Konebada Pty Ltd ATF the William Lewski Family Trust v Commissioner of Taxation

The case before the Federal Court of Australia was Konebada Pty Ltd ATF the William Lewski Family Trust v Commissioner of Taxation. The Applicant, Konebada Pty Ltd, as trustee for the William Lewski Family Trust, sought to challenge the Commissioner of Taxation's decision to disallow input tax credits claimed in respect of payments made for litigation services and other services. The Applicant argued that it was entitled to claim these credits under the A New Tax System (Goods and Services Tax) Act 1999 (Cth). The court was required to determine whether the Applicant was entitled to input tax credits for the services it had paid for, specifically whether these services were acquired in the course of carrying on an enterprise as defined in the Act.

The court considered whether the services in question were acquired for the purpose of carrying on an enterprise. It found that the services were not related to carrying on an enterprise because they were primarily for litigation and advisory services within the family group. The Applicant's activities, though varied, did not constitute carrying on an enterprise for the purposes of the GST Act. The court held that the Applicant was not entitled to the input tax credits it claimed because the services in question were not acquired in the course of carrying on an enterprise. This conclusion was reached without needing to address other issues such as whether the services constituted financial supplies that would be input taxed.

The court dismissed the Applicant's application and ordered that the Applicant pay the Commissioner's costs. The dismissal of the application and the awarding of costs were based on the finding that the Applicant was not entitled to the input tax credits it sought to claim.