Decision: Applications 2023/5016, 2023/5018-5019, 2023/5128-5129, and 2023/7508-7509, are dismissed.

PRACTICE AND PROCEDURE - TAXATION - jurisdiction - sole director convicted of conspiracy to import cocaine - whether disqualified due to operation of section 206B(1)(b)(ii) Corporations Act - whether taxation objections lodged with proper authority - conviction involved dishonesty - director disqualified - taxation objections invalid as not lodged with proper authority - applications dismissed due to Tribunal having no jurisdiction

Administrative Review Tribunal Act 2024 (Cth) - section 97

Corporations Act 2001 (Cth) - sections 9, 206B(1), 206B(1)(b)(ii)

Criminal Code Act 1995 (Cth) - sections 11.5, 11.5(1), 11.5(2)(a), 11.5(2)(b), 307.1, 307.1(1)(c)

Taxation Administration Act 1953 (Cth) - Part IVC, sections 14ZL, 14ZQ, 14ZY, 14ZZ, 14ZZA

Bosanac v Commissioner (2019) 374 ALR 425; (2019) 93 ALJR 1327; [2019] HCA 41

Calabretta v Redpen D_evelopments Pty Ltd (in liquidation) (receivers and managers appointed)_ (2010) 183 FCR 47; [2010] FCA 81

Donojon 1325 Pty Ltd v Donojon Pty Ltd atf Donojon Unit Trust & Anor [2026] VSC 58

McCann v Switzerland Insurance [2000] 203 CLR 579; [2000] HCA 65

MultitecFBM (Asia Pacific) Pty Ltd v Han (2008) 69 ACSR 106; [2008] NSWSC 1339

Peters v The Queen [1998] 192 CLR 493; [1998] HCA 7

Segler & Commissioner of Taxation [2024] AATA 4286

Tara Communications Group Pty Ltd v Simons Ravden Pty Ltd (2008) 69 ACSR 106; [2008] NSWSC 1339

Waters v Diesel Holdings Pty Ltd [2024] VSCA 77

1. On 8 April 2026, I heard an interlocutory matter concerning the jurisdiction of the Tribunal to hear the four applications filed by the corporate applicants. I issued orders later that day dismissing the applications to the Tribunal by the four corporate applicants on the basis that the Tribunal had no jurisdiction to hear those applications. These are my reasons for doing so.
2. The issue for determination is: does the conviction in February 2020 of Mr Rohan Peter Arnold, the sole director of each of Arnold Consulting Services Pty Ltd, Selx Holdings Pty Ltd, Lohan Herbi Ventures Pty Ltd atf for the Lohan Herbi Ventures Trust, and Pyrtee Pty Ltd atf RPA Family Trust, mean that none of these four corporate applicants has a director and therefore cannot bring an application for review of taxation assessments issued to those companies?[1]

1. In 2023, the Commissioner of Taxation issued reasons for decision disallowing in part objections made by each of the corporate applicants to assessments of income tax and assessments for shortfall penalty. The assessments the subject of the objections are:

1. Review applications were commenced in the former Administrative Appeals Tribunal in July and October 2023,[2] by each of the four corporate applicants.[3]
2. On 20 February 2020, Mr Arnold was convicted on his plea of guilty in the District Court of New South Wales on the following indictment:

Between about 18 January 2017 and about 16 January 2018, at Sydney in the State of New South Wales and elsewhere, did conspire with [redacted name] and [redacted name] and divers others to import a commercial quantity of a border controlled drug, namely cocaine, contrary to subsection 307.1(1) and 11.5(1) of the Criminal Code.[4]

3. Mr Arnold was sentenced to a total of 27 years' imprisonment, with a non-parole period of 19 years and 6 months, backdated to 16 January 2018. Mr Arnold is currently incarcerated at a correctional facility in New South Wales.
4. There is no dispute between the parties that, since at least 2017, Mr Arnold was the sole director of each of the four corporate applicants.
5. The Commissioner first raised the question of the corporate applicants' ability to pursue their review applications in about February 2026. On 10 March 2026, I made orders to the effect that the question of jurisdiction was to be determined at an interlocutory hearing on 8 April 2026 and directed the filing of written submissions.
6. The question before me solely concerns the impact of Mr Arnold's conviction in 2020 on his status after that date as a director of each of the corporate entities.

1. I set out below a chronology of the relevant events.

Commissioner issues audit decision and notices of assessment for each of Consulting, Selx, Lohan, and Pyrtee

Mr Arnold sentenced to 27 years in prison, backdated to the date he was taken into custody

Selx, by its agent law firm Aulich, filed an objection to the assessments

Pyrtee, by its agent law firm Aulich, filed an objection to the assessments

Lohan, by its agent law firm Aulich, filed an objection to the assessments

Consulting, by its agent law firm Aulich, filed an objection to the assessments

Commissioner issues objection decisions for each of Consulting, Selx, and Lohan

Consulting, Selx, and Lohan, by their agent law firm Aulich, commence review proceedings in the AAT

Pyrtee, by its agent law firm Aulich, commences review proceedings in the AAT

1. The Commissioner contends that Mr Arnold's conviction resulted in an automatic disqualification as a director of Consulting, Selx, Lohan, and Pyrtee, under section 206B(1)(b)(ii) of the Corporations Act 2001. It follows from this:

(a) Mr Arnold had no legal authority to cause the four corporate applicants to lodge objections to assessments, so that the objections were invalid; > > (b) the objection decisions were not validly made; > > (c) the objection decisions are not reviewable objection decisions within the meaning of the Taxation Administration Act 1953 (Cth) (TAA); and > > (d) the Tribunal has no jurisdiction to review.

2. The heart of the argument was that once the conviction was recorded, Mr Arnold was automatically disqualified as a director, so that any acts he purported to undertake as a director after that date were invalid.
3. Mr Bruckner, for Mr Arnold, submits that Mr Arnold is not disqualified as a director by reason of his conviction because the conviction does not involve dishonesty in the relevant sense. Furthermore, they submit that even if he was disqualified, the objections filed with the Commissioner in 2022 were valid, so that the objection decisions are valid, and the proceedings in the Tribunal are within jurisdiction.

1. In Segler & Commissioner of Taxation,[5] I considered what the necessary steps were to confer jurisdiction on the Tribunal in the context of a taxation matter. I explained:

[26] Relevantly, the TAA confers jurisdiction on the Tribunal to review some decisions made by the Commissioner of Taxation. However, as ss 14ZZ and 14ZZA of the TAA make plain, it is not every action by the Commissioner which is subject to review by the Tribunal. Relevantly, review is only available for matters which fall within the definition of 'reviewable objection decisions' which in turn requires that an 'objection decision' has been made. Objection decision is defined in s 14ZY to include, relevantly, a 'taxation objection' is defined in s 14ZL in the following terms: > > (1) This Part applies if a provision of an Act or a legislative instrument (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. > > [27] In order for a taxpayer to commence the process of making a taxation objection, a 'taxation decision' must have been made. 'Taxation decision' is defined in s 14ZQ to mean 'the assessment, determination, notice or decision against which a taxation objection may be, or has been, made'. > > [28] Consequently, the preconditions for a taxpayer seeking review in the Tribunal are: > > (a) a taxation decision must have been made; > > (b) a taxation objection must have been made; and > > (c) the taxation objection must be a reviewable objection decision.[6]

2. In this case, each of the assessments issued to each of the corporate applicants is a taxation decision within the meaning of section 14ZQ of the TAA. Unlike in Segler, each of the corporate applicants lodged a taxation objection with the Commissioner. Providing those objections were validly made, the decisions on the taxation objections are reviewable objection decisions within the meaning of the TAA. They will be validly made if Mr Arnold was not disqualified, or if he was disqualified but his disqualification did not invalidate his actions in giving instructions to Aulich to lodge objections with the Commissioner.

1. Section 206B(1) of the Corporations Act provides:

A person becomes disqualified from managing corporations if the person: > > (a) is convicted on indictment of an offence that: > > (i) concerns the making, or participation in making, of decisions that affect the whole or a substantial part of the business of the corporation; or > > (ii) concerns an act that has the capacity to affect significantly the corporation's financial standing; or > > (b) is convicted of an offence that: > > (i) is a contravention of this Act and is punishable by imprisonment for a period greater than 12 months; or > > (ii) involves dishonesty and is punishable by imprisonment for at least 3 months; or > > (c) is convicted of an offence against the law of a foreign country that is punishable by imprisonment for a period greater than 12 months. > > The offences covered by paragraph (a) and subparagraph (b)(ii) include offences against the law of a foreign country.[7]

2. Dishonest means dishonest according to the standards of ordinary people.[8]
3. It is clear that the disqualification of the director is an automatic consequence of a conviction falling within, relevantly, section 206B(1)(b)(ii).
4. The sole question is whether the offence for which Mr Arnold was convicted in 2020 was one which 'involves dishonesty'. The parties agree that the relevant authority is Waters v Diesel Holdings Pty Ltd where the Victorian Court of Appeal found:[9]

Section 206B(1)(b)(ii) captures offences in which dishonesty is inherent or an element of the offence. All that is necessary to determine whether an offence falls within s 206B(1)(b)(ii) is to consider the relevant legislative provision or common law rule for the offence. No further inquiry is necessary.

5. The effect of this is that I should look at the offence itself, but not at the statement of agreed facts or the sentencing remarks of the District Court of NSW, in determining whether Mr Arnold's conviction was one which involved dishonesty.

1. Section 307.1 of the Criminal Code Act 1995 relevantly provides:

307.1 Importing and exporting commercial quantities of border controlled drugs or border controlled plants > > (1) A person commits an offence if: > > (a) the person imports or exports a substance; and > > (b) the substance is a border controlled drug or border controlled plant; and > > (c) the quantity imported or exported is a commercial quantity.

2. Section 11.5 of the Code contains the provisions in respect to conspiracy:

11.5 Conspiracy > > (1) A person who conspires with another person to commit an offence punishable by imprisonment for more than 12 months, or by a fine of 200 penalty units or more, commits the offence of conspiracy to commit that offence and is punishable as if the offence to which the conspiracy relates had been committed. > > (2) For the person to be guilty: > > (a) the person must have entered into an agreement with one or more other persons; and > > (b) the person and at least one other party to the agreement must have intended that an offence would be committed pursuant to the agreement; and > > (c) the person or at least one other party to the agreement must have committed an overt act pursuant to the agreement.[10]

1. The offending involved Mr Arnold and others, being charged with conspiracy to import cocaine. The indictment on which he was charged and convicted is set out earlier in these reasons.
2. The actual amount of cocaine is not relevant to my consideration, other than the fact it is 'a commercial quantity' within section 307.1(1)(c) of the Code. The indictment itself identified two named and other unnamed co-conspirators, in accordance with section 11.5(2)(a). I infer from his plea of guilty that all other relevant elements of the offence were proven. In doing so, in particular I infer, without reference to the statement of material facts, that Mr Arnold pleaded guilty to an offence which included:

(a) him entering into an agreement with the other people;[11] and > > (b) him, and at least one other person, intending to commit the offence of importing a commercial quantity of cocaine into Australia.[12]

3. The question then is whether entering into an agreement with other people, and Mr Arnold and one other person, intending that they import a commercial quantity of cocaine into Australia, is an offence which involves dishonesty. In my view it is.
4. Dishonesty is not a term of art, but an ordinary concept. In Peters v The Queen,[13] it was found that dishonesty is to be determined by reference to the mental state of the person whose conduct is in issue.[14] In that case, the High Court was considering what directions a jury required in a criminal matter involving a solicitor convicted of conspiracy to defraud, where the impugned conduct of the appellant involved a positive act.[15] The intention to enter an agreement intended to be achieved by dishonest means warrants punishment by the criminal law.[16] By contrast, in McCann_,[17]_ the High Court considered dishonesty in the context of an omission, being the failure by a solicitor to disclose to a client certain information which he had, that failure leading the client to paying money out and losing it so that the solicitor could earn a secret commission. The crucial aspects of the solicitor's conduct, in omitting to advise his client of the information that led to his omission's characterisation as dishonest, were that it was in breach of his fiduciary duties, and that he must have known he should have disclosed the information.
5. In this case, the offence itself provides the answer. By pleading guilty, Mr Arnold accepted that he entered into an agreement with others and that he and at least one other person had the intention of committing the offence of importing a commercial quantity of cocaine into Australia.
6. I am therefore satisfied that the offence Mr Arnold was convicted of involved dishonesty in the relevant sense. I am therefore satisfied that Mr Arnold was disqualified as a director by reason of the operation of section 206B(1)(b)(ii) of the Corporations Act on the date of his conviction in 2020.

1. Section 14ZL of the TAA confers a right on a person who is dissatisfied with an assessment to object to its making. The person who can make the objection is the taxpayer to whom the assessment is issued. In the case of a trust, the person is the trustee, in the case of a company, it is the company itself.
2. It is trite law that a company can only operate through its director or directors, so that if the company has only one director, it is that director who is the company's mind and who can lodge a taxation objection under section 14ZL of the TAA. Notably, each of Consulting, Selx, Lohan, and Pyrtee had only one director at the time the Commissioner issued the notices of assessment, the taxation decisions, in September 2018.
3. No other or additional director was appointed at any time after September 2018 to any of the companies; the person giving instructions to Aulich at the time the objections were lodged, in 2022, was Mr Arnold. Aulich must have been aware that he was incarcerated at the time he gave those instructions, that firm having acted for him in the criminal proceedings.
4. In my view, the right to lodge a taxation objection in section 14ZL of the TAA presupposes that the person who lodges it has the legal authority to do so. For each of these four corporate applicants, that would require the person giving instructions to the lawyers to lodge the objections being a director of the relevant company, or otherwise being authorised by the company to give instructions.[18] A person who was not a director of the company was only able to give instructions if she or he were acting on the authority of the company. Therefore a person who had been a director, but was disqualified at the time of giving the instructions to file the taxation objection, would only be able to lawfully give those instructions if there was another director appointed at the time who authorised the disqualified person to give the instructions to the lawyers.[19] It is common ground that there was no other director able to authorise Mr Arnold to give instructions to Aulich to lodge the objections.
5. As I explained in Segler, if there is no valid taxation objection, there is no reviewable decision, and no jurisdiction residing in the Tribunal. That is of course to be understood in light of Bosanac v Commissioner,[20] which explains that it is the assessment which is the decision under review, not the objection decision itself. However, the objection decision is a precondition of jurisdiction in this Tribunal, so that, irrespective of there being a valid reviewable decision, i.e. assessment, in the absence of a valid taxation objection, there cannot be a valid objection decision.
6. Mr Bruckner pressed on me that the objections filed by the corporate applicants, on Mr Arnold's instructions given at a time when he was disqualified as a director, remained valid objections. This submission was grounded in the NSW Supreme Court decision of MultitecFBM (Asia Pacific) Pty Ltd v Han,[21] involving a person who was disqualified from managing a corporation who instructed solicitors on behalf of a company. The disqualified person was not a director himself and acted on the authority of the sole director of the company. Furthermore, the sole director ratified the instructions to the solicitor. The case concerned whether the disqualified person was acting within the boundaries of his authority at the time he instructed the solicitors. It does not stand for a broad general proposition that the acts of a disqualified person are valid. Much less does it stand for the proposition that, irrespective of a director's disqualification under section 206B, the acts done by the former director, after his disqualification, are valid.[22]
7. Section 97 of the Administrative Review Tribunal Act (ART Act) provides that I must dismiss an application if I am satisfied that the decision is not reviewable by the Tribunal. I am satisfied that the absence of a valid objection means the taxation decisions, the various notices of assessment issued to the corporate applicants in September 2018, are not reviewable decisions and so the Tribunal has no jurisdiction. The review applications by the corporate applicants must be dismissed.

1. For these reasons, on 8 April 2026, I made orders dismissing each of the following applications:

(a) 2023/5016, between Consulting and the Commissioner; > > (b) 2023/5018-5019, between Selx and the Commissioner; > > (c) 2023/5128-5129, between Lohan and the Commissioner; and > > (d) 2023/7508-7509, between Pyrtee and the Commissioner.

I certify that the preceding thirty-six paragraphs are a true copy of the reasons for the decisions herein of Deputy President C Thompson SC

..................................[SGD]..................................

[1] Mr Arnold himself was also issued with assessments and has lodged an application, which is being case managed concurrently with those of the four corporate applicants. The conviction has no impact on the Tribunal's jurisdiction in respect to Mr Arnold's personal assessments. Counsel who appeared at the hearing appeared for Mr Arnold alone.

[2] Each of Consulting, Selx, and Lohan commenced their reviews in July 2023. Pyrtee commenced its review in October 2023. All four were commenced within time.

[3] These were transferred to this Tribunal upon its commencement in October 2024.

[5] [2024] AATA 4286.

[8] Section 9 of the Corporations Act.

[9] [2024] VSCA 77 at [78]; emphasis added.

[11] Section 11.5(2)(a) of the Code.

[12] Section 11.5(2)(b) of the Code.

[13] [1998] HCA 7; [1998] 192 CLR 493, [18], per Toohey and Gaudron JJ.

[14] As explained in McCann v Switzerland Insurance [2000] HCA 65; [2000] 203 CLR 579 by Gaudron J at [55], citing the joint judgment of herself and Toohey J in Peters.

[15] Given the plea of guilty in Mr Arnold's case, the question of jury directions is not relevant.

[16] [1998] HCA 7; [1998] 192 CLR 493, [141] per Kirby J.

[17] [2000] HCA 65; [2000] 203 CLR 579, [61] - [62] per Gaudron J.

[18] For example, a validly appointed director might instruct an accountant to lodge objections.

[19] Donojon 1325 Pty Ltd v Donojon Pty Ltd atf Donojon Unit Trust & Anor [2026] VSC 58 concerning a bankrupt person, someone automatically disqualified under section 206B(3) of the Corporations Act.

[20] (2019) 374 ALR 425; (2019) 93 ALJR 1327; [2019] HCA 41.

[21] (2008) 69 ACSR 106; [2008] NSWSC 1339 at [34] - [35].

[22] Tara Communications Group Pty Ltd v Simons Ravden Pty Ltd [2008] NSWSC 1339 at [11]; See too Calabretta v Redpen Developments Pty Ltd (in liquidation) (receivers and managers appointed) [2010] FCA 81 regarding the need to seek validation by the Court of the appointment of an administrator, appointed by the sole director of a company who was disqualified at the time of the purported appointment.