Carmelo Francesco Raccuia v Deputy Commissioner of Taxation

[1984] FCA 402

Re: CARMELO FRANCESCO RACCUIA and ANNITA RACCUIA
And: DEPUTY COMMISSIONER OF TAXATION
No. WA G52 of 1984
Administrative Law - Income Tax - Statutes
84 ATC 4873 / 4 FCR 437

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Toohey J.(1)

CATCHWORDS

Administrative Law - judicial review - whether decision of Commissioner not to refer applicants' objections to Board of Review - request for referral posted - whether Commissioner "received" request - application of postal rules by statute and at common law - application for extension of time to lodge review application - onus

Administrative Decisions (Judicial Review) Act 1977 s.11

Income Tax Assessment Act 1936 ss. 187, 188, 189

Acts Interpretation Act 1901 s.29

Income Tax - Request for reference to Board of Review - Posted - Whether posting deemed to be service - Request not received by Commissioner - Whether taxpayer's rights extinguished - Income Tax Assessment Act 1936 (Cth), ss 187, 188, 189 - Acts Interpretation Act 1901 (Cth), s 29.

Statutes - Interpretation - Posting deemed service - Whether contrary intention manifest by requirement of receipt - Acts Interpretation Act 1901 (Cth), s 29 - Income Tax Assessment Act 1936 (Cth), ss 187, 188, 189.

HEADNOTE

Held: (1) Where a taxpayer posts a request for the Commissioner to refer his decision to disallow an objection to assessment to a Board of Review but the request is not received by the Commissioner, the taxpayer's right to a reference is lost.

(2) Section 29 of the Acts Interpretation Act 1901 (Cth) which deems service in certain circumstances to have been effected by properly addressed prepaid post cannot avail a taxpayer where the request is not received by the Commissioner, because a contrary intention is manifest by ss 188 and 189 of the Income Tax Assessment Act 1936 (Cth).

(3) Similarly, the rule of the common law regarding proof of delivery of duly posted letters is displaced by the express terms of the Income Tax Assessment Act 1936 (Cth).

HEARING

1984, November 23. #DATE 23:11:1984

C P Stevenson, for the applicants.

C L Zelestis for the respondent.

Solicitors for the applicants: Stone James Stephen Jaques.

Solicitors for the respondent: Australian Government Solicitor.

GFV

ORDER

1. The applicants' application for an extension of time within which to lodge this application is dismissed.

2. The applicants' application for an order of review is dismissed.

3. Liberty to apply on the question of costs.

Orders accordingly

JUDGE1

The applicants are husband and wife and, it would appear, carry on business in partnership as designers and builders. The business is largely carried on by Mr. Raccuia though Mrs. Raccuia attends to office matters from their home including the typing of correspondence.

1. The applicants seek a review of what they claim to be decisions made by the respondent not to refer to a Board of Review his disallowance of the objection of each applicant to an assessment made against each of them under the provisions of the Income Tax Assessment Act 1936 ("the Income Tax Act").

2. The application, which is a joint application, seeks an order directing the respondent to refer each of the alleged decisions to a Board of Review. The application also seeks an extension of time within which to lodge the application. If there was a decision for the purposes of the Administrative Decisions (Judicial Review) Act 1977 ("the Judicial Review Act"), it was made by letter dated 9 March 1984. The application was not lodged until 26 June 1984, outside the period of 28 days prescribed by s.11 of the Judicial Review Act.

3. I agreed to hear the application for an extension of time concurrently with the application for review. I did so on the ground that the evidence to be adduced in connection with the substantive application was quite short and that time and expense would be saved by one hearing rather than two. This approach assumes that the application for an extension of time has reasonable prospects of success; as it turned out, very little evidence was led in support of an extension of time. Where the Court is asked to deal with an application for extension of time concurrently with the application for review, I suggest that the applicant file an affidavit in support of the former. This will enable the Court to make some useful assessment of the prospects of success of the application for extension and of the time likely to be taken in dealing with that matter. It may then seem appropriate, in a particular case, to hear the two matters together. In other cases it may be preferable to deal with the extension of time first before embarking on a lengthy hearing which will prove pointless if the extension is refused.

4. The application for review turns on a narrow issue of fact though it has implications for other taxpayers.

5. Each of the applicants received a notice of assessment of income tax for the year ended 30 June 1981. Each applicant objected to the assessment by letter dated 29 June 1982, in each case a letter prepared by the applicants' accountant. By letters dated 13 June 1983, that is nearly 12 months later, the respondent disallowed the objections. The letters of disallowance directed the applicants' attention to s.187 of the Income Tax Act which permits a taxpayer, dissatisfied with the decision on an objection, within 60 days after service of notice of the decision to request the Commissioner for Taxation to refer the decision to a Board of Review or to treat the objection as an appeal and forward it to a Supreme Court. Section 188 obliges the Commissioner, if the request is accompanied by a fee of $2.00, to refer the decision or forward the objection in accordance with the request.

6. The applicants gave evidence that on 13 July 1983 a letter was prepared in their name, addressed to the respondent requesting that "we have an interview with the Board of Review". The letter also purported to enclose $4.00. The evidence of the applicants was that the letter was drafted by Mr. Raccuia and handed to his wife who typed it in duplicate along with an envelope addressed to "Deputy Commissioner of Taxation, 1 St. George's Terrace, Perth, W.A.". Mr. Raccuia signed the letter and shortly after Mrs. Raccuia posted it at the East Cannington Post Office a short distance from their home and office. The letter was not returned.

7. About the end of 1983, no acknowledgement of the letter having been received from the respondent but proceedings having been taken against Mrs. Raccuia for the amount due on her assessment, the applicants contacted a firm of solicitors. Two representatives of the firm spoke to Mr. Drieberg, a senior advising officer with the Australian Taxation Office, in the course of which it emerged that the respondent had no record of having received the letter. There was some correspondence between the solicitors and the Taxation Office which culminated in the letter of 9 March 1984 already mentioned. The relevant parts of that letter read:
   
   

"It is advised that the letter dated 13 July 1983 does not appear to have been received in this office. There is also no record of the receipt of the remittance ($4.00) allegedly enclosed therewith. Accordingly the view is taken that the provisions of Section 187 and 188 of the Income Tax Assessment Act have not been complied with".

1. Although both applicants were cross-examined concerning the circumstances of the preparation and posting of the letter, in his final address counsel for the respondent did not make any attack on their evidence. I have no reason to reject their evidence and accept that they did write and post the letter of 13 July 1983. Whether the letter was received by the respondent and what the relevant sections of the Income Tax Act require in that regard are questions that remain to be determined.

2. The respondent called four officers of the Taxation Office who testified to the system employed for the receipt of correspondence, particularly that containing cash, the methods by which the receipt of such correspondence and cash are recorded and the process by which a letter such as that written by the applicants reaches the appeals section. The witnesses gave evidence of searches made of all relevant records since 13 July 1983 and of the absence of any reference to the letter written by the applicants or the receipt of cash from them. There was evidence from the person having executive responsibility for the cashiers' area that over the last two years (the period he held the position) there had been no other instance comparable to the present one. I am satisfied that, whatever the reason, the respondent did not receive the applicants' letter.

3. The legal consequences of a finding that the applicants wrote and posted the letter of 13 July 1983 but that the respondent did not receive it must now be considered. The question is primarily one of the interpretation of certain provisions of the Income Tax Act. Sub-section 187(1) allows a taxpayer, dissatisfied with the decision disallowing his objection, to "request" the Commissioner to take one or other of the steps therein mentioned. The word "request" is somewhat equivocal though it does carry with it the notion of communicating a wish or desire from one person to another. But in my view the matter is put beyond doubt by the two succeeding sections of the Act. By reason of sub-s.188(1), the Commissioner's obligation to refer a decision or forward an objection arises "If the request is accompanied by a fee of $2". Section 189 provides that "If within 60 days after receiving the request accompanied by the fee of $2" the Commissioner does not refer the decision or forward the objection, the taxpayer may require him to do so. The requirement that the request be accompanied by a fee and the reference to the Commissioner receiving the request accompanied by the fee, in my view, make it clear that the Commissioner must receive the request before any obligation on his part can arise. Evidence that goes no further than showing that a taxpayer posted to the Commissioner a request in terms of s.187 does not establish, for the purposes of the Income Tax Act, that the Commissioner received the request.

4. Counsel for the applicants relied on s.29 of the Acts Interpretation Act 1901 which reads:
   
   

"29. Where an Act authorizes or requires any document to be served by post, whether the expression 'serve' or the expression 'give' or 'send' or any other expression is used, then unless the contrary intention appears the service shall be deemed to be effected by properly addressing prepaying and posting the document as a letter, and unless the contrary is proved to have been effected at the time at which the letter would be delivered in the ordinary course of post".

1. I am prepared to assume that s.187 authorizes a request to be served by post. But in my view, by reason of the provisions of ss.188 and 189 of the Income Tax Act, a contrary intention appears and the provisions of s.29 of the Acts Interpretation Act must yield to the provisions of the Income Tax Act. For that reason it is unnecessary to refer to decisions on s.29 or its counterparts, some of which are mentioned in Lombard v. Mohrwinkel (1973) 1 ACTR 57.

2. The applicants are not assisted by the rule of the common law regarding proof of delivery of letters. "Proof that a letter has been posted, and that it was prepaid, properly addressed, and not returned undelivered, is evidence of its delivery in the ordinary course of post" (Halsbury's Laws of England 4th Ed. Vol. 17 para. 211). The rule must also yield to the express provisions of the Income Tax Act.

3. The result then is that the circumstances under which s.188 of the Income Tax Act comes into operation have not arisen. There has not been, in terms of the Judicial Review Act, a decision not to refer the applicants' request to a Board of Review because, within the period of 60 days provided by sub-s.187(1), there was no request to the Commissioner to do so.

4. I have expressed my views about the substantive matters raised by this application before considering whether an extension of time should be granted. I have done so because of the way in which the proceedings were conducted. Because of the way they were conducted the substantive matters have become relevant to a consideration whether an extension of time should be granted. Counsel for the applicants was in the course of his final address when I drew to his attention that no evidence had been adduced to explain the delay in lodging the application under the Judicial Review Act. Counsel then sought leave to recall Mr. Raccuia to give evidence on this aspect. The application was not opposed by the respondent and I acceded to it. However, Mr. Raccuia's evidence did not advance the applicants' case any further. The letter of 9 March 1984 was addressed to the applicants' solicitors who sent a copy of it to their clients. According to Mr. Raccuia it was some 2 or 3 weeks thereafter before he instructed the solicitors to take further action. This was due in part to his financial position and in part to the need to consult other members of the family. But there was no evidence of dates on which any of these events occurred and, in the end, I was left with no more than an implication that the applicants' solicitors may not have proceeded with the necessary speed.

5. This is an unsatisfactory situation. If an applicant seeks an extension of time, it is incumbent on him to offer the court some explanation for the delay in lodging the application. That is not to say that an explanation will necessarily justify an extension of time; questions of prejudice to the respondent and of the public interest may also arise. See Hickey v. Australian Telecommunications Commission (1983) 47 ALR 517 where the relevant decisions are discussed.

6. No justification has been offered for extending the time for making this application. Even if an extension were granted the application would fail.

7. In the circumstances the appropriate order would appear to be one refusing the applicants an extension of time in which to lodge their application. Because the application has been lodged and is before the Court there will be a further order that the application itself be dismissed.