Moreton Resources Ltd and Innovation and Science Australia (Taxation)

This matter concerned an appeal by Moreton Resources Ltd against a decision of Innovation and Science Australia (ISA) regarding the classification of certain research and development (R&D) activities. The dispute centred on whether specific activities undertaken by Moreton Resources qualified as core or supporting R&D activities for the purposes of tax concessions.

The primary legal issue before the Tribunal was to determine the correct classification of Moreton Resources' R&D activities under the relevant provisions of the *Industry Research and Development Act 1986* (Cth) (the IRD Act), specifically in light of amendments introduced by the IRD Amendment Act in 2011. This involved interpreting sections 27A, 27J, and 27M of the IRD Act, as well as transitional provisions relating to the repeal of section 39J.

The Tribunal considered the provisions of section 27J(1) of the IRD Act, which outlines the types of findings ISA may make regarding an R&D entity's registration, including whether an activity was a core R&D activity or a supporting R&D activity. The Tribunal noted that any findings made by ISA under section 27J are subject to section 32B, meaning they cannot be inconsistent with earlier findings. Furthermore, section 27M allows ISA to vary an entity's registration if the variation is consistent with any findings made under Part III of the IRD Act and is otherwise justified. The Tribunal also had regard to transitional provisions, specifically Item 16 of Schedule 4 of the IRD Amendment Act, which stipulated that references to registration under the current section 27A would include references to registration under the repealed section 39J for certain provisions, provided the R&D activity registered under the former section 39J was a core R&D activity within the meaning of the amendments.