Fitzgibbon and Commissioner of Taxation

[2004] AATA 631

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 631

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No NT2004/1

TAXATION APPEALS DIVISION		)
Re		DAVID CLAUDE FITZGIBBON

Applicant

And COMMISSIONER OF TAXATION

Respondent

DECISION

Tribunal P.J. Lindsay, Senior Member

Date21 June 2004

PlaceSydney

Decision The Tribunal dismisses the application for want of jurisdiction.

(sgd) P.J. Lindsay, Senior Member

CATCHWORDS

INCOME TAX - Notice to applicant to lodge income tax return – applicant on tax agent’s lodgment program  - extension to lodgment date formerly available denied - no jurisdiction to review decision requiring lodgment at earlier date – application dismissed.

Administrative Appeals Tribunal Act 1975 s.25

Income Tax Assessment Act 1936 ss.161,162

Taxation Administration Act 1953 s. 388-55

Balnaves v Commissioner of Taxation (1985) 8 FCR 589

Morgillo v Deputy Commissioner of Taxation (2000) 174 ALR 41

O’Reilly v Commissioner of State Bank of Victoria (1983) 153 CLR 1 

REASONS FOR DECISION

P.J. Lindsay, Senior Member        

1.      David Claude Fitzgibbon (the applicant) received a notice from the Australian Taxation Office requiring him to lodge his income tax return for the 2002-03 income year by 31 October 2003.  That notice, dated 3 September 2003 and issued in the name of Erin Holland, a Deputy Commissioner of Taxation, stated as follows:

Notification of requirement to lodge your 2003 income tax return by 31 October 2003

For information and action

Due to your poor lodgment history this letter is formal notification of your requirement to lodge a return of income for the year ended 30 June 2003 by 31 October 2003.  if your income tax return is prepared and lodged by a tax agent the lodgement concession extended to agents under the Practitioner Lodgment Program will not be available to you.

Your return of income for the year ended 30 June 2003 will not be considered duly lodged until the 2003 tax return for individuals and all the accompanying supplements, schedules and attachments (where applicable) are completed and lodged.

If you do not lodge your return by the due date you may incur a failure to lodge on time penalty or we may take legal action against you for failure to lodge.

The notice was signed by Elsa Estwick for Ms Holland.

2.      Mr Fitzgibbon wrote to the Australian Taxation Office on 23 September 2003 to request information as to the factual and legal basis for what he described as the administrative decision of 3 September 2003.  The reply on behalf of Erin Holland dated 20 October 2003 is set out below:

Reference is made to your letter dated 23 September 2003 which refers to the decision by the Australian Taxation Office, as advised by letter dated 3 September 2003, that your income tax return for the financial year ended 30 June 2003 is to be lodged no later than 31 October 2003.  In your letter you request:

(i) The factual basis of the decision

The facts upon which the decision was based related to your lodgment history for the years ended 30 June 2000, 2001 and 2002, and are as follows:

a) 2000 year

The 2000 income tax return was lodged only after demands by way of a reminder and final notice, which expired on 8 May 2001, were issued. The matter was referred for prosecution and legal proceedings were subsequently instituted. The Court found the defence [sic] proven but chose to not record a conviction pursuant to s19B of the Crimes Act 1914.

b) 2001 year

The 2001 income tax return was lodged only after demands by way of a reminder and final notice, which expired on 27 September 2002, were issued.

c) 2002 year

The 2002 income tax return was lodged only after demands by way of two (2) reminders and a final notice, which expired on 15 May 2003, were issued.

ii) The legal basis of the decision

You are required to lodge a return of income for the year ended 30 June 2003 by the general notice which is published annually by the Commissioner of Taxation in the Commonwealth of Australia Gazette dated 27 June 2003 pursuant to section 161 of the Income Tax Assessment Act 1936.  Specifically, the Gazette notice stipulates:

“Every person required to lodge a return … whose income year ends on 30         June 2003 must do so by 31 October 2003.”

Pursuant to s162 of the Income Tax Assessment Act 1936 a person must, if required by the Commissioner, whether before or after the end of the year of income, give the Commissioner, within the time required, and in the approved form:

a) a return or a further or fuller return for a year of income or a specified    period, whether or not the person has given the Commissioner a return for the           same period;

or

b) any information, statement or document about the person’s financial      affairs.

3.      Mr Fitzgibbon’s written submissions state:

1. Whether the demand by a member of a task force (purportedly not a commissioner or deputy commissioner of taxation) is an administrative act.  I say it is and is therefore reviewable.

2. Whether delegation extends beyond the normal rules on delegation ie Delegatus non potest delegore [sic], and if so to what extent.  I say it does not extend to this situation.

3. Whether the facts and the legal basis said to be available to the person signing the      document justify such an action in the light of repercussive effects on a lawyer in      New South Wales of penal legislation affecting the right to hold a practising      certificate.

He elaborated on these submissions at the hearing.

applicable legislation

4.      The following sections from the Income Tax Assessment Act 1936 (the Assessment Act 1936) deal with the lodgment of income tax returns:

s. 161 Requirement to lodge a return

(1) Every person must, if required by the Commissioner by notice published in the Gazette, give to the Commissioner a return for a year of income within the period specified in the notice.

Note: The Commissioner may defer the time for giving the return: see section 388-55 in Schedule 1 to the Taxation Administration Act 1953.

…

s. 162 Further returns and information

A person must, if required by the Commissioner, whether before or after the end of the year of income, give the Commissioner, within the time required and in the approved form:

(a) a return or a further or fuller return for a year of income or a specified   period, whether or not the person has given the Commissioner a return for      the same period ;or

(b) any information, statement or document about the person's financial     affairs.

Deferral of lodgment may be allowed in certain circumstances. Section 388-55 in schedule 1 to the Taxation Administration Act 1953 (the Administration Act) provides:

Commissioner may defer time for lodgment

(1) The Commissioner may defer the time within which an ^*approved form is required to be given to the Commissioner or to another entity.

(2) A deferral under subsection (1) does not defer the time for payment of any amount to the Commissioner.

5.      As for the power of the Administrative Appeals Tribunal to review decisions, it is necessary to refer to the Administrative Appeals Tribunal Act 1975 (the AAT Act), specifically s.25 which reads:

Tribunal may review certain decisions

(1) An enactment may provide that applications may be made to the Tribunal:

(a) for review of decisions made in the exercise of powers conferred by that         enactment; or

(b) for the review of decisions made in the exercise of powers conferred, or          that may be conferred, by another enactment having effect under that    enactment.

…

(4)  The Tribunal has power to review any decision in respect of which application is made to it under any enactment.

findings and consideration

6.      A hearing was convened at Newcastle to determine whether the tribunal has jurisdiction in this matter. Mr Fitzgibbon represented himself and Mr D Ong from the Australian Taxation Office represented the Commissioner of Taxation (the respondent).  The only evidence presented was the applicant’s oral evidence.

7.      Mr Fitzgibbon said that he is a barrister, who in recent years has been in partnership with his wife in relation to farm land under development. For a number of years he has been able to defer lodgment of the partnership return and his income tax return until at least the April following the end of the relevant income year, due to his being on an extended lodgment program, a concession granted to his accountant by the Australian Taxation Office. It was not disputed and I find that, until the 2002-03 income tax return, he has benefited from the extension in lodgment date by being on the accountant’s lodgment program.  There being no argument to the contrary, I will accept that the quote in par 2 above sets out the relevant part of the Commissioner’s notice in the Gazette dated 27 June 2003.

8. Mr Fitzgibbon contended that the decision to deny him an extension beyond 31 October 2003 is reviewable by the tribunal. In his submission, the decision is an administrative decision and it is within the tribunal’s jurisdiction to review it. There was no reference to any judicial authority to support the submission. He said s.25 of the AAT Act gives the tribunal the power to review any decision in respect of which an application is made to it under any enactment. He could not identify a particular provision in any enactment that gives the tribunal jurisdiction to review the decision not to allow him to defer lodgment beyond 31 October 2003. He submitted that according to general principles, Parliament’s intention as expressed in the later Act, the AAT Act, must have been to give the tribunal power to review decisions under the Assessment Act 1936 and the Administration Act. He developed this submission by noting that the AAT Act became law some years after the Assessment Act 1936 and the Administration Act.

9.      As an alternative submission, Mr Fitzgibbon argued that the decision to demand his return by 31 October 2003 had not been lawfully made because a delegation of power had not been made to Ms Estwick.  Further, the notice to him did not refer to it being a decision made under the Assessment Act 1936.

10.     It was submitted for the respondent that the tribunal has not been given jurisdiction to review the respondent’s decision to issue the Gazette notice reminding taxpayers, whether individuals, companies or other, of their obligation to lodge income tax returns and the dates by which they must be lodged.  In addition, it was submitted that the tribunal does not have jurisdiction to review the respondent’s decision not to allow a taxpayer to lodge their return later than the dates specified in the Gazette notice. 

11.     The tribunal’s power to review decisions is based wholly on statute (see, for example Lees v Comcare (1999) 29 AAR 350 at 353). Mr Fitzgibbon seeks review of the respondent’s decision not to extend the lodgment date for his 2002-03 return beyond 31 October 2003. I am satisfied that the decision by the respondent to withhold an extension in the time for lodgment beyond the date stipulated in the Gazette is a decision made under s.388-55 in schedule 1 to the Administration Act (cf Balnaves v Commissioner of Taxation (1985) 8 FCR 589 at 592 in relation to an earlier version of s.161(1)). Notice of the decision was given in the respondent’s letter of 3 September 2003 and expressly stated that the applicant would not be able to rely on any lodgment concession available to his tax agent .

12. Is there an enactment that makes provision for an application to be made to the tribunal for review of the decision not to allow a deferral in lodgment? The Administration Act is an enactment that gives the tribunal jurisdiction to review certain decisions made by the respondent. Section 14ZO in Division 1, Part IVC of the Administration Act notes that Division 4 contains provisions about applications to the tribunal for review of decisions by the respondent in relation to certain taxation objections and requests for extensions of time. Section 14ZZA of the Administration Act provides that:

The AAT Act applies in relation to:

(a) the review of reviewable objection decisions;

(b) the review of extension of time refusal decisions; and

(c) AAT extension applications

subject to the modifications set out in this Division.

13. The ‘extension of time’ referred to in par (b) concerns a decision by the respondent not to accept a late objection and so is not relevant to the instant application. Par (c) is about granting an extension of time for a person to make an application to the tribunal and also is irrelevant. The reference to reviewable objection decisions leads to s.14ZZ of the Administration Act which gives taxpayers the right to apply to the tribunal for review of certain classes of decisions made by the respondent in response to objections. Section 14ZL of the Administration Act states that the review powers and procedures in Part IVC of that Act will apply where legislation makes provision for taxpayers to object against an assessment, determination, notice or decision with which they are dissatisfied. This matter was argued on the basis that the applicant is dissatisfied with a decision, and not that there is dissatisfaction with an assessment, determination or notice.

14. There is provision in s.128P of the Assessment Act 1936 for a taxpayer to object against a decision by the respondent refusing to issue a withholding tax exemption certificate. In the Administration Act context, s.14Y provides that an aggrieved person may apply to the tribunal for review of the respondent’s decisions under ss.14T and 14U which deal with departure prohibition orders. By contrast, s.388-55 in schedule 1 to the Administration Act does not confer objection rights on an aggrieved taxpayer. I am satisfied, therefore, that the tribunal has not been given jurisdiction under s.14ZZA of the Administration Act to determine Mr Fitzgibbon’s application for review of the decision of 3 September 2003.

15. Mr Fitzgibbon’s submission regarding s.25 of the AAT Act is misconceived. The AAT Act does not state that the tribunal may review any administrative decision under any enactment. There must be an enactment that provides that an application may be made to the tribunal for review of the decision in question. Mr Fitzgbbon could not point to a provision to that effect in the Administration Act, the Assessment Act 1936 (or the Income Tax Assessment Act 1997, for that matter) or in other legislation. Further, I reject the submission that he said was based on a principle of statutory interpretation, namely, that as there is an intention on the part of Parliament expressed in later legislation, the AAT Act, to allow all administrative decisions to be reviewed by the tribunal, the Administration Act and the Assessment Act 1936 must be taken as modified pro tanto. I do not accept that the claimed intention exists and I note in all events that Part IVC of the Administration Act was introduced in 1991, subsequent to the commencement of s.25 in the AAT Act.

16.     There was no evidence before me concerning the applicant’s claim that the decision of 3 September 2003 is invalid because the delegation to Ms Estwick to sign the notice was beyond power and unlawful.  Further, I find that, contrary to the applicant’s submission, the decision of the High Court in Morgillo v Deputy Commissioner of Taxation (2000) 174 ALR 41 expressly rejected an argument that a statutory notice of demand was invalid since it had not been issued personally by the relevant Deputy Commissioner and thus there had been an unlawful subdelegation. After referring to the comments made in O’Reilly v Commissioner of State Bank of Victoria (1983) 153 CLR 1 that it would be impossible for the Commissioner and Deputy Commissioners to carry out personally the functions required of them by the Assessment 1936 (and other legislation administered by the Commissioner), Callinan J held that there is no reason to suppose that the officer who actually issued the notice of demand acted in an aberrant, unauthorised or otherwise unlawful manner. In this matter, there is similarly no reason to question the action taken by Deputy Commissioner Erin Holland in deciding that the applicant’s return must be lodged by 31 October 2003 or by Elsa Estwick in signing the communication informing the applicant of that decision.

17.     It follows that the tribunal is not empowered to review the merits of the decision dated 3 September 2003 and the application should be dismissed for want of jurisdiction.

I certify that the preceding 17 paragraphs are a true copy of the decision and reasons for decision of P.J. Lindsay, Senior Member:

Signed:         
          ..................................................................................……………………………….

Associate

Hearing  21 April 2004

Date of Decision  21 June 2004

Applicant  Self-represented

Respondent’s representative     Australian Taxation Office