Driscoll and Commissioner of Taxation (Taxation)
[2016] AATA 206
•7 March 2016
Driscoll and Commissioner of Taxation (Taxation) [2016] AATA 206 (7 March 2016)
Division
TAXATION & COMMERCIAL DIVISION
File Number(s)
2015/4623; 2015/4914
Re
Peter Driscoll
APPLICANT
And
Commissioner of Taxation
RESPONDENT
DECISION
Tribunal Prof R Deutsch, Deputy President
Date 7 March 2016 Date of written reasons 4 April 2016 Place Sydney The extension of time application is refused.
...........................[sgd].............................................
Prof R Deutsch, Deputy President
CATCHWORDS
PRACTICE AND PROCEDURE - extension of time to lodge application for review - extension of time refused
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) s 29(7)
Taxation Administration Act of 1953 (Cth) ss 14ZW (3), 14ZZC, 280-100, 294-75 (1) sch 1
CASES
Brown v Federal Commissioner of Taxation (1999) 42 ATR 118
Hunter Valley Developments Pty Ltd v Cohen, Minister for Home Affairs and Environment (1984) 3 FCR 344
Re Ciaglia v Federal Commissioner of Taxation [2002] 49 ATR 1198Windshuttle v Commissioner of Taxation (1993) 46 FCR 235
REASONS FOR DECISION
Prof R Deutsch, Deputy President
4 April 2016
INTRODUCTION
This is an application by the Applicant seeking an order from the Tribunal that pursuant to section 29(7) of the Administrative Appeals Tribunal Act 1975 (Cth), this Tribunal should extend the time for the making by the Applicant of an application to the Tribunal for a review of a decision.
BACKGROUND
The decision in question had a number of components.
First, the Respondent’s decision that the Respondent did not consider the amounts withdrawn from the trustee for the Driscoll superannuation fund constituted genuine expenses or investments of the fund.
Secondly, the Respondent’s decision that the Driscoll superannuation fund did not meet the definition of a complying superannuation fund in respect of the year ended 30 June 2009.
Thirdly, the Respondent’s decision that the transfer of the superannuation benefits, totalling an amount just over $20,000, from the Universal Super Scheme Fund did not meet the definition of a rollover.
Fourthly, the Respondent’s decision that the superannuation benefits transferred from the Universal Super Scheme Fund are assessable income of the member.
Fifthly, the Respondent’s decision not to remit the administrative penalty imposed under section 294-75 subsection (1) of schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA) in respect of the years ended 30 June 2009 and 30 June 2010.
Sixthly, and finally, the Respondent’s decision not to remit the shortfall interest charge imposed under section 280-100 of the TAA, also in respect of the years ended 30 June 2009 and 30 June 2010.
By way of background, these decisions were made by the Respondent in 2013 and communicated by letter to the Applicant on or around 31 October 2013.
Accordingly, the Applicant had until 30 December 2013 to lodge the application for review within time. That is the date that is 60 days after the person making the application was taken to have been served with notice of the decision and that is by operation of section 14ZZC of the TAA.
Accordingly, the Applicant has lodged his application for review some 616 days late, That is, he lodged his application on 7 September 2015, which, on my calculations, is more than one year and eight months after the objection period ended on 30 December 2013. This is a very substantial period of time and puts a heavy onus on the Applicant to demonstrate why he should be granted such a substantial extension of time.
CONSIDERATION
The relevant provisions relating to the extension of time are set out comprehensively in the relevant legislation and I do not propose in this decision to read through those various sections. I do, however, propose to go through the matters which were raised in the decision of Wilcox J in Hunter Valley Developments Pty Ltd v Cohen, Minister for Home Affairs and Environment (1984) 3 FCR 344. That decision was applied by Senior Member Sassella Re Ciaglia v Federal Commissioner of Taxation [2002] 49 ATR 1198.
Pursuant to those decisions, I should have regard to a number of factors in determining whether an extension of time should be granted. The relevant matters are in particular, any explanation which may exist for the delay in lodging on time; the circumstances that are attendant upon that delay; whether the applications are frivolous or disclose that the taxpayer has an arguable case; and, whether any prejudice might be occasioned to the Respondent.
In all this, I note that the Applicant bears the onus of establishing why the Tribunal should agree to the extension of time request and he is required to fully state and, in detail, the circumstances concerning the reasons for his failure to lodge the objection with the Commissioner within the required time period. That is made clear by section 14ZW subsection (3) of the TAA. Considering those matters sequentially, I remind myself that the Applicant failed to lodge his application for review until some 616 days after the objection period had ended. Originally, the Applicant provided no satisfactory explanation for the delay but he subsequently indicated that he was in constant communication with the Australian Tax Office (ATO) about the matter and they, presumably the ATO, kept referring him back and forth across different departments within the ATO. He indicates that he spoke to numerous people in numerous different departments and eventually got to someone who said “I needed to lodge an application with the AAT”.
It seems to me that allocating blame, or seeking to assign blame to the ATO in these circumstances, is a misconceived argument which cannot possibly succeed. The timeframe here is of such a substantial length of time that it is impossible to conclude that the Applicant, based on the facts that have been presented, had failed to make an application because of anything that may or may not have been said by the ATO in the circumstances.
Secondly, having regard to the circumstances of the delay, I cannot see any justification for the extension of the time request. It is clear to me that the Applicant should have acted promptly to seek an extension of time for lodging a review of the decision, having discussed this matter on a number of occasions with the ATO.
Had the Applicant made the application late, but within a more reasonable timeframe, I may have been minded to allow an extension of time in the circumstances. I also need to have regard to the merits of the Applicant’s substantive arguments. Hill J in Brown v Federal Commissioner of Taxation (1999) 42 ATR 118, 131 accepted the view of von Doussa J in Windshuttle v Commissioner of Taxation (1993) 46 FCR 235 that an Applicant should show he has an arguable case.
It seems to me difficult to sustain the argument that the Applicant in these circumstances has an arguable case. The Applicant indicated to me in the hearing that there were some arguments regarding the genuineness of the expenses that had been paid by the Driscoll superannuation fund but, apart from putting the proposition in broad terms, there was no concrete tangible evidence to support the argument which the Applicant was putting.
There was also no basis for arguing that the view taken by the ATO that the fund was non-complying was anything but correct in the circumstances and there was no argument to suggest that the transfer of the superannuation benefits from the Universal fund to the Driscoll super fund met the definition of a rollover. In the circumstances, it seems to me fairly clear that the balance of evidence supports the conclusion that the transfer of those funds was assessable income of the Applicant and the position taken by the ATO in relation to administrative penalties and shortfall interest were reasonable.
Finally, I do have regard to the argument about prejudice and it seems to me that the Respondent would not be materially prejudiced if the Tribunal were to allow the extension of time request. Notwithstanding that, the mere absence of prejudice is not enough to justify an extension: see Hunter Valley Developments at 349. Again, had the period of time in question been significantly shorter, I may have been minded to take into account the lack of prejudice to the Respondent but in view of the fact that the length of time involved here is well over a year, and closer to two years, I can find no basis for allowing the extension.
CONCLUSION
Accordingly, having regard to all the factors, it my view that the Applicant has failed to demonstrate why the Tribunal should allow such an extensive extension of time request and the application for an extension of time is declined.
DECISION
The extension of time application is refused.
I certify that the preceding 22 (twenty -two) paragraphs are a true copy of the reasons for the decision herein of Prof R Deutsch, Deputy President ................................[sgd]........................................
Associate
Dated 4 April 2016
Date(s) of hearing 11 December 2015, 7 March 2016 Applicant In person Solicitors for the Respondent ATO Review and Dispute Resolution
Key Legal Topics
Areas of Law
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Administrative Law
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Taxation Law
Legal Concepts
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Jurisdiction
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Limitation Periods
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Administrative Penalty
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Statutory Interpretation
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