Commissioner of Taxation v Tamarama Fresh Juices Australia Pty Ltd

The issue 3 The issue before the primary judge was within a limited compass. Could the Commissioner be required by subpoena to disclose "protected information" on the basis that disclosure "was necessary…for the purpose of carrying into effect the provisions of taxation law" within the meaning of s 355-75 of Sch 1 to the Taxation Administration Act 1953 (Cth)? If disclosure of the "protected information" was not "necessary…for the purpose of carrying into effect the provisions of a taxation law" then the subpoena had to be set aside given the terms of s 355-75. 4 Despite the confined scope of the appeal, the arguments presented by both parties in the appeal differed from those made to the primary judge. The Commissioner, the recipient of the subpoena who sought an order setting the subpoena aside based on s 355-75, no longer argued that for disclosure of "protected information" to be "necessary…for the purpose of carrying into effect the provisions of a taxation law" the purpose must arise directly from the taxation legislation. The respondents, as the party who had served the subpoena, no longer argued that "necessary" meant nothing more than "plainly appropriate" for the purpose of carrying into effect the provisions of taxation law. It was thus common ground in the appeal that "necessary" meant more than merely "appropriate", no matter how manifest the propriety might appear, the best synonym for "necessary" being "requisite".

Facts 5 It is not helpful to explain his Honour's process of reasoning because it reflected the way in which the parties had put their arguments at that time. It was not in dispute before us that the subpoena required the Commissioner to produce "protected information", a term defined in s 355-30 of the Taxation Administration Act, being information disclosed or obtained for the purposes of a taxation law, relating to the affairs of an entity which identifies or is reasonably capable of identifying the entity. Otherwise, as the primary judge explained at [7]-[27]: (1) In January 2015 the liquidators of various companies within a group which had been controlled by members of the Binetter family took proceedings in this Court suing members of the family and other companies for equitable compensation effectively equivalent to the tax liabilities of the companies in liquidation. These proceedings are SAD 5 of 2015. (2) In BCI Finances Pty Ltd (In Liq) v Binetter (No 4) [2016] FCA 1351; (2016) 117 ACSR 18 Gleeson J found in favour of the plaintiff companies in SAD 5 but did not determine pecuniary relief. (3) In December 2015, after the hearing before Gleeson J in SAD 5 but before the judgment in Binetter (No 4), the liquidators of the plaintiff companies commenced these proceedings against other entities within or related to the same group of companies or otherwise controlled by members of the Binetter family, referred to as the Nudie entities and the Winmar companies. (4) The plaintiff companies seek compensation from the Nudie entities and Winmar companies on grounds similar to the claims for equitable compensation in the SAD 5 proceedings. (5) The Nudie entities and the Winmar companies each filed an interlocutory application seeking an order permanently staying these proceedings as an abuse of process given the SAD 5 proceedings (relying on an Anshun estoppel, Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589). (6) The Nudie entities sought and were granted leave to issue a subpoena to the Commissioner. The subpoena sought documents given by or to the Commissioner and the liquidators relating to the Nudie entities including taxation assessments and to possible joinder of the Nudie entities as respondents to the SAD 5 proceedings. (7) The Commissioner is the only external creditor of the plaintiff companies.

Conclusion 6 We do not consider that the disclosure required by the subpoena can be said to be "necessary…for the purpose of carrying into effect the provisions of a taxation law" merely because the Commissioner is the only external creditor of the plaintiff companies and the compensation sought is equivalent to the taxation liabilities which the plaintiff companies owed to the Commissioner. This conclusion, in our view, follows from the relevant provisions of Sch 1 to the Taxation Administration Act.

The nature of the appeal 7 The question whether, in any particular case, disclosure of protected information is "necessary…for the purpose of carrying into effect the provisions of a taxation law" involves an evaluative exercise about which minds may differ. Appellate review of a decision of this character should be subject to the same principles as discretionary decisions, as set out in House v The King [1936] HCA 40; 55 CLR 499 at 505; that is, an error of principle or a plainly unreasonable or unjust result is required before appellate intervention is warranted (Ghosh v NineMSN Pty Ltd [2015] NSWCA 334; (2015) 90 NSWLR 595 at [37]; Wilmar Sugar Australia Limited v Mackay Sugar Limited [2017] FCAFC 40 at [45]-[46]). 8 In the present case the primary judge's conclusion at [114] reflected his Honour's acceptance of the Nudie entities' case that to permit the Commissioner to disclose protected information to the liquidators "while at the same time withholding the same documents" from the Nudie entities' would involve a "one sided outcome [which] would not be conducive to the recovery of the correct or true amount of tax and would not be in the interests of justice". It is apparent from this that his Honour at least implicitly accepted the argument for the Nudie entities that disclosure was "plainly appropriate" for the purpose of taxation legislation, an argument not pursued in the appeal. To this extent, his Honour was led into an error of principle. 9 Apart from this, and as explained below, we are satisfied that the disclosure sought by the subpoena is not for the purpose of "carrying into effect the provisions of a taxation law". The primary judge's description at [114] that the "ultimate aim of the present proceeding or, the real purpose of the present proceeding, is to recover the unpaid tax which is the subject of the various assessments issued by the Commissioner against the plaintiffs" may be accepted as reflecting the Commissioner's purpose in funding the actions by the liquidators of the plaintiff companies and voluntarily disclosing protected information to the liquidators. The Commissioner's purpose, however, is not the test. The test is whether the disclosure is necessary for the purpose of carrying into effect the provisions of a taxation law. The required relationship is thus between the disclosure and giving effect to the provisions of a taxation law, and the required criteria are that the relationship is one of purpose (in contrast, for example, to mere effect or consequence) and necessity (in contrast, for example, to mere relevance, convenience, desirability or propriety). 10 In the present case, the relationship between the subpoena in aid of an application to stay a proceeding as a consequence of which the Commissioner, as a creditor, may stand to recover in the winding up of the plaintiff companies an amount equivalent to unpaid tax debts is too tenuous and remote be characterised as disclosure for the purpose of "carrying into effect the provisions of a taxation law", let alone the disclosure being "necessary" for that purpose.

The statutory scheme 11 The relevant provisions are in Div 355 of Sch 1 to the Taxation Administration Act which concerns the confidentiality of taxpayer information. Section 355-1 explains that: The disclosure of information about the tax affairs of a particular entity is prohibited, except in certain specified circumstances. Those exceptions are designed having regard to the principle that disclosure of information should be permitted only if the public benefit derived from the disclosure outweighs the entity's privacy. 12 The objects of Div 355 in s 355-10 are: (a) to protect the confidentiality of taxpayers' affairs by imposing strict obligations on *taxation officers (and others who acquire protected tax information), and so encourage taxpayers to provide correct information to the Commissioner; and (b) to facilitate efficient and effective government administration and law enforcement by allowing disclosures of protected tax information for specific, appropriate purposes. 13 While it may be accepted that the objects reflect a balance between competing interests, it is important to recognise that the balance is struck by the content of the succeeding provisions. It is not left to a discretionary exercise. 14 Subdivision 355-B concerns the recording or disclosure of protected information by a taxation officer (which is defined to mean the Commissioner or an individual appointed or engaged under the Public Service Act 1999 (Cth) and performing duties in the Australian Taxation Office; s 355-30). Section 355-25 makes it an offence for a taxation officer to record or disclose protected information acquired by a taxation officer as a taxation officer other than to a court or tribunal or to the entity to which the information relates or, in effect, that entity's agents. By s 355-35 the consent of the entity to which the protected information relates is not a defence. 15 Section 355-50 provides an exception to the offence provision in s 355-25 if the recording or disclosure is made by the taxation officer in performing duties as a taxation officer including, in the table to s 355-50(2), a record or disclosure to any entity, court or tribunal "for the purpose of administering any taxation law" (item 1 in the table) or "for the purpose of criminal, civil or administrative proceedings (including merits review or judicial review) that are related to a * taxation law" (item 3 in the table). 16 A "taxation law" is an Act of which the Commissioner has the general administration (including a part of an Act to the extent to which the Commissioner has the general administration of the Act) or legislative instruments made under such an Act (including such a part of an Act) or the Tax Agent Services Act 2009 (Cth) or regulations made under that Act (s 995-1 of the Income Tax Assessment Act 1997 (Cth)). 17 It is common ground that the Commissioner of Taxation disclosed "protected information" about the Nudie entities to the liquidators of the plaintiff companies relying on the exceptions in items 1 and 3 in the table to s 355-50(2). It is also common ground that the subpoena will require production of the documents the Commissioner disclosed to the liquidators. 18 There are other exceptions to the offence created by s 355-25 under which a taxation officer may disclose protected information specified in s 355-55 to s 355-70, but they need not be identified. It is sufficient to note that all such exceptions, in common with s 355-50, involve voluntary disclosures by a taxation officer. 19 In contrast to the earlier provisions s 355-75 concerns compulsory disclosure of protected information to a court or tribunal. Section 355-75 provides that: An entity who is or was a * taxation officer is not to be required to disclose to a court or tribunal * protected information that was acquired by the entity as a taxation officer except where it is necessary to do so for the purpose of carrying into effect the provisions of: (a) a * taxation law; or (b) the Foreign Acquisitions and Takeovers Act 1975 , if the entity acquired the information because of a request under subsection 138(4) of that Act. 20 As the Commissioner submitted, there are some obvious differences between s 355-75 (dealing with disclosure under compulsion) and s 355-50 (dealing with voluntary disclosure). On the one hand, a taxation officer may disclose protected information "for the purpose of administering any taxation law" or "for the purpose of criminal, civil or administrative proceedings (including merits review or judicial review) that are related to a * taxation law". On the other hand, a taxation officer may not be required to disclose protected information unless the disclosure is "necessary for the purpose of carrying into effect the provisions of a taxation law". The provisions do not mirror each other. Nor is there any sensible reason why they should do so when one provision concerns permissible voluntary disclosures and the other concerns disclosures under compulsion to a court or tribunal. Section 355-75 involves a relatively confined subset of s 355-50. This is because a disclosure may be for the purpose of administering a taxation law or for the purpose of proceedings that are related to a taxation law (s 355-50) without the disclosure being necessary to carry into effect the provision of a taxation law (s 355-75). However, a disclosure necessary to carry into effect the provision of a taxation law (s 355-75) must be a disclosure for the purpose of administering a taxation law (s 355-50). 21 Subdivision 355-C concerns disclosures of protected information by people other than a taxation officer. Such disclosure is also an offence (s 355-155), to which there are exceptions generally equivalent to the references in Subdivision 355-B to the purpose of administering a taxation law or for the purpose of proceedings that are related to a taxation law (s 355-170 to s 355-200). Section 355-205 concerns disclosure such other people may be required to make to a court or tribunal and is in terms equivalent to s 355-75 (that is, disclosure necessary for the purpose of carrying into effect the provisions of a taxation law). 22 Subdivision 355-D concerns the disclosure of protected information that has been unlawfully acquired. Such disclosure is an offence (s 355-265), to which there are exceptions again reflecting in part the references in Subdivision 355-B the purpose of administering a taxation law or for the purpose of proceedings that are related to a taxation law (s 355-275). Section 355-280, like s 355-75 and s 355-205, concerns the disclosure of protected information acquired under Subdiv 355-D which a person may be required to make to a court or tribunal, which is also confined to disclosure necessary for the purpose of carrying into effect the provisions of a taxation law. 23 From these provisions it is apparent that the statutory scheme does not treat voluntary and compulsory disclosures in the same manner. In each case, whether the relevant person is a taxation officer or not, the scope of disclosures that a taxation officer may make is wider than those which such an officer may be required to make to a court or tribunal. It follows that there may be cases, such as the present in our view, in which a taxation officer may make a disclosure of protected information to a person (for example under s 355-50(2)) but may not be required to disclose the same information to a court or tribunal under s 355-75. As a result, application of the provisions of this scheme may well involve a "one sided" situation as the primary judge concluded at [114] (that is, disclosure of protected information by the Commissioner to the liquidators which the Commissioner cannot also be required to disclose to a court or tribunal), but that one-sidedness results from the asymmetry of the statutory provisions. It embodies the balance which the Parliament has struck, in the content of the provisions, between the competing interests identified in s 355-10. 24 The extrinsic material supports this approach to the provisions. The Tax Laws Amendment (Confidentiality of Taxpayer Information) Bill 2010 (Cth) Explanatory Memorandum, which introduced Div 355 explains the exceptions for compulsory disclosures to a court or tribunal in ss 355-75, 355-205 and 355-280 in paragraph 4.18 in terms consistent with the provisions (that is, such disclosures may only be required where necessary for carrying into effect the provisions of a taxation law). This may be contrasted with paragraph 5.20 which explains the disclosures a taxation officer may make in s 355-50(2) which include disclosures for the purpose of proceedings that are "directly or indirectly related to a taxation law". In other words, the Explanatory Memorandum accurately reflects the different treatment of voluntary and compulsory disclosures of protected information. The reference to "directly or indirectly related to a taxation law" in paragraph 5.20, on which the primary judge relied at [107] to support his conclusion, concerns only voluntary (that is, s355-50) and not compulsory (that is, s 355-75) disclosures. 25 In common with the primary judge we consider that decisions concerning the predecessor provision in s 16 of the Income Tax Assessment Act 1936 (Cth) (the 1936 Act) are relevant. We also consider that, other than perhaps the reasoning in Re Confitt Constructions Pty Ltd (In Liq) [1999] 2 Qd 490 and Re Fortex Pty Ltd and the Income Tax Assessment Act (1986) 17 ATR 690, those decisions support our conclusions. In considering the decisions it is important to appreciate the particular issue with which each is dealing. Some deal with the scope of "protected information" (s 16(1)). Some deal with voluntary disclosures by a taxation officer (s 16(2)). Some deal with disclosures a taxation officer may be required to make to a court or tribunal (s 16(3)). Section 16 was in these terms: (1) In this section, unless the contrary intention appears… 'officer' means a person who is or has been appointed or employed by the Commonwealth or by a State, and who by reason of that appointment or employment, or in the course of that employment, may acquire or has acquired information respecting the affairs of any other person, disclosed or obtained under the provisions of this Act or of any previous law of the Commonwealth relating to income tax. (2) Subject to this section, an officer shall not either directly or indirectly, except in the performance of any duty as an officer, and either while he is, or after he ceases to be an officer, make a record of, or divulge or communicate to any person any information respecting the affairs of another person acquired by the officer as mentioned in the definition of officer in subsection (1). (3) An officer shall not be required to produce in Court any return, assessment or notice of assessment, or to divulge or communicate to any Court any matter or thing coming under his notice in the performance of his duties as an officer, except when it is necessary to do so for the purpose of carrying into effect the provisions of this Act or of any previous law of the Commonwealth relating to Income Tax. 26 It is apparent from these provisions that s 16(1) and (2) are the equivalent of s 355-50 (protected information and voluntary disclosure). Section 16(3) is the equivalent of s 355-75 (compulsory disclosure). 27 Before considering the cases relating to s 16 of the 1936 Act, it should also be noted that there was no issue that the Commissioner has the function of not merely assessing, but also recovering tax. Chapter 2 of Schedule 1 to the Taxation Administration Act concerns the collection, recovery and administration of income tax, the Commissioner having functions in respect of all of these matters. 28 Canadian Pacific Tobacco Company Limited v Stapleton [1952] HCA 32; (1952) 86 CLR 1 concerned s 16(1) of the 1936 Act which functioned to define information protected from disclosure and the exception in s 16(2). Dixon CJ considered it appropriate to give a "very wide meaning" to the information protected from disclosure and the s 16(2) exception (at 5-7). The case did not concern the equivalent to s 355-75 which is in s 16(3). In the Full Court the observations of Williams J about s 16(3) at 11 (that the section "only protects an officer from being required to do those things, it does not forbid his doing them") exposes the difference between the disclosures that a taxation officer may make and may be required to make to a court or tribunal. 29 Norper Investments Pty Ltd v Deputy Commissioner of Taxation (1977) 7 ATR 463 concerned s 16(3). It was a case in which the Commissioner applied to wind up a company for unpaid tax. The company subpoenaed the Commissioner for documents relating to the company's affairs. Justice Needham concluded that the exception in s 16(3) ("necessary to do so for the purpose of carrying into effect the provisions of this Act …") was satisfied as the Commissioner was recovering tax and thus carrying into effect the provisions of the 1936 Act. 30 The primary judge at [54] cogently explained why the reasoning in Re Fortex cannot be reconciled with the statutory provisions on the basis that the "whole purpose of s 16(3) was to absolve an officer (as defined) from being required to produce material to the Court except when it was necessary to do so for the purpose of carrying into effect the provisions of the 1936 Act or other appropriate laws of the Commonwealth". We agree with the primary judge and consider Re Fortex to be wrongly decided. The Nudie entities did not suggest to the contrary. 31 Purnell Bros Pty Ltd v Transport Engineers Pty Ltd (1984) 73 FLR 160 concerned the Commissioner's application to set aside a subpoena relying on s 16(3). Former directors of a company were seeking to remove a liquidator. The Commissioner was not a party to the proceedings but was a creditor of the company. The former directors served a subpoena on the Commissioner for the production of documents relating to the tax affairs of the company. At 178-179 Powell J said: It being clear enough, one would think, that the Commissioner is, for relevant purposes, "an officer", and that the documents-if they exist-sought to be produced constitute, or relate to, matters or things coming into the possession of, or coming under the notice of, the Commissioner or his officers in connection with the performance of his, and their, official duties, it would seem to follow that the documents may not be produced, nor can production of them be compelled, unless "it is necessary to do so for the purpose of carrying into effect the provisions of this Act". Whatever may be one's view as to the position in relation to taxation appeals …or cases in which the Commissioner, as a Plaintiff, is actively seeking to recover a debt for taxation …I am quite unable to see how it can be said that "it is necessary.... for the purpose of carrying into effect the provisions of the Act" that the documents sought to be produced in fact be produced for the purposes of an application to which the Commissioner is a stranger. 32 Commissioner of Taxation v Nestle Australia Ltd (1986) 12 FCR 257 concerned s 16(2), not s 16(3). The Full Court of the Federal Court held that discovery of documents by the Commissioner in judicial review of a decision under s 206 of the 1936 Act (to refuse to grant an extension of time for payment of income tax) was within the exception in s 16(2) of "in the performance of any duty as an officer". The Full Court (at 262-263) also described the exception in s 16(3) ("when it is necessary to do so for the purpose of carrying into effect the provisions of this Act…") as covering: the production of documents by an officer to courts or his giving evidence in proceedings before them for recovery of tax (Norper Investments Pty Ltd v Deputy Federal Commissioner of Taxation (1977) 77 ATC 4211); appeals to Supreme Courts against the disallowance of objections to assessments (Re Fortex Pty Ltd (supra)); appeals under the Taxation (Unpaid Company Tax) Assessment Act 1982 (Cth) (Hutchins v Federal Commissioner of Taxation (supra)); appeals to this Court from judgments of Supreme Courts on taxation appeals both at first instance and from decisions of boards of review; appeals to this Court from decisions of the Administrative Appeals Tribunal in tax matters which has recently subsumed the jurisdiction formerly exercised by boards of review; and proceedings pursuant to s 39B of the Judiciary Act 1903 or the Judicial Review Act involving challenges to decisions of officers of the Taxation Office of the kind mentioned earlier. Other proceedings in addition to these may be within the scope of the exception; but the principal ones appear to be those just mentioned. 33 Propend Finance Pty Limited v Commissioner of Australian Federal Police (1994) 27 ATR 584 involved the validity of search warrants. The applicants, challenging the warrants, served a subpoena on the Commissioner who sought to set the subpoena aside relying on s 16(3). At 591 Davies J said: Ms Fullerton submitted that, in the context of s 16(3), the word "necessary" means "indispensable" or "requisite". I would accept the second meaning. 34 At 592 Davies J concluded that it had not been shown that disclosure would assist in carrying into effect the provisions of a taxation law so that the exception in s 16(3) was not engaged. In so concluding his Honour noted that "it is not requisite or appropriate that there be disclosure by the Australian Taxation Office". Given that his Honour had expressly accepted that "necessary" in s 16(3) meant "requisite" we do not consider that this statement suggests he considered "appropriate" also to be a synonym for "necessary" in s 16(3). Rather, we consider that his Honour was emphasising that the subpoena to the Commissioner fell far short of satisfying the criterion of necessity. 35 Simionato Holdings Pty Ltd v Commissioner of Taxation (1995) 60 FCR 375 concerned judicial review of the Commissioner's actions in seizing banking records which were provided to the liquidator of companies of which the Commissioner was a creditor. Accordingly, the case involved s 16(2), not s 16(3). The Commissioner was not being required to disclose to a court or tribunal any information but, in reliance on the exception in s 16(2) ("in the performance of any duty as an officer…"), had disclosed information for the purpose of increasing the prospect of recovery of unpaid taxes in the liquidation. As von Doussa J explained at 384: When the companies were placed into liquidation, the Commonwealth became an unsecured creditor in the liquidation, along with any other unsecured creditors. Rights under the general law to otherwise recover the tax debts were superseded by the right to prove in the liquidation as an unsecured creditor, and to share in the dividends, if any, paid in the liquidation to unsecured creditors. The duty to get in assets of the companies then lay with the liquidator: s 478 of the Corporations Law, as did the obligation to investigate the existence and extent of the assets: Peter J. Keenan, "Investigation by External Administrators" (1995) 13 Company and Securities Law Journal 368 at 375. 36 His Honour considered that the Commissioner's actions were in the performance of the duty of an officer within the meaning of s 16(2) as: Steps taken to maximise the return to creditors including the Commonwealth by assisting the liquidator were proper and appropriate steps for the Commonwealth to improve the recovery of revenue from the liquidations. 37 Re Confitt concerned s 16(3). The facts in Re Confitt must be appreciated. The company had paid tax to the Commissioner. The liquidator of the company considered that the payment to the Commissioner might be a voidable preference payment. The liquidator obtained a summons for examination of the Commissioner and a taxation officer which were sought to be set aside relying on s 16(3). The issue was whether the disclosures sought by the summonses were "necessary for the purpose of carrying into effect the provisions of this Act…". His Honour concluded the exception was satisfied. 38 Irrespective of the result (about which nothing need be said), we are unable to accept the reasoning in Re Confitt. At [6] Williams J said that, as s 16(2) had been given a liberal construction (for example, by Dixon CJ in Canadian Pacific), the same approach should be taken to s 16(3). At [14]-[18] his Honour said: It can thus be seen that the courts have given a liberal interpretation to the phrase "except when it is necessary to do so for the purpose of carrying into effect the provisions of this Act". The passages quoted tend to suggest that whenever the Commissioner, or an "officer", is involved in litigation in which the validity of an assessment or the validity of a payment of tax are in question then the Commissioner and the "officer" are carrying into effect the provisions of the Act, and if the court orders that it is necessary for them to divulge the information in question there is no breach of s. 16. In each of the cases referred to the nature of the proceedings in the court was relevant to the conclusion reached. I was somewhat concerned as to whether or not the examination by a liquidator of company officers and others pursuant to the provisions of the Corporations Law could be said to be a procedure for the purpose of carrying into effect the provisions of the Income Tax Assessment Act, but I have been persuaded by the reasoning of von Doussa J. [in Simionato] that, at least in the circumstances before him, such an examination could be so regarded. This case is, however, somewhat different. The liquidator is seeking to question the lawfulness of the payment by Confitt of moneys to the Commissioner; he is essentially examining the lawfulness of the payment or payments with a view to recovering those moneys for the benefit of the creditors generally. If actual proceedings were commenced by the liquidator to recover those payments (say as a voidable preference) then the Commissioner and his "officers" would clearly be carrying into effect the provisions of the Income Tax Assessment Act by defending the claim. In that situation, consistently with the decisions referred to above, the court could order in the interests of justice the divulging of the information which would then be a divulging or communication necessary for the purpose of carrying into effect the provisions of the Act (namely the retention of moneys received by way of payment of income tax). If that is so then it is difficult to see why the position should be different at the examination stage. The examination is being conducted because the retention of the money in question is under threat; if the Commissioner then established that the payment received was lawful (for example, was not a preference) the revenue benefits because the money can be retained in the hands of the Commissioner. Clarification of the legal position at that stage could well result in significant savings to the revenue because additional legal costs would not be incurred. I have therefore come to the conclusion that the divulging of information by either applicant in the course of being examined by the liquidator in the Magistrates Court would not constitute a breach of s. 16(3) where it could be said that what they were doing was "necessary … for the purpose of carrying into effect the provisions of" the Income Tax Assessment Act. 39 This reasoning does not reflect the differences of function and language between ss 16(2) and 16(3). As noted, s 16(2) involves an officer disclosing information of his or her own volition. If the disclosure is "in the performance of any duty as an officer" as provided for in s 16(2), the disclosure is permissible. Section 16(3) involves a disclosure by an officer to a court or tribunal under compulsion. In such a case, the disclosure may only be required if "it is necessary to do so for the purpose of carrying into effect the provisions of this Act…". The circumstances, of voluntary and compulsory disclosure, are different. It is one thing to take a liberal approach to the scope of the performance of any duty by an officer to determine whether a voluntary disclosure was permissible. It is another to apply the same approach to compulsory disclosure to a court or tribunal when the statute expressly provides that such disclosures may only be required if "necessary …for the purpose of carrying into effect the provisions of this Act…". The reasoning also does not reflect the fact that Canadian Pacific and Simionato concerned s 16(2), not s 16(3). 40 In contrast to Re Confitt, Branson J recognised the differences between ss 16(2) and 16(3) in Donnelly v Davison [2000] FCA 1396; (2000) 105 FCR 1. The case concerned a summons for examination served by a bankruptcy trustee on the bankrupt. In support of an application to set aside the summons, the bankrupt served a subpoena on the Commissioner. The Commissioner was the sole creditor of the bankrupt estate and was funding the examinations. At [6] her Honour said: Before giving consideration to the authorities concerning s16(3) of the ITA Act, it is appropriate to notice the different purposes served by s16(2) and s16(3). S16(2) imposes a prohibition on the disclosure of information by an officer "except in the performance of any duty as an officer". Its principal purpose is to protect the confidentiality of information provided to officers by taxpayers. S16(3) does not prohibit disclosure of information which an officer is prepared to give under instructions from the officer's superiors (Canadian Pacific Tobacco Co Ltd v Stapleton (1952) 86 CLR 1). It is thus not the case that s16(3) is principally concerned to protect confidential information in the interests of taxpayers. While s16(3) assists in the protection of confidential information provided to officers by taxpayers, its principal purpose appears to be to protect officers from compulsion to disclose. 41 We do not accept the submission for the Nudie entities that Branson J overlooked the operation of the exception in s 16(3). Her Honour's description of the principal purpose of s 16(3), to protect taxation officers from compulsion to disclose, accords with the language of the section. We also see no error in her Honour's observations at [12] that: The terms of s16(3) of the ITA Act themselves suggest that information and documents can come to the notice of an officer "in the performance of his duties as an officer" which it will not be necessary for him or her to disclose "for the purposes of carrying into effect the provisions of this Act or of any previous law of the Commonwealth relating to Income Tax". In my view, the language of s16(3), seen in the context of PtII of the ITA Act, discloses an intention that the circumstances in which an officer may be compelled in Court to disclose information or to produce documents should be limited to purposes directly arising out of the provisions of the ITA Act or earlier income tax legislation. This seems to me to be the approach to the subsection which the Full Court adopted in Federal Commissioner of Taxation v Nestlé Australia Ltd. It is also the approach to the subsection adopted by Powell J in Purnell Bros Pty Ltd v Transport Engineers Pty Ltd. 42 The first sentence reflects the asymmetry apparent in the operation of s 355-50 and s 355-75 (and in the equivalent provisions to each of these sections). The reference to "purposes directly arising out of the provisions of the ITA Act…" should be understood as merely emphasising the requirement of necessity which the exception requires. 43 We also see no error in her Honour's approach to the question whether the circumstances of the case satisfied the terms of the exception in s 16(3). As her Honour said: [13] The Commissioner is not a party to the present proceeding. Although the Commissioner is the only creditor of Mr Davison's bankrupt estate, and may be assumed to be funding the proposed examinations, the examinations are proposed for the purpose of carrying into effect the provisions of the Bankruptcy Act. The proposed examinations do not directly arise out of the provisions of the [1936] Act. This, in my view, is the position even though steps taken by taxation officers to maximise the return to the Commissioner from Mr Davison's estate, including the provision of funding to Mr Donnelly as trustee of the estate, may be seen as steps taken in the performance of their duties as officers. [14] I conclude that the subpoena seeks the production of documents in circumstances which would result in an officer divulging or communicating to the Court matters or things coming under the officer's notice in the performance of his or her duties as an officer, otherwise than when it is necessary to do so for the purpose of carrying into effect the provisions of the [1936] Act or any earlier Act relating to income tax. [15] The subpoena addressed to the Proper Officer of the Australian Taxation Office will be set aside. It is unnecessary for me to give consideration to the submissions of the Commissioner that the subpoena is otherwise an abuse of process as it is too broadly expressed and therefore oppressive, as it involves "fishing", or because it seeks the production of documents that are irrelevant to the proceeding. 44 While we would prefer not to adopt an approach which introduces the concept of "directly arising" to the operation of the exception in s 16(3), we consider that her Honour was doing no more in [13] than identifying a factor relevant to the assessment of necessity. Her Honour's conclusion in [14], that the exception in s 16(3) was not satisfied, is one with which we agree. The mere fact that the Commissioner stood to gain as a creditor if the trustee recovered money for the bankrupt estate did not mean that the examinations summons, still less a subpoena to aid an application by the bankrupt to set aside the summons, engaged the exception in s 16(3) of the disclosure being necessary for the purpose of carrying into effect a provision of the 1936 Act. We do not consider that her Honour adopted a "narrow interpretation" of the exception (in contrast to the primary judge at [78]). Nor do we consider that her Honour's approach was contrary to that of the Full Court in Nestle which, as noted, was a case depending on the terms of s 16(2) (again, in contrast to the primary judge at [78]). While we accept that the authorities supported a liberal approach to the exception in s 16(2), the same cannot be said in respect of the exception in s 16(3). Only Re Confitt takes that approach but, as we have said, we are unable to accept the reasoning in that case. 45 In our view, it cannot be said that a subpoena to the Commissioner of Taxation in aid of an application by the Nudie entities for a stay of the proceedings against them by the liquidators of the plaintiff companies satisfies the exception in s 355-75 of Sch 1 to the Taxation Administration Act of a disclosure necessary for the purpose of giving effect to a provision of a taxation law merely because the Commissioner is the sole creditor of the plaintiff companies, is funding the liquidators, and stands to benefit if the proceedings are permitted to be prosecuted and succeed by an amount potentially equivalent to the unpaid taxes for which the Commissioner has or may prove in the winding up of the plaintiff companies. The purpose of the disclosures does not give effect to a provision of a taxation law. Rather, a possible consequence of other related steps, being the successful prosecution of the proceedings if they are not stayed, may enable the Commissioner to recover amounts equivalent to unpaid taxes and that such recovery involves the Commissioner in administering taxation laws. This is insufficient to engage the exception in s 355-75. No doubt the Commissioner's provision of protected information to the liquidators satisfied the exception in s 355-50(1) (a disclosure made in performing duties as a taxation officer), but this does not mean compulsory disclosure to a court or tribunal is necessary for the purpose of giving effect to a provision of a taxation law. The "one sided" nature of this result is a consequence of the asymmetry of the statutory provisions. Effect must be given to those provisions. 46 While we accept the proposition that the issue is to be resolved as one of substance rather than form, so that the fact of the Commissioner being a party to proceedings or not is not determinative, we do not agree that this factor is irrelevant. In deciding if disclosure is necessary for the purpose of giving effect to a provision of a taxation law all of the circumstances may and should be considered, including the nature of the application in aid of which disclosure is sought (in the present case, an application to stay proceedings as an abuse of process), the nature of the proceedings in which the application is made (in the present case, a proceeding by the plaintiff companies for equitable compensation from other companies), the relationship of the Commissioner to the application and the proceedings (in the present case, the Commissioner is not a party to the application or the proceedings, but is the creditor who may ultimately benefit in the winding up of the plaintiff companies if the proceedings succeed), and the relationship between the disclosure and the asserted giving of effect to the taxation laws (in the present case, a consequence of the successful prosecution of the proceedings may be the Commissioner recovering amounts equivalent to unpaid taxes, which is not the same as disclosure being necessary for the purpose of carrying into effect of any such provision). 47 We do not accept the submissions of the Nudie entities to the contrary. In particular, we do not agree that the exception in s 355-75 is engaged in this case because the circumstances should be characterised as involving the lawfulness of the Commissioner's attempts to secure the revenue (and thus give effect to the taxation laws) by means of this proceeding. It is not that the characterisation is inaccurate. It is that it functions at too high a level of generality to be meaningful given the terms of s 355-75. The Commissioner is attempting to secure the revenue. The Commissioner is acting in the administration of a taxation law. But, as noted, the Commissioner's purposes are not the issue. The issue is whether the disclosure is necessary for the purpose of carrying into effect a provision of a taxation law. Disclosure to aid the stay application is not necessary for the relevant purpose merely because, if the stay is granted, the plaintiff companies in consequence cannot recover amounts equal to unpaid taxes by way of relief and in further consequence thereon the Commissioner as the sole creditor cannot recover those amounts in the winding up of the plaintiff companies. The connection between the consequence for the Commissioner and the disclosure is too tenuous and remote to satisfy the exception in s 355-75. 48 We also do not accept that the statutory provisions invite or permit an exercise which balances the interests of an entity in maintaining the privacy of the entity's tax affairs against the interests sought to be advanced by disclosure. The balance has been struck by the statutory provisions. Under s 355-50 (voluntary disclosure) the test is whether the disclosure is "in performing…duties as a taxation officer". Under s 355-75 (compulsory disclosure to a court or tribunal) the test is whether the disclosure is necessary for the purpose of carrying into effect the provisions of a taxation law. The required exercise is evaluative but not discretionary. In particular, the questions of purpose and necessity under s 355-75 are not informed by considerations of fairness or justice. The circumstances either meet the exception or they do not, albeit that minds might differ as to the result. There is no discretion to exercise. 49 For these reasons we concluded that leave to appeal must be granted, the appeal allowed and the subpoena to the Commissioner set aside. I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Middleton, Gilmour and Jagot.

SCHEDULE OF PARTIES NSD 558 of 2017 Respondents Fifth Respondent: 12 YEARS JUICE FOODS AUSTRALIA PTY LTD ACN 110 000 265 Sixth Respondent: 12 YEARS JUICE FRANCHISING SYSTEMS PTY LTD ACN 102 561 928 Seventh Respondent: REAL JUICE PTY LTD ACN 102 244 842