THE TAXPAYER Applicant And COMMISSIONER OF TAXATION

[2010] AATA 544

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 544

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2009/5952-5955

TAXATION APPEALS DIVISION		)
Re		THE TAXPAYER

Applicant

And COMMISSIONER OF TAXATION

Respondent

DECISION

Tribunal Deputy President P E Hack SC;
F D O’Loughlin, Senior Member

Date21 July 2010

PlaceBrisbane

Decision

In each of the Applications 2009/5952, 2009/5953, 2009/5954 and 2009/5955:

(1) insofar as the proceedings concern decisions that relate to supplies made before 17 March 2005 pursuant to contracts originally entered into by Oldco Pty Ltd, those decisions (including decisions on shortfall penalty and remission) are affirmed;

(2) insofar as the proceedings concern decisions that relate to supplies made before 17 March 2005 pursuant to contracts originally entered into by Newco 1 Pty Ltd or Newco 2 Pty Ltd, those decisions (including decisions on shortfall penalty and remission) are set aside and remitted to the respondent with a direction to allow the objection in full;

(3) insofar as the proceedings concern decisions that relate to supplies made on or after 17 March 2005, those decisions (including decisions on shortfall penalty and remission) are:

(a) set aside; and

(b) remitted to the respondent for reconsideration according to law and in accordance with the following directions or recommendations:

(i) any valuation of the freehold interest in relation to Tower Two and Tower Three (as at 1 July 2000) provided to the respondent within 60 days of the date of this decision, which complies with the requirements of the following determinations, should be considered by the respondent in his reconsideration:

(A) with respect to supplies made up to and including 30 November 2005, A New Tax System (Goods and Services Tax) Margin Scheme Valuation Requirements Determination (No. 2) 2000;

(B) with respect to supplies made on or after 1 December 2005, A New Tax System (Goods and Services Tax) Margin Scheme Valuation Requirements Determination MSV 2005/3;

(ii) if no valuation is provided to the respondent in accordance with subparagraph (i) above in relation to Tower Two, it would be appropriate for the respondent to proceed on the basis that the applicant is not entitled to use the margin scheme provided for by Division 75 of the GST Act in relation to such of the supplies made on or after 17 March 2005 that relate to Tower Two;

(iii) if no valuation is provided to the respondent in accordance with subparagraph (i) above in relation to Tower Three, it would be appropriate for the respondent to proceed on the basis that the applicant is not entitled to use the margin scheme provided for by Division 75 of the GST Act in relation to such of the supplies made on or after 17 March 2005 that relate to Tower Three.

..............Signed.................

Deputy President

REASONS FOR DECISION

21 July 2010 Deputy President P E Hack SC;
F D O’Loughlin, Senior Member   

1. On 2 July 2010 we published our reasons for decision in these matters ([2010] AATA 497) and invited submissions from the parties about the form of a decision to give effect to those reasons. We have received, and considered, those submissions.

2. For his part the Commissioner submits that the question of the provisions of valuation in relation to supplies made on or after 17 March 2005 should be dealt with by use of the power under s 43(1)(c)(ii) of the Administrative Appeals Tribunal Act rather than by use of the power under s 42D of that Act. The applicant’s submissions do not urge a contrary view nor suggest reasons for not adopting that approach. We accept, as the Commissioner submits, that it is appropriate to make a decision in those terms. 

3. We will then give effect to our conclusions by making a decision in each matter in the following terms:

In each of the Applications 2009/5952, 2009/5953, 2009/5954 and 2009/5955:

(1) insofar as the proceedings concern decisions that relate to supplies made before 17 March 2005 pursuant to contracts originally entered into by Oldco Pty Ltd, those decisions (including decisions on shortfall penalty and remission) are affirmed;

(2) insofar as the proceedings concern decisions that relate to supplies made before 17 March 2005 pursuant to contracts originally entered into by Newco 1 Pty Ltd or Newco 2 Pty Ltd, those decisions (including decisions on shortfall penalty and remission) are set aside and remitted to the respondent with a direction to allow the objection in full;

(3) insofar as the proceedings concern decisions that relate to supplies made on or after 17 March 2005, those decisions (including decisions on shortfall penalty and remission) are:

(a) set aside; and

(b) remitted to the respondent for reconsideration according to law and in        accordance with the following directions or recommendations:

(i) any valuation of the freehold interest in relation to Tower Two   and Tower Three (as at 1 July 2000) provided to the respondent                   within 60 days of the date of this decision, which complies with   the requirements of the following determinations, should be   considered by the respondent in his reconsideration:

(A) with respect to supplies made up to and including 30 November 2005, A New Tax System (Goods and Services Tax) Margin Scheme Valuation Requirements Determination (No. 2) 2000;

(B) with respect to supplies made on or after 1 December 2005, A New Tax System (Goods and Services Tax) Margin Scheme Valuation Requirements Determination MSV 2005/3;

(ii) if no valuation is provided to the respondent in accordance with subparagraph (i) above in relation to Tower Two, it would be appropriate for the respondent to proceed on the basis that the applicant is not entitled to use the margin scheme provided for by Division 75 of the GST Act in relation to such of the supplies made on or after 17 March 2005 that relate to Tower Two;

(iii) if no valuation is provided to the respondent in accordance with subparagraph (i) above in relation to Tower Three, it would be appropriate for the respondent to proceed on the basis that the applicant is not entitled to use the margin scheme provided for by Division 75 of the GST Act in relation to such of the supplies made on or after 17 March 2005 that relate to Tower Three.

I certify that the preceding 3 paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC and F D O’Loughlin, Senior Member

Signed:         ..............Signed….................................................
  Associate

Dates of last submissions        16 July 2010
Date of Decision  21 July 2010
Counsel for the applicant          Mr FL Harrison QC with Mr DW Marks
Solicitors for the applicant        Moore Stephens (Gold Coast) Pty Ltd 
Counsel for the Respondent     Mr BD O’Donnell QC with Mr S Lumb
Solicitors for the Respondent    McInnes Wilson Lawyers