Sunlea Enterprises Pty Ltd As Trustee for Drummond Cove Unit Trust and Commissioner of Taxation (Taxation) - [2018] AATA 2792

Sunlea Enterprises Pty Ltd As Trustee for Drummond Cove Unit Trust and Commissioner of Taxation (Taxation) [2018] AATA 2792 (2 August 2018)
Division:TAXATION & COMMERCIAL DIVISION
File Number: 2017/0089
Re:Sunlea Enterprises Pty Ltd As Trustee for Drummond Cove Unit Trust
APPLICANT

AndCommissioner of Taxation
RESPONDENT

DECISION
Tribunal:Senior Member Dr M Evans
Date:2 August 2018
Place:Perth

The Reviewable Decision of the Respondent dated 8 November 2016 is affirmed.
...[sgd].....................................................................
Senior Member Dr M Evans
CATCHWORDS
Goods and Services Tax (GST) – whether creditable acquisitions pursuant to section 11-5 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act) – whether Applicant entitled to claim input tax credit – carrying on an enterprise – tax invoices - property development – project management - whether invoices for unrecouped project costs evidence the making of taxable supplies – joint venture heads of agreement – burden of proof - reviewable decision affirmed
LEGISLATION
A New Tax System (Goods and Services Tax) Act 1999 (Cth), s 9-5, s 9-15, s 9-20(1)(a), s 11-5, s 11-10(1),(2) and (3), s 11-15(1), s 11-20, s 11-25, s 29-10(1), s 29-10(1A), s 29-10(3), s 29-70(1), s 29-70(1B), s 195-1,
A New Tax System (Goods and Services Tax) Regulations 1999 (Cth) - superseded, r 29-70.01(2)
Administrative Appeals Tribunal Act 1975 (Cth), s 25(1), s 37(1AB), s 43
Corporations Act 2001 (Cth), s 237(2), s 436A,
Taxation Administration Act 1953 (Cth), Part IVC, s 14ZL(1), s 14ZY(1) and (2), s 14ZZ(1)(a)(i), s 14ZZJ, s 14ZZK, 14ZZO, s 14ZQ,
Transfer of Land Act (WA)
Trustees Act 1962 (WA), s 71
CASES
Bayconnection Property Developments Pty Ltd and Ors and Commissioner of Taxation [2013] AATA 40
Crown Estates (Sales) Pty Ltd v Commissioner of Taxation [2016] FCA 335
Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614
Federal Commissioner of Taxation v MBI Properties Pty Ltd (2014) 254 CLR 376
Franknelly Nominees Pty Ltd v Abrugiato [2013] WASCA 285
Gashi v Federal Commissioner of Taxation (2013) 209 FCR 301; [2013] FCAFC 30
Gauci v Federal Commissioner of Taxation [1975] HCA 54; (1975) 135 CLR 81
GH1 Pty Ltd, in Liquidation and Commissioner of Taxation [2017] AATA 1063
Hardoon v Belilios [1901] AC 118
HP Mercantile Pty Ltd v Commissioner of Taxation (2005) 143 FCR 553
Jones v Dunkel (1959) 101 CLR 298
Kemtron Industries Pty Ltd v Commissioner of Stamp Duties (Qld) [1984] 1 Qd R 576
Re Wodonga Pharmacy Pty Ltd and Australian Community Pharmacy Authority [2014] AATA 496
Richard Walter Pty Ltd v Commissioner of Taxation (1996) 67 FCR 243
Rio Tinto Services Limited v Federal Commissioner of Taxation (2015) 235 FCR 159; [2015] FCAFC 117
Sunlea Enterprises Pty Ltd as Trustee for Drummond Cove Unit Trust v Pollock & Ors [2014] WASCA 91
Worrall v Harford [1802] EngR 342; (1802) 8 Ves Jun 4; 32 ER 250
SECONDARY MATERIALS
Goods and Services Tax Ruling GSTR 2000/17W, paragraph 63
Goods and Services Tax Determination GSTD 2004/4, paragraph 2
Cooper G and Vann R, “Implementing the Goods and Services Tax” (1999) 21 Sydney Law Review 337
REASONS FOR DECISION
Senior Member Dr M Evans
2 August 2018
THE APPLICATION

This is an application for the review of a decision of the Respondent dated 8 November 2016 (Exhibit R2, T1/T40 and T2), which disallowed the Applicant’s objection against an amended assessment for the quarterly tax period from 1 October 2012 to 31 December 2012.
Essentially, the dispute between the parties concerns the validity of two invoices, charged to the Drummond Cove Unit Trust (DCUT) by Sandpiper Asset Pty Ltd (Sandpiper). A description of the invoices is as follows:
(a)An invoice dated 15 June 2010 for “unrecouped project costs 2006 to 2010” for the total amount of $12,017,901.50 which includes $1,092,536.50 GST (Exhibit R2, T17, page 118); and
(b)An invoice dated 30 June 2010 for “unrecouped project costs 2006 to 2010” for the total amount of $18,997,489.28 which includes $1,727,044.48 GST (Exhibit R2, T17, page 119).
These will be referred to as “the Disputed Invoices”. Both the Disputed Invoices were numbered 16. The Applicant submits that the doubling up of this numbering occurred in error (Exhibit A2, para [15]).
The amount in dispute is the total GST payable under the Disputed Invoices, being $2,819,581.00, which the Applicant argues that it should be allowed to claim as an input tax credit (Exhibit R2, T1, page 3).
DCUT and Sandpiper were related parties, with Mr Philippe Steinier (Mr Steinier) being a Director of both Sandpiper and Sunlea Enterprises Pty Ltd (Sunlea) (the trustee for the DCUT) as at the date of the invoices (T12). Further details about the Directors of the companies involved in this matter are detailed in the Background section below.
PRELIMINARY
The following background has been compiled from various materials before the Tribunal including the materials detailed in the section below named “material before the Tribunal”.
The Tribunal has also referred to the interlocutory decision of the Supreme Court of Western Australia, regarding security for costs, Sunlea Enterprises Pty Ltd as Trustee for Drummond Cove Unit Trust v Pollock & Ors [2014] WASCA 91, which, as noted by the Applicant in paragraph [10] of its Statement of Facts, Issues and Contentions (Exhibit A2) contains some factual information. The Supreme Court decision also references some details of the DCUT and its various trustees from time to time, which the Tribunal has referred to because the Applicant did not produce the document by which the DCUT was created, and no evidence was led as to the terms of the DCUT.
BACKGROUND
As noted in the reported Supreme Court decision, the DCUT was created in June 2004 (Exhibit R1, para [4]; WASC 91, at [18]). 200 units were issued in the DCUT. Mr Steinier as trustee for the Pilou Trust held 50% of the issued units, and Betts Nominees Pty Ltd (Betts Nominees) owned the other 50% of the issued units (Exhibit R1, para 4; see [2014] WASC 91, at [6]).
The trustee of the DCUT has been registered for GST since 20 June 2004 (Exhibit R2, T2, page 5).
Betts Nominees was owned by Trevor Betts and his wife (Exhibit R1, para 5; [2014] WASC 91, at [5]).
On 20 December 2004, Diamo Nominees Pty Ltd (Diamo), as the initial trustee for the DCUT, became the registered proprietor of a large plot of vacant land in Glenfield and Drummond Cove near Geraldton, Western Australia (Exhibit A1, para [16] and annexure RH-1). The land comprised approximately 220 hectares, and was acquired for the purpose of subdivision and sale as vacant residential lots (Exhibit A2, para [5]; Exhibit R1, para [9]).
The Directors of Diamo were Trevor Betts and Mr Steinier (T10, page 59-60), with only one issued share held by Mr Steinier (Exhibit R1, para 6; [2014] WASC 91, at [8]).
Diamo borrowed $5,950,000 from the Bank of Western Australia to acquire the land (Exhibit R1, para 11; [2014] WASC 91, at [21]).
Diamo was the trustee of the DCUT from 20 June 2004 to 17 July 2007 (R1, para [6]).
On 13 August 2005, Dreamview Investments Pty Ltd in its own capacity and as trustee for the Dreamview Trust (Dreamview), Diamo in its own capacity and as trustee for the DCUT, and Sandpiper Asset Pty Ltd (Sandpiper), entered into a “Heads of Agreement” (Heads of Agreement) to create a joint venture to develop and sell the land (Annexure RH-3 to Exhibit A1). Under this Heads of Agreement, Diamo and Dreamview were the joint venturers and Sandpiper was described as the “Trustee”. On 21 September 2005, the parties executed a deed of variation (Annexure RH-6 to Exhibit A1).
Clause 6.1(a) of the Heads of Agreement provided for the appointment of a management committee comprising two representatives each from Diamo and Dreamview.
The Heads of Agreement provided that, on a date to be agreed by the management committee, the joint venturers would appoint a project manager to exclusively manage the project on terms to be set out in a project management agreement (Clause 3(a) and Reference Schedule para 5, Heads of Agreement). Clause 3(b) provided that “The duties, roles, responsibilities, liabilities and functions of the Manager will (sic) set out in the Project Management Agreement.”
Clause 1.1 of the Heads of Agreement states, “Project Management Agreement means the project management agreement to be made between the Joint Venturers and the [Project] Manager and which must be in form and substance satisfactory to the Joint Venturers”.
No formal project management agreement, as envisaged by the Heads of Agreement, was made. The terms of the proposed project management agreement were not set out in the Heads of Agreement. There was no other document before the Tribunal setting out the terms of the proposed project management agreement. The Applicant claims that Diamo and Dreamview appointed Sandpiper to be the project manager (Exhibit A2, para [8]). Specifically, terms regarding the functions and obligations of the project manager and, more importantly, the basis of the remuneration to be paid to the project manager, are not set out in any documents put into evidence, and nor were they addressed in the oral evidence presented by the Applicant.
Recital D of the Heads of Agreement dated 13 August 2005 states, “At the request of Diamo and Dreamview, the Trustee [Sandpiper] has agreed to hold the Joint Venture Property on trust as bare trustee for the Joint Venturers on the terms and conditions in this document.”
Clause 2.4 of the Heads of Agreement dated 13 August 2005 provides as follows:
2.4 Trustee for Joint Venturers
(a) Diamo must, as soon as practicable after the date of this document, do everything necessary to:
(i) help Dreamview refinance Diamo’s Debt in the way contemplated by clause 2.1(a) of schedule 1; and
(ii) transfer to the Trustee (on the basis that the directors and shareholders of the Trustee are or will be only the Joint Venturers or Members of the Management Committee, equally), to hold on trust for Diamo, pursuant to the Declaration of Trust, all Diamo’s estate and interest in and to the Land.
(b) The shares in the Trustee will be held equally by Diamo and Dreamview.
(c) Each of Diamo and Dreamview will be entitled to appoint 2 directors to the board of the Trustee.
(d) By its execution of this document, the Trustee agrees to act as the trustee for Diamo in the way contemplated by clause 2.4 and to be bound by this document as if it was Diamo.
(e) Diamo and Dreamview agree that they:
(i) may each lodge an absolute caveat over the Land to protect their respective interests in the Land and the Project; and
(ii) will, if reasonably asked to do so by the Management Committee, withdraw their caveat to allow Diamo or the Trustee to deal with the Land for the purposes of the Subdivision only, provided that, immediately after the relevant dealing, they may immediately relodge that caveat, at their sole cost and expense.
No separate written declaration of Trust was signed (Exhibit R1, para [22]).
James Freemantle and Michael Lurie were the Directors of Sandpiper from 5 August 2005 until 16 March 2007. Mr Steinier was a Director from 1 September 2005 to 2 January 2014. Trevor Betts was a Director from 1 September 2005 until 6 October 2008. Carina Lee-Anne Healey was a Director from 16 March 2007 until 22 June 2007. Daniel Gauthier was a Director from 3 August 2010 to 4 August 2010, and Kevin Healey was a Director from 16 March 2007 until 2 January 2014 (Exhibit R2, T12, page 80).
Sandpiper had 4 issued shares, with 2 shares held by Dreamview and 2 shares held by Sunlea (Exhibit R2, T12, page 83; Exhibit R1, para [13]).
Michael Lurie and James Freemantle were Directors of Dreamview from 5 August 2005 until 16 March 2007. From 16 March 2007, Kevin Healey was the sole Director and Secretary of Dreamview (T13).
Playstar Holdings Pty Ltd (Playstar) was the trustee of the DCUT from 17 July 2007 until approximately 13 November 2007 ([2014] WASC 91, at [15] and [20]). From 30 November 2006, the Directors of Playstar were Mr Steinier and Trevor Betts, with only one issued share held by Mr Steinier (Exhibit R2, T11, page 69 - 72, Exhibit R1, para [7])
From 13 November 2007, Sunlea became the trustee of the DCUT (R1, para [8]; [2014] WASC 91, at [20]). The Directors of Sunlea were Mr Steinier (appointed 10 March 2009) and Trevor Betts (appointed 11 March 2009). The previous sole Director and Secretary of Sunlea was Rick Gavin Hopkins (from 16 October 2007 to 10 March 2009) who was Mr Steinier’s accountant (Exhibit R2, T9, page 51-52).
Sandpiper became the registered proprietor of the land in August 2005, and on 25 August 2005 Walthamstow Pty Ltd (Walthamstow) advanced funds to Sandpiper which were secured by a registered mortgage. On 27 December 2006, Troika Capital Pty Ltd (Troika) advanced funds to Sandpiper which were also secured by a registered mortgage. On 5 November 2007, Walthamstow and Troika advanced additional funds to Sandpiper which were also secured by registered mortgages (Exhibit R1, para 32-34).
In the course of the project, Sandpiper issued a series of 17 invoices to the DCUT (Exhibit R2, T17, page 103 - 119), including the Disputed Invoices, which the Applicant submitted were for costs incurred during the management of the project, including costs that Sandpiper incurred to third parties, plus a margin for Sandpiper (transcript, page 5; Exhibit A2, para [11]; para [33] Applicant’s closing submissions).
Of these 17 invoices, 15 invoices were issued between 30 June 2007 and 30 June 2009 (T17, page 103 – 117), and the Applicant claimed the GST components of these as input tax credits in business activity statements lodged prior to 30 June 2010. There is no dispute in relation to the Applicant’s entitlement to input tax credits for these 15 invoices.
Sandpiper did not claim the GST component of the Disputed Invoices (dated 15 June 2010 and 30 June 2010) in any of its Business Activity Statements (Exhibit R1, para [42]).
On 1 December 2008, a deed was executed between Walthamstow and Troika (Mortgagees) and Sandpiper (Deed) under which Sandpiper acknowledged it was in default under the mortgages and irrevocably authorised Walthamstow and Troika to proceed with a mortgagee sale, including the completion of settlement of the sale of the land (Annexure RH-6 to Exhibit A1, clause 1, 2 and 3 of Deed).
The powers of the Mortgagees were set out in clause 4 of the Deed. In addition to those set out in the mortgage documents and those arising under the Transfer of Land Act (WA) (clause 4(a) of Deed), these were expressed to include a list of 15 powers (clause 4(b) of the Deed), including:
(a)the power “to market and advertise the land for sale in such manner as the Mortgagees may in their absolute discretion determine” (clause 4(b)(iii));
(b)“to expend such funds as the Mortgagees may in their absolute discretion determine to advertise, promote, or improve the land…”” (clause 4(b)(iv));
(c)to appoint agents to sell the land (clause 4(b)(viii));
(d)“appoint a solicitor, accountant, valuer, surveyor, settlement agent or other professionally qualified person to assist in the sale of the Land” (clause 4(b)(ix));
(e)“to do all acts and execute all documents necessary with respect to the sale of the Land” (clause 4(b)(xi));
(f)“enter into and complete any contract for the sale of any parts of the Land” (clause 4(b)(xii));
(g)“subdivide and sell separately part of the Land” (clause 4(b)(xiii)); and
(h)“to sell the lots that comprise the Land in such numbers or as a whole as the Mortgagees shall see fit” (clause 4(b)(xiv)).
The remaining land was sold on 4 June 2010, and the proceeds of sale were applied to discharge Sandpiper’s liabilities to the Mortgagees in full (T4, page 22).
The Applicant submitted that payment of the Disputed Invoices was made by way of a set-off whereby Sandpiper debited, and the Applicant credited, the amount of the invoices in the books for their respective loan accounts. Although the set-off was against Sandpiper and the Applicant’s loan accounts, there was no formal written loan agreement between them (T39, page 266). The details of this set-off are discussed in further detail below (Exhibit A1, para [25]-[27].
On 3 August 2010, Dino Travaglini was appointed Administrator of Sandpiper under s 436A of the Corporations Act2001 (the Corporations Act). On 7 September 2010 at a meeting of the creditors of Sandpiper, it was resolved that Sandpiper be wound up, and Dino Travaglini be appointed as liquidator (T5, page 29-30).
At this meeting the liquidator accepted all claims for voting purposes only, including a claim from the Applicant for $12,873,092 (T5, page 27). The Respondent reported that, “… discussions with the liquidator… and perusal of the Sandpiper documents under the control of the liquidator provided no reference to the invoices in question or to any details of a loan between DCUT and Sandpiper…” (Exhibit R2, T2, page 14), and the Applicant was not asked by the liquidator to contribute to the liquidation in respect of the Disputed Invoices (Exhibit R1, para [47]). The Applicant submitted that this was because the invoices had been paid by the Applicant (Closing submission of the Applicant dated 23 April 2018, paragraph 21).
Sandpiper was deregistered on 2 January 2014 (T12, page 78).
The Applicant lodged a business activity statement on 30 June 2014 for the tax period from 1 October 2012 to 31 December 2012. In it, the Applicant claimed input tax credits in the amounts of $1,092, 536.50 and $1,727,044.48, amounting to a total of $2,819,580.98 (T19, page 123 and 139).
By a Notice of Amended Assessment dated 28 September 2015, the Respondent amended the Applicant’s assessment for the tax period from 1 October 2012 to 31 December 2012 to disallow the input tax credits, which resulted in a debit adjustment of $2,819,581 (T30, page 196-197).
On 7 April 2016 the Applicant objected to the Notice of Amended Assessment (T31-T38, page 198-265).
By a “Notice of Objection Decisions” (sic) dated 8 November 2016 (Exhibit R2, T1/T40 and T2) (the Reviewable Decision), the Respondent disallowed the Applicant’s objection of 7 April 2016.
On 5 January 2017, the Applicant made an application to the Taxation and Commercial Division of the Administrative Appeals Tribunal (Tribunal) for review of the Reviewable Decision (Exhibit R2, T1).
In addition to these Tribunal proceedings, there are also ongoing proceedings in the Supreme Court of Western Australia filed by the Applicant against Dreamview Investments Pty Ltd, and others, including Jamie Kevin Pollock, Kevin Healy, Trevor Betts, Michael Lurie, James Freemantle, Walthamstow Pty Ltd, Troika Capital Pty Ltd and others for damages for breach of contract and equitable compensation for the tort of conspiracy to cause economic harm (see generally [2014] WASC 91 and Applicant’s Closing Submissions, para [61]). Mr Steinier obtained leave of the Court to bring the proceedings in Sunlea’s name pursuant to s 237(2) of the Corporations Act ([2014] WASC 91, para [4]).
ISSUE BEFORE THE TRIBUNAL
The issue for determination by the Tribunal was similarly identified by both the Applicant and the Respondent in their Statements of Facts, Issues and Contentions (Exhibit A2 and Exhibit R1 respectively), and concerns whether the Applicant is entitled to claim input tax credits for the amounts of GST in the Disputed Invoices (a rounded total of $2,819,581).
The primary issue is whether the Applicant made creditable acquisitions (pursuant to section 11-5 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act) in respect of the Disputed Invoices.
JURISDICTION
The Tribunal has the power to review a decision if an enactment authorises the Tribunal to do so (s 25(1), Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act)).

Part IVC of the Taxation Administration Act 1953 (Cth) (TAA) concerns taxation objections, reviews and appeals. Section s 14ZL(1) of the TAA sets out when Part IVC applies:
(1) This Part applies if a provision of an Act or of regulations (including the provision as applied by another Act) provides that a person who is dissatisfied with an assessment, determination, notice or decision, or with a failure to make a private ruling, may object against it in the manner set out in this Part.
(2) Such an objection is in this Part called a taxation objection.
Under s 14ZY of the TAA, the Commissioner decides taxation objections. The Commissioner must decide, under s 14ZY(1) of the TAA whether to allow the taxation objection, wholly, or in part, or to disallow it. This is an objection decision (s 14ZY(2) of the TAA).
Section 14ZZ(1)(a)(i) of the Taxation Administration Act 1953 (Cth) (TAA), provides that a person who is dissatisfied with a reviewable objection decision made by the Commissioner may apply to the Tribunal for a review of that decision, or appeal to the Federal Court against the decision.
Section 14ZQ of the TAA defines “reviewable objection decision” as “an objection decision that is not an ineligible income tax remission decision.” This decision is not an ineligible income tax remission decision.
In this matter, the Applicant is dissatisfied with the Reviewable Decision (being a decision of the Respondent to disallow the Applicant’s objection to the Notice of Amended Assessment). Accordingly, the Tribunal is satisfied that it has jurisdiction to review the Reviewable Decision.
Section 43 of the AAT Act applies to the review of a reviewable objection decision (s 14ZZJ of the TAA), and empowers the Tribunal to affirm or vary the decision under review, or alternately to set aside the decision under review and substitute a new decision, or remit the matter for reconsideration.
MATERIAL BEFORE THE TRIBUNAL
The application was heard by the Tribunal on 9 April 2018. Mr J Leek appeared for the Applicant, and Mr C Slater appeared for the Respondent.
Mr Rick Gavin Hopkins (Mr Hopkins), a Chartered Accountant, a Partner at PKF Lawler Chartered Accountants and registered tax agent for the Drummond Cove Unit Trust (DCUT), was called as a witness by the Applicant, and gave evidence to the Tribunal in person. In his witness statement (Exhibit A1), Mr Hopkins stated that he had provided accounting, tax and business advisory services to the trustee of DCUT since its establishment, as well as to Sandpiper. Mr Hopkins also stated that he was secretary of Diamo (from 2 November 2007 to 30 December 2009), Playstar (from 2 November 2007 to 4 April 2011) and a Director and secretary of Sunlea (from 16 October 2007 to 10 March 2009) (Exhibit A1, para [9]-[14]). Mr Hopkins was also the accountant for Mr Steinier, and described himself as taking an interest in Sandpiper due to representing Sunlea (transcript, page 29-30), until the third quarter of 2009 when he undertook an accounting advisory role for Sandpiper.
No other witnesses were called by either party.
The following documents were before the Tribunal:
(a)witness statement of Rick Gavin Hopkins dated 20 October 2017 (7 pages) with annexures RH1 to RH9) (Exhibit A1);
(b)the Applicant’s Statement of Facts, Issues and Contentions dated 20 October 2017 (Exhibit A2);
(c)letter addressed to The Trustee for Drummond Cove Unit Trust from the Australian Taxation Office titled “Completion of Audit” dated 2 October 2008 (Exhibit A3);
(d)letter addressed to The Public Officer, Sandpiper Asset Pty Ltd from the Australian Taxation Office titled “Interim Report” dated 17 August 2010 (Exhibit A4);
(e)letter addressed to The Trustee for Drummond Cove Unit Trust from the Australian Taxation Office titled “Completion of Audit” dated 20 November 2012 (Exhibit A5);
(f)the Respondent’s Statement of Facts, Issues and Contentions dated 25 August 2017 (Exhibit R1); and
(g)the Respondent’s s 37(1AB) documents (“T-documents”) containing documents T1 to T40 (Exhibit R2).
Subsequent to the hearing, the parties submitted the following written closing submissions, which the Tribunal has also considered:
(a)Closing Submission from the Applicant dated 23 April 2018;
(b)Closing Submission from the Respondent, undated but filed on 7 May 2018;
(c)Closing Submission in Reply from the Applicant dated 14 May 2018.
LEGISLATIVE FRAMEWORK
In Crown Estates (Sales) Pty Ltd v Commissioner of Taxation [2016] FCA 335, Logan J provided the following summary of the general scheme of GST at [26] – [27]:
[26] A general summary of the scheme of taxation found in the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act) is offered by the High Court in Federal Commissioner of Taxation v MBI Properties Pty Ltd (2014) 254 CLR 376 at 382, [3] (MBI Properties):
Under the GST Act, an entity is liable to pay GST on any “taxable supply”, and is entitled to an input tax credit on any “creditable acquisition”. For each tax period applicable to the entity, amounts of GST are set off against amounts of input tax credits to produce a net amount, which may then be subject to adjustments. The net amount, as adjusted, is the amount which the entity must pay to the Commonwealth, or which the Commonwealth must pay to the entity, in respect of the period.
[27] Further elaboration of the general scheme of the GST act is to be found in Rio Tinto Services Limited v Federal Commissioner of Taxation (2015) 235 FCR 159 ; [2015] FCAFC 117 (Rio Tinto) at [3], where the Full Court stated:
The general scheme of the GST Act is to impose tax upon the supply of goods and services. The burden of the tax is designed to fall upon the ultimate consumer by a system of invoice-based credits: see HP Mercantile Pty Ltd v Commissioner of Taxation (2005) 143 FCR 553 at [13]; Cooper G and Vann R, “Implementing the Goods and Services Tax” (1999) 21 Sydney Law Review 337 at 347–8. The Australian GST is a multi-staged tax in the sense that it is imposed on every supply of goods and services (unless it is GST-free or input taxed) but, generally speaking, each supplier in the chain will be entitled to a credit for the GST imposed upon the preceding supply until the final supply to the consumer who is not entitled to a credit. The supply of some goods and services, however, is treated differently. Some supplies are GST-free and some are input taxed. The latter effectively treat the business purchaser who supplies goods and services to others as if the business purchaser was the consumer of the goods and services. The final supply of goods and services which are input taxed is not subject to GST but the supplier will be entitled to credits except to the extent that the acquisitions related to supplies that would be input taxed: see s 11–15(2)(a) and HP Mercantile at [46] and [50].
Logan J noted that the general scheme of GST involved a system of “invoice-based credits”, citing Hill J in HP Mercantile Pty Ltd v Commissioner of Taxation (2005) 143 FCR 553. The relevant passage, at [13], is as follows:
The genius of a system of value added taxation, of which the GST is an example, is that while tax is generally payable at each stage of commercial dealings (supplies) with goods, services or other “things”, there is allowed to an entity which acquires those goods, services or other things as a result of a taxable supply made to it, a credit for the tax borne by that entity by reference to the output tax payable as a result of the taxable supply. That credit, known as an input tax credit, will be available, generally speaking, so long as the acquirer and the supply to it (assuming it was a “taxable supply”) satisfied certain conditions, the most important of which, for present purposes, is that the acquirer make the acquisition in the course of carrying on an enterprise and thus, not as a consumer. The system of input tax credits thus ensures that while GST is a multi-stage tax, there will ordinarily be no cascading of tax. It ensures also that the tax will be payable, by each supplier in a chain, only upon the value added by that supplier.
Section 11-20 of the GST Act states, “You are entitled to the input tax credit for any *creditable acquisition that you make”.
Further, s 11-25 of the GST Act provides, in part, “The amount of the input tax credit for a *creditable acquisition is an amount equal to the GST payable on the supply of the thing acquired…”
Section 11-5 of the GST Act, titled, “What is a creditable acquisition?” provides:
You make a creditable acquisition if:
(a) you acquire anything solely or partly for a *creditable purpose; and
(b) the supply of the thing to you is a *taxable supply; and
(c) you provide, or are liable to provide, *consideration for the supply; and
(d) you are *registered, or *required to be registered.
Section 11-10 of the GST Act defines an acquisition broadly, as follows:
(1) An acquisition is any form of acquisition whatsoever.
(2) Without limiting subsection (1), acquisition includes any of these:
(a) an acquisition of goods;
(b) an acquisition of services;
(c) a receipt of advice or information;
(d) an acceptance of a grant, assignment or surrender of *real property;
(e) an acceptance of a grant, transfer, assignment or surrender of any right;
(f) an acquisition of something the supply of which is a *financial supply;
(g) an acquisition of a right to require another person:
(i) to do anything; or
(ii) to refrain from an act; or
(iii) to tolerate an act or situation;
(h) any combination of any 2 or more of the matters referred to in paragraphs (a) to (g).
(3) However, acquisition does not include:
(a) an acquisition of *money unless the money is provided as *consideration for a supply that is a supply of money or *digital currency; or
(b) an acquisition of digital currency unless the digital currency is provided as consideration for a supply that is a supply of digital currency or money.
Section 11-15(1) of the GST Act provides, in part, that, “You acquire a thing for a creditable purpose to the extent that you acquire it in * carrying on your * enterprise”.
Section 9-20(1)(a) of the GST Act provides that, “An enterprise is an activity, or series of activities, done: (a) in the form of a *business…”.
Section 195-1 of the GST Act states, ““carrying on” an *enterprise includes doing anything in the course of the commencement or termination of the enterprise.” (bold in original)
Section 195-1 also states, ““business” includes any profession, trade, employment, vocation or calling, but does not include occupation as an employee.” (bold in original)
As noted above, GST is payable on “taxable supplies”, which are defined in s 9.5 of the GST Act as follows:
You make a taxable supply if:
(a) you make the supply for *consideration; and
(b) the supply is made in the course or furtherance of an *enterprise that you *carry on; and
(c) the supply is *connected with the indirect tax zone; and
(d) you are *registered, or *required to be registered.
However, the supply is not a *taxable supply to the extent that it is *GST‑free or *input taxed.
Consideration is defined in s 9-15 of the GST Act as follows:
(1) Consideration includes:
(a) any payment, or any act or forbearance, in connection with a supply of anything; and
(b) any payment, or any act or forbearance, in response to or for the inducement of a supply of anything.
(2) It does not matter whether the payment, act or forbearance was voluntary, or whether it was by the *recipient of the supply.
Section 29-10(1) of the GST Act provides that:
(1) The input tax credit to which you are entitled for a * creditable acquisition is attributable to:
(a) the tax period in which you provide any of the * consideration for the acquisition; or
(b) if, before you provide any of the consideration, an * invoice is issued relating to the acquisition--the tax period in which the invoice is issued.
Further, s 29-10(3) is a further requirement that the taxpayer must hold a tax invoice for a creditable acquisition at the time when the GST return is lodged. It provides:
(3) If you do not hold a * tax invoice for a * creditable acquisition when you give to the Commissioner a * GST return for the tax period to which the input tax credit (or any part of the input tax credit) on the acquisition would otherwise be attributable:
(a) the input tax credit (including any part of the input tax credit) is not attributable to that tax period; and
(b) the input tax credit (or part) is attributable to the first tax period for which you give to the Commissioner a GST return at a time when you hold that tax invoice.
Section 29-70(1) of the GST Act sets out what is required for a document to be a valid tax invoice. This section was amended on 1 July 2010. The parties have agreed, and the Tribunal concurs, that with respect to the Disputed Invoices, the applicable legislation is that in effect at the time the invoices were issued (30 June 2010) (see “Reasons for Decision”, Exhibit R2, T2, page 6). At this time, s 29-70(1) of the GST Act read as follows:
(1) A tax invoice for a *taxable supply:
(a) must be issued by the supplier, unless it is a *recipient created tax invoice (in which case it must be issued by the *recipient); and
(b) must set out the ABN of the entity that issues it; and
(c) must set out the *price for the supply; and
(d) must contain such other information as the regulations specify; and
(e) must be in the *approved form.
However, the Commissioner may treat as a tax invoice a particular document that is not a tax invoice.
Regulation 29-70.01(2) of the A New Tax System (Goods and Services Tax) Regulations 1999 (Cth) (Regulations), which was in effect as at 30 June 2010, stated:
(2)   If the total amount, including GST, payable for the supply or supplies to which the tax invoice relates is $1 000 or more, the tax invoice must contain the following information:
(a)    the words ‘tax invoice’ stated prominently;
(b)    the date of issue of the tax invoice;
(c)    the name of the supplier;
(d)    the name of the recipient;
(e)    the address or the ABN of the recipient;
(f)    a brief description of each thing supplied;
(g) for each description, the quantity of the goods or the extent of the           services supplied.
Paragraph 63 of the Goods and Services Tax Ruling GSTR 2000/17W, which was withdrawn with effect from 25 May 2011, but which was in effect as at 30 June 2010, is titled, “Description of each thing supplied” and states:
A tax invoice must include a description of each thing supplied. The description must be sufficient to identify what was supplied. This will help to establish whether it is a creditable acquisition for the recipient.
In GH1 Pty Ltd, in Liquidation and Commissioner of Taxation [2017] AATA 1063 (GH1), Deputy President McCabe and Senior Member Walsh stated, at [43]-[44]:
…The mere existence of a “tax invoice” is not, by itself, sufficient to establish that a “taxable supply” (under s 9-5 of the GST Act) and corresponding “creditable acquisition” (under s 11-5 of the GST Act), has, in fact, occurred.
44.As DP Frost commented in Bayconnection Property Developments Pty Ltd and Ors and Commissioner of Taxation [2013] AATA 40, at [86]:
...the reality is that a tax invoice does not create a taxable supply; it records one. If a taxable supply did not take place, then a “tax invoice” is meaningless. In other words, documents that are so called “tax invoices” cannot substantiate a creditable acquisition, if in fact there was no supply or acquisition. It must follow that the scrutiny of transactions is always essential, particularly transactions between related parties. [emphasis added]
More generally, s 14ZZK of the Taxation Administration Act 1953 (Cth) (TAA), provides:
On an application for review of a reviewable objection decision:
(a) the applicant is, unless the Tribunal orders otherwise, limited to the grounds stated in the taxation objection to which the decision relates; and
(b) the applicant has the burden of proving:
(i) if the taxation decision concerned is an assessment—that the assessment is excessive or otherwise incorrect and what the assessment should have been; or
(ii) in any other case—that the taxation decision concerned should not have been made or should have been made differently.
Further, in GH1, Deputy President McCabe provided the following explanation about the burden of proof (at [39] – [42]):
39. With respect, this submission is misplaced. GH1 [the Applicant] bears the onus of establishing that the Assessment is excessive: s 14ZZK(b)(i) of the Tax Administration Act 1953 (TAA). The burden on GH1 is two-fold: to prove, on the balance of probabilities, that the Assessment is excessive and what the correct assessment ought to be.
40. There is no onus on the Commissioner to show that the Assessment is reasonable or supported by evidence: Gauci v Federal Commissioner of Taxation [1975] HCA 54; (1975) 135 CLR 81 (Gauci) at 89 per Mason J:
The Act does not place any onus on the Commissioner to show that the assessments were correctly made. Nor is there any statutory requirement that the assessments should be sustained or supported by evidence. The implication of such a requirement would be inconsistent with s 190(b) for it is a consequence of that provision that unless the appellant shows by evidence that the assessment is incorrect, it will prevail.
41. The position was authoritatively summarised by the Full Federal Court in Gashi v Federal Commissioner of Taxation (2013) 209 FCR 301; [2013] FCAFC 30 (Gashi) at [61]:
In seeking to establish in Pt IVC proceedings that an assessment issued under s 167 is excessive, the ultimate question was and remains whether the amount of each assessment was excessive: Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614 at 623. Section 14ZZO of the TAA places the burden of proving each assessment is excessive on the taxpayer: Dalco at 623 citing George at 189. The TAA does not place any onus on the Commissioner to show that the assessments were correctly made: Dalco at 624 citing Gauci v Federal Commissioner of Taxation [1975] HCA 54; (1975) 135 CLR 81 at 89. Indeed, absent agreement with the Commissioner to confine the issues for determination in a Pt IVC proceeding, the Commissioner is entitled to rely upon any deficiency in the taxpayer’s proof of the excessiveness of the amount assessed in seeking to uphold the assessment: Dalco at 624.
42. As submitted by the Commissioner:
23....If the applicant had led credible evidence to establish that the acquisitions took place, the Commissioner would need to then point to evidence which supported his view that they did not, and in doing so, he would assume an evidentiary onus: Richard Walter Pty Ltd v Commissioner of Taxation (1996) 67 FCR 243. But in the evidentiary lacuna presented to the Tribunal by this applicant, that position never arises because the highest point that the applicant’s case rose to was a submission, in effect, that because the acquisitions were recorded in the MYOB accounts of the applicant, they must have occurred...
CREDITABLE ACQUISITION
As noted above, a person is entitled to input tax credits for that person’s creditable acquisitions, pursuant to s 11-20 of the GST Act. In order to make a creditable acquisition, the person must meet the four criteria set out in s 11-5 of the GST Act.
Registration for GST
It was not in dispute that the Applicant meets the fourth criterion (s 11-5(d) GST Act), because, as noted above at paragraph [9], it has, at all relevant times, since 20 June 2004, been registered for GST (Exhibit A2, para [34]).
Consideration/ Set-off
With respect to the third criterion (s 11-5(c) GST Act), the Respondent did not admit that the Applicant provided any consideration for the alleged creditable acquisitions (Exhibit R1, para [59(c)]). The Applicant, however, contends that the Applicant did provide consideration in the form of the set-off in the loan accounts of Sandpiper and the Applicant, as noted in paragraph 35 above.

It is relevant here to discuss the submissions of the Applicant, and the evidence regarding the set-off.
The Applicant has submitted that, in its books, Sandpiper credited sale proceeds from the subdivided lots to a loan account in favour of the Applicant, and debited the amount of the invoices to the same loan account. This resulted in a credit balance of $12,873,092.55 as at 30 June 2010, which represented a net amount owed by Sandpiper to the Applicant (Exhibit A2, para [13]); Sandpiper Asset General Leger, Exhibit A1, Annexure RH-8, page 138).
The Applicant further submitted that, in its books, the Applicant debited sale proceeds from the subdivided lots to a loan account in favour of Sandpiper. The Applicant credited the amount of the invoices to the same account. This resulted in a debit balance of $12,885,001, as at 30 June 2010, which represented the net amount owed to the Applicant by Sandpiper (Exhibit A2, para [14]; T18, page 120).
Thus, there was a slight difference between the loan account balances of Sandpiper and the Applicant of $11,908.45, which counsel for the Applicant submitted was “immaterial” (Exhibit A2, para [14]).
A closer inspection of the book entries shows that the amounts of the Disputed Invoices are clearly shown in the book entries for the DCUT (Exhibit R2, T18, page 120). Specifically, there is an entry for 21 June 2010 with the description “costs on charged” for $12,017,901.50; and a subsequent entry for 30 June 2010 with the description “Development cost on charged” for $18,997,489.28.
However, the corresponding entry for the set-off in the general ledger of Sandpiper is less clear. The entry in question is numbered “GJ000147”, and dated 4 June 2010 for a credit amount of $1,245,364.62, and has the description, “Sale of Lot 100” (Exhibit A1, Annexure RH-8 page 138. In his witness statement (Exhibit A1), Mr Hopkins, at paragraph [26] stated:
It should be noted that the 4 June 2010 credit of $1,245,364.62 to the loan account in favour of Sunlea is a net figure arrived at as follows:

Description Debit Credit

Sale proceeds $33,500,000.00

Sandpiper tax invoice dated 15 June 2010 $12,017,901.50

Land tax $1,239,244.60

Sandpiper tax invoice dated 30 June 2010 $18,997,489.28

Total $32,254,635.38 $33,500,000.00
The net credit of $1,245,364.62 is the difference between $32,254,635.38 and $33,500,000.00.

The following relevant exchange occurred when Mr Hopkins was cross-examined about how entry GJ000147, dated 4 June 2010, was compiled (transcript, page 52-53):
Mr Slater:Your evidence is that entry is actually net of the two Sandpiper invoices that were subject of these proceedings, which were not issued until 15 June and 30 June?
Mr Hopkins:    Yes.
Mr Slater:So in giving that evidence, where do you get that from, in order to tell the Senior Member that that’s what’s happened?
Mr Hopkins:    Where do I - can you say
Mr Slater:Where do you get that information to say that the line item of 1.245 million entered on about 4 June 2010, possibly related to a sale of Lot 100, is a net item of sale proceeds plus two invoices, at least, which are dated some period after that? Where do you get that information for this table?
Mr Hopkins:    By calling out general journal 147, distilling out the entries that are not related to the sale directly, and condensing it in this fashion. Just a normal process to extract the numbers and present it in a way that’s easy to understand.
Mr Slater:It may be easy to understand, but on the face of it this table will suggest that the loan item of 4 June 2010, 1.245 million, is comprising of events that haven’t happened until 15 June and 30 June. Do you accept that? On its face?
Mr Hopkins:    I accept - I accept that whoever entered it, entered the date as 4 June and the sales - the invoices are dated 15 and 30 June, yes.
Mr Slater:So your table doesn’t explain where you get the background to say this is a net effect?
Mr Hopkins:    No
Mr Slater:       You’re saying it’s based upon a general journal?
Mr Hopkins:    Yes. What I’m saying is general journal 147, if you distil it down in relation to the sale, those are the entries. I could have written - I don’t know how many entries, I think I counted up about ten or 12, debits and credits, which would make a lot of sense to us as bank (indistinct) or accountants, but would not be terribly clear.
Mr Slater:Do you accept it’s still not terribly clear to us, today, in that simplified table, how it happened? Do you accept that criticism?
Mr Hopkins:    No. I find it clear. I think it’s clear.
The Tribunal does not regard this to be a satisfactory explanation. There is no evidence before the Tribunal of the other journals or invoices from which entry GJ000147 was compiled. The only evidence as to the breakdown is from Mr Hopkins.
Further, although Mr Hopkins gave evidence that there was a credit of sale proceeds and a debit of fees to the loan account, no corresponding credit and debits are shown against this account. The account only shows credits, including the entry GJ000147 for $1,245,364.62, described as “Sale of Lot 100”. It would be reasonable to expect that credit and debit entries would be recorded against the account to show how $33,500,000.00 was “distilled” down to $1,245,364.62. Additionally, the description of the entry itself – “Sale of Lot 100” – is not in the language of a set-off. When the two account entries which apparently comprise the set-off are compared, they do not match up, and the existence of a set-off is not apparent on the face of the records. This raises some doubt as to whether a set-off did actually occur.
As identified in the above exchange with Mr Hopkins, as well as failing to show the breakdown of these debits and credits, the timing of entry GJ000147 is also problematic. The Tribunal notes that Mr Hopkins was unable to provide a satisfactory explanation as to why the entry predated the Disputed Invoices, as is illustrated by the following exchange under cross-examination (transcript, page 51):
Mr Slater:       … is that your general journal that you entered or someone else?
Mr Hopkins:    No, no. I didn’t enter general journal 147, no.
Mr Slater:       So someone else?
Mr Hopkins:    Someone else.
Mr Slater:       Was it at your direction?
Mr Hopkins:    Good question. The financial statements I reviewed at the end. Whether I directed somebody to - no, it’s - it would be unusual for me to say to somebody, “Please enter journal 147 with these numbers”, you know, “Here are the records, prepare them.” I would review it and make changes. So in terms of specific direction for that particular journal, I don’t know but it’s highly unlikely.
Mr Slater:Nonetheless your evidence at paragraph 26 is that the one line item about $1.25 million, 245 million dollars, is actually comprised of some sale proceeds of $33 million?
Mr Hopkins:    M’mm.
Mr Slater:Less three items. Now this general journal is entered in the Sandpiper books as “Effective 4 June 2010” on page 138?
Mr Hopkins:    Yes. It’s got 4 June in the third column.
Mr Slater:That’s not, or is it, the date of the data entry or the date of the effect of the transaction?
Mr Hopkins:    It’s the date that the relevant bookkeeper puts in.
Mr Slater:       As?
Mr Hopkins:    When they key something in. Sometimes they’ll enter the date of a transaction, sometimes they’ll enter the date as the end of the quarter, if they’re doing a quarterly set of numbers, or sometimes they’ll enter it in a 30 June, you know, or the end of a relevant financial year. So…
Mr Slater:And you’re not the bookkeeper so you can’t tell why they entered 4 June 2010?
Mr Hopkins:    No, except that I understand settlement, from memory, happened around 4 June.
Mr Slater:       So if that’s that - if we go back to your statement at paragraph 26?   Mr Hopkins:   Yes.
Mr Slater:       Your sale proceeds?
Mr Hopkins:    I’ll need to go back and check, but from memory it happened in early June.
Mr Slater:Early June. That’s the sale proceeds arrived of $33.5 million. That’s your recollection now?
Mr Hopkins:    Yes.
In summary, Mr Hopkins was not the book-keeper who made the 4 June entry, and the book-keeper who made the entry was not called as a witness. Mr Hopkins only offered speculative explanations as to why the date (4 June 2010) of the entry predated the invoices (15 June 2010 and 30 June 2010). This creates some doubt in the mind of the Tribunal as to the underlying validity of the set-off, given that the set-off entry is dated before the date of the invoices.
With respect to the issue of consideration, GSTD 2004/4 contemplates that consideration can be in the form of a set-off in book entries. Paragraph 2 of GSTD 2004/4 states that:
A set-off can occur if each party has made a supply to the other and each party is required to pay the other for the supply made to it. A set-off can also occur, in certain circumstances, if one party makes a supply, such as rental premises or management services, to the other and the parties agree that payment is to be achieved by set-off…
The above GST determination (GSTD 2004/4) refers to a requirement to pay. As noted above, no formal or written project management agreement (as envisaged by the Heads of Agreement) was ever entered into, and there is no evidence before the Tribunal of any provisions of any claimed project management agreement relating to the Applicant’s liability to pay Sandpiper and Sandpiper’s entitlement to payment. Indeed, Mr Hopkins, in response to a request from the Respondent to provide copies of a contract or other documents between Sandpiper and Drummond Cove in relation to transactions being on charged, stated, “There is no contract between Sandpiper and Drummond Cove in relation to the costs being on charged” (letter to the Respondent dated 12 June 2015 at T23, page 160).
The GST determination (GSTD 2004/4) also refers to a supply being made. The Tribunal notes, however, that it is in dispute by the parties as to whether Sandpiper supplied anything to the Applicant. This requires consideration of the evidence relating to whether anything was acquired and supplied. Specifically, whether the Applicant acquired anything for a creditable purpose (s 11-5(a) GST Act), and whether Sandpiper made a taxable supply to the Applicant (s11-5(b) GST Act).
Did the Applicant acquire anything, and did Sandpiper supply anything?
The Respondent submitted that it was not satisfied that there was a real transaction underlying the two Disputed Invoices that was both an acquisition and a taxable supply (s 11-5(a) and (b) of the GST Act) (see, for example, opening submissions of the Respondent, transcript, page 9-10). This involves a consideration of both sides of the transaction, namely what did the Applicant receive, and was it for a creditable purpose, and secondly, what did Sandpiper supply, and was it a taxable supply?
Project Management Services
As noted above, under the Heads of Agreement, it was agreed that a project manager would be appointed under a project management agreement, but no formal or written project management agreement, as envisaged by the Heads of Agreement, was ever made. Thus, there was no documentary evidence before the Tribunal to support the Applicant’s claim that Sandpiper was appointed to provide project management services to the Applicant.
In his witness statement, Mr Hopkins stated that, at para [20], “Diamo and Dreamview carried out the project in joint venture. Sandpiper fulfilled the role of Project Manager.” Similarly, in his evidence to the Tribunal, Mr Hopkins stated that Sandpiper was appointed as the project manager (transcript, page 14), and he elaborated on Sandpiper’s duties as follows (transcript, page 15):
Sandpiper had an office up in Stirling and it had a number of people, all of which had property subdivision experience. So, Sandpiper, amongst other things, brought their connections and expertise to the project and, through their connections, they engaged a number, or a large number, of contractors, the largest of which, obviously, is Melaleuca. So, they got on and turned roughly 220 hectares of sand dunes into an approval for - in the order of 1700 or 2000 lots, a school, a marina, a district shopping centre and actually got on and developed a few hundred blocks of land as the early part of this. They facilitated the earthworks, the approvals and they got on and did it in a fairly - fairly speedy - speedy timeframe. So, they did all the development work. They spent in the order of 50 million dollars, a large chunk of it, really early on in developing a very large tract of land.
Apart from the Applicant’s, and Mr Hopkins’, assertion that Sandpiper was appointed, and undertook the role of, project manager under section 3 of the Heads of Agreement, there is very little evidence to substantiate this. As noted above, no written of formal project management agreement, as envisaged by the Heads of Agreement, appointing Sandpiper as Project Manager was ever made, and there was no other documentary evidence before the Tribunal indicating that Sandpiper was appointed as project manager, nor was there evidence as to the terms of such an agreement. Indeed, it is surprising that in a large scale property development involving the invoicing of millions of dollars that there would be no formal legal documentation evidencing these terms.
Although Mr Hopkins referred to Sandpiper having “a number of people” in its office, “all of which (sic) had property subdivision experience”, as well as Mr Kevin Pollock being the “principal brains or drive (sic) for Sandpiper”, and the “subdivision and development brains behind Sandpiper” (transcript, page 15-16) none of these people were called to give evidence with respect to whether Sandpiper was appointed as Project Manager, and whether Sandpiper supplied project management services. Neither was Mr Steinier, who had been a Director of Sandpiper, Sunlea and Diamo, and who would have been in a more knowledgeable position, to give evidence about any underlying transaction and what was supplied and acquired, than Mr Hopkins. Indeed, Mr Steinier gave evidence in the Supreme Court proceedings ([2014] WASCA 91), which the Applicant referred to as containing factual details about the project in its Statement of Facts, Issues and Contentions (Exhibit A2, para [10]). No explanation was given as to the failure to call these witnesses, and accordingly, the Tribunal draws an adverse inference (Jones v Dunkel (1959) 101 CLR 298; Re Wodonga Pharmacy Pty Ltd and Australian Community Pharmacy Authority [2014] AATA 496).
Mr Hopkins stated that he “took on formal responsibilities [ie accounting and tax services] for Sandpiper from about the third quarter of 2009”. Mr Hopkins explained this role under cross-examination (transcript, page 32):
Mr Slater:The compliance role, as you put it, that is preparing income tax returns, preparing business activity statements to report GST, and dealing with the Commissioner’s questions and audits, is a role that you took on for Sandpiper in third quarter 2009?
Mr Hopkins:    Correct.
Mr Slater:       Prior to that you hadn’t had that role?
Mr Hopkins:    Correct.
Mr Slater:And it wasn’t until third quarter 2010 that you also took on the role of principal place of business and registered office; that was the records we saw?
Mr Hopkins:    Yes, at that - at that date, the registered office changed and the principal place of business changed to our - our office.
Thus, even though Mr Hopkins had been involved from time to time with the various companies outlined above, his involvement with Sandpiper did not correspond with approximately the first 3 and a half years stated in the Disputed Invoices (namely, 2006, 2007, 2008, and half of 2009). Additionally, the Heads of Agreement deed was executed on 13 August 2005, and the deed of variation on 21 September 2005, before Mr Hopkins undertook “formal responsibilities” for Sandpiper in the third quarter of 2009. This raises some doubt as to whether Mr Hopkins had direct knowledge of what Sandpiper’s role was.
Further, the following exchange during cross-examination is also instructive of the role Mr Hopkins played (transcript, page 33-34), and whether his evidence was based on his direct observation or experience, or on the basis of what he learnt from his clients, such as Mr Steinier, in his advisory and accounting role:
Mr Slater: And when you were working in those offices it was working in the role of compliance, as you describe it?
Mr Hopkins:    In a wide range - a wide range of capacities. The principal one is probably as an adviser; advisory capacity to give it that umbrella term.
Mr Slater: Advisory for - let’s be clear about this; you said it was advisory for compliance work?
Mr Hopkins:    Um
Mr Slater:       Well, what was it?
Mr Hopkins:    Okay, maybe I’ll explain a bit more of the terminology. When I used the term “advisory” it’s something more than recording the relevant entries and books or BAS forms or corresponding with the Tax Office. It’s the provision of commercial advice; that’s what I’m talking about. So when I say advisory, it’s something more than filling in tax returns or BASes or putting in - preparing financial statements. It’s all the other stuff. So does that help?
Mr Slater:Well, as we understand, that work still involves someone reporting to you what has gone on or is about to go on, or might go on, or could go on and you’re telling them your experience as an accountant what may or may not happen, or what you should or should not do; advising; is that right?
Mr Hopkins:    Crikey.
Mr Slater:You’re going out to meet them, sometimes they’re coming to see you; but they’re reporting to you what is happening, and you are using that information to prepare advice to them?
Mr Hopkins:    Some of my advice is based on meetings with people in Greg Rowe’s office or in the Drummond Cove office. So it’s not just about people reporting to me to provide advice. That sounds awfully - awfully formal. So I would attend meetings, I would provide advice to my clients; obviously in their - clearly in their Havelock Street offices, and also from time to time in Greg Rowe’s office. I hope that - that helps you understand.
Mr Slater:Yes, you are providing advice to them about their circumstances, about the consequences that might arise from what they’ve done?
Mr Hopkins:    Yes.
Mr Slater:I take it that you did not negotiate with the heavy works machinery suppliers for the---?
Mr Hopkins:    No.
Mr Slater:And you didn’t negotiate with many of the other contractors involved in a large scale property development?
Mr Hopkins:    Some small ones I did, but none of the large, the large players.
Mr Slater:The extent of your knowledge about what’s going on at the Geraldton land development site, it’s acknowledged it reported to you?
Mr Hopkins:    Not - not entirely. I’ve been up to Geraldton a large number of times. I’ve met with a variety of the consultants on site up at Geraldton, and dealt with a number of the consultants in Perth. So I think I had a good understanding of what was going on, on the ground.
Although Mr Hopkins had some involvement with small contractors, it is likely that his “good understanding of what was going on” was dependent on what his client’s told him as an advisor, and that it is doubtful that he was in a position to accurately comment on whether Sandpiper supplied project management services.
There was also a question raised in the cross-examination of Mr Hopkins as to whether Greg Rowe and Associates was the Project Manager. The following exchange is relevant:
Mr Slater:        What role did Mr Rowe play in relation to the development?
Mr Hopkins:    Greg Rowe - or Greg Rowe & Associates, I think they’ve changed the business name in recent times is essentially a town planning group. In this regard - or in this project - and I’ve been involved with other clients that have used Greg Rowe & Associates and they provided - or their group provided similar services to other clients. He also provided a coordinating role, particularly in the early stages of the project, and that came about, I think in part, because his office was in Newcastle Street in Northbridge, the Sandpiper office was up in Stirling and the office space that Drummond Cove had was in West Perth, which was tiny and completely unsuitable for the types of planning that went on. So, particularly in the early part, there were a number of meetings in his boardroom. They had, you know, normal secretarial and receptionist support, they had the AB equipment, all that type of stuff you would expect to see in a meeting room for this type of - type of project, which wasn’t available either at Drummond Cove or up in Stirling.
Mr Slater:       But his expertise that he was engaged for was the town planning?
Mr Hopkins:    Absolutely, yes. It was needed because, as I said before, they turned sand dunes - you know, effectively, sand dunes into - well, the plan was to turn it into a large integrated land development.
Mr Slater:       Was Greg Rowe & Associates fulfilling the role of project manager?   Mr Hopkins:           No.
Mr Slater:So, to what extent would you say there was any overlap between Sandpiper’s role and Greg Rowe’s role?
Mr Hopkins:    Right. He was paid by Sandpiper cash on a time basis up until November ‘06. All the decisions, every single decision on the subdivision was made by Sandpiper Asset Pty Ltd. Every single bill was paid by Sandpiper Asset Pty Ltd. The largest contractors to the project were engaged directly by Sandpiper Asset Pty Ltd. Greg Rowe performed, what I would term, as the normal town planning function and a coordinator function based on the room available at that time of thing. So, no - no overlap - no uncertainty between his role and those, you know, behind the project and Sandpiper.

Despite Mr Hopkins’ denial that Greg Rowe and Associates was appointed as project manager, he did refer to Greg Rowe providing a “coordinating role” in the early stages of the project which is suggestive of possible project management duties being undertaken. Additionally, the Respondent has submitted (Respondent’s closing submissions, para [47]) that the Tribunal may infer that there is evidence that Greg Rowe and Associates was the manager of the project from paragraph [70] of the decision of the Supreme Court, [2014] WASC 91 regarding security for costs which states:
… the defendants rely on matters recorded in the minutes of project meetings, which commence in October 2005. Even when Mr Steinier was not present at project meetings, Mr Betts (also a director of Diamo) was present. Minutes of all meetings are recorded as sent to Mr Steinier. The minutes show:
1. In late 2005, Greg Rowe and Associates was appointed to provide project management services to Diamo. To the extent that Sunlea's claim is based upon Sandpiper acting as project manager, the appointment of Greg Rowe and Associates is contrary to that claim…
The Applicant submitted that Greg Rowe and Associates provided town planning advice, and not project management services, and that the Tribunal should not draw the inference because the above passage from the Supreme Court was obiter, and the substantive matters remain in dispute in the Supreme Court (Applicant’s closing submissions in reply, para Y). However, the Tribunal is of the view that the above passage from the Supreme Court decision does cast some doubt about the accuracy of the Applicant’s claim that Sandpiper was the project manager and made taxable supplies to the Applicant whilst fulfilling this role.
Mortgagees in possession
Additionally, for part of the period in the Disputed Invoices, the mortgagees, Walthamstow and Troika, were in possession, and consequently, there is some doubt as to whether Sandpiper could supply anything at all, given that the mortgagees had entered into possession, and had an irrevocable authorisation to proceed with a mortgagee sale pursuant to the Deed dated 1 December 2008 (Exhibit A1, annexure RH-6). In the following exchange with Mr Hopkins during cross-examination, Mr Hopkins was asked about the activities of Sandpiper after the Deed was entered into (transcript, page 35-36):
Mr Slater:       The point of my question, which you didn’t quite address…?
Mr Hopkins:    Apologies.
Mr Slater:…was that Sandpiper was not doing anything in this period because Walthamstow had control on sales?
Mr Hopkins:    No, that’s not - that’s not right. Walthamstow took over principal responsibility of the sale of the land. Everything else was as it was. They didn’t take over land subdivision responsibility. So as long as you’re talking about the principal responsibility, the sales function, yes, you’re right.
Mr Slater:But they had also funded all of that, hadn’t they; they’d funded the development of the land?
Mr Hopkins:    They’d funded a large portion of it.
Mr Slater:And Sandpiper had spent that money, or somebody had spent that money?
Mr Hopkins:    Yes.
Mr Slater:       This deed is recording that there’d been defaults in repayment of that?
Mr Hopkins:    Yes.
Mr Slater:And that mortgagees were stepping in to recover their money through the sale of the land. That’s what you understand, isn’t it?
Mr Hopkins:    Yes.
Mr Slater:Sandpiper’s role is really that Walthamstow and Troika Capital stood in the shoes of Sandpiper to get the task done and it’s not the case that Sandpiper could go on and do anything different because Walthamstow and Troika Capital were saying, “We are exercising the sale of this land”?
Mr Hopkins:    In relation to the sales function, it was Walthamstow’s job to get the best price so Sandpiper would - was very interested in getting the best price. So they would bring particular parties to the attention of Walthamstow. So Sandpiper did all its normal functions, whatever that was, as well as what I’ve just said in relation to the sales function. Obviously the sales function is substantially produced*.
Mr Slater:Because this is the hard end of that financing process where the mortgagees want their money out and they are stepping in to just complete it so that they can recover their financed funds?
Mr Hopkins:    Yes.
[The Tribunal notes that “produced” should likely be “reduced”]
The Tribunal notes the extensive powers of the mortgagees, as set out in clause 4 of the Deed (discussed above at para 33). As illustrated in the above passage, Mr Hopkins’ evidence was that Sandpiper continued to perform its “normal functions.” However, that evidence contradicts the express terms of the Deed under which the Mortgagee’s took over complete and “irrevocable” control of the land, its development, marketing and sale (see para 33 above). The evidence suggests that it was unlikely that Sandpiper was making taxable supplies to the Applicant during the time the mortgagees were in possession.
Bare trustee
The Respondent further argues that Sandpiper was merely acting as a bare trustee and that, as a consequence, there was no taxable supply by Sandpiper. Instead, the Respondent submits that, as a bare trustee, Sandpiper would be entitled to recoup any expenses it incurred on behalf of the beneficiaries by way of an indemnity (citing Hardoon v Belilios [1901] AC 118 in Respondent’s Closing Submissions, para [23]). The Respondent further argues that this entitlement to recoup would not be a transaction that imposed or required GST (Respondent’s opening submissions, transcript, page 8; Respondent’s closing submissions, para [23]).
The right of indemnity of a trustee was explained in the Western Australian Court of Appeal decision of Franknelly Nominees Pty Ltd v Abrugiato [2013] WASCA 285 by Buss JA [206] as follows:
206 Although a trustee is in general personally liable for all trust liabilities incurred by the trustee, in equity the trustee has a right of indemnity out of the trust assets for liabilities properly incurred in the management or administration of the trust. The trustee has a power of recoupment and a right to exoneration. The right of indemnity is an incident of the trustee's office and is inseparable from it. See Worrall v Harford [1802] EngR 342; (1802) 8 Ves Jun 4, 8; [1802] EngR 342; 32 ER 250, 252 (Lord Eldon LC); Kemtron Industries Pty Ltd v Commissioner of Stamp Duties (Qld) [1984] 1 Qd R 576, 585 (McPherson J, Andrews SPJ agreeing).
As well as having a right of indemnity in equity, a trustee also has a right of indemnity under statute (see Trustees Act 1962 (WA), s 71).
Alternately, the Respondent argued that Sandpiper was merely acting as an agent, and would be entitled to a similar indemnity from the principal for expenses incurred in the process of entering into contracts on behalf of the principal (Crown Estates (Sales) Pty Ltd v Commissioner of Taxation [2016] FCA 335 at [41]-[44]) (Respondent’s closing submissions, para [25]). The exchange with Mr Hopkins in para 108 above, refers to Sandpiper having a “sales function” whilst the mortgagees were in possession and that “they would bring particular parties to the attention of Walthamstow”, which may suggest an agency arrangement (transcript, page 35). However, given the express powers of the Mortgagees in possession under the Deed, and the evidence before the Tribunal, it is unlikely that Sandpiper had any function, or was able to supply anything at all, whilst the Mortgagees were in possession, and there is no other evidence of an agency arrangement.
The Respondent further submitted that the description in the Disputed Invoices of what was supplied - “unrecouped project costs” – “suggests an on-charging of expenses” and further that, “That language is not consistent with a liability to make a payment in relation to any supply made in the course or furtherance of an enterprise carried on by the purported supplier, appointed as bare trustee. It is consistent with an indemnity for a bare trustee or an obligation arising from agency.” (Respondent’s closing submissions, para [31]).
On the other hand, the Applicant submitted that Sandpiper held the land as a bare trustee, but supplied project management services in an independent capacity. In support of this submission, the Applicant noted that Sandpiper had entered into the Heads of Agreement in its own capacity, and also as a bare trustee (Applicant’s closing submissions, para [28]). The Applicant also submitted that Sandpiper’s Australian Business Number (ABN) in the Disputed Invoices is its ABN in its personal capacity, and not its ABN as trustee (Applicant’s closing submissions, para [29(i)]).
The Applicant further referred to prior correspondence from the Respondent (Exhibit A3, and A5) where the Respondent referred to Sandpiper as the “project manager”. However, the Tribunal must consider the evidence before it to determine whether anything was supplied by Sandpiper and acquired by the Applicant, and a prior view, or a fact found by the Respondent (which may or may not be correct), is not a sufficient basis to conclude that Sandpiper was acting independently as a project manager and not as a bare trustee or agent.
As noted above, there was an executed Heads of Agreement, under which Sandpiper was appointed “Trustee” and more particularly referred to in Recital D as a “bare trustee”. In his evidence to the Tribunal, Mr Hopkins also described Sandpiper as a bare trustee. The following exchange from the cross-examination of Mr Hopkins is relevant (transcript, page 36):
Mr Slater:In fact, Sandpiper was at all times the bare trustee of the land under that Heads of Agreement; that’s correct?
Mr Hopkins:    Yes.
Mr Slater:And Sandpiper, because it held it on trust, couldn’t go and develop its own land or decide its own golf courses, as opposed to residential lots or universities as opposed to marinas, could it?
Mr Hopkins:    Sandpiper couldn’t do that on its own right. Sandpiper had obligations under the Heads of Agreement to report to the management committee.
Mr Slater:So Sandpiper wasn’t on a frolic of its own developing land; it was developing the land under the Heads of Agreement, it was developing the land that originally Diamo and Dreamview wanted, but over time Sunlea and Dreamview or its iteration wanted?
Mr Hopkins:    Yes.
And further (transcript, page 36-37):
Mr Slater:     Alright. But, it is only developing the land project, as I - as originally envisaged in the Heads of Agreement. It is not doing its own frolic with that tract of land, it’s developing what the joint venturers want?
Mr Hopkins:    Yes.
Mr Slater:      Sandpiper is developing what the joint venturers want?
Mr Hopkins:    Yes.
Mr Slater:     So, when you said Sandpiper had no direction from anyone, that is qualified by the, well it was building the property development that the Heads of Agreement wanted?
Mr Hopkins:    Yes. What Sandpiper did get on and do, was make some decisions, which didn’t actually go back to the management committee. The management committee, as it turned out, was it meant to? The answer was yes, but in practice, it didn’t. Was it a frolic? They would argue no - they would probably argue no. But, they did get on and make some decisions, without reference to the management committee.
Mr Slater:     So, all of those decisions made have subsequently become subject to some contentious WA Supreme Court actions?
Mr Hopkins:    Yes.
This exchange is suggestive that Sandpiper was acting as a bare trustee in that Sandpiper was taking direction from the management committee, and was not acting independently. Indeed, Mr Hopkins describes that when Sandpiper undertook activities independently it became contentious, indicating a view that it acted outside of its role as a bare trustee by acting independently.
In summary, the evidence does not support the Applicant’s assertion that Sandpiper made a taxable supply to the Applicant. It is unclear as to what the Applicant acquired from Sandpiper, if anything, under the Disputed Invoices. The evidence suggests that Sandpiper was acting as a bare trustee. If this was the case, a trustee’s right to claim expenses by way of indemnity is not a transaction which attracts GST.
Were the Disputed Invoices Tax Invoices?
The effect of s 29-10(1) and (3) of the GST Act is that generally a tax invoice is required before a person can attribute input tax credits for a creditable acquisition.
As noted above, the Applicant has argued that in the course of a project management role, Sandpiper incurred costs to third parties which were included in the Disputed Invoices (Applicant’s opening submissions, transcript, page 5-6) as “unrecouped project costs”.
However, the Respondent is of the view that the Disputed Invoices are not valid tax invoices pursuant to s 29-70(1) of the GST Act (as it was at 30 June 2010), and that there are no grounds for the Commissioner to exercise discretion to treat them as valid tax invoices. This is because there is insufficient evidence to show that the invoices represent actual creditable acquisitions (Exhibit R2, T2, page 14-15).
There are detailed requirements which must be met before a document can fit the description of a “tax invoice”. As submitted by the parties and accepted by the Tribunal, it is appropriate to consider the Disputed Invoices against the version of s 29-70 of the GST Act which was in effect at the time the Disputed Invoices were issued (30 June 2010). Under s29-70(d), a tax invoice was required to contain “such other information as the regulations specify”, with r 29-70.01(2) setting out the relevant information that the tax invoice must contain if the supply to which it related exceeded $1,000.
The main issue with the Disputed Invoices arises from paragraph (f) – being “a brief description of each thing supplied” which was described by GSTR 2000/17W – cited above, but relevant to cite here again:
A tax invoice must include a description of each thing supplied. The description must be sufficient to identify what was supplied. This will help to establish whether it is a creditable acquisition for the recipient.
Also, paragraph (g) of r 29-70.011(2) required a tax invoice to contain information including: “for each description, the quantity of the goods or the extent of the services supplied”. However, the Disputed Invoices did not contain this information.
The Disputed Invoices have the general description, “Unrecouped project costs 2006 to 2010”, with no further detail or itemisation of what was supplied. Indeed, in a letter to the Respondent dated 25 July 2015 (T28, page 179), Mr Hopkins stated, “The June 2010 invoices can be analysed in a multitude of ways”. Indeed, this statement summarises the main problem with the Disputed Invoices in terms of their lack of specificity.
In a letter to the Respondent dated 2 August 2016 (T39, page 268-9), Mr Hopkins provided a table in which he generally summarised these costs to third parties under general headings including architects, bank charges, civil and earthworks, contractors and consultants fees. However, these amounts differed from those under the same headings provided by Mr Hopkins in a letter to the Respondent dated 20 February 2015 (Appendix 1, T15, page 102), which raises further doubt as to what the costs were. Further, given that the “unrecouped project costs” cover a 4 year period, it is likely that some or all of the amounts in the tables provided by Mr Hopkins are comprised of more than one transaction. However, no supporting documentation, for example copies of invoices from, or correspondence with, these suppliers, was supplied to the Tribunal to substantiate the amounts shown in these tables, or how they were calculated.
Additionally, the Disputed Invoices are two separate invoices issued two weeks apart, and yet the description of what was supplied is identical. Presumably each invoice should relate to different and separate “unrecouped project costs”, but from the tables provided by Mr Hopkins, and with such a general description of what was supplied (that is, “unrecouped project costs 2006 to 2010”) it is difficult to distinguish which costs are meant to be included in which Disputed Invoice. In the Tribunal’s opinion, this further illustrates the lack of a sufficient description to detail what was supplied.
To further illustrate that the description “unrecouped project costs” was not sufficient to identify what was supplied, it can be contrasted with the more specific descriptions in the other 15 tax invoices which refer to more specific supplies being made, such as selling and settlement costs, project management fees, land tax and development costs. Mr Hopkins was asked about why the descriptions in the Disputed Invoices differed from those in the previous 15 invoices (in T17, from page 103) under cross-examination (transcript, page 63-64):
Mr Slater:In your evidence, the case of your client Sunlea, is that it has issued invoices in the past and there are these two invoices issued in June 2010 you wish to make an input tax claim for, right?
Mr Hopkins:    Yes.
Mr Slater:Do you agree with me that the invoices, earlier invoices, and we can go to them because they’re in the book at page 103 and following? Page 103 is the first invoice, just moving through them, the description field for each invoice is slightly different?
Mr Hopkins:    Yes.
Mr Slater:       Do you agree there’s no requirement to always charge the same description?
Mr Hopkins:    Sorry?
Mr Slater:There’s no requirement to keep the same description, but the description would change to accurately reflect what the transaction was, is that correct?
Mr Hopkins:    No, the description would be appropriate for whatever the charge is.
Mr Slater:The acquisition or the taxable sale has to be recorded in some way in the description?
Mr Hopkins:    This is the invoices that were prepared by Sandpiper, given to Drummond Cove.
Mr Slater:       Yes?
Mr Hopkins:    It’s obvious that the description from time to time changes.
Mr Slater:       Yes, that’s what I asked?
Mr Hopkins:    That might reflect different circumstances or you know, day of the week or whatever.
Mr Slater:All the way through to page 117, on no invoice has Sandpiper charged for “unrecouped project costs” 2006 to 2010?
Mr Hopkins:    That would be right.
Mr Slater:The Senior Member might be comfortable to infer that the two invoices that we’re dealing with, because they have a different description, are dealing with different transactions to the earlier invoices?
Mr Hopkins:    I can’t speak for the Senior Member, but she would be wrong if she did.
Mr Slater:       The wording of the description has changed?
Mr Hopkins:    Yes.
Mr Slater:       That would indicate that the underlying transaction is different?
Mr Hopkins:    No, not at all.
Mr Slater:The reason to change the wording, as you said, would be to record something different going on, would it not?
Mr Hopkins:    Not necessarily. The big thing that happened, rather obviously, in that quarter was the sale of the land, the termination of the overall project. So that’s the difference. The fact there’s different descriptions doesn’t, to me, matter much at all.
Mr Slater:I put to you that it does matter because it’s recording different things?
Mr Hopkins:    It’s work that Sandpiper has done. In each of these cases, Sandpiper has done some work and it has charged the owner of the land to do the work under various headings from time to time. That is consistent all the way through. It’s done some work, it’s charging fees for the work that it’s done.
Mr Slater:You agree that just as the Commissioner has audited the last two invoices, it could also audit the other invoices that we’ve looked at, could have as looked at in previous audits, those invoices, but they would also have to justify an acquisition for a creditable purpose and a taxable supply?
Mr Hopkins:    They’ve met the relevant requirements of the Act at the time, yes.

In the Tribunal’s opinion, Mr Hopkins did not provide an adequate explanation of the differences between the descriptions of what was supplied in the 15 invoices when compared to those in the Disputed Invoices. Overall, his evidence does not assist in determining what, if anything was supplied by Sandpiper. The Tribunal finds that the Disputed Invoices do not meet the requirements of a valid tax invoice, and that there is insufficient evidence to show that the Disputed Invoices represent actual creditable acquisitions.
CONCLUSION
In summary, the Tribunal finds that the Applicant has not discharged its burden of proving (pursuant to s 14ZZK(b)(i) of the TAA), on the balance of probabilities, that the assessment is excessive or otherwise incorrect. The Tribunal has set out its reasons in detail above, but by way of summary notes:
(a)There is insufficient evidence before the Tribunal to establish a real transaction behind the Disputed Invoices, and to establish that something real was acquired by the Applicant and supplied by Sandpiper. That is, there is insufficient evidence of a creditable acquisition or taxable supply under s 11-5 of the GST Act;
(b)There was no evidence as to the terms of any claimed project management agreement, nor any evidence of the terms relating to Sandpiper’s entitlement to payment. Accordingly, the Tribunal cannot be satisfied that, with respect to the payment made by way of a set-off, that the Applicant was required to pay Sandpiper for the purposes of GSTD 2004/4;
(c)There is insufficient evidence to determine whether consideration was provided in the form of a set-off, as required by s 9-5(a) of the GST Act. Entry GJ000147 in Sandpiper’s general ledger is a composite figure (apparently comprised of credits and debits which were not separately itemised), pre-dates the invoices, and is expressed in terms (“Sale of Lot 100”), which do not refer to the invoices or otherwise indicate a set-off;
(d)The Disputed Invoices, through the use of the description “unrecouped project costs 2006 to 2010” are not expressed in terms of a supply, but rather a reimbursement or indemnity as a bare trustee or agent which are transactions that do not attract GST. There was other evidence before the Tribunal as discussed above, which suggests that Sandpiper was acting as a bare trustee; and
(e)The Disputed Invoices do not comply with the requirements of a tax invoice within the meaning of s 29-70(1) the GST Act and r 29-70.01(2) because they do not sufficiently identify what was supplied.
DECISION
The Reviewable Decision of the Respondent dated 8 November 2016 is affirmed.

I certify that the preceding 132 (one hundred and thirty -two) paragraphs are a true copy of the reasons for the decision herein of Senior Member Dr M Evans

....[sgd]....................................................................
Associate
Dated: 2 August 2018

Date(s) of hearing: 09 April 2018

Date final submissions received: 14 May 2018

Solicitors for the Applicant: J Leek, Deloitte Legal

Counsel for the Respondent: C Slater, Francis Burt Chambers

Solicitors for the Respondent: R McGrade, Australian Taxation Office

Description	Debit	Credit
Sale proceeds	$33,500,000.00
Sandpiper tax invoice dated 15 June 2010	$12,017,901.50
Land tax	$1,239,244.60
Sandpiper tax invoice dated 30 June 2010	$18,997,489.28
Total	$32,254,635.38	$33,500,000.00

Date(s) of hearing:	09 April 2018
Date final submissions received:	14 May 2018
Solicitors for the Applicant:	J Leek, Deloitte Legal
Counsel for the Respondent:	C Slater, Francis Burt Chambers
Solicitors for the Respondent:	R McGrade, Australian Taxation Office