Brookdale Investments Pty Ltd and Commissioner of Taxation - [2013] AATA 186

[2013] AATA 186

Division	TAXATION APPEALS DIVISION
File Number(s)	2012/3132
Re	BROOKDALE INVESTMENTS PTY LTD
APPLICANT
And	COMMISSIONER OF TAXATION
RESPONDENT

DECISION

Tribunal	Senior Member C R Walsh
Date	27 March 2013
Place	Perth

Decision Summary

The Tribunal affirms the Commissioner’s objection decision dated 30 May 2012.

..(sgd) C R Walsh....................

Senior Member C R Walsh

Catchwords

GOODS AND SERVICES TAX – dispute regarding quantum of “consideration” on “taxable supply” of land - meaning of “consideration” considered – meaning of “price” considered – meaning of “money” considered – “timing” of taxable supply considered - failure by applicant to call any witnesses in support of application – rule in Jones v Dunkel applied – Commissioner’s objection decision affirmed

Legislation
A New Tax System (Goods and Services Tax) Act (Cth) – s 9-5(a) – s 9-15 – s 9-70 – s 9-75 – s 195-1 – Division 29 – s 29-5

Taxation Administration Act 1953 (Cth) – s 14ZZK(b)(i)

Cases

Federal Commissioner of Taxation v Dalco (1990) 168 CLR 164
ANZ Savings Bank Ltd v Federal Commissioner of Taxation 94 ATC 4844
McCormack v Federal Commissioner of Taxation 79 ATC 4111; 80 ATC 4179
Macmine Pty Ltd v Federal Commissioner of Taxation 79 ATC 4133
Vadesz v Commissioner of Taxation [2006] AATA 682
Gauci & Ors v Federal Commissioner of Taxation (1975) 135 CLR 81
T-T Line Company Pty Ltd v Federal Commissioner of Taxation [2009] FCAFC 178
Jones v Dunkel (1959) 101 CLR 298
Re Sanctuary Lakes Pty Ltd and Commissioner of Taxation [2012] AATA 404
Stasos v Tax Agents Board (1990) 21 ALD 437
Kumar v Minister for Immigration and Citizenship [2009] AATA 124

Re Rodger and Secretary, Department of Social Security (1991) 24 ALD 720

Secondary Materials

Explanatory Memorandum to the A New Tax System (Goods and Services Tax) Bill 1998 (Cth)

REASONS FOR DECISION

Senior Member C R Walsh

27 March 2013

INTRODUCTION

The sole issue in dispute between the parties in this review application is the quantum of “consideration”, for goods and services tax (GST) purposes, received by Brookdale Investments Pty Ltd (Brookdale) on the “ taxable supply” of land known as “Lot 231 on Deposited Plan 53347” (Lot 231) to a third party, Ms Sandhu.
More particularly, Brookdale seeks a review of the Commissioner’s objection decision (dated 30 May 2012) which disallowed part of Brookdale’s objection (dated 8 March 2012) to an amended assessment of a GST net amount (of $59,283), for the quarter ended 31 December 2007, on the sale of Lot 231.

EVIDENCE BEFORE TRIBUNAL

Brookdale’s evidence

Brookdale’s evidence in this application comprises:
(i)a bundle of documents titled “Applicant’s Evidence”, which was filed with the Tribunal on 3 December 2012 and tendered into evidence at the hearing of this application as “Exhibit A1” (Brookdale’s Evidence); and
(ii)a Statement of Facts, Issues and Contention, which was filed with the Tribunal on 3 December 2012 (Brookdale’s SFIC).
Brookdale’s Evidence comprises:
(i)Brookdale’s financial accounts for the years ended 30 June 2004 to 30 June 2008; and
(ii)Brookdale’s company tax returns for the years ended 30 June 2007 and 30 June 2008.
Brookdale did not file any witness statements in support of its application. Further, no witnesses appeared before the Tribunal at the hearing of this application and gave evidence in support of Brookdale’s position.
The Tribunal notes that none of Brookdale’s financial accounts for the years ended 30 June 2004 to 30 June 2008 (referred to in paragraph 4(i) above) have been independently audited.

Commissioner’s evidence

The Commissioner’s evidence in this application comprises:
(i)Sub-Section 37 (1AB) Statement in Lieu, or “T” documents (titled “Reasons for Decision and Relevant Documents”) which was filed with the Tribunal on 16 August 2012 and tendered into evidence at the hearing of this application as “Exhibit R2” (T Documents);
(ii)a bundle of “Supplementary Section 37 Documents” which was filed with the Tribunal on 31 August 2012 and tendered into evidence at the hearing of this application as “Exhibit R3” (Supplementary T Documents); and
(iii)a caveat (number “H 945945”), dated 3 December 2001, on the Lake Clifton Properties, with Ms Sandhu (as “Caveator”) and Brookdale (as “Registered Proprietor) (Caveat), attaching a “Statutory Declaration” of Ms Sandhu dated 14 November 2001 (Sandhu Statutory Declaration).

RELEVANT BACKGROUND FACTS & EVIDENCE

During the period, Brookdale conducted a property development business, was registered for GST and accounted for GST on a cash basis, paying and reporting quarterly: see Brookdale Investments Pty Ltd v Commissioner of Taxation [2013] AATA 154 at [4].
On 17 March 2001, Ms Sandhu sold her property at 342 The Boulevard, City Beach, Western Australia for $676,000 (City Beach Property).
Ms Sandhu agreed to loan the net proceeds of the sale to Brookdale (Loan), to enable Brookdale to purchase Lots 22, 23 and 25 on Deposited Plan 21705 (Lake Clifton Properties).
On 6 April 2001, Ms Sandhu (as “Lender”) and Brookdale (as “Borrower”) executed a “Loan Term Sheet” to formalise the Loan (Loan Term Sheet). The expression “Principal Sum”, is defined in clause 2.2 of the Loan Term Sheet as follows:
“the total amount of net proceeds of the sale of the [City Beach Property] which the Lender [i.e. Ms Sandhu] pays at the request of the Borrower [i.e. Brookdale] to BankWest in reduction of the purchase price of the [Lake Clifton Properties].“
Further, clause 7 of the Loan Term Sheet, titled “Repayment”, states:
7.1The Principal Sum shall be repaid in full free of interest upon the date of sale of the [Lake Clifton Properties] by [Brookdale].
7.2The Principal Sum is unsecured and the Lender [i.e. Ms Sandhu] has no right to require the borrower [i.e. Brookdale] to sell the [Lake Clifton Properties].
Ms Sandhu subsequently lodged the Caveat on the Lake Clifton Properties.
By a “Contract for the Sale of Shares” in Brookdale, dated 28 May 2003, Mr Vincent Paul De Villers sold 100% of the shares in Brookdale to Mr John Poppazi and Mr Anthony Gurgone (Contract for Sale of Shares). Ms Sandhu was a party to the Contract for Sale of Shares, as “Caveator”.
The Contract for Sale of Shares, among other things:
·     defined “Land” (at clause 1.1) as the Lake Clifton Properties;
·     defined “Loan Amount” (at clause 1.1) as:
“the sum of $652,118.50 being the amount the principal sum referred to in clause 2.2 of the Loan Agreement”;
·     defined “Loan Agreement” (at clause 1.1) as:
“the document titled ‘Loan Term Sheet’ dated 6 April 2003 made between the Company as borrower and the Caveator as Lender”; and
·     acknowledged (at clause 5.1) Ms Sandhu as “caveator” and that Brookdale was indebted to Ms Sandhu for $652,118.50, as follows:
“The Purchasers [i.e. Mr Popazzi and Mr Gurgone] acknowledge and covenant with the Vendor [i.e. Mr De Villers] as follows:
5.1The Land [i.e. the Lake Clifton Properties] is subject to the Caveat and that the Company [i.e. Brookdale] is indebted to the Caveator [i.e. Ms Sandhu] in the Loan Amount pursuant to the terms of the Loan Agreement…..”
Further, the Contract for Sale of Shares provided (at clause 5.1) that Mr Popazzi and Mr Gurgone (the purchasers) would make their “own arrangements with [Ms Sandhu] to enable the Mortgage to be discharged on the Settlement Date”.
Brookdale subsequently applied to subdivide the Lake Clifton Properties, and agreed that it would transfer one of the Lots comprising the Lake Clifton Properties (being Lot 23 on Pan 21705) to Ms Sandhu in repayment of the Loan.
In 2006, Brookdale agreed to sell part of the Lake Clifton Properties to Lonepine Enterprises Pty Ltd (Lonepine).
An undated and unsigned “Deed of Compromise and Release”, between Brookdale and Ms Sandhu, at T7 of the T Documents (Deed of Compromise and Release), states, among other things, that:
(i)Brookdale agreed to direct Lonepine to transfer part of the subdivided land to Ms Sandhu within 7 days of the issue of the certificate of title: clause 2 of the Deed of Compromise and Release; and
(ii)Ms Sandhu agreed that, upon being registered as the proprietor of part of the subdivided land transferred to her by Lonepine, she would “release and forever discharge Brookdale from liability to repay the Loan and from all actions accounts proceedings claims damages costs and expenses in respect thereof”: clause 3.1 of the Deed of Compromise and Release.
The “Recitals” to the Deed of Compromise and Release provide, inter alia:
(A)In or about March 2001 Sandhu advanced to Brookdale the sum of $676,000 (“the Loan”).
(B)Brookdale entered into a Contract for the Purchase of [the Lake Clifton Properties] (the Land) and applied the Loan monies above referred towards the purchase thereof.
(C)Brookdale then made application to subdivide the Land and agreed with Sandhu that upon completion of the subdivision it would transfer free of encumbrances part of the Land being Lot 23 [i.e. one of the Lots comprising the Lake Clifton Properties] thereon in full and final settlement of the Loan.
Clause 6 of the Deed of Compromise and Release is an “entire agreement” clause which provides:
6. ENTIRE DEED
This Deed constitutes the sole and entire agreement between the Parties and any warranty, representation, guarantee or other term or condition of any nature not expressly contained or recorded in this Deed is of no force and effect.
By a Transfer of Land, dated 6 August 2007, Brookdale transferred Lot 231 to Ms Sandhu (Transfer of Land).
The Transfer of Land records the “consideration” for the transfer of Lot 231 from Brookdale to Mr Sandhu as follows:
Consideration (Note 5)
Pursuant to a Deed of Compromise and Release between Brookdale Investments Pty Ltd (ACN 095 691 302) and Caroline Emily Kaur Sandhu dated the 5 December 2006 and stamped on the 22 February 2007.
On 5 October 2007 the Western Australian Office of State Revenue (OSR) assessed the Transfer of Land for stamp duty (of $42,300), based on a market value of $900,000.
On 25 October 2007, the Transfer of Land was subsequently registered with Landgate.
When Brookdale lodged its BAS for the quarter ended 31 December 2007 it reported a net amount of -$18 for GST on purchases. The BAS did not include details of the proceeds of the sale of Lot 231, nor did Brookdale remit any GST applicable to that sale to the Commissioner. That is, Brookdale treated the supply of Lot 231 as a GST-free supply. Consequently, in accordance with the self-assessment system, the “net amount” of GST disclosed in the BAS for that quarter and refunded by the Commissioner was $18.
On 9 August 2010, the Commissioner notified Brookdale that he would be commencing an audit of Brookdale’s taxation affairs for the income period 1 July 2006 to 30 June 2008.
By letter dated 25 March 2011 (titled “Completion of Audit”) the Commissioner notified Brookdale of the outcome of his audit. In summary, the Commissioner determined, that the:
(i)Brookdale had failed to report a taxable supply, being the sale of Lot 231 and the GST payable with respect to that supply;
(ii)value of the supply was $900,000, being the market value of Lot 231, as assessed by the OSR (on the Transfer of Land) for stamp duty purposes; and
(iii)GST payable by Brookdale on the supply was $81,818 (Audit).
Following his findings in the Audit, on 25 March 2011 the Commissioner issued a notice of assessment of GST net amount to Brookdale (of $81, 818) for the quarter ended 30 September 2007 (Original Assessment).
On 27 May 2011 Brookdale objected to the Original Assessment (Original Objection).
On 20 December 2011, the Commissioner:
(a)allowed the Brookdale’s objection in part;
(b)determined that the consideration for the supply of Lot 231 was $652,118, being the amount of the Loan in the Contract for the Sale of Shares; and
(c)determined that the supply of Lot 231 should be attributed to the quarter ended 31 December 2007 (Original Objection Decision).
In accordance with the Original Objection Decision, on 23 January 2012 the Commissioner issued a notice of amended assessment of GST net amount to Brookdale (of $59,283) for the quarter ended 31 December 2007 in respect of the supply of Lot 231 (Amended Assessment).
On 8 March 2012 Brookdale objected to the Amended Assessment (Objection).
On 30 May 2012 the Commissioner disallowed the Objection in relation to the GST payable on the supply of the Property (Objection Decision).
On 17 July 2012, Brookdale applied to the Tribunal for a review of the Objection Decision, contending that:
(i)the transfer of Lot 231 was not a supply;
(ii)alternatively, if the transfer of Lot 231 was a supply, the supply was not taxable or was GST-free; and
(iii)alternatively, if the transfer of Lot 231 was a taxable supply, it was for a lesser amount than $652,118.
However, Brookdale subsequently conceded that the transfer of Lot 231 was a “taxable supply” such that the contentions referred to in paragraph 22(i) and (ii) above are no longer pressed by Brookdale in this review application.

ISSUES

Consequently, the sole issue for determination by the Tribunal in this review application is the amount of “consideration” received by Brookdale for the supply of the Lot 231 to Ms Sandhu.
In summary, Brookdale’s contention is that the consideration for the supply of Lot 231 by Brookdale to Ms Sandhu is $521,484, being the amount of the Loan, recorded in Brookdale’s financial accounts on the date the Transfer of Land was executed (being 5 October 2007).
In contrast, the Commissioner’s contention is that the consideration for the supply of Lot 231 by Brookdale to Ms Sandhu is $652,118.50, being the “Loan Amount” in the Contract for Sale of Shares (which refers to the “Principal Sum” in clause 2.2 of the Loan Term Sheet).

BURDEN OF PROOF

Pursuant to s 14ZZK(b)(i) of the TAA, Brookdale bears the burden of proving that the Amended Assessment is excessive: Federal Commissioner of Taxation v Dalco (1990) 168 CLR 164 and ANZ Savings Bank Ltd v Federal Commissioner of Taxation 94 ATC 4844. The standard of proof is on the balance of probabilities.
If Brookdale is unable to establish that the Amended Assessment is excessive, then the Amended Assessment must stand, irrespective of whether or not there are any facts or circumstances which would on the face of it support the Amended Assessment: McCormack v Federal Commissioner of Taxation 79 ATC 4111; 80 ATC 4179 and Macmine Pty Ltd v Federal Commissioner of Taxation 79 ATC 4133.
Importantly, the burden will not necessarily be discharged, for example, by Brookdale showing an error by the Commissioner in forming a judgment as to the amount of the Amended Assessment: Dalco (1990) 168 CLR 614 at 621 and Vadesz v Commissioner of Taxation [2006] AATA 682 at [31].
There is no onus on the Commissioner to show that the Amended Assessment is reasonable or supported by evidence: Gauci & Ors v Federal Commissioner of Taxation (1975) 135 CLR 81 at 89 per Mason J.

RELEVANT LAW

A supply can only be a “taxable supply” for GST purposes if it is made for “consideration: s 9-5(a) of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act).
The term “consideration” is defined in s 9-15 of the GST Act, in part, as follows:
9-15 Consideration
(1) Consideration includes:
(a)any payment, or act or forbearance, in connection with a supply of anything; and
(b)any payment, or any act or forbearance, in response to or for the inducement of a supply of anything.
(2)It does not matter whether the payment, act or forbearance was voluntary, or whether it was by the recipient of the supply.
It is clear from the use of the word “includes” in the s 9-15 that “consideration” is an inclusive definition of the ordinary meaning of the term. It is also clear that the intention of the legislation is that the term “consideration” be construed as broadly as possible. This is consistent with what is said in the Explanatory Memorandum to the A New Tax System (Goods and Services Tax) Bill 1998 (Cth), which Bill introduced the GST Act (EM). At [3.9] the EM states, in part:
3.9 Section 9-15 defines consideration. Consideration for GST is broader than it is for contractual purposes. Consideration for GST is intended to be very broad….
The breadth of the term “consideration” was acknowledged by the Federal Court in T-T Line Company Pty Ltd v Federal Commissioner of Taxation [2009] FCAFC 178; (2009) 74 ATR 771.
Broadly, under the GST Act, the supplier (in this case, Brookdale) is liable to GST of an amount equal to 10% of the “value” of the taxable supply they have made or are making: s 9-70 of the GST Act. The “value” of the taxable supply is the “price” for the supply multiplied by ten-elevenths: s 9-75 of the GST Act.
Section 9-75 of the GST Act provides that “price” is calculated as follows:
price is the sum of:
(a)so far as the *consideration for the supply is consideration expressed as an amount of *money – the amount (without any discount for the amount of GST (if any) payable on the supply; and
(b)so far as the consideration is not consideration expressed as an amount of money – the *GST-inclusive market value of that consideration. [Emphasis added]
“Money” is defined inclusively in s 195-1 of the GST Act as follows:
money includes:
(a)       currency (whether of Australia or of another country); and
(b)       promissory notes and bills of exchange; and
(c)any negotiable instrument used or circulated, or intended for use or circulation, as currency (whether of Australia or of another country); and
(d)       postal notes and money orders; and
(e)       whatever is supplied as payment by way of:
(i)        credit card or debit card; or
(ii)       crediting or debiting an account; or
(iii)      creation or transfer of a debt.
The GST Act is silent on the issue of when a supply is “made” for GST purposes. It is the general attribution rules in Division 29 of the GST Act which determine the tax period to which GST payable on a supply is attributable. Specifically, s 29-5 of Division 29 of the GST Act, titled “What is attributable to tax periods”, states:
29-5     Attributing the GST on your taxable supplies
(1)       The GST payable by you on a *taxable supply is attributable to:
(a)the tax period in which any of the *consideration is received for the supply; or
(b)if, before any consideration is received, an *invoice is issued relating to the supply – the tax period in which the invoice is issued.
(2)       However, if you *account on a cash basis, then:
(a)if, in a tax period, all of the *consideration is received for a *taxable supply – GST on the supply is attributable to that period;
(b)if, in a tax period, part of the consideration is received – GST on the supply is attributable to that tax period, but only to the extent that the consideration is received in that tax period; or
(c) if, in a tax period, none of the consideration is received – none of the GST on the supply is attributable to that tax period. [Emphasis added]

ANALYSIS

Brookdale’s contentions

According to Brookdale, the time of the supply of Lot 231 (from Brookdale to Ms Sandhu) for GST purposes is when the Transfer of Land document was executed on 5 October 2007 and the “consideration” for the supply is the “consideration” as at that date.
Brookdale contends that the “value” of the supply of Lot 231, for the purposes of s 9-75 of the GST Act, is the amount of money by which Brookdale debited the loan balance to Ms Sandhu in its financial accounts (being, $531,484) in the years ended 30 June 2004 to 30 June 2007. Brookdale further contends that, for the purposes of the GST Act, “consideration” includes money and, in this case, the reduction by Brookdale of its debt to Ms Sandhu. That is, Brookdale argues that the debiting of the loan balance to Ms Sandhu in its financial statements satisfies the definition of “money” s195-1 of the GST Act.

In support of this contention, Brookdale refers to the following:
·Brookdale’ financial accounts for the year ended 30 June 2004 record a “Non-Current Liability, Loan – CEK Sandhu” balance, as at 30 June 2003, of $531,484;
·Brookdale’ financial accounts for the year ended 30 June 2005 record a “Non-current liability, Loan – unsecured” of $521,484;
·Brookdale’ financial accounts for the year ended 30 June 2006 record a “non-current liability, Loan – unsecured” of $521,484;
·Brookdale’ financial accounts for the year ended 30 June 2007 record a “Creditor & Borrowings, Loan – unsecured” of $521,484;
·Brookdale’ financial accounts for the year ended 30 June 2008 record a “Creditor & Borrowings, Loan – Unsecured” of “Nil”;
·Brookdale’s 2007 Income Tax Return declares “Financial & other information”, at Label 8, consistent with its financial accounts for the year ended 30 June 2007; and
·Brookdale’s 2008 Income Tax Return declares “Financial & other information”, at Label 8, consistent with its financial accounts for the year ended 30 June 2008.
Brookdale submits that the “price” of the supply of Lot 231, for the purposes of s 9-75 of the GST Act, is the amount of money by which Brookdale debited its loan balance as evidenced in its financial accounts (as set out above). According to Brookdale, the signed and dated financial statements of Brookdale, together with the dated company tax returns (as set out above), are sufficient evidence of Brookdale having a liability of $521,484 in October 2007.
Brookdale further submits that, applying the formula set out in s 9-75 of the GST Act (i.e. the price multiplied by ten-elevenths) the “value” of the supply of Lot 231 is, it follows, $474,076 (being $521,484 X 10/11). Consequently, Brookdale says, the amount of GST on the supply of Lot 231 for the purposes of s 9-70 of the GST Act is $47,407 (being 10% of $474,076) and not $59,283 as contended by the Commissioner.
According to Brookdale, the Commissioner’s reliance on the loan value of $652,118, as described as the “Loan Amount” in the Contract for Sale of Shares (dated 23 May 2003), is irrelevant in determining the “consideration” for the supply of Lot 231 by Brookdale to Ms Sandhu on 5 October 2007 (being the date the Transfer of Land was executed).
That is, Brookdale contends that Lot 231 was not supplied in May 2003 and Brookdale has not debited any account to satisfy the definition of “money” in the GST Act consistent with the “value” relied upon by the Commissioner of $652,118. Brookdale points out that the only account debited in Brookdale’s accounts the 2008 year is the amount of $521,484 (titled “Loans – Unsecured”).

Commissioner’s contentions

In contrast, the Commissioner contends that the amount of “consideration” received by Brookdale for the taxable supply of Lot 231 was $652,118 and, further, that there is insufficient evidence that Brookdale made any repayments to Ms Sandhu in reduction of the “Loan Amount” to render this amount a lesser amount, as put by Brookdale. In support of this contention, the Commissioner points out that the Deed of Compromise and Release (and, in particular, its “entire agreement” clause), the Transfer of Land and the Sandhu Statutory Declaration do not refer to any reduction in the value of the Loan by way of repayments.
According to the Commissioner, the Tribunal should rely on the contemporaneous transaction documents, being the Contract for Sale of Shares, the Deed of Compromise and Release and the Transfer of Land, to determine the correct “consideration” for the supply.
Further, before the Tribunal the Commissioner submitted that, whilst there is discrepancy in the documents as to whether the correct value of the loan is $676,000 or $652,118.50, this is not an issue for the Tribunal, as the Commissioner accepts that the correct value is $652,118.50, being the “Loan Amount” referred to in the Contract for Sale of Shares, which refers to the “Principal Sum” in clause 2.2 of the Loan Term Sheet.
Further, the Commissioner submits that Brookdale’s financial accounts are unaudited and unsupported by any witness giving evidence concerning their preparation or about the alleged repayments. The Commissioner contends that it was open to Brookdale to call evidence Ms Sandhu or Mr Popazzi in support of this application but it did not. The Commissioner says that the Tribunal ought to infer that, as a result of Brookdale’s failure to call any witnesses to support its case, that the witness’ evidence would not have supported its case: Jones v Dunkel (1959) 101 CLR 298; Re Sanctuary Lakes Pty Ltd and Commissioner of Taxation [2012] AATA 404 at 241; Stasos v Tax Agents Board (1990) 21 ALD 437; Kumar v Minister for Immigration and Citizenship [2009] AATA 124 at 112; Re Rodger and Secretary, Department of Social Security (1991) 24 ALD 720.
Finally, the Commissioner submits that in circumstances where the financial accounts of Brookdale are inconsistent with the contemporaneous evidence, and Brookdale has not called any evidence to explain the discrepancy, no weight should be given by the Tribunal to the unaudited financial accounts of Brookdale.

Tribunal’s views

In relation to Brookdale’s assertion that the time of the supply of Lot 231 (from Brookdale to Ms Sandhu) for GST purposes is when the Transfer of Land document was executed on 5 October 2007 and that the “consideration” for the supply is, therefore, the “consideration” as at that date, the Tribunal reiterates that the GST Act is in fact silent on the issue of when a supply is “made” for GST purposes: see paragraph 51 above.
Liability for GST arises in respect of “taxable supplies”, but the “time” of the supply is not determinative of the time that liability arises. Instead, and depending on which method of accounting for GST a taxpayer uses, the time that the invoice is issued or the consideration is “received” determines the time that the GST liability arises in respect of taxable supplies: see discussion on Division 29 in paragraph 51 above. In the case of a taxpayer, like Brookdale, who accounts for GST on a “cash” basis what is critical in determining to which tax period the GST on a taxable supply is attributable is when the relevant consideration is “received”. Consequently, Brookdale’s contention concerning the timing of the supply of Lot 231 is flawed.
Based on the totality of evidence before it, but, in particular, the Contract for Sale of Shares, Deed of Compromise and Release, the Transfer of Land and the Sandhu Statutory Declaration, the Tribunal accepts that the “consideration” for the supply of Lot 231 by Brookdale to Ms Sandhu was, as submitted by the Commissioner, $652,118, being the “Loan Amount” referred to in the Contract for Sale of Shares which refers to clause 2.2 of the Loan Term Sheet. The Tribunal reaches this view despite that fact that one of the documents before it (being the Deed of Compromise and Release), is undated and unsigned. Such an approach is consistent, the Tribunal considers, with the fact that the definition of “consideration” in s 9-15 of the GST Act is intended to be construed inclusive and broadly. More broadly, in fact, than it is for contractual purposes: see paragraphs 46 and 47 above.
The content of the financial statements upon which Brookdale relies in this application are unaudited and not substantiated by the evidence of any witness and that content is inconsistent with the content of the contemporaneous transaction documents before the Tribunal. The Tribunal does not consider, as contended by Brookdale, that the financial statements and tax returns provided by it are sufficient evidence to establish that the “consideration” for the supply of Lot 231 was $521,484.
This situation could perhaps have been rectified if Brookdale had called a witness or witnesses in support of its application (for example, Ms Sandhu or Brookdale director, Mr Poppazi). But, it chose not to. Accordingly, the Tribunal takes the view that the content of the contemporaneous transaction documents (including the Contact for the Sale of Shares, the Deed of Compromise and Release, the Transfer of Land and the Sandhu Statutory Declaration) are to be preferred to the financial statements and tax returns provided as evidence by Brookdale. In such circumstances, it is open to the Tribunal to infer that the evidence of any witnesses called by Brookdale would not have supported its case: Jones v Dunkel and see other cases referred to in paragraph [62] above. Further, in such circumstances, the Tribunal is not satisfied, on the balance of probabilities, that Brookdale has discharged its onus that the Amended Assessment is excessive: Dalco, ANZ Savings Bank, McCormack and Macmine.

DECISION

For the above reasons, the Tribunal affirms the Objection Decision.

I certify that the preceding 69 (sixty nine) paragraphs are a true copy of the reasons for the decision herein of Senior Member C R Walsh.

...(sgd) T Freeman......................

Associate

Dated 27 March 2013

Date(s) of hearing	21 February 2013
Representative for the Applicant	Mr R Wytkin C. Pope & Associates Pty Ltd
Counsel for the Respondent	Ms C H Thompson
Solicitors for the Respondent	Jackson McDonald