Ferguson v Commissioner of Taxation

We have considered your objection and disallowed it. The attached Reasons for Decision statement explains how we made this decision. It also explains our decision on the shortfall interest charge and administrative penalty." The letter is not a model of clarity, indeed it is ambiguous. On one view it informs the applicant that the objection has been disallowed but only in respect of the substantive amended assessments. On another, the last sentence of this extract from the letter might lead the reader, when read with subsequent parts of the letter, to the view that the objection against the assessments of shortfall penalty had also been disallowed, but without expressly saying so. 8 On 30 March 2012 (a Friday) the applicant, by his solicitors, electronically sent for filing: (1) an Application for Review of Decision in the Tribunal dated 30 March 2012 ("the AAT Application"); and (2) a Notice of Appeal against appealable objection decisions in this Court dated 30 March 2012 ("the Notice of Appeal") 9 The AAT Application was sent to the Brisbane registry of the Tribunal and was recorded as filed the same day it was sent. The Notice of Appeal was sent to the Australian Capital Territory registry of the Court (the applicant lives in the Australian Capital Territory) but was not accepted as filed owing to failure to attach the objection decision and to pay the appropriate fee. These deficiencies were only notified to the applicant's solicitors on 3 April 2012. These deficiencies were rectified that day and the Notice of Appeal was recorded in the Court's file as having been filed that day. 10 The AAT Application lodged on behalf of the applicant, like the Commissioner's letter of 14 February 2012, was not a model of clarity. In the box labelled "Decision", it merely said: "Please see copy of the decision attached" and attached a copy of the Commissioner's letter of 14 February 2012, although this accords with the "Information for Applicants" form concerning the completion of the AAT Application. In the box labelled "Reasons for Application", there appeared the following: "1. The legislation the Commissioner relies upon does not apply to tax the grant of rights made to the Taxpayer, or his superannuation fund. 2. Any rights were acquired at a different time than is contended by the Commissioner. 3. The Taxpayer is entitled to be reassessed under Section 139DD of the Income Tax Assessment Act 1936 (Cth)." With respect, none of these three matters, either alone or together, spell out the reasons for the applicant's application. The reason for the applicant's application was because he thought the decision was wrong. But what decision? The decision to disallow the applicant's objection to both the substantive amended assessments and the assessments of shortfall penalty, a conclusion for which the Commissioner contends; or the decision to disallow the applicant's objection only to the assessments of shortfall penalty, the conclusion for which the applicant contends. 11 On the other hand, the Notice of Appeal, in its terms, was more specific. It provided: "The Applicant appeals against the decision made by the Respondent on 14 February 2012 under subsection 14ZY(1) of the Taxation Administration Act 1953 to disallow in full the objection of the Applicant dated 1 October 2010 against notices of amended assessment issued on 25 August 2010 for the years ended 30 June 2007 and 30 June 2008." Clearly, the appeal to this Court was confined to the decision of the Commissioner to disallow the applicant's objection against the substantive amended assessments and did not extend to, or embrace, the Commissioner's decision to disallow the applicant's objection against the assessments of shortfall penalty.

Consideration 12 It is in the context of these findings of fact that the Commissioner's application has to be considered. 13 This is not a case where the applicant lodged with the Tribunal an application for review of the Commissioner's decision with respect to the disallowance of both the substantive amended assessments and the assessments of shortfall penalty and then, subsequently, had a change of mind with respect to the decision on the former and lodged a notice of appeal in this Court. If they were the facts, I would have no alternative but to upheld the Commissioner's application and set aside the applicant's notice of appeal: s 14ZZ of the TA Act; Punin; Graspas. 14 Here, the applicant, by his solicitors, sent the Notice of Appeal to this Court and the AAT Application to the Tribunal at the same time although the former was not recorded by the registry of this Court as having been filed until four days after it was sent for the reasons set out in [9] above. In these circumstances, I am of the view that the AAT Application has to be read and construed in the context of the Notice of Appeal, and vice versa. So read and construed, it is clear, in my view, that the Notice of Appeal is confined to the Commissioner's decision to disallow the applicant's objection in respect of the substantive amended assessments and that the AAT Application is confined to the Commissioner's decision to disallow the applicant's objection in respect of the assessments of shortfall penalty.

Conclusion 15 It follows, in my view, that the Commissioner's application must be dismissed. 16 I was asked by counsel for the Commissioner that if I was to come to this conclusion, I should nevertheless make no order as to costs. Counsel for the applicant submitted that costs should follow the event. In my view, the costs of the application should be costs in the cause. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds.