I do not accept the respondent's contention that the ATCO device is part of the fixed electrical installations in consumers' premises. It follows that the sales tax exemption of the ATCO devices depends on whether they are adaptors for the purposes of Item 43(3). 19 Item 43 was considered by a Full Court of the Federal Court in Dick Smith Electronics Pty Limited v Federal Commissioner of Taxation 97 ATC 5089 ("Dick Smith Electronics"). In that case an exemption was claimed under Item 43 in respect of devices which converted 240 volt alternating current ("AC") to 9 volt direct current ("DC") for use in baby monitor kits and a CD player. The primary judge held that the essential function performed by the device was to transform the voltage of the current from 240 volts to 9 volts and to rectify the current by converting it from AC to DC. His Honour held that the adapting function of the device was incidental to the essential functions of converting and transforming current with the consequence that the device was not an adaptor within the meaning of subitem 43(3)(a). On appeal, Carr J (with whom Foster J and Tamberlin J agreed), stated at 5093 that the word "adaptors" was used in subitem 43(3)(a) in its ordinary usage sense, which his Honour described as follows: "In my view an adaptor is something which adapts. The New Shorter Oxford English Dictionary defines the verb 'adapt' as to 'Fit, adjust, (to); make suitable (to or for) ... Alter or modify to fit for a new use, new conditions, etc ...'. It also defines 'adaptor" as being synonymous with 'adapter' which, in turn, it defines as: 'A device allowing connection of pieces of equipment ... unable to be connected directly ... an electrical fitting of this nature, usu. one enabling more than one plug to be connected to the same socket.' The Macquarie Dictionary 2nd ed (1991) relevantly defines 'adaptor' as: 'an accessory plug for connecting a piece of apparatus fitted with one type of terminals to a supply point with a different type.' Although the Macquarie Dictionary definition of 'adaptor' provides an example of an electrical adaptor, I consider that for present purposes the New Shorter Oxford English Dictionary definition is more useful, particularly when read with the definition of the word 'to adapt'." Tamberlin J, although in agreement with Carr J, made certain additional observations. Tamberlin J also regarded the reference to "adaptors" as a reference to that item in its popular usage rather than to any technical or trade meaning. His Honour stated at 5096-5097 that, in determining the most natural and ordinary meaning of words such as "adaptors" it is right to look at the form, contents and use of the item treating that matter as a question of fact. 20 In considering whether the particular devices in question were adaptors in the sense described above, Carr J observed at 5093: "The devices with which we are concerned in this matter make 240 volt AC power suitable for use in the domestic appliances described earlier in these reasons. They do this by a composite process of transforming the 240 volt power down to 9 volts and converting AC power to DC power. The evidence shows that they also contain a 'filter' which provides a uniform level of DC voltage. It would seem that this makes the power even more suitable for the appliances concerned. Having reached that stage in my reasoning, my reading of the authorities is that it is permissible to derive assistance from the evidence of those engaged in the relevant trade." His Honour concluded at 5095-5096: The essential character of the devices is to make 240 volt AC power suitable for appliances which require 9 volt DC power. In my opinion the essential character of the devices is thus to adapt that power for those particular appliances. In practical terms they are adaptors. The respondent submitted that the legislature by adopting the terms 'convertors' and 'transformers' in sub-item 43(2)(i) and 'adaptors' on the other in sub-item 43(3)(a) regarded them as different items. It was common ground that a convertor is a device which changes alternating current to direct current and that a transformer is a device which transforms currents from one voltage to another. The devices in this matter can thus be seen to contain both convertors and transformers (and filters). I think that there are two answers to this submission. First, items 43(1) and (2) relate to goods of a kind ordinarily used as part of fixed electrical installations. Item 43(3) is concerned with goods of a kind ordinarily used in connection with fixed electrical installations. Secondly, it is one thing to exclude on an individual basis [as sub-item 43(2)(i) does] condensors, convertors, starters and transformers. It is another thing to refuse exemption to a device which by combining a convertor, a transformer and a filter squarely falls within the definition of 'adaptors'. Counsel for the respondent suggested that item 43(3) was concerned solely with items which had only a physical function. That is certainly true of sub-items 43(3)(a) and (b). However it can be seen that that is not the case in relation to sub-item 43(3)(c) ('electrical safety devices for the protection of persons'). That sub-item would, in my opinion, clearly extend to such electronically operated devices as heat or smoke detectors. It might be thought odd that Parliament should exclude convertors and transformers from sales tax exemption when they form part of a fixed electrical installation, but extend exemption from sales tax when they are contained in devices which satisfy the description of 'adaptors' when ordinarily used in connection with fixed electrical installations. What policy might justify such a distinction? The answer to that question is, in my view, reflected in the following passage from the reasons for judgment of Lindgren J in Telstra at ATC p 4816; FCR pp 580-581: 'It is not obvious what, if any, unifying concept underlay the list of exclusions. A broad notion of things not 'reasonably necessary for the installation of an electrical system in a building', or of things not 'reasonably necessary before it can be said that electricity is available to be consumed throughout a building', may have been influential. But the more likely explanation is to be found in particular responses to exigencies of political pressure.' I agree that to search for logical consistency in Schedule 1 to the Act is likely to prove fruitless and unhelpful." Tamberlin J observed at 5097-5098: "When the popular usage test is applied, in the present circumstances, it is common ground that the term 'adaptors' includes the articles in question. The fourth matter is that the difference drawn in Item 43 between 'goods used as part of ...' and 'goods used in connection with ....', is a significant distinction for present purposes. The specific reference to the expressions 'converters' and 'transformers' in sub-item (2) does not require the conclusion that such goods cannot come within sub-item (3) which is concerned with the broader category of goods 'used in connection with'. These different prefatory phases in each of the paragraphs may provide a rationale for excluding 'converters' and 'transformers' from exemption under sub-item (1), but conferring exemption where they are included in sub-item (3) because they come within the expression 'adaptors' and are used in connection with fixed electrical installations. The popular usage of 'adaptors' to include adaptors which convert and transform current has the consequence of indicating a sub-class of 'adaptors', but this does not necessarily take the types of adaptor in the present case outside the ambit of the term 'adaptor'. … In summary, it seems to me, that an error of law resides in the application of the 'essential character' test, to override the conclusion which would otherwise be reached as a result of what might be described as the 'popular usage' approach. Although analysis of essential character or function might in some cases, provide guidance, it is not controlling in this case where the Court is satisfied that the goods come within the expression 'adaptor' both in popular usage and in the trade sense. There is simply no need to resort to the 'essential character' approach in the present circumstances. In any event, even on the 'essential character' approach, in my view, the goods are within the description of 'adaptors' because it is clear that their function is to 'adapt' current by converting and transforming it when used in connection with fixed electrical installations." 21 In Dick Smith Electronics the Full Court concluded that the device in question was properly identified or characterised as an adaptor because its composite transforming, converting and filtering functions were for the purpose of adapting electricity for use in the baby monitoring kit and CD player the device was serving. In the context of Item 43(3) once that conclusion was arrived at it was not to the point that an essential characteristic of the device might be its transforming function. 22 In any event a transformer, as part of a fixed electrical installation, can transform electrical current by maintaining or stepping up or reducing voltage to the required voltage. In that context it may have few adaptation functions. However, a different situation might arise in respect of goods used in connection with fixed electrical installations. It is likely that such goods will have significant features that adapt the electricity they are transmitting to make that electricity suitable for use in the item being served by the goods. Thus, whether such goods perform the function of adapting the electricity for a particular purpose, and thereby become adaptors, will also involve questions of fact and degree. The fact that a supplier identifies its product as a transformer is relevant to, but not determinative of, the proper characterisation of the item. 23 The ATCO devices were designed specifically to meet the Australian safety and other requirements for extra low voltage lighting applications and practices. The ATCO brochure in respect of the device states that it has the following features: · Absolute safe separation of 240V primary supply with 12V secondary being at the opposite end of the transformer. · Spacious accommodation junction box designed to take 2xTPS (twin core and earth) for looping supply. · Easy application cable clamping on both primary and secondary, accommodates a range of cable sizes and types. The use of screws to clamp the cables is not required and meets the requirements of fixed or portable applications. · Slimline construction enables installation through a 60mm diameter ceiling hole. · Self resetting current sensitive thermal cutout provides greater protection against overload. · Soft start performance extends lamp life. · Dimmable on a dimmer designed for inductive (magnetic transformer) loads. The brochure also states that the device has "innovative wiring features" that enable easy wiring installation with the lighting installations for which the devices were designed. 24 Mr Collins identified six technically important functions of the ATCO devices which he claimed were essential for their safe and reliable operation in connection with 12 volt halogen lighting. The features, which were not challenged, were described by him as follows: "1. It modifies (reduces) the mains voltage commonly available in a premises so that it is made suitable for the direct and easy connection of small halogen downlights and facilitates the safe and efficient operation of halogen downlights. 2. Its construction and physical dimensions enables it to be safely installed in a ceiling space and its supply lead and plug enables it to be easily and safely connected to mains supply via a socket outlet. 3. It incorporates a safety isolating transformer which fully complies with the provisions of AS 3108, thus ensuring the mains voltage is electrically and physically separated from the lamp terminals. This makes it completely safe for persons installing and maintaining the lighting circuit and lamp. The lamp voltage is restricted to 12 volts and this makes it safe to touch. Contact with this voltage will not cause injury. 4. It incorporates thermal over current protection which disconnects supply should a fault develop. Its design limits the secondary short circuit current to 21 amps. These two features greatly reduce the probability of fire and the subsequent dangers to persons and property arising out of such fires. 5. The output is voltage regulated to ensure correct operation, colour retention and longevity of halogen lamps. Voltage regulation is a measure of the ability of a transformer to maintain a constant voltage over the full range of load conditions. Halogen lamps are best served by a regulated supply. 6. The high internal impedance of the magnetic circuit limits the lamp current during switch-on and supply transient conditions, this enhances the life of the lamp. The inductive design of the TM50A-2 reduces the effect of rapid mains variations being transferred to the halogen lamps. In essence the TM50A-2 smooths the variations in mains voltage and provides the halogen lamp with a more steady and consistent voltage." 25 A significant feature of the ATCO device, that adapts it for use in connection with a halogen light fitting, is its "self resetting current sensitive thermal cutout". That feature was described by Mr Collins as follows: "The current flowing through a coil consumes energy and this energy increases the temperature of the coil. An electrical radiator uses this principle to provide radiant heat. The TM50A-2 incorporates a mechanism for disconnecting supply should the lamp circuit or transformer become overloaded. Over time this higher current will increase the temperature of the windings. The TM50A-2 provides the required protection against this temperature rise. … With power of 50 watts and voltage at 240 volts the current is approximately 0.2 amps (50/240=0.2 amps). This means that the current through the lighting circuit fuse would be only 0.2 amps. A fault within either the lamp or the TM50A-2 would cause the current to rise. If the fault was in the secondary circuit and it was say 20 times the normal current then the primary current would be only 4 amps (0.2 x 20 = 4.0 amps). The circuit fuse would not respond to a 4 amp current as it is designed to operate at approximately 150% of its rating, ie 15 amps for a 10amp fuse. With such a fault persisting and remaining undetected then the possibility of fire and injury is greatly increased. The TM50A-2 incorporates a thermal cutout in the primary coil of the transformer. The full operating current of the transformer passes through the cutout. The cutout has an inbuilt switch which responds to temperature. On reaching the set temperature the switch opens and the current ceases. The TM50A-2 transformer (and cutout) cools and at a lower set temperature the cutout closes. The cycle then repeats. The temperatures chosen for the TM50A-2 cutout are designed to avoid serious overheating and thus equipment damage and fire is avoided. If the TM50A-2 experiences an increase in current above its rated 0.2 amps the integral thermal cutout begins to heat. With any additional increase in current the cutout responds and opens. Once the cutout opens the TM50A-2 and the attached halogen lamp are disconnected from supply. If the cutout is correctly chosen serious damage is avoided and the safety aspects of both the TM50A-2 and the lamp are not compromised. The TM50A-2 provided to me and the subject of this report incorporates an integral and suitably rated thermal cutout. The inclusion of this feature greatly enhances the other safety functions of the TM50A-2." 26 AS/NZS 3000 requires internal or external overcurrent protection for extra low voltage installations. In the case of the ATCO device internal, rather than external, protection was selected. Thus, the short circuit and overload protection was integrated into the ATCO device to meet the standards and adapt it to its use in connection with halogen light fittings. Professor Mareels accepted during cross-examination (at T p 56) that such protection is not "something inherently required for the transforming function". 27 Another significant feature of the ATCO device is the manner in which it adapts the 12 volt current to optimum lamp operation. That process was described in the ATCO brochure as follows: "Electronic transformers operate the lamp in the high frequency range (30-40kHz). The use of modern electronic technology guarantees optimum lamp operation. The life of the lamps can be extended considerably by limiting the starting current, soft starting and a constant secondary voltage, independent of the load throughout the entire output range. A unique circuit design in the electronic transformers in the higher output ranges, 150VA and 210VA, provides additional secondary voltage stabilisation throughout the entire primary voltage range from 207 to 264V." Mr Collins described aspects of this feature in pars 5 and 6 of his description of the six technically important functions of the ATCO device. 28 The features described by Mr Collins and, in particular, the overcurrent protection and the adaptation to optimum lamp operation, make the device suitable for use in connection with halogen light fittings. While the primary function of the device is that of a safety isolating transformer it also incorporates other significant features that ensure its suitability for use in connection with halogen light fittings. Thus, the device does far more than merely transform 240 volt current to 12 volt current (or more precisely to 11.4 volt current). 29 In my view the features described above, cumulatively, result in the ATCO devices being properly characterised as "adaptors" in the ordinary usage sense described in Dick Smith Electronics. 30 Professor Mareel's evidence was to the effect that the ATCO devices are transformers. However, in explaining that characterisation he placed considerable emphasis on the fact that devices that employ a magnetic field of induction to isolate and transform current are known in electrical engineering as transformers, rather than adaptors. In that regard his evidence (at T pp 73-74) was as follows: "When we talk in electrical engineering about transformers, we always talk about the transformers which are based on magnetic induction. … HIS HONOUR - Is the substance of what you're saying that you recognise that a transformer and adaptor both have the same function of adapting one form of electrical current for use in a particular item which requires a different form of current, so they adapt for that purpose, but you say if the means by which that occurs is no more than this field of magnetic induction which you referred to then that [is], what distinguishes a transformer from an adaptor?---That's essentially right, yes." In his report Professor Mareels stated that the "essential nature of a transformer is to exploit magnetic induction". The difficulty with the evidence given in the above passages is that it relied on technical or trade meanings used in "electrical engineering", rather than on the ordinary parlance meaning of the word "adaptor" (and, in so far as it may be relevant "transformer"). However, reliance upon the technical meaning of the word "adaptor", as used in Item 43(3), was rejected by the Full Court in Dick Smith Electronics. Further, because of that approach Professor Mareels was not prepared to attach significance to the features described above which, cumulatively, have led me to conclude that the ATCO device is an adaptor for the purposes of subitem 43(3)(a). 31 Professor Mareels also placed considerable emphasis on the fact that certain adaptation features of the ATCO device, by merely conforming to safety standard requirements for transformers, could not thereby change the character of the device from a transformer to an adaptor. There are a number of difficulties with that approach. First, as was explained in Dick Smith Electronics the issue under subitem 43(3)(a) is whether the devices are adaptors used in connection with fixed electrical installations, and not whether they are transformers used as part of such installations. Second, the fact that the devices comply with the safety standards in AS/NZS 3108 and AS/NZS 3000 in order to adapt the current for use in halogen light fittings does not detract from but, rather, may confirm the "adapting" features of the devices. 32 In view of the above conclusions it is unnecessary to decide whether the device also falls within subitem 43(3)(c) as an electrical safety device for the protection of persons. However, I doubt that a device falls within that subitem merely because it incorporates some safety features. The inherently dangerous nature of electric current will inevitably require that devices using that current incorporate some safety features. The fact that those features exist does not have the consequence that the device is therefore to be characterised as an "electrical safety device", if safety is not a purpose of the device: cf Telstra Corporation at 569, 572, 587-589. 33 For the above reasons the applicant is entitled to a declaration that the ATCO device is an adaptor for the purposes of subitem 43(3)(a). As the applicant has succeeded it is also entitled to an order that the respondent pay its costs of the proceedings. I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Merkel.