McIntosh Bros Pty Ltd (In Liq) v Chief Commissioner of State Revenue

McIntosh Bros Pty Ltd (in liquidation) sought judicial review of assessments issued by the Chief Commissioner of State Revenue, which found the company liable for land tax. The dispute centred on whether the company’s activities were exempt from land tax under the Primary Production Exemption provisions of the State Revenue Act. Specifically, the issue was whether the agistment arrangements conducted by McIntosh Bros constituted primary production and thus qualified for the exemption. The case was heard in the Supreme Court of New South Wales.

The primary legal issues the court needed to decide were whether the agistment operations conducted by McIntosh Bros constituted primary production, and if the activities met the criteria for the primary production exemption, including the meaning of 'dominant use','significant and substantial', and 'purpose of profit'. Additionally, the court needed to determine whether the use of notional costs of labour and land use was appropriate in this context and who bore the onus of proof.

The court held that McIntosh Bros' agistment activities constituted primary production and were exempt from land tax under the Primary Production Exemption provisions. The court clarified the meanings of 'dominant use', 'significant and substantial', and 'purpose of profit', finding that the activities met these criteria. It further found that the use of notional costs was appropriate in this case. Regarding the onus of proof, the court held that the taxpayer bore the burden of proving that the exemption applied.

The Supreme Court set aside the Commissioner’s assessments, ruling in favour of McIntosh Bros. The company was exempt from the land tax assessments issued by the Commissioner.