A Taxpayer and Commissioner of Taxation
[2001] AATA 220
•16 March 2001
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2001] AATA 220
ADMINISTRATIVE APPEALS TRIBUNAL )
) No AT1999/49
TAXATION APPEALS DIVISION ) Re A TAXPAYER Applicant
And
COMMISSIONER OF TAXATION
Respondent
DECISION
Tribunal Deputy President Burns Date16 March 2001
PlaceCanberra
Decision The decision of the Tribunal is that the decision under review is set aside and in substitution therefor it is determined that 31 October 1997 be the date by which the applicant must register a transitional Reasonable Benefit Limit with the respondent. ….......……...(Signed)..............…….
DEPUTY PRESIDENT B H BURNS
CATCHWORDS
TAXATION – transitional reasonable benefit limit – failure to lodge application on time – extension of time – relevant considerations – decision set aside.
Income Tax Regulations 1936 – reg 53E, 53FA
Taxation Determination 97/7
Cobiac v Liddy (1969) 119 CLR 257
Federal Commissioner of Taxation v Swift & Others (1989) 20 ATR 1434
REASONS FOR DECISION
16 March 2001 Deputy President B H Burns 1. This is an application by Mr G (“the applicant”) for review of a decision of a delegate of the respondent dated 16 September 1999 (T34) to not exercise the discretion pursuant to regulation 53E of the Income Tax Regulations 1936 (“ITR”) to allow an extension of time for the applicant to lodge a transitional reasonable benefit limit (TRBL) application form.
2. The Tribunal received into evidence the documents lodged pursuant to s.37 of the Administrative Appeals Tribunal Act 1975 (T1-T39), together with 12 exhibits, 9 lodged by the applicant (Exhibits A1-A9) and 3 lodged by the respondent (Exhibits R1-R3). In addition, the Tribunal heard evidence from the applicant. The applicant was represented by Mr A Powie and the respondent was represented by Ms J Gatland, both of counsel.
3. The issue before the Tribunal is whether or not the extension of time in which to lodge the TRBL application form should be granted.
legislation
4. The reasonable benefit limit (“RBL”) is intended to limit the amount of concessionally taxed superannuation benefits received by a person. Changes announced in 1993 (T36) foreshadowed the introduction of fixed dollar limits as from 1 July 1994 in place of salary linked RBLs. So as to “…ensure that the long-term savings plans of those people approaching retirement are not unduly disturbed by the change in the reasonable benefit limits arrangements…” (T36), arrangements were put in place for people who could satisfy certain criterion (referred to as “eligible persons”) to lodge a TRBL application.
5. Sub-regulation 53E(1) of the ITR provided at the relevant time:
“53E(1) A person who, under regulation 52, 53 or 53A is an eligible person, must register a transitional RBL with the Commissioner:
(a) not later than 31 December 1996; or
(b) if in a particular case the Commissioner allows registration at a later date – by that date”
6. The Tribunal notes that sub-paragraph 53E(1)(b) of the Regulation was amended by SR No 80 of 1999 with effect from 19 May 1999, subsequent to the period concerning the decision under review. Accordingly, and with the consent of both parties, the Tribunal makes reference to sub-paragraph 53E(1)(b) of the Regulation as it stood prior to 19 May 1999.
7. On 12 December 1996 the Commissioner extended the deadline from 31 December 1996 to 4 April 1997 as indicated in a media release dated 12 December 1996 (T39).
8. Taxation Determination 97/7 was issued by the Commissioner on 2 April 1997 and provides (inter alia):
“…
Reasons for considering a further extension of time
3. The Commissioner will register a transitional RBL where it can be demonstrated that a valid reason exists which prevented lodgement of a transitional RBL application by 4 April 1997. Approval for registration after that date will be considered on a case by case basis. However, as a guide, applications will be accepted generally where:
·an eligible person has been out of contact for a prolonged period (eg overseas) and this has prevented registration of their transitional RBL by 4 April 1997;
·a serious illness has prevented the eligible person from registering the transitional RBL by 4 April 1997;
·an eligible person has sought information from a superannuation fund, employer or other organisation to enable the transitional RBL to be registered and they have not received that information by 4 April 1997; or
·an eligible person has applied for approval by the Tax Office of a higher arm’s length salary under subregulation 47(3) of the ITR and a reply has not been received by the person by 4 April 1997. All applications for a higher arm’s length salary must be lodged by that date.
4. Approval for registration of a transitional RBL after 4 April 1997 will not be granted generally where the above circumstances do not exist and an eligible person merely:
· was not aware of the need to lodge a transitional RBL application or was not aware that a Transitional RBL Application Form was required to be lodged by 4 April 1997; or
· forgot to register the transitional RBL by 4 April 1997.
…”
background
9. The applicant was, until last year, the managing director of a company (LSL). On about 24 October 1997 the applicant, through his actuary, lodged a request to register his TRBL application form (T3) and further provided the application form at this time. A delegate of the respondent refused this request on 7 November 1997 (T4).
10. The applicant lodged another request on 24 March 1998 (T6). This request was refused with such refusal being communicated to the applicant on 19 May 1998 (T9). The applicant then wrote to the Deputy Commissioner of Taxation – Superannuation, Mr M Monaghan on 30 September 1998 (T12) seeking further review. This request was also refused on 15 January 1999 (T16).
11. On 23 April 1999 the applicant through his present solicitors lodged another request (T24). This request was treated by the respondent as a valid objection, and was disallowed on 16 September 1999 (T34). It is worth noting that this final decision was delayed pending legislative amendments, the effect of which was to make such decisions subject to possible review by this Tribunal.
applicant’s evidence
12. The applicant’s evidence comprised a sworn affidavit (Exhibit A2) and sworn testimony. The applicant informed the Tribunal that he was the managing director of LSL for twelve years from 1988 to 2000. He is a Fellow of the Australian Society of Certified Practising Accountants and has a Bachelor of Economics degree. He was also a director of the company which was the corporate trustee of LSL’s Senior Executives’ Superannuation Fund as and from 1988.
13. Mr G gave evidence that he could not recall reading anything about TRBLs in the press during the relevant period, nor could he recall receiving any information in his role as director of the Superannuation Fund, but agreed during cross examination that he was aware of the concept of TRBLs. He said that his role as director of the Fund was to be responsible for the administration of the fund, and attend a couple of meetings per year.
14. The applicant said that he received a letter from LSL in February 1995 (Exhibit A7) indicating that the TRBL legislation had been passed and advising him to defer registration of any proposed TRBL. He said that he then received another letter at the end of April 1995 (Exhibit A9) which gave more information and included an application form, but could not recall reading the letter, telling the Tribunal that he simply received it and filed it at home.
15. From the letter dated 23 February 1995 (Exhibit A7), the Tribunal notes the following:
“…
Certain people are entitled to special higher limits called transitional RBL’s. It is difficult to tell who may be eligible for a higher limit without doing extensive calculations…
If you have an entitlement to the higher limit, you have until 31 December 1996 to apply to the Taxation Office to register your entitlement . The Taxation Office application form is quite complex and requires expert advice to ensure that you do not overlook any of your entitlements – any error or omission could prove very costly.
At this stage it is suggested that you defer any registration with the Taxation Office. The … Group Superannuation function together with benefits consultants, … will contact you in the next few weeks to help determine whether you have an entitlement and what further action to take…”
16. From the letter dated 28 April 1995 (Exhibit A9) the Tribunal notes the following:
“…
This letter follows the initial advice to you of 23 February 1995.
You are a Fund Member who may qualify for a transitional RBL which is higher than the ‘standard’ RBL. If this is so, there will be valuable taxation concessions available to you when you ultimately receive your superannuation benefit, but only if you register a claim for the higher limit with the Tax Office.
The aim of this letter is to assist you in determining whether you have an entitlement to a transitional RBL…
…
Expiry of Offer
The fee structure outlined above will apply in respect of all forms received by ….. up to 31 December 1995 and will lapse thereafter.
Declining the Offer
You are not obliged to take up ….. service offer. Should you wish, you are quite free to prepare the Tax Office application yourself or to engage an alternative service provider.
If you do not wish to use the ….. service, please fill in just your name and the Fund name in Part A of the data collation form and return it in the envelope provided. This will enable ….. to identify those declining from those whose business is outstanding.
…”
17. The applicant gave evidence that as the letter arrived in the same week that LSL’s annual general meeting was held, he put the letter into his personal superannuation file at home, where it remained unattended. He stated that he saw superannuation as something that was “a long long way away” (Transcript p47) and so he simply filed the letter away. He said that due to an unfortunate combination, namely, of thinking that he had time up his sleeve before responding, together with substantial work commitments, he did not give the letters their proper attention. He agreed with the Tribunal that had the letters told him explicitly about the monies he was potentially going to miss out on, he would have filled in and lodged the form immediately.
18. Mr G informed the Tribunal that he was heavily reliant upon people in his office to assist in matters such as superannuation, and relied in particular on the general manager of the Superannuation Fund, Mr R, and the company secretary, Mr P. He said that he only became aware that the TRBL deadline had passed when TRBLs came up in a casual conversation with a colleague whilst travelling home from an overseas trip in September 1997. He gave evidence that it was only when he talked to his travelling colleague that the issue of TRBLs loomed large in his mind.
19. The applicant said that upon his return from this overseas trip in September 1997 he spoke to Mr P who told him that he should have put in an application for TRBL. He told the Tribunal that he then got together his financial information and approached a firm of actuaries, to assist him lodge the late application form. He gave evidence that once he had obtained the relevant information from his income tax return, he had officers of his company keep in contact with the actuaries to ensure that everything was proceeding correctly.
20. The applicant told the Tribunal that he learned that Mr R had reminded a number of people about the deadline for lodging a TRBL application, but as Mr R did not report directly to him, Mr R had instructed Mr P to remind him, which Mr P failed to do. He gave evidence that he had to retrench Mr P in March 1999 due to a general downsizing, and that their relationship since that time has been hostile and acrimonious.
21. The applicant informed the Tribunal that a small firm of chartered accountants did his income tax returns each year, but that they have never been involved in providing him with superannuation advice.
22. The applicant gave evidence that he was extremely busy in 1996 due, in particular, to staffing issues and travel requirements, working an average 12 to 14 hour day. In relation to the travel requirements, he stated that one has to bear not only the days away in mind, but also the significant amounts of work that must be done prior and subsequent to any such travel. He stated that superannuation was simply not on his mind during that period of time.
23. In early 1997 he was diagnosed with, and underwent surgery to remove a skin cancer.
24. The applicant testified that if he cannot lodge his application for a TRBL to be registered, he will have to pay over $360,000 in additional tax. He told the Tribunal that he will roll his eligible termination payment (ETP) into a superannuation fund in order that he can access it at age 55. He said that he was aware that ETPs are subject to taxation. In conclusion he wished that there was some sort of late lodgement fine that he could pay, and that he would happily pay the administration costs associated with late lodgement.
applicant’s submissions
25. Mr Powrie submitted on behalf of the applicant that it is fair, just and equitable, bearing in mind the totality of the circumstances, to exercise the discretion in favour of the applicant. He further submitted that the applicant has always maintained his taxation affairs in good order. He also submitted that the applicant clearly had an extremely difficult and taxing job, had to move house during the period in question and had a skin cancer removed.
26. Mr Powrie referred to the fact that the applicant had a separate filing system for superannuation, and that the failings of this home filing system should not of itself result in the discretion not being exercised in the applicant’s favour. He also submitted that the failings of the applicant’s business advisers should not be held against the applicant.
27. Mr Powrie submitted that the letters received by the applicant (Exhibits A7 and A9) were received within the context of there being a deadline some 18 months in the future. Under such circumstances, Mr Powrie submitted that it is not unremarkable that the applicant failed to remember the significance of those letters as and when his TRBL application form due date eventuated.
28. Mr Powrie submitted that it was clearly the intent of the legislators that taxpayers in the position of the applicant not be disadvantaged, and that the TRBL legislation be construed in the most beneficial way possible. He referred in this regard to a passage from Cobiac v Liddy (1969) 119 CLR 257 at 269 wherein Windeyer J stated (inter alia):
“The whole history of criminal justice has shewn that severity of punishment begets the need of a capacity for mercy. The more strict a rule is made, the more serious become the consequences of breaking it, the less likely it may be that Parliament would intend to close all avenues of exception… It is that a capacity in special circumstances to avoid the rigidity of inexorable law is of the very essence of justice.”
29. Mr Powrie submitted that the Tribunal should take a global approach to the exercise of the discretion, and that in an assessment of “reasonableness”, the Tribunal should have regard for general social standards rather than the slavish application of any legal test (French J in Federal Commissioner of Taxation v Swift & Others (1989) 20 ATR 1434 at 1449 and 1453). He submitted that not exercising the discretion in favour of the applicant would have a disproportionate effect in terms of the additional tax burden the applicant would face. He further submitted that the imposition of this additional tax burden runs contrary to the spirit and intention of the Income Tax legislation.
30. Mr Powrie submitted that the applicant falls within the gambit of Taxation Determination 97/7 but that in any event, the determination does not have the force of legislation, and must be considered in conjunction with section 8 of the Act, which, in his submission, provides that the principles of fairness and equity are to be applied in the interpretation of the Act.
31. Mr Powrie submitted that the delay of itself is not fatal to the applicant, as it has been adequately explained. The respondent would not suffer any prejudice by the granting of the application in his submission.
respondent’s submissions
32. Ms Gatland submitted on behalf of the respondent that this case is distinct from most concerning extension of time in that allowing the claim would allow the applicant to benefit from transitional arrangements that are no longer available to other taxpayers. She also submitted that the fact that the scheme was voluntary is significant, as the applicant was in no way forced to participate in it.
33. Ms Gatland submitted that the delay has not been sufficiently explained by the applicant. In relation to work pressure, she submitted that the applicant conceded that once he decided to register his TRBL application, the necessary steps were taken without delay, and that the applicant was not in a position different to other people with heavy workloads in the class of people affected by TRBLs.
34. A further submission of Ms Gatland was that the applicant received multiple reminders from his employer in relation to the TRBL scheme. She submitted that the applicant had clearly been made aware of his rights and had failed to act upon that advice. She noted that the applicant had not called Mr P or Mr R as witnesses. She further submitted that the applicant must have been aware of the TRBL issue by virtue of his role as a director of the company superannuation fund.
35. Ms Gatland submitted that the respondent had undertaken an extensive advertising campaign to alert people to the need to register. She submitted that the personal and medical pressures faced by the applicant did not cover the entire period in question and should not be given great weight by the Tribunal. On the whole of the evidence, Ms Gatland submitted that the applicant had not taken reasonable steps to ensure that the application was duly lodged.
36. The respondent submitted that the “penalty” to be suffered by the applicant is not as high as the applicant contends. Ms Gatland further submitted that it is appropriate to have regard to Taxation Determination 97/7 to ensure consistency in the exercise of the discretion and that “forgetting” of itself is not sufficient as a reason for not lodging the TRBL application pursuant to the provisions of the determination.
the tribunal’s findings, reasons and decision
37. The Tribunal would indicate that it has had regard to the whole of the evidence together with the submissions of the parties, both oral and written. The Tribunal has summarised the parties’ submissions, but sees no purpose served in setting out the submissions in full here, as they are well known to the parties and to the Tribunal.
38. The Tribunal also notes that there was some discrepancy between the parties as to the tax implications for the applicant were he to not succeed before the Tribunal. Determining what tax may be payable in that event is a complex matter of assessment predicated on a number of assumptions about which the Tribunal has insufficient evidence, and it is not this Tribunal’s role to attempt that assessment herein. For the purposes of these reasons, it is sufficient to note that as a minimum, based upon the respondent’s calculations, the applicant stands to lose approximately five percent of his pension payments per year should the Tribunal exercise the discretion in Regulation 53E(1)(b) against allowing the applicant to register his TRBL application. It could not be disputed that such an amount would fall to be described as a significant sum of money.
39. The issue in these proceedings relates to the exercise of the discretion pursuant to Regulation 53E(1)(b) of the ITR to allow registration by the applicant of a TRBL application with the respondent at a date later than 4 April 1997 or not, as the case may be.
40. Regulation 53E(1)(b) as at the date when the applicant applied to the respondent for registration of a TRBL, namely, on or about the 24 October 1997 and as at the date of the refusal to register the TRBL application, read as follows:
“53E(1) A person who, under regulation 52, 53 or 53A is an eligible person, must register a transitional RBL with the Commissioner:
…
(b) if in a particular case the Commissioner allows registration at a later date – by that date.”
41. Regulation 53E(1)(b) was later amended as and from 19 May 1999 to read:
“53E(1) A person who, under regulation 52, 53 or 53A is an eligible person, must register a transitional RBL with the Commissioner:
…
(b) if the Commissioner grants an application for registration by a later date, by that date.”
42. The Regulation in its former state is in the opinion of the Tribunal the relevantly worded one for the purposes of these proceedings, it being in place at the time of the request for registration and the initial refusal to exercise the discretion in favour of allowing the registration of the TRBL application.
43. The parties have made extensive submissions to the Tribunal regarding the discretion in Regulation 53E(1)(b). That Regulation 53E(1)(b) provides a discretion is beyond question having regard to the wording, namely: “if in a particular case the Commissioner allows …”.
44. Many and varied were the authorities to which the Tribunal was referred in the course of the parties’ submissions. The Tribunal is mindful in its deliberations that care must be taken in focusing on the particular legislation before it at all times and not to be distracted by case authorities which relate to discretions regarding other legislation. Whilst they may be helpful, one must keep in mind the actual legislation.
45. What then are the relevant considerations when considering the discretion reposed in Regulation 53E(1)(b)? It goes without saying that the wording of the regulation and its context, having regard to the nature and purpose of the legislation, are important when considering the nature and scope of the discretion. Having regard to the wording of the regulation, it is apparent on the face of it that there are no conditions as to its exercise appended to it, apart from the requirement that the person in question be an “eligible person” which the applicant is. There are of course, when one has regard to its context, requirements of an administrative nature contained in Regulation 53E(2) and 53 FA which relate to the registration procedure.
46. The considered view of the Tribunal is that the discretion in question can be fairly said to be an unfettered discretion. The Tribunal notes that the TRBL arrangements came into place for eligible persons such as the applicant to “ensure that the long-term savings plans of those people approaching retirement are not unduly disturbed by the change in the reasonable benefit limits arrangements”(T36). The time initially fixed in Regulation 53E(1)(a) for registering a TRBL was not later than 31 December 1996 but this was extended by the respondent to 4 April 1997 pursuant to Regulation 53E(1)(b).
47. It is not in dispute that the registration of a TRBL (all other things being equal) is beneficial to an eligible person as opposed to non-registration. It goes without saying that that is so for the applicant, even taking the scenario outlined by the respondent in its submissions. For the reasons outlined earlier, the Tribunal does not have a preference for the applicant’s figures, the respondent’s figures or any other figures, were the correct or preferable decision be that his application to register a TRBL be refused.
48. It is the opinion of the Tribunal that the very nature of the TRBL legislation, and in particular for present purposes that of Regulation 53E(1), is to ameliorate the changes to the reasonable benefit limits arrangements. It goes without saying that time limits were needed for normal and orderly administrative purposes. It also goes without saying that Parliament recognised that taxpayers would need time within which to lodge their applications for a TRBL and that there would be those who would not be able to meet registration deadlines. And so Parliament provided the respondent with an unfettered discretion to allow other dates for the registration of a TRBL recognising as it did that many and varied would be the particular circumstances as to why a later date was necessary for registration. The unfettered discretion provided was, in the opinion of the Tribunal, Parliament’s recognition that it would be unjust to have an arbitrary cut-off date and that the provision of an unfettered discretion would enable the respondent to have regard to the particular circumstances of each case as to what was fair and equitable.
49. Not unnaturally the respondent formulated policy guidelines regarding the exercise of the discretion contained in Regulation 53E(1)(b). The Tribunal has given consideration to same but is mindful that they are not binding on the Tribunal.
50. A relevant consideration to be weighed in the exercise of the subject discretion is the reason for the applicant’s delay in applying to have registered his TRBL. The Tribunal had the advantage of closely listening to and observing the applicant in the giving of his evidence on this topic. The Tribunal found the applicant to be a most impressive witness who at all times was frank and honest in the giving of his testimony. The Tribunal gained the distinct impression that he did his best at all times to accurately recall the events in question. The Tribunal has no hesitation in accepting his evidence.
51. The Tribunal sees no purpose served in outlining in detail the evidence which the applicant gave and which is to be found in the transcript and in his affidavit (Exhibit A2). The Tribunal accepts that the applicant forgot about any need to lodge an application for registering a TRBL as and from the receipt of the letters to him of 23 February 1995 (Exhibit A7) and 28 April 1995 (Exhibit A9) until a discussion took place with a colleague in September 1997. The Tribunal also accepts that once this latter discussion took place the applicant did all that he could be reasonably expected to do to make application for the necessary registration of his TRBL. There was no unnecessary delay.
52. The reasons why the applicant “did not recall or even think of anything about reasonable benefit limits” (Transcript p73) are to be found in his affidavit (Exhibit A2) as supplemented by his sworn evidence. The Tribunal has no hesitation in accepting that evidence and drawing the reasonable inference from it that the circumstances surrounding the applicant as and from early 1995, until being alerted by his colleague in late 1997, were such as to cause the applicant to forget to register the TRBL.
53. The respondent’s policy guidelines contained in Taxation Determination 97/7 (T35) relevantly state:
“
4. Approval for registration of a transitional RBL after 4 April 1997 will not be granted generally where the above circumstances do not exist and an eligible person merely:
· …
· forgot to register the transitional RBL by 4 April 1997.”
54. The view of the Tribunal is that circumstances may be such that justify the finding that a person has forgotten to register. To forget is of course a natural human phenomenon which afflicts us all from time to time, some more than others. The Tribunal acknowledges that at the initial decision-making level it may be difficult to make a judgment as to the genuineness or otherwise of a claim that one forgot. The factual background relevant to such a claim needs to be examined and then a judgment needs to be made as to whether the particular person has in fact forgotten, having regard to all the circumstances. That task has been made much easier at the merits review stage of proceedings ie, before the Tribunal. One advantage, which the respondent has not had, is that of closely observing and listening to the applicant in the giving of sworn evidence which included the close cross-examination of him by the respondent.
55. The Tribunal formed the view that the factual background relating to the period during which the applicant claimed that he had forgotten was such as to conclude that he had in fact genuinely forgotten. The next step in the view of the Tribunal, if it is determined in a particular case that a person has in fact forgotten, is as to what weight, if any, should be accorded that fact when considering the exercise of the discretion in Reg 53E(1)(b).
56. At the end of the day it is the considered view of the Tribunal that the judgment which then needs to be made, if it is determined that the person in fact has genuinely forgotten, is as to what weight (if any) should be given to that fact in terms of the reasonableness or otherwise of it. (emphasis added) As to the weight which might be given to the reasonableness or otherwise of the fact that a person has forgotten, the Tribunal is of the view that this should be by way of an objective judgement ie, from the perspective of a reasonable person, and in that regard, rather than bestowing the mantle of reasonableness on male passengers on English buses (“the man on the Clapham Omnibus”) as has been the case in the past, it might be more appropriate in this day and age to attribute those qualities to the daily commuter on the Manly ferry. Included in that process would be an examination of whether the actions or inactions of the person found to have forgotten were so lacking in care that they may have significantly increased the chances of the person forgetting the matter in issue. The Tribunal acknowledges that there may be situations where a judgment is made that a person did in fact genuinely forget, but it is clear that that state of affairs (objectively speaking) probably came about because of the grossly negligent attitude of the person in question. There may well also be situations where it is clear that the person did genuinely forget but that was reasonable in all the circumstances. The Tribunal is of the latter view regarding the particular circumstances pertaining to the applicant. The fact that the applicant genuinely forgot, and that it was reasonable to have done so in all the circumstances, must weigh significantly in favour of an exercise of the discretion in his favour.
57. Another relevant consideration is the length of time that has elapsed as and from 4 April 1997 (which date appears to be courtesy of a blanket exercise of the respondent’s discretion pursuant to Regulation 53E(1)(b) covering all applications received before that date) and the applicant’s lodgement of application on or about 24 October 1997. The time in question is close to seven months and can be fairly categorized as not being an extensive period of time. Whilst some might say (but this Tribunal does not) that the greater the length of time the more persuasive the circumstances must be for a favourable exercise of the subject discretion, the Tribunal is of the view that the time which has elapsed must be looked at in the overall context of the particular circumstances of the case. The public interest in bringing about finality must be considered together with any administrative difficulties caused as a consequence of the length of time which has elapsed. In this regard, the Tribunal’s considered view is that whilst some weight should be given towards exercising the discretion non-favourably to the applicant that weight is towards the bottom end of the scale.
58. The next consideration in the Tribunal’s opinion relates to prejudice. From the applicant’s point of view, can it be said that he will suffer any prejudice should the discretion be exercised such as to refuse his application? The material before the Tribunal indicates that he will suffer some prejudice in financial terms, the extent of which is in dispute. The Tribunal has already indicated its views about the difficulty of resolving this dispute and has taken the view that even accepting the respondent’s submissions in this regard, it is clear that the applicant will be significantly financially disadvantaged and this weighs significantly in favour of exercising the discretion such as to allow late registration. As to whether the respondent will suffer any prejudice should the relevant discretion be exercised in favour of the applicant, the Tribunal’s view is that such a course of action would only lead to a correct appraisal by the respondent of the applicant’s situation which, in turn, cannot be seen as (were it otherwise) incurring any loss in so far as the public purse is concerned. Extra administrative cost will no doubt be incurred by the respondent and some weight must be given to this.
59. Another consideration is as to whether there would be any prejudice to the general public should the extension sought be granted. As previously mentioned, the public purse will not suffer in the sense that the applicant will be treated as being an eligible person the same as he would have been treated had he registered in time. Others who have not sought review of registration refusals had the choice to do so at the time and cannot be said to be prejudiced should the Tribunal exercise its discretion in the shoes of the respondent to allow the extension sought in this case. The Tribunal cannot see that a favourable exercise of the subject discretion will discriminate against other taxpayers.
60. In conclusion, the Tribunal would indicate that it has weighed up all the considerations relevant to the particular circumstances of this case and has firmly concluded that the considerations in favour of exercising the discretion in Regulation 53E(1)(b), as the applicant seeks, far outweigh those against, and accordingly the decision of the Tribunal is that the decision under review is set aside and in substitution it is determined that 31 October 1997 be the date by which the applicant must register a TRBL with the respondent.
I certify that the 60 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President B H Burns
Signed: ..........................(Signed)......................................
D M Walkley (Personal Assistant)Date/s of Hearing 7 April 2000 and 28 June 2000
Date of Decision 16 March 2001
Counsel for the Applicant Mr Powrie
Solicitor for the Applicant Powrie & Co
Counsel for the Respondent Ms Gatland
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