DUTY NOT PAID

Press, Volume LXX, Issue 21198, 23 June 1934, Page 20

DUTY NOT PAID

ATTEMPT TO SELL TOBACCO TWO men fined MAGISTRATE'S COMMENTS ON AN ACT Two men who were caught trying to sell tobacco on which no duty had been paid appeared before Mr E. D. Mosley, S.M., in the Magistrate's Court yesterday on charges under the Tobacco Act. They were both fined £5 and costs. The prosecution was said to be the first of its kind in New Zealand. During the hearing the magistrate commented strongly on the sections of the Customs Act which provide minimum penalties for certain offences. The accused were George Bilton Speak, aged 28, of Nelson, and Arthur Augustus Newth, aged 25, of Christchurch. Both were described as labourers. Mr A. W. Brown conducted the prosecution and Mr j. D. Hutchinson appeared for the accused. Speak and Newth were jointly charged that on June 12, not being licensed to manufacture tobacco under the Tobacco Act, they had in their possession a tobacco press and cutter for the manufacture of tobacco contrary to section 12 of the act; that being persons other "than growers or manufacturers of tobacco for their own use, they had in their possession raw tobacco; with being knowingly concerned in dealing in manufactured tobacco with intent to defraud his Majesty of 4he duty due thereon; and that with intent to defraud the Customs Department, they were in possession of 601b of tobacco on which no duty had been paid. Accused pleaded guilty to the second charge, and the others were withdrawn. Later this charge was withdrawn, and the prosecution proceeded under the first charge, which was reinstated, and to which accused pleaded guilty. In Possession of Leaf Mr Brown said the accused were arrested on June 12, when they had in their possession 601b of manufactured tobacco. A search of the premises occupied by them revealed 1201b of raw leaf tobacco and the necessary apparatus to enable them to prepare it for sale. The two men came from Nelson and apparently they procured the leaf there. At present enquiries were being made as to how they procured the leaf. They were arrested when trying to make a sale. It was not known how long the men had been in the business, said Mr Brown, but it really amounted to smuggling. However, it seemed that they were fairly new to the grime and that they were not i-eoliy in a big way. "The Customs Department is aware," said Mr Brown, "that this trade is assuming extraordinary proportions, and the police and the department are making enquiries at present. This, however, is the first prosecution of the kind in New Zealand. It is brought under section 21 of the Tobacco Act. The defendants were quite frank and admitted that they had not paid the duty." Under the Customs Act a penalty of £IOO was provided and another section provided that in some cases the minimum fine must be a quarter of the maximum. A section of the Tobacco Act provided that that rule should apply to certain cases under the Tobacco Act, and he submitted that it applied in this case. The act also provided that the defendants might apply to the Minister for partial remission of the fine. This had been done, and he had been instructed to withdraw the other informations and to proceed with one. It was a serious breach in that they had evaded the customs duties. The seriousness of the offence could be judged from the penalties provided. The magistrate: They are ridiculous. Mr Brown said that although a minimum fine was fixed application could be made to the Governor-General-in-council to remit the fine either wholly or in part. The magistrate: The court, having heard all the facts of the case and having heard counsel, should be in a better position than any one else to impose an adequate penalty. That is one of the troubles with an act which fixes minimum fines. Evading Duties Mr Brown said the defendant had admitted deliberately setting out to evade the customs duties. He submitted that it was a case in which the court would be justified in imposing a substantial penalty. The magistrate: But probably not such a penalty as the court is compelled to impose under the act. "As we all know," said the magistrate, "there are many people in New Zealand who grow their own tobacco, prepare the leaves, and smoke them. It seems • that under Section 21 this may be an offence." Mr Brown said that section 17 of the act provided that it was not'an offence to grow tobacco for one's own use. The magistrate: That is just as well. Section 21 is very wide, and it is fortunate that it has been amended. Mr Brown said it seemed that a grower could even give tobacco to his friends. The Collector of Customs, Mr C. O. Trownson, who was sitting in the court, shook his head. The magistrate: The department would apparently frown on that. Mr Hutchison said he doubted if section 21 of the Tobacco Act provided for a minimum fine, although both he and Mr Brown had assumed that it did. The section stated that an offender was liable, at the option of the Minister, to forfeit either treble the value of such tobacco (including the duty payable) or £IOO, and the offender could be dealt with in the manner provided by the Customs Acts in re- ( spect of persons detained for offences ( against those acts. It was then agreed to withdraw the 1 charge under section 21, and to pro- < ceed on the charge under section 12, that of being in possession of appar- 1 atus for the manufacture of tobacco. ' "Fell Into Trap" Mr Hutchison said that both the de- 1 fendants were single men and of un- 1 blemished character before the present ] affair. Both were unemployed. They 1 had been working at odd jobs in the i Nelson district during the summer, 1 and when the seasonal work came to 1 an end they tried to tide themselves over the winter by selling tobacco. J Unfortunately, on the first occasion i when they tried to make a sale they 1 fell into a trap that had been set for < larger operators. If Mr Brown's con- 1 tentions were correct, the magistrate 1 had no judicial power under the act. Mr Hutchison submitted arguments to ; show that the magistrate had dis- i cretionary powers and was not bound J to fix a minimum penalty. | Ine magistrate said the trouble with 1 the Customs Acts, and some other acts < was that the court, having considered all the facts, thought in its experience 1 that all the circumstances pointed to i a fine of £2 being adequate, and ] found that it was bound to a minimum j of, say, £25. 1 "I must confess I don't like it," Said I the magistrate. "It is not right. This < is a court of justice, where people are J supposed to'get justice, and we do our | best to give it to them." 1 Certainly there was provision for I the Governor-General to remit the fine, said the magistrate, but how £ conid ha be adzed c 4 all tfca feats In >

the same manner as the court. A magistrate had the advantage of having the accused before him, and of hearing counsel for both sides, neither of which advantages was enjoyed by the Governor-General. The Executive Council had to rely on reports, which were not equal in value to hearing counsel and seeing the accused. The magistrate said he was satisfied that the penalty under section 12— £IOO or six months' imprisonment—was one that could be imposed by the court, and he could not see that the court was restricted by section 32. He proposed to act on that, and Mr Brown could take further action if he thought fit. "A Serious Breach" It was the first case of its kind in New Zealand, said the magistrate. Probably it was not generally known by the public that it was a serious breach, because it affected the revenue of the country. The sooner it was widely known the better it would be for all concerned and for the revenue of the country. This was a legitimate source of revenue ana it must not be imperilled. The gravity of the offence was shown by the penalty provided by the legislature. He did not suppose that the accuseu realised the gravity of the offence when they committed it. It was not often that there were offences against the revenue, and he was compelled to look on it more or less seriously, although it was the first prosecution of its kind. In future a most serious view would be taken, and the penalty would meet what the court thought the gravity of the case deserved. He would take into consideration the unblemished character of the accused, and that it was the first case of its kind. The accused would both be convicted and fined £5 and costs. Fourteen days were allowed for payment.

THE GROWING OV TOBACCO LEGAL RESTRICTIONS The law about tobacco production does not go so far in New Zealand as it does in' Australia. In the Commonwealth the provisions of the law which directly concern growers are:— (a/No person may produce tobacco leaf unless he has been registered as a producer by the Collector of Customs. Cb) Every producer, must account to the Customs Department for all tobacco leaf that he produces. For this purpose he must keep a record, in the form prescribed by the law.ofthe area of tobacco he grows each year, the Weight of leaf he produces, and details of all sales. . . (c) No grower may use for smoKing any of the leaf he produces nor cut it up nor subject it to any treatment (other than curing)) to make it suitable for smoking, nor may he sell it to any persons other than a registered dealer or licensed manufacturer. The Collector of Customs (Mr C. O. Trownson) said yesterday that growers in New Zealand did not have to be registered, but had to advise tlia Customs Department when the crop was harvested, and could not remove it except to a bonded tobacco store. It was to be noted, however, that though an exception was made for the man who grew tobacco for his own use, this exception was very rigidly defined. The relevant clause provided for the exception from the prescribed penalties of a person "growing tobacco on his own land, and manu Tacturing it for the use of himself and the members of his own family residing with him, and not for disposal to any other person by sale, barter, or otherwise." This, said Mr Trownson, meant that such a grower could not give the tobacco away to bis friends.