Pilmora Pty Ltd as Trustee of the Townsing Family Trust and Commissioner of Taxation (Taxation)

Case [2015] AATA 976

Pilmora Pty Ltd as Trustee of the Townsing Family Trust and Commissioner of Taxation (Taxation) [2015] AATA 976 (17 December 2015)

 

Division

TAXATION & COMMERCIAL DIVISION

File Numbers

2013/6548-6552

Re

Pilmora Pty Ltd as Trustee of the Townsing Family Trust

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Numbers

2013/6560-6562

Re

Normandy Finance and Investments Asia Pty Ltd

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Numbers

2013/6563-6571

Re

Henry Townsing

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Numbers

2013/6572-6580

Re

Gaynor Townsing

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Number

2013/6581

Re

Henry Townsing Jnr

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Number

2013/6582

Re

Edward Townsing

APPLICANT

And

Commissioner of Taxation

RESPONDENT

File Number(s)

2014/3353-3354

Re

Advant Pty Ltd

APPLICANT

And

Commissioner of Taxation

RESPONDENT

DECISION

Tribunal

Justice Edmonds
Date 17 December 2015
Place Sydney

1.        The applications of the applicants in 2013/6548–6552; 2013/6560–6562; 2013/6563–6571 and 2014/3353 and 2014/3354 are dismissed.          

2.        The objection decisions of the Commissioner in respect of the objections of the applicant in 2013/6572–6580 for the years ended 30 June 2001 to 2009 are set aside.

3.        The objection decisions of the Commissioner in respect of the objections of the applicants in 2013/6581 and 2013/6582 for the year ended 30 June 2001 are set aside.

4.        The matters in 2 and 3 be remitted to the Commissioner to raise assessments of income tax, if any, for the respective years of income referred to therein in accordance with the reasons for decision and to raise assessments of penalty tax, if any, consistent with those primary tax assessments.  Otherwise the applications for further remission are dismissed.

......[sgd].....................................................

Justice Edmonds

REASONS FOR DECISION

Justice Edmonds

17 December 2015

  1. These reasons should be read in conjunction with the reasons for judgment in Normandy Finance Pty Ltd v Commissioner of Taxation [2015] FCA 1420 (Normandy Finance and Investments Asia Pty Ltd and Advant Pty Ltd v Commissioner of Taxation VID 1336 of 2013 and Pilmora Pty Ltd ATF The Townsing Family Trust and Henry George Townsing v Commissioner of Taxation VID 1337 of 2013) (“Federal Court proceedings”), which was published today.

  2. In the case of all applicants in the Federal Court proceedings, the references to this Tribunal are confined to review of the Commissioner’s decisions not to remit penalties and shortfall interest charges imposed at the time of the assessments of income tax and penalty tax.  In the face of the findings in the Federal Court proceedings, a number of the assessments of income tax and penalty tax will be reduced, however, there should be no further remissions of penalty tax or shortfall interest charges so reduced.  Either the applicants have no standing to seek such remissions, or they have not established the grounds upon which their applications for remission are made.  The applications of the applicants for any such further remissions so reduced should be dismissed.

  3. In the cases of the applicants in 2013/6572–6580 and 2013/6581 and 2013/6582, they seek review of their assessments of income tax – 2013/6572–6580 (2001 to 2009); 2013/6581 (2001) and 2013/6582 (2001) – on the same basis as Henry Townsing sought for the years ended 30 June 2000 to 2009 inclusive.  For the same reasons there indicated, in particular at [141] to [144] inclusive, the Commissioner’s objection decisions are set aside and their objections allowed to the extent there indicated.

  4. The reference to the Tribunal for further remission of penalty tax so reduced on the part of the applicants in [3] above should be dismissed on the same grounds given in [2] above for the applicants in the Federal Court proceedings.

I certify that the preceding 4 (four) paragraphs are a true copy of the reasons for the decision herein of Justice Edmonds

............[sgd]............................................................

Associate

Dated  17 December 2015

Date(s) of hearing 1-5 June, 10-12 June, 15-19 June, 24 June, 8-9 July 2015
Counsel for the Applicant Mr J Hyde Page, Mr J Willis, Mr T Bagley
Solicitors for the Applicant Mr M J Ord
Counsel for the Respondent Mr D McGovern SC, Dr J Jaques, Ms J Gatland
Solicitors for the Respondent Australian Government Solicitor
Details
AGLC
Pilmora Pty Ltd as Trustee of the Townsing Family Trust and Commissioner of Taxation (Taxation) [2015] AATA 976
Case
[2015] AATA 976
Decision Date

CaseChat Overview and Summary

Pilmora Pty Ltd as Trustee of the Townsing Family Trust and several related parties brought applications before the Administrative Appeals Tribunal (AAT) seeking review of income tax assessments and penalties imposed by the Commissioner of Taxation. The applicants contested the assessments and penalties based on certain legal grounds. The AAT, presided over by Justice Edmonds, examined the applicants' submissions and the Commissioner's responses to determine whether the assessments and penalties were justified. Justice Edmonds concluded that while some assessments should be reduced following findings from a related Federal Court case, there were no valid grounds for further remission of penalty tax or shortfall interest charges. The AAT dismissed the applicants' requests for additional remissions, upheld some objections, and set aside certain objection decisions, directing the Commissioner to reassess the relevant years in line with the Tribunal's reasoning.

The AAT was tasked with reviewing the decisions made by the Commissioner regarding the income tax assessments and penalties imposed on the applicants. Specifically, the applicants contested the validity of the assessments and penalties, seeking either reduction or complete remission. The legal issues revolved around the applicants' standing to challenge the penalties and whether they had demonstrated sufficient grounds for remission. The AAT had to interpret the relevant tax laws, assess the applicants' arguments, and determine if the penalties were appropriately imposed. Justice Edmonds found that while some assessments should be adjusted, the applicants had not established valid grounds for further remission of penalty tax or shortfall interest charges.

Justice Edmonds' reasoning hinged on the findings from the related Federal Court case, which had already addressed many of the issues at hand. The AAT determined that some assessments should be reduced but found no valid grounds for further remission of penalty tax or shortfall interest charges. Consequently, the AAT dismissed the applicants' requests for additional remissions and set aside certain objection decisions, directing the Commissioner to reassess the relevant years according to the Tribunal's reasoning. The decision underscored the importance of the applicants' standing and the need for valid grounds to challenge penalties.

The final orders of the AAT were to dismiss the applicants' requests for further remissions, set aside certain objection decisions, and direct the Commissioner to reassess the relevant years in accordance with the Tribunal's reasoning. The AAT's decision clarified the legal standing of the applicants and the proper application of tax laws regarding the assessments and penalties in question.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.