M.P. Metals Pty Ltd v Federal Commissioner of Taxation
(1968) 117 CLR 63141 ALJR 297
(Judgment by: Barwick C.J.)
M.P. METALS PTY. LTD.
v FEDERAL COMMISSIONER OF TAXATION
Judges:
Windeyer J.
Barwick C.J.McTiernan
Kitto
Menzies JJ.
Judgment date: 28 April 1967
Judgment by:
Barwick C.J.
1968, January 12.
The following written judgments were delivered:-
BARWICK C.J. I have had the advantage of reading the reasons for judgment prepared in this appeal by my brother Menzies. The section of the Income Tax and Social Services Contribution Assessment Act 1936-1965 (Cth), and the processes performed by the appellant taxpayer are there set out, and I have no need to repeat them. I have come, but not without some hesitation, to the same conclusions as those expressed by his Honour. Whilst the deduction for which s. 62AA provides is given to individual taxpayers, the Act inserting that section was quite evidently prompted by a policy decision in the national interest to stimulate the use of new and up-to-date machinery in the manufacturing industry. I can find no reason which satisfies my mind for excluding from the sweep of that policy the ancillary processes when performed by another, which if done by the manufacturer of the goods, would be covered by it. Indeed, not to include the person who actually performs that process within the scope of the deduction may well endanger the effectiveness of giving the deduction to the manufacturer of the goods. But the legislature has expressed itself in such a fashion that, after much consideration, I cannot conclude that my brother Windeyer was in error in construing the section as not covering these ancillary processes when not performed by the manufacturer of the goods themselves. (at p646)
I have had no difficulty in not accepting the contention that the taxpayer in what it does performs services for the manufacturer of goods within the meaning of s. 62AA (2.) (a) (i). With less certainty, as I have already indicated, I have come to the conclusion that s. 62AA (2.) (a) (ii) is limited to activities of the taxpayer with respect to goods of his own manufacture, and that in common parlance the taxpayer's operations in cutting and baling scrap are not to be described as a process of manufacturing, or the chopped or baled scrap to be described as manufactured goods. (at p646)
Accordingly, I agree with the conclusions and the reasons of my brother Menzies for dismissing this appeal. (at p646)