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40. Do I understand you to form that opinion upon your belief that section 3, and any corresponding sections in the Customs Duties Act amount to actual prohibitions upon refunds, and not simply prohibitions upon the levying ? —I cannot understand a refund except as a contravention of the duty of levying. 41. You do not regard the provisions of an Act as having been complied with unless the amount is levied and paid into the Treasury ?—I think if you levy the duty and then refund it you really do not levy it. I cannot understand it in any other way. 42. It is only your interpretation of the statute in that way that enables you to say that there is a prohibition in the statute upon the refund : is that not so ? —lt is the judgment of the Audit Office. 43. The judgment of the Audit Office is based upon that, is it not?— Yes. In 1898, before the Public Eevenues Act of 1900 was passed, there was an item of £50 for general refunds of Customs duty, and I said then, " It does not appear to me that the item of £50 carries a power sufficient to authorise the Audit Office legally to pass claims in general to the repayment of Customs duty not repayable under the Customs laws." We have raised no objection to charging to "Unauthorised," because the Unauthorised Expenditure Account comes before Parliament; but I think, in view of the strict provisions of section 3 of " The Public Eevenues Act, 1900," it is not legal. 44. Mr. E. G. Allen.] Does not the Public Eevenues Act override the provisions of the Customs law ?—No. 45. It being subsequent legislation?— Section 3 of " The Public Eevenues Act, 1900," will, when applied, amend the law so far as the section authorises, but the Public Eevenues Act is in other respects a general Act. 46. lam referring to section 3. It appears to me that the object of section 3 was really to make legal such cases as that before the Committee, where it is absolutely necessary that some power should be given the Audit Office, under some statute, to authorise payments of this nature, that are not provided for in any other way ?—Yes, but section 3 of that Act of 1900 limits what is to be passed by the Audit Office to the amount of the item placed on the estimates under that section. 47. By the word " item," does it mean the specific item, we will say, of the artificial limbs— does it include a class ?—Not an item of this nature under section 3 of the Public Eevenues Act; but an item for any other payment, such as for the general services of the Department not prohibited by statute, would not limit the payments to the amount of the item, but would be an authority to the Treasury to spend whatever the vote and the Unauthorised Expenditure Account would allow. 48. This item occurred in the Appropriation Act, I suppose?—lt did in the estimates but not in the Appropriation Act. The votes only are carried into the Appropriation Act. If this had been carried into the Appropriation Act it might have been said to have the power of a vote ; but it was not. 49. Then in many respects clause 3of the Public Eevenues Act is a dead-letter ?—No ; wherever it is applied—if, for instance, an individual pays a sum of Customs duty, and the Government thinks that that individual should be exempted from the duty, it can, under that section, put that precise amount of duty on the estimates, and that would be legal authority to pay. 50. As long as it does not exceed the item; but in any case where an item is exceeded the Public Eevenues Act does not authorise the payment of the excess ?—No. 51. I forget whether you suggested any means of overcoming a difficulty of that sort? —No, I did not. I simply said that it appeared to me that to provide for a refund of duty not authorised to be refunded by the Customs laws would require an amendment of those laws—that is to say, authority to refund without limit except the limit of the vote and the Unauthorised Expenditure Account. 52. In the case in point, would this be a surcharge on the Minister for Customs, if there is no way of paying the money except by legislation ?—No. The person who pays the duty would, as I understand is arranged in some cases, wait until the item placed upon the estimates to pay him was passed by the House in the Appropriation Act. 53. Mr. Wood.] This amount has not been passed by the House—-this £11?— The £11 was. We did not take any exception to a payment up to £11. 54. The £3 Bs. is what you object to ?—Yes. It exceeded the item. 55. You say that under the Public Eevenues Act there is no power at all for you to do this ?— There is none where the Act requiring the collection of the revenue makes no provision for refunding it. 56. That is to say, if there were no specific amount'passed by the House, and the Minister for Customs was to refund a certain amount of money, you would not allow it at all ?—No. 57. Not even if it was a wrongful collection of money ?—That would be an error. We always allow an error to be corrected. If a duty were collected in error—if, through some kind of error, say, £2 was collected where only £1 was payable—-we should always allow the correction of the error. 58. Mr. W. Fraser.] Following the question put to you by the Chairman, throughout this correspondence has the Customs Department assumed anywhere that it has statutory power to make refunds ?—I do not recollect that it has. 59. Has the contention not been simply upon the ground that the amount voted was not specific? —-Yes; that is so. This is the minute of the Department: "Although item 13, which is general in its terms, will be exceeded if this voucher is passed, the total amount of the vote will not be exceeded during the year. Under these circumstances it is submitted that this amount should be allowed to pass." That is a minute that would apply reasonably enough to a depart-mental-service expenditure that was not prohibited by statute —that it was lawful to make.