Byrne v McLeod - [1934] HCA 61

[ ] BYRNE McLEOD

RESPONDENT. DEFENDANT,

ON APPEAL FROM A COURT OF PETTY SESSIONS OF Sales Tax-Flour tax-Statutory offence-Penalty-Quantum-Discretion of Court-

Flour Tax Assessment Act 1933 (No. 43 of 1933), sec. 26-Sales Tax Assessment Act (No. 1) 1930-1933 (No. 25 of 1930-No. 47 of 1933), sec. 49-Acts Interpreta- tion Act 1904-1930 (No. 1 of 1904-No. 23 of 1930), sec. 3.

Sec. 49 of the Sales Tax Assessment Act (No. 1) 1930-1933, which is incor- porated in the Flour Tax Assessment Act 1933 by sec. 26, provides that any person who by fraud, default or neglect "avoids or attempts to avoid tax chargeable under this Act shall be guilty of an offence. Penalty: Not less than Fifty pounds nor more than Five hundred pounds and in addition treble the amount of tax payment whereof he has avoided or attempted to avoid."

Held, by Gavan Duffy C.J., Rich, Evatt and McTiernan JJ. (Starke and Dixon JJ. dissenting), that the words in the penalty provision of sec. 49 of the Sales

52 CLR 2

Tax Assessment Act (No. 1) 1930-1933, confer upon the competent tribunal one, but only one, discretionary power, namely, to fix the amount of the fine between the amounts of £50 and £500, but the penalty SO imposed is, in all cases, to be supplemented by an order for the payment of treble the amount of tax avoided or attempted to be avoided.

APPEAL from a Court of Petty Sessions of New South Wales.

Upon an information laid by John William Joseph Byrne, an officer of the Taxation Department of the Commonwealth, Donald Archibald McLeod was charged with having by fraud avoided tax chargeable under the Flour Tax Assessment Act 1933, for the month of February 1934, in that he did in a return, furnished by him to the Commissioner of Taxation pursuant to sec. 16 of the Act, of flour manufactured in Australia by the firm of A. McLeod &Sons, of Merrylands, New South Wales, of which firm he was a partner, understate the aggregate quantity of flour sold and delivered by that firm during February 1934 by 96 tons 731 lbs., the difference between the amount of flour tax actually payable and that shown in the return being £409 10s. 1d.

Separate informations laid by the same informant charged William George McLeod, another partner in the firm of A. McLeod &Sons, and James Larter, an employee of that firm, with aiding and abetting Donald Archibald McLeod in the commission of the offence charged against him as shown above.

It was stated in each information that the defendant therein had incurred a pecuniary penalty exceeding £500, and that the excess over and above that sum had been abandoned.

By sec. 5 of the Crimes Act 1914-1932 a person who aids or abets the commission of any offence against any law of the Commonwealth 'shall be deemed to have committed that offence and be punishable accordingly."

Each defendant pleaded guilty to the respective informations charged. No sworn…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Byrne v McLeod

Details

AGLC: Byrne v McLeod [1934] HCA 61
Case: [1934] HCA 61
Decision Date: 19 December 1934

CaseChat Overview and Summary

The case of Byrne v McLeod concerned an appeal to the High Court of Australia from a Court of Petty Sessions in New South Wales. The appellant, an officer of the Taxation Department, charged the respondent, Donald Archibald McLeod, with committing an offence under the Flour Tax Assessment Act 1933 by fraudulently avoiding tax. The respondent, a partner in a firm, had understated the quantity of flour sold, resulting in an underpayment of tax. Similar charges were laid against another partner and an employee for aiding and abetting. All defendants pleaded guilty.

The central legal issue before the High Court was the interpretation of the penalty provision in section 49 of the Sales Tax Assessment Act (No. 1) 1930-1933, which was incorporated into the Flour Tax Assessment Act 1933. Specifically, the court had to determine whether the penalty, described as "Not less than Fifty pounds nor more than Five hundred pounds and in addition treble the amount of tax payment whereof he has avoided or attempted to avoid," conferred a single discretionary power on the court to fix the fine between £50 and £500, with the treble tax amount being mandatory in all cases, or if it allowed for discretion in the imposition of the treble tax as well.

A majority of the High Court, comprising Gavan Duffy C.J., Rich, Evatt, and McTiernan JJ., held that the penalty provision conferred only one discretionary power: to set the fine between £50 and £500. They reasoned that the phrase "and in addition treble the amount of tax payment whereof he has avoided or attempted to avoid" mandated the payment of treble the avoided tax in all cases, irrespective of the fine imposed within the specified range. The majority found the wording of the provision to be clear and not requiring interpretation by reference to other statutes, such as the Acts Interpretation Act. Starke and Dixon JJ. dissented, with Dixon J. considering the application of section 3 of the Acts Interpretation Act 1904-1930, which he believed indicated that penalties should be interpreted as maximums unless otherwise specified, thus allowing for discretion in the imposition of the treble tax.

The appeal was allowed, and the question in the special case was answered in the affirmative. This meant that the magistrate's interpretation, which allowed for discretion in the imposition of the treble tax, was found to be erroneous. The penalty should have included treble the amount of tax avoided, in addition to a fine between £50 and £500, though the prosecutor had abandoned any excess over £500.

Orders