CONFIDENTIAL and and and COMMISSIONER OF TAXATION

[2012] AATA 321

[2012] AATA 321

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2011/0275-0277
Re	CONFIDENTIAL
APPLICANT
And	COMMISSIONER OF TAXATION
RESPONDENT

File Number(s)	2011/1704-1719
Re	CONFIDENTIAL
APPLICANT
And	COMMISSIONER OF TAXATION
RESPONDENT

File Number(s)	2011/1721-1730
Re	CONFIDENTIAL
APPLICANT
And	COMMISSIONER OF TAXATION
RESPONDENT

DECISION

Tribunal	Mr P W Taylor SC, Senior Member
Date	25 May 2012
Date of written reasons	29 May 2012
Place	Sydney

The application for a direction requiring the Respondent to provide further particulars is refused.

...............[sgd].........................................................

Mr P W Taylor SC, Senior Member

CATCHWORDS

PRACTICE AND PROCEDURE – judgments, decisions and orders – application for direction that the Respondent be required to provide further particulars – application refused

REASONS FOR DECISION

Mr P W Taylor SC, Senior Member

29 May 2012

1. During the course of the directions hearing the terms of the decision intended to be made and the Senior Member’s reasons were stated orally.  The Applicants requested written reasons.

2. The oral reasons for decision have been transcribed by Auscript, the Commonwealth Reporting Service. Whereas those oral reasons may reflect the inelegance of an extempore decision, they are in fact the reasons for the decision.

3. The transcript is annexed and furnished to the Applicant and to the Respondent as it is the reasons for the Tribunal’s decision.

I certify that the preceding 3 (three) paragraphs are a true copy of the reasons for the decision herein of Mr P W Taylor SC, Senior Member

.......[sgd].................................................................

Associate

Dated 29 May 2012

Date of hearing	25 May 2012
Counsel for the Applicant	Ms S Kaur-Bains
Solicitors for the Applicant	Signet Lawyers
Solicitors for the Respondent	Maddocks Lawyers

EXTRACT OF TRANSCRIPT

MR TAYLOR:   All right.  Well, the purpose of that interchange between the respective legal representatives was to canvass the likelihood that I would make a direction of the kind sought by Ms Kaur-Bains on behalf of the three applicants to require responses to the requests for particulars set out in – they’re all dated 24 May?

MS KAUR-BAINS:   The 24^th.  They’re all dated 24 May.

MR TAYLOR:   Request for particulars from Signet Lawyers to Mr Arnold of Maddocks dated 24 May 2012.  The result of my interrogation, if I can use that expression, of the respective legal representatives currently satisfies me that the position adopted by the respondent in, for example, the … contention document [filed in proceedings 2011/0275-0277] of 21 May 2012, is sufficiently set out relevant to the discussion and the request to which I have referred in paragraph 17 and 21, and in particular, paragraph 21.2.  My understanding is that the Commissioner’s position, particularly in relation to paragraph 21.2, is that as at presently informed and advised, the Commissioner does not seek to establish in any positive way the nature or character of any other purpose that may have underlay the contentious transactions.

The Commissioner’s position at the present time is simply that there must be some other purpose and that it is for the applicant to discharge its onus by negating that intellectual possibility, or, as it’s better described, that apparently evidenced purpose, that appearance deriving solely from a conclusion that there is inadequate regularity in the transactions either as to form or performance to the extent that they have currently been identified. I will not ask again Mr Arnold to comment or confirm the interpretation that I’ve just recorded because I have done my best to summarise what I think fairly is the result of the exchange to which I subjected him some time ago. It is my responsibility constituting the tribunal to satisfy myself as to what is an appropriate procedural course to take, and I accept that responsibility, express the views that I have and conclude that it would not be consistent with the objectives of section 2A of the Administrative Appeals Tribunal Act at this stage to require a further particularity of the matters sought in the 24 May 2012 letter.

MS KAUR-BAINS:   Thank you.  Tribunal Member, we will be asking for a copy of that judgment, but also I note that paragraphs – we sought particulars at paragraphs 17 and 20, and I assume they fall within the same – they just haven’t been dealt with in your judgment, that’s all, but I take it Mr Arnold’s position in relation to paragraphs 17 to 20, which is the collateral arrangement argument, is the same, that he’s saying that there must have been some other collateral arrangement.  They’re not positively putting forward a case that there is a particular collateral arrangement.

MR TAYLOR:   Well, I address my remarks to 21.2.  I thought paragraph 20 was just the inadequate substantiation point.

MS KAUR-BAINS:   The way we’ve read the submission – the SFIC is – and we have put it in our request for particulars – is we read paragraphs 17 to 20 of [the Respondent’s Statement of Facts, Issues and Contentions filed in proceedings 2011/0275-0277] as being this collateral – collateral argument;  that is, that the Commissioner is saying even in the event that there is a loan, there is an associated or collateral transaction, and that as a result of the collateral transaction, the payments from [the bank] are assessable income, or something else is assessable income.  But if all that has been said from 17 – in 17 to 20 is that the loans are so irregular – or the circumstances of the loans are so irregular that there must have been something else, if that’s all they’re saying then obviously there’s no particulars to seek.

MR TAYLOR:   That’s as I have expressed myself.  It reflects my understanding, and even though you’ve drawn my attention to paragraph 20, I’m not minded to re-express anything that I’ve said.

MS KAUR-BAINS:   I was just concerned that the judgment just referred to 21 and not the other paragraphs which we had already – which we had also highlighted, which out of fairness – I mean, if they fall into the same category we haven’t got a problem.  It’s just that if – you know, if they don’t, then on one view out of fairness we should – if there’s a positive case that has been put forward by the Commission we should be told what it is.

MR TAYLOR:   I don’t read paragraph 20 as making any positive assertion, and I don’t propose to alter what I’ve said or contemplate any further particulars of paragraph 20.

MS KAUR-BAINS:   I won’t press that.