ATO Interpretative Decision
ATO ID 2005/223 (Withdrawn)
Excise
Distillation and alcohol concentration methods: cyclonic evaporator, separator, condenserFOI status: may be released
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This ATO Interpretative Decision is withdrawn from the database because it contains a view in respect of a provision of the Distillation Act 1901 (section 6) that doesn't apply after 1 July 2006 as a result of changes contained in Excise Laws Amendment (Fuel Tax Reform and Other Measures) Act 2006 (i.e. repeal of the Distillation Act 1901). Despite its withdrawal from the database, this ATO Interpretative Decision continues to be a precedential view in respect of decisions up to 1 July 2006.This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is an apparatus consisting of a cyclonic evaporator, a separator, and a condenser, a still as defined in section 6 of the Distillation Act 1901 (Distillation Act)?
Decision
Yes, the apparatus is a still as defined in section 6 of the Distillation Act.
Facts
An entity operates an apparatus consisting of a cyclonic evaporator, a separator, and a condenser.
The apparatus has the capability to concentrate alcohol.
The entity feeds a solution containing a certain level of alcohol by volume into the apparatus. The stream undergoes evaporation, and condensation. Two streams are produced, being a water stream and a spirit stream.
Reasons for Decision
A still is defined in section 6 of the Distillation Act as:
Still
means any apparatus for or capable of distilling spirits and any part thereof and any apparatus connected or used in connexion therewith.
Based on this definition, any apparatus capable of distilling spirits is a still.
Distillation is not defined in the Distillation Act, but for convenience in interpreting that Act, section 5 outlines the ordinary course of distillation. Subsection 5(iii) of the Distillation Act states:
The wash is distilled in a still by heating to evaporation and condensing the vapour. The liquor product is spirits and the residue of the wash is spent wash...
The Macquarie Dictionary 2001 Revised Third Edition defines 'distil' as:
1. to subject to a process of vaporisation and subsequent condensation, as for purification or concentration.
The Administrative Appeals Tribunal (AAT) in Carlton & United Breweries Ltd & Chief Executive Office of Customs (1996) 42 ALD 321 when considering the evidence of Dr G Stevens, a reader in chemical engineering and an acknowledged international expert in distillation processes noted in paragraph 6:
Dr Stevens gave a broad definition of "distillation", quoting from a standard text as follows:
"The function of distillation is to separate, by vaporisation, a liquid mixture of miscible and volatile substances into individual components or, in some cases, into groups of components. The separation of a mixture of alcohol and water into its components....are examples of distillation."
From an interchange between Dr Stevens and Mr R. Gillham of this tribunal during the hearing, it is plain that distillation processes extend over a broad range - from the unsophisticated pot still to the very sophisticated processes used in the distillation of petroleum products. However, despite the sophistication of some of the processes, the basic element remains constant, namely separation by vaporisation and subsequent condensation. Consequently, Dr Stevens regarded the DAB process, which involves separation by vaporisation, as being a process involving distillation.
The operation of the apparatus meets the requirements of distillation as defined above, namely separation by evaporation and subsequent condensation of the vapour.
The process used by the apparatus is distillation, and the apparatus is being used to distil spirit (in the form of ethanol). Therefore the apparatus is a still as defined in section 6 of the Distillation Act.
Date of decision: 21 July 2005
Legislative References:
Distillation Act 1901
section 5
subsection 5(iii)
section 6
Case References:
Carlton and United Breweries Ltd & Chief Executive Officer of Customs
42 ALD 321
ATO ID 2005/224
Other References:
The Macquarie Dictionary (2001 Revised Third Edition)
Keywords
Alcohol
Ethanol
Spirits
ISSN: 1445-2782
| Date: | Version: | |
| 21 July 2005 | Original statement | |
| You are here | 20 July 2007 | Archived |