Charminar Henley Pty Ltd (Migration)

Charminar Henley Pty Ltd (Migration) [2017] AATA 3015 (13 December 2017)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Charminar Henley Pty Ltd
CASE NUMBER:  1613950
DIBP REFERENCE(S):  BCC2015/1821197
MEMBER:Kate Millar
DATE:13 December 2017
PLACE OF DECISION:  Adelaide
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 13 December 2017 at 12:07pm
CATCHWORDS
Migration – Direct Entry nomination – Requirement for employment to last 2 years – Financial capacity to employ nominee for required duration – Financial capacity requirement met – Genuine need to employ the nominee – Genuine need exists – Adverse information on departmental file
LEGISLATION
Migration Act 1958, ss 65, 359, 359AA, 375A
Migration Regulations 1994, rr 2.57, 5.19
STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

Charminar Henley Pty Ltd (Charminar) operates an Indian restaurant at Henley Beach. Charminar applied for the approval of a nomination of a position for Ms Prabhjot Kaur as a Cook. The nomination application was refused by a delegate of the Minister because the delegate was not satisfied it had the financial capacity to employ Ms Kaur full time for at least two years as required by the criteria for the approval of the nomination.
Charminar has sought a review of this decision. Mr Raghuram Noonay appeared before the Tribunal on 31 August 2017 to give evidence and present arguments. The Tribunal also received oral evidence from Ms Prabhjot Kaur. Charminar was represented in relation to the review by its registered migration agent.
For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision approving the nomination.
SECTION 375A CERTIFICATE
A section 375A certificate appears on the Department file. A copy of the certificate was provided to Charminar prior to the hearing under section 359(2) of the Act, and Charminar was invited to provide any comment on the validity of the certificate. Charminar did not have any comment on the validity of the certificate.
CONSIDERATION OF CLAIMS AND EVIDENCE
This is an application for review of a decision made by a delegate of the Minister for Immigration on 17 August 2016 to refuse Charminar’s application for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).
Charminar applied for approval on 25 June 2015. The requirements for the approval of the nomination of a position in Australia are found in r.5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination (r.5.19(3)) stream and a Direct Entry nomination (r.5.19(4)) stream. If the application is made in accordance with r.5.19(2) and meets the requirements of either stream, then the application must be approved. If any of the requirements are not met then the application must be refused: r.5.19(5).
In this case, Charminar has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry Nomination stream.
The issue in this case is whether Charminar meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in r.5.19(4), which is extracted in the attachment to this decision.
Charminar has a complex shareholding structure, with a number of shareholders that Mr Noonay was unable to name. He could name Naveen Irkulla, Walter Ventrua, Kenny Ting and the ex-wife of a previous chef. The directors at the time of the hearing were Kaylan Irkulla, Mr Noonay and Satish Arun Radika. Mr Noonay said Mr Irkulla is not an active director.
Between the hearing and the time of this decision, the shareholdings and directorships had again changed, with the most recent ASIC search showing Mr Noonay and Kaylan Irkulla as directors and Amrita Bhullar, Mr Noonay, Naveen Irkulla, Walter Ventura, Kong Seng Ting, Radika Irkulla, Kaylan Irkulla and Arun Dachepalli as shareholders.
On being asked how the shareholding structure came about, Mr Noonay said that there is a sister company, and a good location is found the shareholders invest in starting the business. There are other Charminar restaurants, but Mr Noonay said he has no interest in the other restaurants. Mr Noonay said he took on the directorship approximately two years ago and purchased his interest for $32,000 when an earlier manager and director resigned.
The application is compliant: r.5.19(4)(a)
Regulation 5.19(4)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee, and, where applicable, must include the required written certification relating to conduct that contravenes s.245AR(1). The application must also identify a need for the nominator to employ a paid employee to work in the position under their direct control. There is nothing before me to show that application is not complaint, and accordingly, the requirement in r.5.19(4)(a) is met.
Nominator is actively and lawfully operating a business in Australia: r.5.19(4)(b)
Regulation 5.19(4)(b) requires that applicant is actively, lawfully and directly operating a business in Australia. Charminar is currently a registered company. It has provided 2015 and 2016 tax returns showing it operates a restaurant business in Henley Beach. It appears on Google Maps.
There is nothing to indicate that the company does not operate the business as asserted and as it appears in their tax returns.
Accordingly, the requirement in r.5.19(4)(b) is met.
Position is not labour-hire: r.5.19(4)(c)
Regulation 5.19(4)(c) applies to nominators whose business activities include those relating to labour hire to an unrelated business. In these cases, the nominated position must be within the business activities of the nominator. There is nothing to indicate this applies, and it is asserted that Ms Kaur is directly employed by the business.
Accordingly, the requirement in r.5.19(4)(c) does not apply.
Term of employment of the visa holder: r.5.19(4)(d)
Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension.
The delegate was not satisfied the nominee would be employed on a full time basis for two years as the delegate was not satisfied that Charminar had the financial resources to employ the nominee. The delegate looked at gross profit and losses, with a loss in 2013 of $150, a loss of $39,042 in 2014 and a profit of $42,640 in 2015. When compared with the base salary of the nominee of $54,500, the delegate was not satisfied Charminar could meet the nominee’s wages.
Mr Noonay said the business employs two cooks, two kitchen hands and front of house casual staff. He manages the restaurant as well as cooking when one of the chefs is absent. He said he works at the business every day from 5 – 9.30pm. He is paid for 19 – 20 hours but does unpaid work as well. He had recently started working in a hotel as a casual staff member in the morning. He is also looking at a career in real estate.
Charminar provided its 2016 tax return which shows a total income of $460,843 with expenses of $477,511 and a total loss of $16,668. There is an increase of approximately $26,000 from 2015 to 2016 in wages, and a reduction in total profit of approximately $22,000.
A letter was provided from RDC Partners dated 17 August 2016, who state they act as accountants for Charminar. RDC states Charminar is a well-established business and while it did not initially produce a lot of profit, it had a strong financial position. It states that in the last year it has experienced good trading and steady growth.
It is difficult to see the basis of the letter from the accountant in the financial statements of Charminar as its gross profit reduced from 2015 and the business went from a profit of $42,640 in 2015 to a loss of $16,668 in 2016.
Mr Noonay initially referred to the loss in 2016 as a minimal loss, initially stating it was around four digits, or around $4,000, however this would appear to be retained loss and not the net loss. On being asked to compare this to the 2016 financial statements, he acknowledged this was over $16,000. Mr Noonay attributes this loss to his absence from the business while overseas, and because there was more wastage. He also thought it may be seasonal, being he ups and downs of the business. He could not identify any difference in expenses that may account for the loss.
He said all of the staff are paid by an on-line bank transfer, and on being asked to identify the wages in the business bank account said there should be a transfer to the person and the notation “wages”. Mr Noonay was asked to identify the wages transfers from the Charminar bank account. He identified a single transaction “multi-pay anyone”. After the hearing he provide a breakdown of the pay to show the nominee was being paid but obscured the details of other employees being paid and the amounts they are paid. The period for which he provide the wages breakdown is not recent.
The Pay as You Go Payment Summary for Ms Kaur shows that in the 2016 financial year she earned $46,552 gross. Mr Noonay advises her annual salary has been increased to $55,000 to be consistent with the other chef.
Mr Noonay said the business is up and down, and when he took over the financials were pretty bad, which was why he wanted to take over a management role rather than just as a shareholder. He said the staff are happy as their wages are being paid on time, and his suppliers are happy because they are paid on time.
Mr Noonay was asked, given the loss in the 2016 financial year, why it would be viable for Charminar to employ Ms Kaur full time for a period of two years. Mr Noonay said there is a growing market for him, and increased competition. Charminar applied for outside seating for the restaurant, and this has recently been approved so they anticipate increased trade. He said after seeing the financial losses she has been developing ideas to make the business more profitable, for example a live music concert from students from Henley High School. He said he does not want someone else to start cooking when he is trying to develop the restaurant as he does not want a change to the taste. He said the 2017 financial records show he is in a good position and is improving, and the Business Activity statements would show the business is improving.
Charminar provided an extract from a database which states to be a profit and loss statement for 2017. This document records a gross profit of $329,202 and a net profit of $17,491. The Business Activity Statements for three of the quarters in the 2017 financial year were provided. These approximate the 2017 financial statements in terms of total sales and cost of sales when the last quarter data used is an average of the other three quarters.
The wages expense for the business is shown in the BAS as decreasing over the 2017 financial year and when apportioned is approximately $20,000 less than the previous year which is consistent with Mr Noonay being away and subsequently having to employ staff to cover his absence.
Charminar provided a copy of the individual wage transfers, but for random dates that are not recent and in which other details are obscured. Nevertheless the total wages amounts match those on the relevant date from Charminar’s account and the amounts going into Ms Kaur’s account.
Having considered the financial information available to me I am satisfied that Charminar is in a potion to employ Ms Kaur full time for two years in the nominated occupation and that the requirement in r.5.19(4)(d) is met.
No less favourable terms and condition of employment: r.5.19(4)(e)
Regulation 5.19(4)(e) requires that the terms and conditions of employment applicable to the nominated position will be no less favourable than those that are, or would be, provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
Mr Noonay advised Ms Kaur’s salary has been increased to $55,000 per annum to match the other chef, which I take to be a variation to the written employment contract provided to the Department and is consistent with the deposits to Ms Kaur’s account. Charminar provided the Restaurant Industry Award 2010. An annual salary of $55,000 meets the minimum requirements of the Award. The contract provides for superannuation contributions as well as annual and sick leave.
There is nothing else before me that the terms and conditions would be less favourable than an Australian resident or permanent citizen and the requirements of r.5.19(4)(e) are met.
No adverse information known to Immigration: r.5.19(4)(f)
Regulation 5.19(4)(f) requires that there is no adverse information known to Immigration about the nominator or person associated with the nominator; or it is reasonable to disregard any such information. For these purposes, ‘adverse information’ and ‘associated with’ have the meaning given in rr.2.57(3) and 2.57(2).
Adverse information includes being the subject of administrative action (including being issued with a warning) by a competent authority for a possible contravention of a Commonwealth, State or Territory law (r.2.57)(a)(iii)). This must have occurred within the previous three years (r.2.57(3)(c)).
The information that Charminar was monitored by the Department and this was finalised as unsatisfactory 28 January 2015 and that Charminar was counselled about failing to advise of the change to the directors was put to Mr Noonay under section 359AA of the Act. He was invited to provide information on whether this had occurred, whether the outcome was a warning, and if so, whether it should be disregarded. Mr Noonay sought, and was granted, additional time after the hearing to provide comment on this information.
After the hearing, a copy of a letter from the Department dated 28 January 2015 was provided by Charminar. This states that Charminar failed to notify of a change to the directors. It states a decision was made not to issue a formal warning but to counsel the sponsor about is obligations, and the purpose of the letter was to notify of a minor contravention of the obligation. It states this information may be considered in respect of future applications by Charminar.
I find this is adverse information, but that it is reasonable to disregard it as it is described by the Department as a minor contravention and occurred nearly three years ago.
Accordingly the requirements of r.5.19(4)(f) are met.
Satisfactory compliance with workplace relations laws: r.5.19(4)(g)
Regulation 5.19(4)(g) requires that the applicant has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations.
There is nothing before me to sow that Charminar has not complied with workplace relations laws, and the requirements of r.5.19(4)(g) are met.
Tasks of the position genuine need for the position and training requirements r.5.19(4)(h)
Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the attachment to the decision but can be briefly summarised as requiring, as it applies to Charminar:
·the position and nominator’s business is located in regional Australia,
·there is a genuine need for the paid position under the nominator’s direct control which cannot be filled by a locally resident Australian citizen or permanent resident,
·the tasks of the position correspond to those of an occupation at the ANZSCO skill level 1, 2 or 3; and
·that a regional certifying body has advised the Minister about certain matters relating to the position.
The position and business are located in South Australia, all of which is classified as regional Australia (IMMI 11/058). Charminar provided a certificate from the regional certifying body as required.
In regard to the genuine need for the position, information of an allegation on the Department file that Charminar had entered ”cash for visas” arrangements was put to Mr Noonay under section 359AA of the Act. Mr Noonay was advised if the Tribunal relied on this information it would find that there was no genuine need for the position
Mr Noonay said this was a false allegation. He said he is looking for a talented person for the positon. He was asked to provide specific pay records, and Ms Kaur agreed to provide her own bank account statements.
The source of this allegation is not identified, nor is there anything further that supports this allegation.
Information on a site visit conducted by the Department was put to Mr Noonay under section 359AA of the Act. The information from the site report was:
·     That the employment was not genuine.
·     Inconsistent information was provided by Ms Kaur and Mr Noonay, being:
o   Ms Kaur stated Mr Noonay works full time and Mr Noonay said he worked 15 hours per week.
o   Ms Kaur said her hours are not recorded, and Mr Noonay said that all hours are recorded and forwarded.
o   Mr Noonay said Ms Kaur often takes Saturday off to spend with her family, and Ms Kaur said her only day off was Monday.
·     Ms Kaur said Bilal was a dishwasher, but he was observed performing food preparation, a duty that wold be undertaken by a cook.
·     Ms Kaur said 2- 3 staff were rostered on weekdays, and Mr Noonay said 1 -2 maximum.
·     While Ms Kaur wore kitchen uniform it was clean and she did not appear confident in undertaking kitchen duties.
Mr Noonay chose to respond at the hearing, but was also given additional time in which to provide any further comment or repsonse. He said the monitoring was for the manager position, but it expended to Ms Kaur’s position. He said he is paid for 15 – 20 hours paid but Ms Kaur saw him there every day, and he takes less pay then what her works because he wants the business to progress.
He said he said in nominating the number of staff rostered, Ms Kaur had not included him. He said she was nervous when the monitoring visit was conducted as new to her.
The full time staff are not required to sign time sheets as they are on a fixed salary. He said the point was missing from the monitoring report that only the casual staff have to sign a sheet. He said Ms Kaur was cooking at the time of the monitoring but was nervous, and that he thought the Department officers had taken photographs of her cooking. As she was present and cooking, and as there is no formal assessment of her skills before me, I accept this is the case.
Ms Kaur said she started working form Charminar in April or May 2015 in a part time position as she was studying and commenced full time after applying for the job in September 2015. She said her usual hours of work are 3.30pm until 10pm on weekends and 4pm – 10pm on weekdays. She said she cooks the curries and the other chef Gurpal manages the tandoor. Mr Noonay orders the stock. There are kitchen hands Afra and Bilal. The front of house staff are Radika, Bianca and Rica. Mr Noonay cooks if one of the chefs is unavailable.
Ms Kaur gave affirmed evidence that she did not pay anyone to sponsor her for the visa. She provided her bank account statements. She said her work pattern has always been Tuesday to Sunday, but that when she started as a casual she would have some Saturdays off. Since she has been full time she has not taken Saturdays off. She denied not being confidence in the kitchen when the Department officers were there.
Ms Kaur said her role is to make sure they have all the ingredients they need, train other staff in the kitchen, order stock, supervise the cleaning of equipment and assist in planning the menu.

While having some concerns about this matter, there is a genuine need to employ a paid employee to work in the position under the nominator’s direct control.
Charminar provide advertisements for the position, and said they could not obtain an Australian citizen or permanent resident living in the local area.
The tasks described by Ms Kaur are consistent with the tasks nominated in ANZSCO for a cook, which is ANZSCO skill level 3.
Accordingly the requirements of r.5.19(4)(h) are met.
There is much to be uneasy about in this matter. For example:
·     Ms Kaur’s bank accounts show regular payments from “Prime Medical Temp” as pay/salary for “Prabjh” in the period 31 August 2016 to 31 August 2017 when Ms Kaur states she was working full time for Charminar.
·     There are large transactions into and from Ms Kaur’s bank account. These are submitted to be a loan she made to a friend, however the principle sum of the loan was returned to her account the same day.
·     The past losses of the business.
·     It is not entirely clear how many hours Mr Noonay works at the business, or the degree to which he undertakes the cooking.
·     The names of other people paid by the company are obscured in the material provided. The parts that can be observed are that there are seven people to whom wages are paid. One is Ms Kaur. Others are another director Radika Irkulla, Mr Noonay, an S Duma, and K Vanga, later replaced with a Mr Sidu. This can only be partially reconciled with the organisation chart provided.
·     Previous action by the Department for failing to comply with a sponsorship obligation.
·     A site visit that concluded the employment of Ms Kaur as a cook by Charminar was not genuine.
However a general sense of unease is not equivalent to a state of not being satisfied that the Charminar does not meet the requirements in r.5.19 of the Regulations. It is not the role of this Tribunal to conduct a general investigation. These concerns may warrant monitoring of the ongoing employment of Ms Kaur, should the Department wish to do so.
Based on the findings above, the Tribunal finds that the applicant meets the requirements of r.5.19 for approval of the nomination of the position in Australia.
DECISION
The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Kate Millar
Member

ATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994
5.19Approval of nominated positions (employer nomination)
…
(2)The application must:
(a)be made in accordance with approved form 1395…; and
(b)be accompanied by the fee mentioned in regulation 5.37.
…
Direct Entry nomination
(4)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i)       is made in accordance with subregulation (2); and
(ii)      identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and
(b)the nominator:
(i)       is actively and lawfully operating a business in Australia; and
(ii)      directly operates the business; and
(c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and
(d)both of the following apply:
(i)       the employee will be employed on a full-time basis in the position for at least 2 years;
(ii)      the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i)       are provided; or
(ii)      would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and
(h)either:
(i)       both of the following apply:
(A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(B)either:
(I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or
(II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or
(ii)      all of the following apply:
(A)the position is located in regional Australia;
(B)there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control;
(C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;
(D)the tasks to be performed in the position correspond to the tasks of an occupation at a skill level of ANZSCO skill level 1, 2 or 3;
(DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(E)the business operated by the nominator is located at that place;
(F)a body that is:
(I)specified by the Minister in an instrument in writing for this sub-subparagraph; and
(II)located in the same State or Territory as the location of the position;
has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).

[2017] AATA 3015

13 December 2017

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