Southern Global Group Pty Ltd and Commissioner of Taxation (Taxation) - [2021] AATA 3968

Southern Global Group Pty Ltd and Commissioner of Taxation (Taxation) [2021] AATA 3968 (28 October 2021)
Division: SMALL BUSINESS TAXATION DIVISION
File Number(s):2020/4801
Re:Southern Global Group Pty Ltd
APPLICANT

AndCommissioner of Taxation
RESPONDENT

DECISION
Tribunal:Member D Mitchell
Date:28 October 2021
Place:Brisbane

The Tribunal affirms the decision under review in relation to the September 2016, March 2017, June 2017, September 2017, December 2017, June 2018 and September 2018 quarters as set out in paragraph 69 of this decision.
The Tribunal varies the decision under review in relation to December 2016, March 2018 and December 2018 quarters as set out in paragraph 69 of this decision.
........................[SGD]...............................
Member D Mitchell
CATCHWORDS
TAXATION – goods and services tax – bank account methodology audit – were bank deposits taxable supplies – Applicant’s burden to prove amended assessments excessive or otherwise incorrect and what the amended assessments should have been – which assessments were the subject of the objection decision – decision under review affirmed and varied
LEGISLATION
Administrative Appeals Act 1975 (Cth)
A New Tax System (Goods and Services Tax) Act 1999 (Cth)
Taxation Administration Act 1953 (Cth)
CASES
Bosanac v Commissioner of Taxation [2018] FCA 946
Bosanac v Commissioner of Taxation [2019] FCAFC 116
Bosanac v Commissioner of Taxation [2019] HCA 41
Briginshaw v Briginshaw (1938) 60 CLR 336
Imperial Bottleshops Pty Ltd and William John King Egerton v Federal Commissioner of Taxation (1991) 22 ATR 148
Trautwein v Federal Commissioner of Taxation (1936) 56 CLR 63
REASONS FOR DECISION
Member D Mitchell
28 October 2021
INTRODUCTION

Southern Global Group Pty Ltd (the Applicant) is seeking review of an objection decision of the Commissioner of Taxation (the Respondent) dated 29 May 2020.[1]
[1] Exhibit 1, T Documents, T25, pages 316-317, Objection Decision.
The reviewable decision related to the Applicant’s objection to assessments of net GST amounts for the tax periods from 1 July 2016 to 31 December 2018 (the Tax Periods)[2] and allowed the objection in part.
[2] Exhibit 1, T Documents, T2, pages 6-12, Reasons for Objection Decision.
BACKGROUND
The Applicant was incorporated on 23 March 2014[3] and applied for an Australian Business Number (ABN) on 22 August 2016. The Applicant’s main business activity was described as ‘management consulting service’.[4] The Applicant registered for quarterly reporting of Goods and Services Tax (GST) on an accruals basis from 1 July 2016.[5]
[3]     Exhibit 1, T Documents, T10, page 136, ASIC organisational extract search results for Southern Global Group Pty Ltd.
[4]     Exhibit 1, T Documents, T14, page 161, Reasons for Audit Decision.
[5]     Exhibit 1, T Documents, T14, page 161, Reasons for Audit Decision.
The Applicant’s sole director during the Tax Periods was Mr Mohammad Mustapha. The Applicant’s registered address throughout the Tax Periods was listed as being either

Mr Mustapha’s residential address or former place of work (also being the address of the Applicant’s then tax agent).[6]
[6] Exhibit 1, T Documents, T10, pages 136-139, ASIC organisational extract search results for Southern Global Group Pty Ltd.
The Applicant, via a tax agent, lodged its business activity statements (BAS) for the Tax Periods.[7]
[7] Exhibit 1, T Documents, T14, page 161, Reasons for Audit Decision.
The Respondent undertook a covert audit into the Applicant’s GST affairs using a bank account methodology.[8] The Respondent formed the view that unexplained deposits in the Applicant’s bank accounts were unreported consideration for taxable supplies for the relevant Tax Periods.[9]
[8] Exhibit 4, Respondent’s Submissions, page 2, paragraphs 10-11.
[9] Exhibit 4, Respondent’s Submissions, page 2, paragraph 11.
At the conclusion of the audit, on 3 April 2019, the Respondent notified the Applicant that a covert audit had been completed and issued an audit completion letter[10] with reasons for decision[11] and a notice of amended assessments of net amount for the Tax Periods calculating total GST shortfall amounts of $60,520.[12]
[10]    Exhibit 1, T Documents, T13, pages 155-156, Notice of audit decision.
[11]    Exhibit 1, T Documents, T14, pages 157-174, Reasons for Audit Decision.
[12]    Exhibit 1, T Documents, T16, pages 177-178, Notice of amened assessments of net amount.
On the same day, a notice of assessments of penalty was issued by the Respondent on the basis that the Applicant or its agent made false or misleading statements that resulted in the Applicant having shortfall amounts for the Tax Periods.[13] The Applicant did not object to the imposition of penalties and as such that assessment is not before this Tribunal.
[13] Exhibit 1, T Documents, T15, pages 175-176, Notice of assessments of shortfall penalty.
At the instigation of the Applicant, a meeting was convened on or around 1 May 2019, which was attended by the Applicant’s then legal representative, Mr Mustapha and the Respondent’s audit officer.[14] Prior to and at that meeting, the Applicant was made aware of what documentation was required in order for it to prove that deposits into its bank accounts were not to be classified as taxable supplies. It was outlined by the Respondent’s representative that all general comments would require supporting documentation and that a sentence explanation was not enough to prove that a taxable supply had not been made.[15]
[14] Exhibit 1, T Documents, T17, pages 179-181, Confirmation of interview.
[15] Exhibit 1, T Documents, T2, pages 6-7, paragraphs 8-10, Reasons for Objection Decision.
On 4 June 2019, Mr Mustapha, on behalf of the Applicant, provided a response together with attachments to the Respondent in relation to the audit decision.[16]
[16] Exhibit 1, T Documents, T19, pages 184-256, Information provided by Applicant.
On 24 July 2019, after having considered that information, the Respondent notified the Applicant that it had completed an informal review of the audit[17] and issued amended assessments of net amount on the same day.[18] Those amended assessments reduced the total GST shortfall amounts to $38,835.[19]
[17]    Exhibit 1, T Documents, T20, pages 257-262, Revised notice of audit decision.
[18]    Exhibit 1, T Documents, T21, pages 263-264, Notice of amended assessments of net amount.
[19]    Exhibit 1, T Documents, T20, page 258, Revised notice of audit decision.
On 20 September 2019, the Applicant lodged an objection.[20] The Applicant provided that the reason for objecting to the assessments was: [21]
I am objecting to the years relating to the period ended 1 July 2016 to 31 December 2018.
I am objecting to the ATO’s assessment of various transactions which the ATO deemed as GST Income there are several transactions that are loans, and have been paid back in full.
Income received from Quest Capital Management, was classified as GST Income, however it is Interest Income, as Southern Global Group provided loans to QCM. I did not provide a service, therefore it should not be income.
[20] Exhibit 1, T Documents, T22, pages 265-269, Applicant’s notice of objection.
[21] Exhibit 1, T Documents, T22, page 268, Applicant’s notice of objection.
The Applicant further provided that documentation to support its objection would be provided once a case officer was presented.[22]
[22] Exhibit 1, T Documents, T22, page 269, Applicant’s notice of objection.
On 18 February 2020, the Respondent acknowledged receipt of the Applicant’s objection and requested that further information be provided.[23]
[23] Exhibit 1, T Documents, T23, pages 270-271, Acknowledgement of objection and request to provide evidence.
On 23 March 2020, the Applicant provided a letter outlining explanations in relation to the transactions in dispute together with supporting documents.[24]
[24] Exhibit 1, T Documents, T24, pages 273-315, Letter from Applicant with annexures.
On 29 May 2020, the Respondent issued an objection decision:[25]
a.allowing in part, and decreasing the taxable supplies for the December 2017 and March 2018 quarters; and
b.disallowing the objection in relation to the balance of the Tax Periods.
[25] Exhibit 1, T Documents, T25, pages 316-317, Notice of Objection Decision.
However, it should be noted that the Applicant’s objection has been taken to relate to the assessments issued on 3 April 2019, at the end of the audit and as such the true objection decision allowed the Applicant’s objection in part for each of the quarters of the Tax Period. The objection decision was consistent with the Respondent’s decision upon informal review, in all respects other than for the December 2017 and March 2018 quarters where further reductions in the taxable supplies were allowed.[26]
[26] See paragraphs 50-51 and 67 of this decision for explanation on the scope of the Applicant’s objection and the effect of the resulting objection decision.
On 15 June 2020, the Respondent issued a further notice of amended assessments of net amount for the December 2017[27] and March 2018 quarters.[28] Those amended assessments reduced the total GST shortfall amounts to $37,035.[29]
[27]    Exhibit 1, T Documents, T27, page 319, Notice of amended assessment for the period 1 October 2017 to 31 December 2017.
[28]    Exhibit 1, T Documents, T29, page 322, Notice of amended assessment for the period 1 January 2018 to 31 March 2018.
[29]    Respondent’s Further Submissions, Annexure A – Changes in GST Shortfalls.
On 10 August 2020, the Applicant made an application to this Tribunal for review of the objection decision.[30]
[30] Exhibit 1, T Documents, T1, pages 1-5, Application for review of decision.
A Hearing was held by Microsoft Teams on 25 August 2021. At Hearing the Applicant was represented by Mr Mustapha as its sole director, who gave evidence under affirmation.
THE LAW
The relevant law in this matter includes the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act) and the Taxation Administration Act 1953 (Cth) (TAA 1953).
Where a person disagrees with an amended assessment issued by the Respondent they may object to that decision.[31] Following a review of the objection, an objection decision is made by the Respondent.[32]
[31] Following the requirements set out in Part IVC of the TAA 1953.
[32] Section 14ZY of the TAA 1953.
Where a taxpayer is dissatisfied with an objection decision made by the Respondent they may apply to this Tribunal for a review of the decision or appeal to the Federal Court against it.[33]
[33] Section 14ZZ of the TAA 1953.
The Applicant in exercising its right to seek review of the Respondent’s objection decision has, by virtue of section 14ZZK(b)(i) of the TAA 1953, the burden of proving that the assessments for the Tax Periods in dispute are excessive or otherwise incorrect and what those assessments should have been.
The Tribunal is not bound by the rules of evidence and it may inform itself on any matter in such a manner as it thinks appropriate.[34] However, in Briginshaw v Briginshaw (1938) 60 CLR 336 Dixon J (as he then was) considered the relevance of the civil or balance of probabilities standard of proof in Tribunal proceedings. For the Applicant to persuade this Tribunal of the facts it offers to demonstrate that the amended assessments were excessive and as such incorrect and what the assessments should have been:[35]
…. the tribunal must feel an actual persuasion of its occurrence or existence ... It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality… it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters ‘reasonable satisfaction’ should not be produced by inexact proofs, indefinite testimony, or indirect inferences.
[34] Section 33(1)(c) of the Administrative Appeals Act 1975 (Cth).
[35] Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-362.
The discharge of the Applicant’s evidentiary burden in this matter must be considered keeping in mind that the evidence said to support the Applicant’s position is uniquely within the Applicant’s possession or control.[36]
[36] Trautwein v Federal Commissioner of Taxation (1936) 56 CLR 63, per Latham CJ at 87-88.
The GST Act provides that an entity must pay the GST payable on any taxable supply they make.[37]
[37] Section 9-40 of the GST Act.
A taxable supply is made by an entity if the supply was made for consideration; in the course or furtherance of an enterprise being carried on by the entity; is connected with the indirect tax zone; and the entity is required to be registered for GST, unless to the extent that the supply is GST-free or input taxed.[38]
[38] Section 9-5 of the GST Act.
Consideration includes any payment, or any forbearance, in connection with a supply of anything and in response to or for the inducement of a supply of anything.[39]
[39] Section 9-15 of the GST Act.
An enterprise is an activity, or series of activities, done in the form of a business or in the form of an adventure or concern in the nature of trade.[40]
[40] Section 9-20 of the GST Act.
ISSUES
The issue for determination by the Tribunal is whether the Applicant has discharged its burden of proof to establish that the amended GST assessments for the Tax Periods were excessive or otherwise incorrect and what the assessments should have been.
HEARING AND POST HEARING SUBMISSIONS
Throughout the review process leading up to the application to the Tribunal the Applicant provided statements outlining its disputes in relation to deposits into its bank account being assessed by the Respondent as being taxable supplies and in some circumstances provided supporting documentation.[41]
[41] Exhibit 1, T19, pages 184-256, Information provided by the Applicant and T24, pages 273-315, Applicant’s response to information request.
In the lead up to the Hearing of this matter Mr Mustapha filed an affidavit dated

27 January 2021 together with attachments making the following claims:[42]
1.The Applicant entered into a verbal loan agreement with Quest Capital Management Pty Ltd (QCM). Under the loan agreement, the Applicant advanced a total of $52,500, over three transactions between 22 July 2016 and 29 August 2016 to QCM. The Applicant referred to T19, pages 227 and T19 page 229 as being documentary evidence supporting this arrangement.[43] (Transaction 1)
2.Between 14 October 2016 and 20 December 2018, the Applicant received 33 interest return payments from QCM totalling $138,959. The Applicant referred to T19, pages 228, 230-232 and T24, page 286 as being documentary evidence supporting this claim.[44] (Transaction 2)
3.Between 19 December 2017 and 18 August 2020, the Applicant received loans from QCM in three transactions totalling $32,000. The Applicant referred to an affidavit from Ali Assaf the sole director of QCM at that time as being documentary evidence supporting the claim.[45] (Transaction 3)
4.On 23 July 2017, the Applicant loaned $20,000 to Gscoul Recruitment Pty Ltd which was repaid to the Applicant on 14 August 2017. The Applicant referred to T19, page 239 and a bank statement found at Annexure A as being documentary evidence supporting the claim.[46] (Transaction 4)
5.The amounts of $2,000 and $2997.35 received by the Applicant in January 2018 represented the return of capital from investments made in the crypto currency platform. The Applicant referred to T24, pages 296-298, 300-301 and Annexure C as being documentary evidence supporting the claim.[47] (Transaction 5).
6.On 19 December 2018, the Applicant lent $22,500 to Nitro Steel Fixers Pty Ltd which was repaid to the Applicant on the same day. The Applicant referred to T24, page 315 and Annexure D as being documentary evidence supporting the claim.[48] (Transaction 6)
7.On 30 October 2018, the Applicant borrowed $50,000 from WHFB Superfund and repaid the loan on 14 May 2019. The Applicant referred to T24, pages 309-314 as documentary evidence supporting the claim.[49] (Transaction 7)
[42]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments.
[43]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 2, paragraph 7.
[44]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, pages 2-3, paragraph 8.
[45]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 4, paragraph 8.
[46]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 4, paragraph 8.
[47]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 4, paragraph 9.
[48]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 4, paragraph 9.
[49]    Exhibit 3, Affidavit of Mr Mustapha Mohammad with attachments, page 5, paragraph 9.
Leading into the Hearing it appeared that of the deposits totalling $409,209[50] that remained in dispute at the conclusion of the objection decision, the Applicant was only disputing the amounts that constituted the above outlined transactions totalling $268,557.35.[51]
[50] Being deposits assessed as being additional taxable supplies at the conclusion of the audit: see Exhibit 1, T Documents, T2, pages 7-10, paragraphs 12, 39 and 47; $427,209 - $9,500 - $8,500.
[51] Being $139,060 + $32,000 + $20,000 + $2,000 + $2,997.35 + $22,500 + $50,000.
At Hearing Mr Mustapha told the Tribunal that was not the case at all. He said he should have addressed the other amounts and would do so at Hearing. He said he thought he conceded that less than $70,000 was income.[52]
[52] Transcript, pages 6-7.
Mr Mustapha gave evidence and was cross examined in relation to the 7 transactions and acknowledged that there were discrepancies in its ledger accounts and where loan amounts were being advanced to, where the repayments of the loans and any associated interest was coming from, that in some instances no interest was being charged or paid and in many instances no written loan agreements were in existence.[53] In summary Mr Mustapha told the Tribunal that:[54]
My biggest argument is that there were loans that have been paid back and forth. Yes, interest hasn’t been paid. It doesn’t mean that it’s not a loan. So, you can see from my general ledger account that loans have been paid - have been paid back in full. I know that there’s an inconsistency when it comes to QCM interest, and other related parties, but again it doesn’t change the facts.
[53] Transcript, pages 5-36.
[54] Transcript, page 25.
On cross-examination, Mr Mustapha when asked what his occupation was, said:[55]
I’m a bookkeeper, accountant, entrepreneur, investment guru. I’ve got like 10 companies. You name it.
[55] Transcript, page 22.
Mr Mustapha agreed that he was a partner at the accounting firm Wentworth, Williams and Associates and that he was aware of financial record keeping and how to record financial transactions.[56] He said that he never thought he would be audited and provided:[57]
I understand, yes I am an accountant and I’m a bookkeeper and I should be diligent, I should have had all these documents ready, I didn’t, but it doesn’t change away from the facts.
[56] Transcript, pages 22-23.
[57] Transcript, page 23.
When put to Mr Mustapha that if the Applicant was not accepting all other disputed transactions as being taxable supplies then what did he say the amended assessments for the Tax Periods should be, he requested a short adjournment to locate information in that regard.[58]
[58] Transcript, page 26.

At the recommencement of the Hearing, Mr Mustapha told the Tribunal that he thinks he did concede about $90,000, but he wanted to see what the Respondent said about the transactions. He said that the transactions that relate to PMG 300 relate to money the Applicant borrowed, that two other transactions relate to repayments of loans being made by Nitro and that other amounts related to money being borrowed by the Applicant. Mr Mustapha was not able to reconcile the amounts he was discussing with the disputed transaction list.
When reminded about the onus being on the Applicant to establish that the amended assessments for the Tax Periods in dispute are excessive or otherwise incorrect and what those assessments should have been, the following interaction followed:[59]
[59] Transcript, pages 33-34.
WITNESS: To be honest with you, I think - the issue is I have got to go back and look at what I have done in my initial objection. Look, I - I can tell after - like right now, in regards - because there are additional transactions made to Nitro. There are additional transactions made to PMG300. I have received money from my related company (Indistinct) Capital, which I have declared as GST-free. It's commission. But I think that you probably want a proper breakdown per quarter of which - which transactions I'm disputing. I would need more time on that so I can analyse - analyse the transactions.
MEMBER: And I guess the - the concern that I have there, Mr Mustapha, is this matter has been on foot now for a very long time.
WITNESS: Correct.
MEMBER: And you have been given these opportunities, and I would have thought at the conciliation these things would have been spoken about as well. So if I was to allow you the time, then I would expect to see something come back, because otherwise it's - it's starting to seem like, up until now, you - you haven't taken this matter as seriously as what perhaps you should have. Noting that you - you do have accounting qualifications so you do, I would assume, understand the tax laws to a better level than the ordinary taxpayer, and would have been aware of the burden of proof that the applicant needs to establish in this matter. So my only concern with adjourning and giving you time to do it is that we then need something provided that sets out what the position is and why and ties it back to the documents. So it's - - -
WITNESS: Yes. Look, the issue here is that even if I did provide a breakdown, it's going to be the same explanation. Money came in, money came out.
MEMBER: Yes, I understand your explanation, but the - there's two hurdles for the taxpayer to get across, and so just - just establishing that the assessments are wrong or excessive is not enough. You need to establish what the assessments should have been. So, I mean, for example, if - if the position was that yes, it was the seven things we are talking about, groups of things we were talking about, and you say all of those should not be counted, then that establishes to a certain degree what it is you're saying the taxable position should have been.
WITNESS: Yes.
MEMBER: But if - if it's - if that's not it, because that's kind of the information you have got before us, and there's other things that you want to contest, then we need to know what those are so that you can establish what it is you say that the quarterly statements should have been. So it needs to be clear what's being conceded and what's not and what's in dispute and what's not, and that's not clear.
WITNESS: Okay.
The Tribunal also raised concerns with the Respondent throughout the Hearing in relation to the calculations it provided as part of its filed written submissions and what decision was actually being sought.[60]
[60] Transcript, pages 26-28 and 35-56.
At the conclusion of the Hearing the Tribunal made the following directions:
1.On or before 30 August 2021, the Applicant must provide to the Tribunal and the Respondent submissions in relation to which unexplained deposits the Applicant considers to be in dispute, and what the Applicant claims the amended assessments should be for the periods in question.
2.On or before 13 September 2021, the Respondent must provide to the Tribunal and the Applicant a submission that:
a.     replies to the submissions received in accordance with Direction 1;
b.     provides clarification of the taxable supplies, together with a breakdown of the transactions and calculations for each period in question; and
c.     clarifies the decision sought by the Respondent.
3.On or before 20 September 2021, the Applicant must provide to the Tribunal and the Respondent any submissions in reply, or advise that he does not intend to do so.
44.On 30 August 2021, the Applicant provided a submission stating the following:[61]
·On the 7 April 2017 in the amount of $5,500 was a loan form Nitro Steel Fixers (NSW) Pty Ltd
·On the 10 May 2017 was a loan repayment from Nitro, which SGG lent on the 4 May 2017
·On the 7 October 2017, was a loan repayment from PMG 300 Pty Ltd, which it lent on the 3 October 2017
[61]    Applicant’s post hearing statement.
The Applicant also provided a document marked as Annexure A setting out amounts that were income and have and/or ought to have been declared as GST income. The transactions totalled $225,509.
On 21 September 2021,[62] the Respondent provided the following submissions contending that the Applicant had not satisfied the onus of proof it bears pursuant to section 14ZZK of the TAA 1953:[63]
[62] An extension of time was granted in relation to directions 2 and 3 of the Directions made on 25 August 2021, so that direction 2 was required to be complied with by 21 September 2021 and direction 3 was required to be complied with by 28 September 2021. The Applicant was further contacted by the Tribunal to follow up whether or not he intended to provide any further submissions in reply and if so asked to do so by close of business on 1 October 2021. No response was received from the Applicant.
[63] Respondent’s further submissions, page 4, paragraphs 18-24.
18. The evidence provided by Mr Mustapha at the Hearing in his capacity as sole representative of the Applicant, did not provide a clear position on whether the amended assessments were excessive or otherwise incorrect and what those amended assessments should have been.
19. Further, the Applicant’s material is brief and unreliable, and the contended explanation for the deposits would not satisfy the Tribunal to the requisite standard.
20. In the premises of all of the above observations of the Applicant’s evidence, it is submitted that none of the evidence given by the Applicant during the Hearing or evidence contained in the T Documents, nor the affidavit and submissions subsequently provided to the Tribunal should be relied on.
21. The Applicant has not provided any primary evidence impugning the Commissioner’s amended assessments of net amount, nor provided any evidence as to what the amended assessments of net amount ought to be for the Relevant Quarters.
22. The Applicant did not call any witnesses to give evidence at the Hearing and so there is limited evidence to solidify the Applicant’s contentions.
23. When questioned about Mr Mustapha’s occupation at the Hearing, Mr Mustapha’s gave evidence that he was a Partner at Wentworth Williams & Associates (an accounting firm). Despite Mr Mustapha’s professional experience and expertise, he has been unable to ensure that the Applicant met its obligations under relevant taxation laws. It is reasonable to expect that Mr Mustapha, and as a consequence the Applicant, is adequately experienced and in a far better position than the average person to be aware of the relevant record keeping requirements.
24. Accordingly, the Applicant’s evidence is limited, at best because:
a. there is a lack of independent, contemporaneous and primary source documents which should have been available to the Applicant to support its contentions;
b. the Applicant has not called any witness to corroborate his contentions; and
c. the material provided is brief and lacks supporting evidence.
The Respondent provided consolidated tables that outlined the quarterly breakdown of:
·the bank deposits identified during audit and GST shortfall calculations.[64]
·changes in the GST shortfall amounts between audit, informal review, objection and the present proceedings.[65]
·each deposit in dispute for each quarter, identifying those deposits in dispute before the Tribunal, those not in dispute before the Tribunal (as they had been conceded by the Applicant, were excluded during the informal review and objection processes, were errors made by the Respondent at audit or were concessions made by the Respondent during the Tribunal process).[66]
[64]    Respondent’s further submissions, Annexure B.
[65]    Respondent’s further submissions, Annexure A.
[66]    Respondent’s further submissions, Annexure C.
On 22 October 2021, the Tribunal sought further explanation from the Respondent in relation to the calculations provided in the consolidated tables. The Respondent provided a response on 26 October 2021 providing further information in relation to particular calculations and an amended consolidated table in relation to the bank deposits identified during audit and GST shortfall calculations. While conceding that calculation errors had arisen at various times during the review process, the Respondent submitted that overall its position had not changed with regard to the resulting GST shortfall amount of $36,616. The Applicant was provided with the additional information and given an opportunity to provide a response, however did not do so.[67]
[67] Respondent’s Response to Further Information Request.
Of particular significance, the tales showed that the total bank deposits identified at audit was $1,053,491,[68] with $227,509[69] being taxable supplies conceded by the Applicant, $454,850[70] being conceded by the Respondent not to have been taxable supplies, and taxable supplies remaining in dispute of $371,132.[71] As a result the GST shortfall calculations upon which the Respondent relies is based on taxable supplies of $598,641.[72]
[68]    Respondent’s further submissions, Annexure B, Column (D) and Respondent’s Response to Further       Information Request, Amended Annexure B, Column (D).
[69]    Respondent’s further submissions, Annexure B, Column (A) and Respondent’s Response to Further Information Request, Annexure B, Column (A).
[70]    Respondent’s Response to Further Information Request, Amended, Annexure B, Column (B).
[71]    Respondent’s further submissions, Annexure B, Column (C) and Respondent’s Response to Further Information Request, Amended Annexure B, Column (C).
[72]    Respondent’s further submissions, Annexure B, Column (E); and Respondent’s Response to Further Information Request, Amended Annexure B, Column (E).
In the Respondent’s Submissions provided a week prior to the Hearing, the Respondent took a new approach to considering the Applicant’s objection to that taken at objection and in their previously filed Statement of Facts Issues and Contentions. The Respondent submitted that the Applicant’s objection should be seen as an objection against the amended assessments that were issued on 3 April 2019 as a result of the audit rather than the amended assessments that were issued on 24 July 2019 following the informal review.[73] Consequently, the Respondent sought that the objection decision as it relates to the GST assessments for the Tax Periods (other than for the December 2017 and March 2018 quarters) should be varied to the extent of the concessions made by the Respondent on informal review and otherwise affirmed.[74]
[73] Exhibit 4, Respondent’s Submissions, pages 12-15, paragraphs 74-85.
[74] Exhibit 4, Respondent’s Submissions, page 15, paragraph 85.
The Respondent submitted that this interpretation of the Applicant’s objection is the correct interpretation on the following basis:[75]
79. Section 155-80 of Schedule 1 to the TAA provides that every amended assessment is an assessment for the purposes of any taxation law. Pursuant to s 155-90 of Schedule 1 to the TAA, a taxpayer can object against an assessment of an assessable amount if dissatisfied with the assessment.
80. Section 14ZV of the TAA sets out the limited objection rights in the case of certain taxation decisions:
If the taxation objection is made against a taxation decision, being an assessment or determination that has been amended in any particular, then a person's right to object against the amended assessment or amended determination is limited to a right to object against alterations or additions in respect of, or matters relating to, that particular.
…..
82. Read together with section 155-90 of Schedule 1 to the TAA, in the Commissioner’s view, the limited right of objection in section 14ZV imposes a requirement that an objection can only be made where the taxpayer is dissatisfied with the amended assessment.
83.The Applicant could not have been dissatisfied with the amended assessments issued on informal review, notice of which issued on 24 July 2019, as it reduced the GST shortfall amounts for each of the Relevant Quarters by a total amount of $21,685 which was a favourable outcome for the Applicant.
[75] Exhibit 4, Respondent’s Submissions, page14, paragraphs 79-83.
Based on the consolidated tables discussed at paragraphs 47 to 49 above and in particular the concessions made by the Respondent as a result of the Hearing and request for further information, the Respondent contended that the objection decision should be varied to the extent of the amounts identified in the below table:[76]
[76] Respondent’s further submissions, page 6, paragraph 33.

Tax Quarter

Increase in Taxable Supplies

GST Shortfall

1 Jul - 30 Sept 2016

$18,100

$1,645

1 Oct - 31 Dec 2016

-$6,106

-$555

1 Jan - 31 Mar 2017

$18,894

$1,717

1 Apr - 30 June 2017

$18,375

$1,670

1 Jul - 30 Sept 2017

$65,500

$5,954

1 Oct - 31 Dec 2017

$7,000

$550

1 Jan - 31 Mar 2018

$0

$0

1 Apr - 30 June 2018

$226,999

$20,636

1 Jul - 30 Sept 2018

$0

$0

1 Oct - 31 Dec 2018

$54,979

$4,998

TOTAL

$403,741

$36,616

CONSIDERATION

Each application is considered on its own merits. In matters of this kind the Applicant bears the burden of proving that the GST assessments were excessive or otherwise incorrect and what those assessments should have been.
In Bosanac v Commissioner of Taxation [2018] FCA 946, Stewart J found at [9]:[77]
The onus is on the taxpayer to prove on the balance of probabilities the extent to which an impugned assessment is excessive. Where a taxpayer fails to retain records which evidence the course of a business, or fails to create such documents, he or she may well face a great difficulty in demonstrating excessiveness. This was the very problem which the applicant faced here.
[77] Which was endorsed by the Full Federal Court and High Court in Bosanac v Commissioner of Taxation [2019] FCAFC 116 and Bosanac v Commissioner of Taxation [2019] HCA 41, respectively.
The Applicant in this matter has openly told the Tribunal that it does not have records or documents which evidence the course of its business. Mr Mustapha’s primary contention on behalf of the Applicant was that the absence of such documents does not change the facts as he states them.
The Applicant provided limited loan agreement documents, of which were not reflective of the transactions then made. It also made reference to both loans it made and it received where no loan agreements were entered into, no interest was required and described that the transactions occurred because Mr Mustapha and the other party knew each other and assisted each other with cash flow. Mr Mustapha told the Tribunal that the Applicant’s ledger accounts reflected where money was lent and where the associated interest received was attributed. He told the Tribunal that the fact that the transactions did not necessarily come from the listed entity did not change anything. Mr Mustapha said he directed funds being loaned as requested and accepted interest payments regardless of who made them.
What is evident is that there is a web of entities with a number of different people leading different groups, all of which have interacted and moved money between them. The purposes of money flow and the services that were provided in relation to that money flow is not clear.
The Tribunal made it clear at the outset of the Hearing and throughout the Hearing that the Applicant had the onus of proving that the amended assessments were excessive or otherwise incorrect and what those assessments should have been. Mr Mustapha indicated he understood. It is noted that Mr Mustapha gave evidence that he holds accounting qualifications and was aware of the reporting and record keeping obligations of the Applicant. He acknowledged that he did not keep good records on behalf of the Applicant but contended that the lack of records did not change the facts. Mr Mustapha indicated that he never expected to be audited. Given that Mr Mustapha has a higher understanding than the average taxpayer of taxation laws and obligations this was a very arrogant and risky position to take.
At Hearing it became clear that Mr Mustapha had not adequately prepared for the Hearing, to be able to explain the 7 transactions provided in his Statutory Declaration as on many occasions, he asked the Tribunal and the Respondent to remind him of the statements or information he had previously provided. As a result, Mr Mustapha needed to, on a number of occasions be taken to information he had submitted on behalf of the Applicant. Mr Mustapha told the Tribunal that the Applicant was not conceding the difference between the amount of the 7 transactions and the balance of the deposits (which was in the order of at the very least $130,000) in dispute however, was unable to tell the Tribunal which deposits the Applicant continued to dispute and why.
The Tribunal provided the Applicant with further time after the Hearing to provide such information and to provide submissions in relation to what the Applicant claims the amended assessments for the Tax Periods should be, as outlined in paragraph 43. The submission received from Mr Mustapha did not make it clear what deposits the Applicant continued to dispute and in no way assisted in providing any clarity to what the true amended GST assessment position was, if it was in fact different to that being contended by the Respondent.
The Respondent in making its post hearing submissions provided comprehensive tables outlining the changes in its position throughout the process, the deposits identified at audit and which deposits remained in dispute. Despite being provided with an opportunity to respond to those submissions, the Applicant failed to provide any further information.
It is of great concern to the Tribunal that despite his professional expertise and experience as an accountant Mr Mustapha failed to ensure that the Applicant was able to meet its obligations under relevant taxation laws and failed to provide a comprehensive statement, neither in writing nor orally at Hearing, that set out what the Applicant contended the amendment assessments for the Tax Periods should have been. It is reasonable to expect that Mr Mustapha, and as a consequence the Applicant, is in a far better position than the average taxpayer to be able to clearly articulate its GST position for the Tax Periods.
To that extent the Tribunal considers that Mr Mustapha’s evidence is unreliable and unpersuasive. He was unable to give clear evidence in relation to how the amended assessments were excessive or otherwise incorrect and what they should have been for the Tax Periods. The Tribunal notes that the Applicant did not call any witnesses to give evidence at Hearing to corroborate the assertions being made by Mr Mustapha.

The Tribunal is mindful that the evidence adduced by the Mr Mustapha on behalf of the Applicant should be considered carefully. Hill J in Imperial Bottleshops Pty Ltd and William John King Egerton v Federal Commissioner of Taxation (1991) 22 ATR 148 at 155 stated:
A taxpayer who does not keep records of his deductible outgoings faces a very difficult task. If he goes into the witness box and swears that he incurred the outgoings he is making a self-serving statement. That does not necessarily mean that he is not to be believed. Such a statement, like statements of purpose, or object or state of mind must, however, be “tested most closely, and received with the greatest caution”: Pascoe v FCT (1956) 6 AITR 315; 11 ATD 108 at 111. It would, of necessity, be a rare case indeed where a taxpayer, claiming to have expended a very large sum of money on trading stock and other business expenses, would succeed in satisfying the burden of proving that the assessment is excessive. Some other corroborative evidence would normally be required which makes it more probable than not that his sworn testimony is to be believed. It must, however, be borne in mind that the evidence of a taxpayer is not to be regarded as ‘prima facie unacceptable’, cf McCormack v FCT (1979) 143 CLR 284 at 302 per Gibbs J; 9 ATR 610; 23 ALR 583.
Considering the evidence as a whole the Tribunal agrees with the Respondent that the evidence provided by the Applicant is limited on the basis that:
a. there is a lack of independent, contemporaneous and primary source documents which should have been available to the Applicant to support its contentions;
b. the Applicant has not called any witness to corroborate its contentions;
c. the material provided on behalf of the Applicant is brief and lacks supporting evidence; and
d. that material does not accord with the evidence gathered by the Respondent in relation to where amounts being deposited in the Applicant’s bank accounts came from or where transfers out of the Applicant’s bank accounts went to.
Based on the evidence before it the Tribunal finds that the Applicant did not satisfy its onus to prove that the assessments for the Tax Periods were excessive or otherwise incorrect and what the correct assessments should be.
The Tribunal accepts the Respondent’s contention that the Applicant’s objection in this matter should be taken to be an objection to the amended assessments issued as a result of the audit findings. The Tribunal notes that should it not do so, by virtue of the operation of section 14ZV of the TAA 1953 the Applicant’s right to object would be limited to the alterations made in respect of the particulars amended by the amended assessments that resulted from the objection process. This would clearly be contrary to the Applicant’s intentions at the time of making its objection.
Resulting from the evidence provided at Hearing and the contentions made by the Respondent in its post hearing submissions the Tribunal accepts the Respondent’s concessions that the three deposits (relating to an amount of $200 and the deposits that were discussed in reference to Transaction 5)[78] should not be considered to be taxable supplies made by the Applicant in the December 2016 and March 2018 quarters respectively. Further the Tribunal accepts that the Respondent is not seeking to correct the minor calculation errors in relation to the GST Shortfall amounts, as being appropriate, noting they are in the taxpayers favour (this particularly affects the deposits assessed as additional taxable supplies and the GST shortfall amount for the December 2018 quarter).
[78] As set out in the Respondent’s further submissions.
Consequently, based on the findings set out above, the Tribunal:
(a)
affirms the reviewable objection decision in relation to the September 2016,

March 2017, June 2017, September 2017, June 2018 and September 2018 quarters meaning that the amended assessments made on 3 April 2019 are to be varied to the extent set out in the Respondent’s informal review decision and as outlined in the table provided at paragraph 52 above.
(b)varies the reviewable objection decision in relation to the December 2016 quarter to allow for a further reduction of the taxable supplies of $200, meaning that the amended assessment made on 3 April 2019 is to be varied to the extent set out in the Respondent’s informal review decision together with the further reduction to the assessable taxable supplies, in the amounts outlined in the table provided at paragraph 52 above.
(c)affirms the reviewable objection decision in relation to the December 2017 quarter meaning that the amended assessment made on 3 April 2019 is to be varied to the extent set out in the Respondent’s informal review decision and objection decision and as outlined in the table provided at paragraph 52 above.
(d)varies the reviewable objection decision in relation to the March 2018 quarter to allow for a further reduction of taxable supplies of $4,997, meaning that the amended assessment made on 3 April 2019 is to be varied to the extent set out in the Respondent’s informal review decision, objection decision and this further reduction to the assessable taxable supplies, as outlined in the table provided at paragraph 52 above.
(e)varies the reviewable objection decision in relation to the December 2018 quarter to allow for a further reduction of taxable supplies of $271, meaning that the amended assessment made on 3 April 2019 is to be varied to the extent set out in the Respondent’s informal review decision and this further reduction to the assessable taxable supplies, as outlined in the table provided at paragraph 52 above.
CONCLUSION
Based on the evidence before it the Tribunal finds that the Applicant has failed to discharge its onus to prove that the amended assessments for the Tax Periods were excessive or otherwise incorrect and what those assessments should have been.
The Tribunal accepts the submissions made by the Respondent in relation to the amended assessments to which the objection should be taken to apply and the concessions made by the Respondent in its submissions filed after the Hearing. Consequently, the Tribunal affirms and varies the reviewable objection decision to the extent outlined in paragraph 68 above so that the amended assessments made on 3 April 2019 for the Tax Periods are to be amended to reflect the amounts identified in the table provided at paragraph 52 of this decision.

I certify that the preceding 71 (seventy-one) paragraphs are a true copy of the reasons for the decision herein of Member D Mitchell

...........................[SGD].................................
Associate
Dated: 28 October 2021

Date of hearing:

Date of last submission:

25 August 2021

26 October 2021

Applicant: Mr Mohammad Mustapha

Solicitors for the Respondent:
Ms Azra Koch

Australian Taxation Office

Tax Quarter	Increase in Taxable Supplies	GST Shortfall
1 Jul - 30 Sept 2016	$18,100	$1,645
1 Oct - 31 Dec 2016	-$6,106	-$555
1 Jan - 31 Mar 2017	$18,894	$1,717
1 Apr - 30 June 2017	$18,375	$1,670
1 Jul - 30 Sept 2017	$65,500	$5,954
1 Oct - 31 Dec 2017	$7,000	$550
1 Jan - 31 Mar 2018	$0	$0
1 Apr - 30 June 2018	$226,999	$20,636
1 Jul - 30 Sept 2018	$0	$0
1 Oct - 31 Dec 2018	$54,979	$4,998
TOTAL	$403,741	$36,616