R v Goel

[2011] NSWDC 83

District Court

New South Wales

Medium Neutral Citation:	R v GOEL [2011] NSWDC 83
Hearing dates:	1 August 2011
Decision date:	04 August 2011
Jurisdiction:	Criminal
Before:	Berman SC DCJ
Decision:	See para [30] jury to be directed accordingly
Catchwords:	CRIMINAL LAW - Judgment - causation under Commonwealth Criminal Code - tax fraud - "but for" test rejected
Legislation Cited:	Criminal Code 1995 (Commonwealth)
Cases Cited:	Arulthiakan v The Queen 204 ALR 259 Moffatt v The Queen (2000) 112 ACrimR 201 R v Petroulias (no 30) [2007] NSWSC 119 Royall v The Queen (1990) 172 CLR 378
Category:	Procedural and other rulings
Parties:	The Crown Dinker Goel
Representation:	W Hunt - The Crown A Morris - The Accused Director of Public Prosecutions (Cth) Mark Klees and Associates
File Number(s):	2009/00011996

Judgment

Introduction

1. The trial of Dinker Goel began last Monday. He was arraigned on 41 counts under s135.1(3) of the Criminal Code 1995 (Commonwealth). Evidence was called over 3 days until, in circumstances I am about to describe, he was re-arraigned and pleaded guilty. This followed a request, from Mr Goel's counsel, Mr Morris, that I indicate how I was proposing to direct the jury as regards one aspect of the elements of each of the alleged offences. After I heard argument from Mr Morris and the Crown Prosecutor, I indicated that I would not be directing the jury in the way Mr Morris asked me to. I then adjourned for Mr Morris to get further instructions in the light of what I had just said. It was when the Court resumed that Mr Goel was re-arraigned in the presence of the jury and pleaded guilty.

1. These are the reasons for me deciding that I would not direct the jury in the way Mr Morris sought.

Facts which are largely undisputed

1. On Sunday 19 October 2008 the accused went to the offices of CNR Accounting and Taxation Pty Ltd. There the accused met a tax consultant by the name of Sharang Sareen. He asked Mr Sareen to prepare 41 tax returns. The accused handed over 41 payment summaries (previously known as group certificates) purporting to show the income earned and tax withheld of 41 taxpayers. He also gave to Mr Sareen a document recording each of the taxpayer's bank account details. Mr Sareen did what he was asked to do, that is he prepared the tax returns and caused them to be lodged with the Australian Taxation Office.

1. As it turns out the payment summaries were false. None of the tax payers actually worked for any of the three companies recorded on the various payment summaries. Accordingly they did not earn the income recorded on that summary nor was tax withheld. Further the bank account and BSB numbers were not those of the relevant taxpayers.

1. At Mr Goel's request, Mr Sareen included in each of the taxation returns claims for deductions to which the tax payer was not entitled. In fact each tax return should have had zero deductions claimed.

1. Thus the tax returns would have had the effect, if they were processed by the Australian Taxation Office, of causing refunds to be made to the 41 tax payers. Those refunds would have totalled in the order of $184,000.

1. The actions of the offender led to him being charged with 41 counts under s135.1(3) of the Criminal Code 1995 (Commonwealth). There was one count in relation to each tax return. The 41 counts were in a common form namely,

"Between about 18 October 2009 and 22 October 2008 at Sydney in the State of New South Wales, did with the intention of dishonestly causing a loss to the Commonwealth, cause a tax return for the financial year ending 30 June 2008 in the name (the named tax payer) to be prepared and lodged with Australian Taxation Office, in that he procured CNR Accounting and Taxation Pty Ltd to prepare and lodge the return."

1. The elements of that offence were set out in a document which I proposed to give to the jury in my summing up as being:

1. The accused caused the relevant tax return to be lodged, and

2. at the time he did this he intended to cause a loss to the Commonwealth, and

3. he intended to cause the loss to the Commonwealth dishonestly, which means that:

• what he did was dishonest according to the standards of ordinary people, and
• he knew that what he did was dishonest according to the standards of ordinary people.

1. It is of course necessary that the relevant act of the accused coincides with the necessary mental element before the accused can be found guilty.

The Course of the Trial

1. When the accused was arraigned last Monday he pleaded not guilty to each of the 41 counts. On the third day of the trial, the Crown began to play a number of recordings of interviews that the accused had with an investigator from the Australian Taxation Office, Mr Paul Anderson. In the course of those interviews Mr Anderson asked the accused, amongst many other matters, about how it came about that deductions were claimed for things such as work related expenses on each of the tax returns. The accused told Mr Anderson that he had asked Mr Sareen to claim "general deductions". When pressed by Mr Anderson to explain what he meant, the accused admitted that he should not have made that request because he had nothing to justify an assertion that such expenses had been incurred by the taxpayer.

1. As to whether the accused knew whether what he was doing was dishonest, it is important to note that the accused told Mr Anderson:

"as far as my concern, it was wrong because even I am working as a tax, tax agent it was wrong".

1. Later on in that same interview the accused admitted the following:

"and I put it to you that you, you knew that there was no evidence of any deductions at all and yet you were still happy to give instructions to Sharang (Mr Sareen) to make claims for deductions that you did not know existed".

1. After hearing this part of the interview I took the opportunity, after the jury had left for the afternoon to discuss with Mr Morris and Mr Crown whether my understanding of the elements that the Crown had to prove were correct. I was concerned because it appeared that in the interview, part of which I had just heard, it appeared that the accused was admitting to committing the offence, (even if he was not admitting that he was as dishonest as the Crown was suggesting he was). Mr Morris correctly anticipated one of the queries I had when he said, "you're going to ask me why is this a trial?".

1. It then became clear, after discussions with the Crown and Mr Morris, that there was a dispute between them as to how I would direct the jury. It also became clear that if I decided that I would not direct the jury in the way Mr Morris wanted me to, then it would be better for his client to learn this sooner rather than later so that he could decide how to plead.

1. The jury was therefore told not to attend until 11.00 o'clock the following day and counsel and I spent the morning resolving the issue as to how I would direct the jury.

The correct direction to the jury.

1. It became apparent that it was the position of Mr Morris that the relevant act which the Crown must prove as being the one which caused the tax return to be lodged (and which the crown must prove was done with the necessary mental element) was the ultimate act of the accused which led to the return being lodged. Mr Morris was proposing to argue to the jury, and asked that I direct them as a matter of law, that they could not find that the accused had caused the tax return to be prepared and lodged when he finished speaking to Mr Sareen on Sunday 19 October 2008 because the taxation returns were not prepared and lodged until a couple of days after that, that occurring after the accused had received an invoice and payed it.

1. Mr Morris' position was that the time which the Crown needed to prove that the accused was dishonest (both subjective and objective dishonesty as defined in s130.3 Criminal Code ) was when the accused did the ultimate act which led to the return being lodged. His submission was that it was only the final act of the accused which caused the return to be lodged which was relevant because without that final act the tax return would not have been lodged. In effect Mr Morris suggested that I would direct the jury that there was a "but for" test to be applied in determining when the accused caused the tax return to be prepared and lodged.

1. Mr Morris was going to submit to the jury that because the act which caused the tax return to be lodged had to coincide with the mental element of dishonesty, whilst the accused may have been acting dishonestly on the Sunday (something he freely admitted in the interviews with Mr Anderson) he was not acting dishonestly at the time of his final act which led to the returns being lodged. (I have to say that I did not fancy the chances of Mr Morris being able to persuade the jury that it was reasonably possible that what the accused knew, and thus whether he was acting dishonestly, varied from 19 th October 2008 to when the taxation returns were lodged, but that was going to be a matter for the jury and not me).

1. The Crown's position was that I would direct the jury that they could find the accused guilty if the relevant mental state coincided with any single act which, together with other acts, led the tax return to be lodged. This would be an act which they could find caused the tax return to be lodged, and that the time at which the Crown needed to prove the mental element was when the accused did any one of those acts.

1. In the course of argument I raised the analogy, endorsed by the Crown of the situation where if a person hits another twice, and the person dies, and any one blow would not have been enough to cause the death, and the person would be guilty of murder if he or she had the necessary mental element at the time of the first blow. As a matter of law that first blow would have caused the death.

1. The Crown argument was that, at the very least, as soon as:

• Mr Sareen told the accused that he would claim "general deductions" at the request of the accused,
• which the accused knew should not have been claimed,
• and then agreed that the returns should be lodged with those deductions claimed in the return

then the jury could find that he had done an act which caused a loss to the Commonwealth by causing a tax return to be lodged with the intention of acting dishonestly, that he knew was acting dishonestly, and that his intention and knowledge coincided with the act.

1. The concept of causation in the criminal law has caused difficulty from time to time. Although of course the leading case in Australia is Royall v The Queen (1990) 172 CLR 378 the Justices of the High Court in that case do not speak with one voice. As Wood CJ at CL pointed out in Moffatt v The Queen (2000) 112 ACrimR 201,

[70]. "The formulation of the test to be applied was not stated by their Honours in identical terms. Brennan J said that the accused's act or omission "must contribute significantly to the death of the victim" (at 398; 66). Deane and Dawson JJ said that it would be sufficient if the accused's conduct "or significant cause of death" (is a substantial at 41; 77). The "causal connection must be sufficiently substantial to enable responsibility for the crime to be attributed to the accused" (at 412; 78). Toohey and Gaudron JJ said the jury will inevitably concentrate its attention upon " whether the act of the accused substantially contributed to the death" (at 423; 86). McHugh J said that the wrongful act must be "An operating caused and a substantial cause" (at 444; 102).

1. However the important thing to note at this stage as far as the present case is concerned is that whichever precise formulation is adopted it would suggest that I would not direct the jury in the way in which Mr Morris asked me to. The "but for" test is not the test of causation in the criminal law.

1. Of course it is usually an accused who is complaining about a but/for test being used (see Arulthilakan v The Queen 204 ALR 259) because it can convey to a jury that "a negligible causal relationship will suffice". But I can see no good reason why the Royall test(s) should not apply even where it is the accused who seeks to limit the concept of causation to an ultimate act.

1. And lest it be thought that the common law test of causation is for some reason not applicable to offences under the Commonwealth Criminal Code, the Crown Prosecutor referred me to the decision of R v Petroulias (No 30) [2007] NSWSC 119 where in a prosecution under the predecessor to the section of the Criminal Code under which the present allegations are brought, Johnson J relied on the decision in Royall in determining the issue of causation in that trial.

1. I am satisfied that it would have been wrong to tell the jury that they could only look at one act of the accused in deciding whether an act of the accused which caused the tax return to be lodged coincided with the necessary mental element, and it would have been especially wrong to tell the jury that that act would have to be the ultimate act of the accused which led to the return being lodged.

1. That was not my understanding of the concept of causation as it applied in the trial. I was of the view that the jury were entitled to look at any one act which, together with other acts, led the tax return to be lodged and determine whether that that act caused (in the Royall sense) the tax return to be lodged and if that act coincided with a finding that the accused had the necessary mental element at that time then all the elements of the offence would have been proved by the Crown.

1. Mr Morris also had some submissions regarding the precise terms of the indictment. Indeed he said that if each count in the indictment made no reference to the return being "lodged" but only referred to the return being "prepared" then his client would have no defence. Notwithstanding the obvious attraction to the Crown in having the accused plead guilty to an indictment amended in that way, (namely the absence of a judgment which could be the subject of appeal) the Crown did not make any application to amend the indictment.

1. It has to be remembered that the offence is complete as soon as a person does an act with the intention of dishonestly obtaining a gain from a Commonwealth entity. Quite clearly in his interviews the accused was admitting that he had done that when he spoke to Mr Sareen on Sunday 18 th October 2008. Of course the accused comes to court to meet a particular allegation as specified in an indictment. But that does not mean that the Crown must prove beyond reasonable doubt everything in the indictment and due recognition must be paid to the difference between what the Crown must prove and what are mere particulars. Much of the allegation contained in the indictment consists of particulars. For example the words "in that he procured CNR Accounting and Taxation Pty Ltd to prepare and lodge the return" are particulars, not elements, so I did not find that the particular way the counts were drafted supported Mr Morris' submission as to the way I should direct the jury.

1. Those are the reasons for me indicating to Mr Morris that I would not direct the jury in the manner he asked me to.

1. The task of deciding the factual basis on which I must sentence Mr Goel now begins. It will be for me to decide whether his dishonesty extends to knowledge that the tax returns were based on income which was not earned and tax which was not withheld or whether his dishonesty is instead, as Mr Morris suggests, limited to procuring the lodging of tax returns with claims for deductions which should not have been made. Even if I do not find in favour of the Crown on that issue a second issue remains concerning whether the offender's dishonesty extended to knowledge of the extent of the deductions actually claimed or whether it was limited to him believing that some lesser amount would be claimed by Mr Sareen.

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Decision last updated: 05 August 2011