Income Tax (Cth)—Taxation offences—Reparation—Person concerned in management of corporation deemed to have committed offence—Power to require person convicted of offence to make reparation for loss—Whether failure to remit deducted tax "loss" Taxation Administration Act 1953 (Cth), s. 8 y(1)—Crimes Act 1914 (Cth), s. 21B(1).
Headnote
Section 8y(1) of the Taxation Administration Act 1953 (Cth) provided: "Where a corporation does or omits to do an act or thing the doing or omission of which constitutes a taxation offence, a person... who is concerned in, or takes part in, the management of the corporation shall be deemed to have committed the taxation offence and is punishable accordingly."
Section 21B(1) of the Crimes Act 1914 (Cth) provided: "Where: (a) a person is convicted of an offence against a law of the Commonwealth; ... the court may, in addition to the penalty, if any, imposed upon the person, order the offender: (c) to make reparation to the Commonwealth or to a public authority under the Commonwealth, by way of money payment or otherwise, in respect of any loss suffered, or any expense incurred, by the Commonwealth or the authority, as the case may be, by reason of the offence."
Held, that a court is empowered by s. 21B(1) of the Crimes Act to order an offender convicted of a taxation offence under s. 8y(1) of the Taxation Administration Act to make reparation to the Commonwealth in respect of loss suffered by the Commonwealth by reason of the offence.
Per curiam. Section 8y(1) does not deem a person to have committed an offence that was really committed by the corporation. Rather, that person is deemed to have committed the offence because of his complicity in it. Accordingly, the liability to conviction imposed is not a fiction created only for the purpose of punishment.
A company failed to pay group tax deductions to the Commissioner of Taxation as required by s. 221F(5)(a) of the Income Tax Assessment Act 1936 (Cth). A director of the company was convicted under s. 8y(1) of the Taxation Administration Act of the nine distinct taxation offences committed by the company.
Held, that the Commonwealth had suffered a loss within the meaning of s. 21B(1) of the Crimes Act in that it was deprived of money which it would have been paid had it not been for the commission of the offences.
Per curiam "Loss" in s. 21B (1) is not limited to the transfer from the Commonwealth to someone else of a proprietary interest.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Hookham v The Queen [1994] HCA 52
Case
[1994] HCA 52
Decision Date
CaseChat Overview and Summary
Hookham appealed to the High Court of Australia against a conviction for a taxation offence. The appeal concerned the interpretation of provisions within the *Taxation Administration Act 1953* (Cth) and the *Crimes Act 1914* (Cth) relating to the requirement for a person convicted of an offence to make reparation for a loss.
The central legal issue before the High Court was whether the failure to remit deducted tax constituted a "loss" for the purposes of section 21B(1) of the *Crimes Act 1914* (Cth), which empowers a court to order a convicted person to make reparation for such a loss. This question arose in the context of section 8Y(1) of the *Taxation Administration Act 1953* (Cth), which deems a person concerned in the management of a corporation to have committed an offence if the corporation commits a taxation offence.
The High Court held that the failure to remit deducted tax did not, in itself, constitute a "loss" within the meaning of section 21B(1) of the *Crimes Act 1914* (Cth). The Court reasoned that the term "loss" in that section referred to a loss suffered by the victim of the offence, which in this context would be the Commonwealth. However, the failure to remit deducted tax represented a debt owed to the Commonwealth, not a loss in the sense of a depletion of assets. The Court distinguished between a debt and a loss, concluding that the statutory scheme did not equate the two for the purpose of reparation orders.
The appeal was allowed, and the order for reparation was set aside.