Fraser Escape 4x4 Tours P/L v Deputy Commissioner of Taxation

Fraser Escape 4x4 Tours P/L applied to the Federal Circuit Court to set aside a statutory demand issued by the Deputy Commissioner of Taxation. The applicant was unable to pay its debts and was incurring taxation liabilities, while the directors had used personal assets to attempt to satisfy these debts. The applicant argued that the statutory demand should be set aside under section 459J(1)(b) of the Corporations Act 2001, as it was not just and equitable to do so.

The court examined whether the statutory demand should be set aside based on the applicant's inability to pay its debts and the lack of any proceedings to challenge the taxation assessments. The court found that there was no evidence of any proceedings to challenge the relevant assessments or decisions of the respondent. The applicant’s directors had used personal assets to try to satisfy the liabilities, indicating the applicant's inability to pay its debts. However, the court held that these factors did not make it just and equitable to set aside the statutory demand.

The court dismissed the application to set aside the statutory demand. It concluded that the statutory demand should not be set aside as it was not just and equitable to do so, despite the applicant's financial difficulties and the lack of challenge to the taxation assessments. The court found that the applicant had not demonstrated sufficient grounds to persuade the court to exercise its discretion in its favour. The orders of the court were to dismiss the application.