LHRC v Deputy Commissioner of Taxation

1 INTRODUCTION [1] 2 THE ISSUES [5] 2.1 Prayers [1] & [2]: the application for a declaration and mandatory injunction with respect to the 2011 ACC examination [8] 2.2 Prayer [3]: application for an injunction so that the s 264 interview does not proceed [10] 2.3 Prayer [4]: application for injunction to quarantine the ACC information from future use in connection with a s 264 interview [11] 2.4 Prayer [5]: an order requiring the non-publication directions to be re-made in accordance with law [12] 2.5 Abandoned grounds [14] 3 PROCEDURAL MATTERS [17] 4 BACKGROUND [21] 4.1 The ACC and authorisation of special operations and investigations [21] 4.2 Project Wickenby [49] 4.3 Operation M [56] 4.4 Project Grindelford [61] 4.5 The tax review and commencement of the audit of the first applicant's tax affairs and associated entities in 2009 [62] 4.6 ATO officers and their roles in Operation M [65] 4.7 The summons issued to the first applicant to attend and give evidence at the ACC examination on 24 February 2011 [72] 4.8 The ACC examination on 24 February 2011 and non-publication directions [78] 4.9 Amendments to the Non-publication Direction [86] 4.10 Dissemination of the transcript to the ATO [91] 4.11 Results of audit and amended assessments [95] 4.12 The decision to issue the s 264 notice [101] 5 THE CHALLENGES TO THE ACC EXAMINATION [123] 5.1 Relevant provisions relating to the conduct of an examination and the use to which evidence may be put [123] 5.2 The allegation that the decision to conduct the ACC examination was made for an improper purpose (ground 2(i), statement of grounds) [136] 5.2.1 The issue [136] 5.2.2 What are the purposes for which the power to issue a summons under s 28(1) of the ACC Act may issue? [139] 5.2.3 Was the power to issue the summons to appear and give evidence at the ACC examination exercised for a lawful purpose? [145] 5.2.3.1 Relevant principles [145] 5.2.3.2 Did the exercise of power miscarry by reason of an improper purpose? [152] 5.3 The allegation that the decision-maker in deciding to conduct the ACC examination had regard to an irrelevant consideration (ground 2(ii), statement of grounds) [170] 5.4 The allegation that the decision-maker decided to hold the ACC examination under dictation (ground 2(vii), statement of grounds) [173] 5.5 Challenges to the legality of the ACC examination based on the way in which the examination was conducted [182] 5.5.1 The mixed purposes for which the evidence was allegedly taken at the ACC examination (ground 2(iv), statement of grounds) [182] 5.5.2 The presence of the ATO audit officers at the ACC examination and alleged failure to give the first applicant an opportunity to comment on their presence (ground 2(v), statement of grounds) [189] 5.5.2.1 The applicants' contentions [189] 5.5.2.2 Relevant statutory provisions [192] 5.5.2.3 The directions made by the examiner for ATO staff to be present [200] 5.5.3 The failure to advise the first applicant of the presence of the ATO officers and to invite him to comment (ground 2(vi), statement of grounds) [208] 5.5.4 The submission that the ATO officers' presence was not authorised on the basis that they were persons associated with the possible prosecution of the first applicant [219] 6 POWER TO ISSUE THE S 264 NOTICE [231] 6.1 The issue [231] 6.2 Relevant principles and statutory provisions [233] 6.3 The first s 14ZYA contention [243] 6.4 The second s 14ZYA contention [247] 6.5 The applicants' contention that their construction of s 14ZY is supported by the manner in which s 264 has been interpreted [250] 6.6 Conclusion as to the power to issue a s 264 notice [269] 7 THE CHALLENGE TO THE LEGALITY OF THE DECISION TO ISSUE THE S 264 INTERVIEW [271] 7.1 Alleged lack of authority for the ATO to use the transcript for the purposes of a s 264 interview [271] 7.1.1 Applicants' contentions: an overview [271] 7.1.2 The substratum of the applicants' arguments [272] 7.1.3 Does the non-publication direction preclude the ATO from using the ACC transcript in deciding whether to issue a s 264 notice (ground 4(vi), statement of grounds)? [285] 7.1.4 The challenge to the non-publication direction on the ground that the ACC examiner should have enjoined the use of the ACC transcript in connection with a s 264 interview (grounds 4(iii), 6 and 8, statement of grounds) [287] 7.2 The alleged failure to have regard to a relevant consideration (ground 4(i), statement of grounds) [297] 7.2.1 Relevant principles [298] 7.2.2 No failure to consider a relevant consideration [300] 7.3 The challenge to dissemination of the ACC transcript on the ground that the first applicant was not given the opportunity to make submissions about dissemination (ground 4(v), statement of grounds) [305] 7.4 Wednesbury unreasonableness (ground 4(ii), statement of grounds) [308] 8 CONCLUSION [317]

1. INTRODUCTION 1 These proceedings were instituted in response to a notice given under s 264 of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936) (the s 264 Notice) requiring the first applicant to attend an interview and answer questions regarding his personal income tax affairs and those of his wife and five discretionary trusts. 2 The applicants seek relief intended to ensure that those conducting any interview of the first applicant pursuant to s 264 do not have access to, or knowledge of, the substance of the first applicant's evidence given in an examination on 24 February 2011 by the Australian Crime Commission (the Commission or ACC) in the exercise of compulsive powers under the Australian Crime Commission Act 2002 (Cth) (the ACC Act). The examination was purportedly carried out pursuant to Project Wickenby in furtherance of an operation which I will describe as Operation "M" which comprises part of that project. Project Wickenby is a special ACC investigation under the ACC Act in which a number of government agencies participated, including the Australian Tax Office (ATO). The ATO has completed a large number of audits of taxpayers in furtherance of Operation M in which the common theme is that the taxpayer receives payments from, or makes payments to, overseas entities, particularly in known tax havens. At the examination, while the first applicant had no privilege against self-incrimination, he answered questions on the basis that he had invoked protections under the ACC Act limiting the uses to which his evidence could be put. 3 The first applicant is a director of an investment bank. The second to sixth applicants are the trustees of the discretionary trusts (the trustee companies), the beneficiaries of which include in each case the first applicant and his family members. The first applicant is also the principal and a director of each of the trustee companies, together with his father. The discretionary trusts were described in the applicants' submissions as "effectively [the first applicant's] private entities." 4 At the time of the hearing, the trustee companies had each been issued with audit finalisation report papers from the ATO in which the ATO had outlined its reasons for intending to issue amended assessments. The first applicant had also been the subject of amended assessments for the financial years 2000 to 2007, increasing his personal income tax liability by a sum in excess of $10 million and substantial penalties in amounts also totalling in excess of $10 million. The first applicant has lodged objections with the ATO against the amended assessments.

2. THE ISSUES 5 By the Further Further Amended Application for Relief (the Amended Application), the applicants seek relief under s 39B of the Judiciary Act 1903 (Cth) and the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act) in order to ensure that information obtained at the ACC examination cannot be used in any interview of the first applicant under s 264 of the ITAA 1936 or in any decision in the future to conduct such an interview. The applicants seek to achieve that end by challenges to the decision to conduct, and to the conduct of, the ACC examination on 24 February 2011 (the ACC examination), and to the decision to issue the s 264 notice in March 2014. They also seek achieve that end indirectly by challenging the dissemination of the transcript to the ATO and the scope of the non-publication directions made by the ACC examiner. For the reasons set out below, none of these grounds are made out and the application must be dismissed. 6 The grounds on which the applicants seek relief in the Amended Application are stated in an amended document dated 15 July 2014 (Statement of Grounds). This was provided to the Court and the respondents in final form cross-referenced to the applicants' written submissions only in the evening of the first day of the trial. 7 Given the many changes in the applicants' position before, during and even after the trial, it is helpful to summarise their final contentions and how they relate to the relief sought.

2.1 Prayers [1] & [2]: the application for a declaration and mandatory injunction with respect to the 2011 ACC examination 8 First, by the Amended Application, the applicants seek under s 39B of the Judiciary Act 1903 (Cth): 1. a declaration that the ACC examination of the first applicant on 24 February 2011 was a nullity or vitiated by an error of law (prayer for relief at [1]); and 2. a mandatory injunction requiring first respondent (the Commissioner) to return all copies of the transcript of the ACC examination to the ACC, and effectively to quarantine the ACC transcript from use in connection with any ongoing tax audit, assessment or objection tasks involving the liability of any of the six applicants and their associated trusts (prayer for relief at [2]). 9 This relief is sought on the following grounds: a) the decision to conduct the ACC examination was convened for an improper purpose, the decision maker had regard to an irrelevant consideration, and/or the decision was made at the behest of ATO audit officers, effectively under dictation; and b) by reason of the way in which the ACC examination was conducted, namely, that evidence was not taken solely for a purpose within power, the examination was not held "in private" because four ATO audit officers were present, and/or that the first applicant was not advised of the presence of the ATO officers and given an opportunity to comment, and the four ATO officers were persons associated with the possible prosecution of the first applicant.

2.2 Prayer [3]: application for an injunction so that the s 264 interview does not proceed 10 Secondly, pursuant to s 39B of the Judiciary Act, and the ADJR Act, the applicants seek a permanent injunction restraining the Commissioner from proceeding with the interview of the first applicant foreshadowed in the s 264 notice and accompanying letter (prayer for relief at [3]) on the following grounds: a) the decision to hold the interview failed to take into account a relevant consideration or was unreasonable; b) the non-publication directions or conditions of dissemination should have enjoined the use of the ACC transcript in connection with a s 264 interview because of the potential to prejudice a fair trial of the first applicant; c) if the ACC examination was a nullity, the transcript would not have been available to the ATO for the purposes of s 264; d) the non-publication directions did not permit the ACC transcript to be taken into account in a decision to issue a s 264 notice; and e) the dissemination of the transcript: i) was a nullity because the first applicant was not permitted to make submissions about its prospective dissemination; or ii) should have been accompanied by conditions preventing its use at a s 264 interview, or the purpose for which the transcript was obtained does not permit it to be used so as to defeat the protections under the ACC Act (also identified as a ground for [4] of the prayer for relief). (I note in this regard that no specific relief is sought in the Amended Application for the later dissemination of the audiotape of the interview. However, no issue was raised in this regard by the respondents and I have therefore assumed in the applicants' favour that, if they were entitled to relief with respect to the transcript, relief would also issue with respect to the audiotape.)

2.3 Prayer [4]: application for injunction to quarantine the ACC information from future use in connection with a s 264 interview 11 Thirdly, the applicants seek a permanent injunction restraining the staff of the Commissioner and persons retained by the Commission (prayer for relief at [4]) from, in the future: (i) communicating the transcript of the ACC examination or the substance of the evidence given to any person deciding whether or not to require the first applicant to attend a s 264 interview; (ii) exercising the s 264 power to require the first applicant to attend for an interview; (iii) attending a s 264 interview of the first applicant; and (iv) attempting to influence the questions asked at any such interview of the first applicant; where those persons have read the transcript of the ACC examination or are aware of the substance of the evidence given, and the substance of that evidence has not entered the public domain. The grounds on which this relief is sought essentially repeat those at subparagraphs 10 and (e)(ii) above.

2.4 Prayer [5]: an order requiring the non-publication directions to be re-made in accordance with law 12 In the alternative to [4] of the prayer for relief, the applicants seek a writ of mandamus requiring the CEO of the ACC to attach conditions to the use of information obtained at the ACC examination in any future s 264 interview so as to limit its use either: (i) in accordance with law; or (ii) so that the information cannot be used to require the first applicant for a s 264 interview or to formulate questions for such an interview. 13 The grounds on which this relief is sought again essentially repeat those at subparagraphs 10 and (e)(ii) above.

2.5 Abandoned grounds 14 Finally, by amendments to the originating application, the applicants expressly abandoned grounds under the ADJR Act alleging that: a) procedures required by law to be observed in connection with the s 264 decision were not observed; and b) that the decision was an improper exercise of the power because it was for a purpose other than that for which the power was conferred or was an abuse of power. 15 However, they maintained allegations of improper purpose insofar as the s 264 issues were raised under s 39 of the Judiciary Act. 16 In the course of the trial, the applicants also abandoned allegations that an irrelevant consideration was taken into account in the decision to conduct the ACC examination, being (allegedly) the opinion of the ATO that circumstances indicated federally relevant criminal activity.

3. PROCEDURAL MATTERS 17 Before considering the applicants' contentions, it is necessary to say something about the manner in which they conducted their case. 18 The grounds on which the applicants relied were largely not identified in the originating application filed on 15 April 2014 but in a document filed by the applicants on 17 June 2014 pursuant to orders made on 13 June 2014 (the original Statement of Grounds). These orders were intended to ensure clarity and precision about the grounds on which relief was sought in circumstances where, shortly before the trial, leave was sought and granted to amend the application substantially and to join the second to sixth applicants. Nonetheless, the applicants sought to further amend their application at the start of the trial and later that day provided an "updated" Statement of Grounds (the Statement of Grounds) said to reflect the proposed further amendment and the applicants' case as developed in their written submissions. The respondents ultimately very fairly did not oppose the amendments to the application or, with the amendments being allowed, to reliance on the "updated" Statement of Grounds, despite that document demonstrating that the grounds on which the applicants sought relief had shifted considerably in a number of respects. Finally, after judgment was reserved, the applicants applied on 10 September 2014 for leave to re-open their case to argue that there was no power to issue the s 264 notice because the first applicant had earlier lodged a taxation objection against his amended assessments - a proposition that they had expressly disavowed earlier in their closing address. The Commissioner and the ACC very fairly did not oppose the application to re-open or to amend. Notwithstanding that I did not consider that an adequate reason had been given as to why the point was not raised earlier, I considered on balance that it was in the interests of justice to grant leave to re-open. In reaching that view, I had regard (as I explained in my ruling at the time), among other matters, to the fact that the application was not opposed, that a determination of the further issue would not require the calling of any further evidence or fact finding but was a question of law, that the issue seemed to be fairly arguable, and that the applicants would likely be barred by an issue estoppel from raising the issue if I were to refuse leave. 19 The end result was that there were multiple and substantial changes to the grounds relied upon by the applicants before trial, during the course of the hearing, and even after judgment was reserved. The many changes in the applicants' position exacerbated the difficulties posed in any event in navigating through multiple sets of written submissions filed by the applicants and working out their relationship to the Statement of Grounds provided at trial. That complexity was increased by the many cross-references contained in the updated Statement of Grounds to disjointed paragraphs in the various sets of submissions cited in support of each ground of the applicants' reworked case, rather than to a coherent written argument. These difficulties were further exacerbated by the applicants' failure not merely to cross-reference their submissions to the evidence, but indeed to identify any evidence for certain propositions. 20 In short, I am of the view that the manner in which the applicants conducted their case was inefficient and rendered their case unnecessarily complex in light of the obligations on parties and their legal representatives under s 37N of the Federal Court of Australia Act 1976 (Cth). I raise these issues particularly as they may have a bearing upon the appropriate orders as to costs which I have reserved pending further argument.

4.1 The ACC and authorisation of special operations and investigations 21 The applicants' submissions were underpinned by a number of misconceptions as to the nature of the investigation authorised by the Wickenby Determination and the ACC Act. Those misconceptions primarily relate to the degree and nature of collaboration permitted by the Determination and the Act between the ACC and other government agencies participating in the investigation, the permitted purposes of an investigation and of the Wickenby investigation itself, and the purposes for which information and intelligence may be shared with other government agencies. These misconceptions go to the heart of the legislative scheme pursuant to which the Determination was made. As such, it is necessary to begin with an understanding of the ACC Act and its objects. 22 The ACC is established by s 7(1) of the ACC Act. It replaced the National Crime Authority Act 1984 (Cth) (NCA), the Office of Strategic Crime Assessments and the Australian Bureau of Criminal Intelligence, the intention being to enhance the capacity for the Australian Government to counteract serious and organised crime. As Finkelstein J explained in AA Pty Limited v Australian Crime Commission (2005) 219 ALR 666; [2005] FCA 1178 (AA v ACC) at 670: The Federal Government had two major concerns. Complex criminal activity engaged in by skilled criminal syndicates was on the rise. "The globalisation of markets had brought with it the globalisation of crime" is how the Attorney-General put it on the second reading of the Bill... There was also the risk of terrorism.… The new body was designed to play a pivotal role in national law enforcement operations to combat such threats in conjunction with other State and Federal (including Territory) agencies, especially state and federal police forces. (citations omitted) (Note:- an appeal against this decision was allowed on grounds not relevant to this point: Australian Crime Commission v AA Pty Ltd (2006) 149 FCR 540; [2006] FCAFC 30.) 23 As will be apparent, the purpose of providing for a collaborative approach between government agencies in addressing serious organised crime is a fundamental plank of the legislative scheme enacted by the ACC Act. 24 The ACC consists of the CEO, the examiners and the members of the staff of the ACC (s 7(2)). Examiners are legal practitioners of at least five years standing who are appointed under s 46B of the Act by the Governor-General. 25 The functions of the ACC under s 7A of the ACC Act are essentially directed towards the gathering, investigation and dissemination of criminal information and intelligence. In particular, they include: (a) to collect, correlate, analyse and disseminate criminal information and intelligence and to maintain a national database of that information and intelligence; (b) to undertake, when authorised by the Board, intelligence operations; (c) to investigate when authorised by the Board, matters relating to federally relevant criminal activity; (d) to provide reports to the Board on the outcomes of those operations or investigation; … 26 Section 4(1) defines an "intelligence operation" to mean "an operation that is primarily directed towards the collection, correlation, analysis or dissemination of criminal information and intelligence relating to federally relevant criminal activity, but that may involve the investigation of matters relating to federally relevant criminal activity." The phrase "federally relevant criminal activity" is defined in s 4(1) to mean: (a) a relevant criminal activity, where the relevant crime is an offence against a law of the Commonwealth or of a Territory; or (b) a relevant criminal activity, where the relevant crime: (i) is an offence against a law of a State; and (ii) has a federal aspect. 27 "Relevant criminal activity", in turn, means "any circumstances implying, or any allegations, that a relevant crime may have been, may be being, or may in future be, committed against a law of the Commonwealth, of a State or of a Territory", while "relevant crime" means, relevantly, "serious and organised crime" (s 4(1), ACC Act). "Serious and organised crime" is defined to include, among other things, tax evasion involving two or more offenders, substantial planning and organisation, the use of sophisticated methods and techniques, and is ordinarily committed in conjunction with other offences of a like kind (s 4(1), ACC Act). 28 The Board of the ACC is established by s 7B and is constituted by the CEO and the heads of various state and federal government agencies, namely, the Commissioner of the Australian Federal Police (AFP), the Secretary of the Department, the CEO of Customs, the Chairperson of the Australian Securities and Investments Commission (ASIC), the Director-General of Security, the Commissioner or head of each of the State and Territory police forces, and the Commissioner of Taxation (s 7B(2), ACC Act). As such, the Board's decision-making takes into account state/federal interests, the interests of particular police forces and prosecuting authorities, and certain Commonwealth agencies. Furthermore, in performing its functions under the Act, the ACC is required, so far as practicable, to work in cooperation with "law enforcement agencies" as defined in s 4(1), namely, the AFP, a State Police Force, or any other authority or person responsible for enforcing Commonwealth or State laws (s 17(1), ACC Act). 29 Pursuant to s 7C of the ACC Act, the Board's functions include: (c) to authorise, in writing, the ACC to undertake intelligence operations or to investigate matters relating to federally relevant criminal activity; (d) to determine, in writing, whether such an operation is a special operation or whether such investigation is a special investigation; (e) to determine, in writing, the class or classes of persons to participate in such an operation or investigation; (f) to establish task forces; (g) to disseminate to law enforcement agencies or foreign law enforcement agencies, or to any other agency or body of the Commonwealth, a State or a Territory prescribed by the regulations, strategic criminal intelligence assessments provided to the Board by the ACC... 30 The authorisation by the Board of a "special ACC operation/investigation" in accordance with its functions under s 7C(c)-(e) is a necessary precondition for the exercise of certain coercive powers conferred by the ACC Act, including, relevantly, the power under s 28 to summon a person to give evidence and produce documents at an examination vested in an examiner. 31 By s 4(1), a "special ACC operation/investigation" means: (a) an intelligence operation that the ACC is undertaking and that the Board has determined to be a special operation; or (b) an investigation into matters relating to federally relevant criminal activity that the ACC is conducting and that the Board has determined to be a special investigation. 32 It is apparent from the definition of "intelligence operation" (set out at [26] above) that while the primary focus of an "intelligence operation" is not investigation, nonetheless the functions are not mutually exclusive. As Logan J held in QAAB v Australian Crime Commission [2014] FCA 747 (QAAB) at [15], "[t]he definition of 'intelligence operation' is such that there is no necessary statutory antipathy between such an operation and the asking of questions by the examiner that relate to a 'federally relevant criminal activity'. That is so even though the ACC Act also contemplates (s 7A(c)) that the ACC may, after Board authorisation, directly conduct 'an investigation into matters relating to federally relevant criminal activity'." 33 The term "investigation" is not defined but is used in the Act in contradistinction to the "collecting" of criminal intelligence. This suggests, in my opinion, that "investigation" bears its ordinary meaning, namely, a searching inquiry to ascertain facts (see by analogy Taciak v Commissioner of Australian Federal Police (1995) 59 FCR 285 at 294; Health Insurance Commission v Freeman (1998) 88 FCR 544. However, as I later explain (at [143]), I do not consider that this means that intelligence cannot be collected in the course of investigation. The two functions are by their nature not mutually exclusive. Rather the difference between an intelligence operation and an investigation is ultimately a difference in direction or purpose. 34 Section 7C confers power on the Board to determine special ACC operations and investigations, subject to certain conditions: Special operations (2) The Board may determine, in writing, that an intelligence operation is a special operation. Before doing so, it must consider whether methods of collecting the criminal information and intelligence that do not involve the use of powers in this Act have been effective. Note 1: See also subsection 7G(4) for the voting rule that applies in relation to such a determination. Note 2: See also Division 2 for the examination powers available if there is a special operation. Special investigations (3) The Board may determine, in writing, that an investigation into matters relating to federally relevant criminal activity is a special investigation. Before doing so, it must consider whether ordinary police methods of investigation into the matters are likely to be effective. Note 1: See also subsection 7G(4) for the voting rule that applies in relation to such a determination. Note 2: See also Division 2 for the examination powers available if there is a special investigation. 35 As I later explain, the reference to "effective" in s 7C(3) has been interpreted as meaning "effective to permit the laying of charges against offenders": X7 v Australian Crime Commission (2013) 248 CLR 92; [2013] HCA 29 (X7) at [146] (Hayne and Bell JJ, with whom Kiefel J agreed); see further at [283] below. 36 The Board cannot determine that an intelligence operation/investigation is a special intelligence operation/investigation unless, exceptionally, at least nine Board members (including at least two Commonwealth Board members) vote in favour of making the determination (s 7G(4)). A determination under s 7C(2) or (3) has immediate effect (s 7C(6)). 37 By s 7C(4), a determination under subsection (2) or (3) must contain certain details, namely: (a) describe the general nature of the circumstances or allegations constituting the federally relevant criminal activity; and (b) state that the relevant crime is, or the relevant crimes are or include, an offence or offences against a law of the Commonwealth, a law of a Territory or a law of a State but need not specify the particular offence or offences; and (c) set out the purpose of the operation or investigation. 38 The Explanatory Memorandum to the Australian Crime Commission Establishment Bill 2002 (the ACC Explanatory Memorandum 2002) highlighted the importance of these conditions on the exercise of the power in s 7C(1) at p. 9, explaining that the threshold tests contained in ss 7C(2) and (3) "provide an important safeguard on the exercise of coercive powers under the Act", while the detail required by s 7C(4) "sets the parameters for the operation of investigation and represents another important safeguard on the exercise of coercive powers under the Act." 39 While, however, the Board has the power to determine that an operation/investigation is a special ACC operation or investigation, and to allocate an examiner to that special operation/investigation under s 46A(3), the coercive powers then available to be exercised are not vested in the Board. Only an examiner is vested with the power under s 24A to conduct an examination for the purposes of a special ACC operation/investigation. Equally, under s 25A(1), the examiner determines how proceedings at an examination are to be conducted subject to certain statutory requirements. 40 Importantly, while the examiner is part of the ACC by reason of s 7(2), the independence of the examiner is apparent from a number of features of the ACC Act. The examiner is not a member of the Board of the ACC, and therefore has no vote, among other things, on a determination that an intelligence operation/investigation is a special intelligence operation/investigation. An examiner is appointed not by the Board but by the Governor-General, holding full time office for the period specified in the instrument of appointment, and his or her appointment can be terminated only by the Governor-General on specified grounds (s 46H). Separate provision is also made under ss 46C and 46D for remuneration and terms of employment of an examiner, and an examiner cannot engage in paid employment outside the duties of his or her office without ministerial approval (s 46G). Examiners also have the same protection and immunity in the performance of their functions and exercise of their powers as a Justice of the High Court of Australia (s 36(1)). 41 The independence of the examiner has also been described as "an important safeguard to the exercise of the coercive powers": ACC Explanatory Memorandum 2002 at p. 16. In light of the legislative scheme and in particular, the provisions to ensure the independence of examiners, the power relevantly of an examiner to summon a person to appear to give evidence on oath is, in my opinion, exercisable by the examiner solely in the exercise of his or her independent discretion. Indeed all parties proceeded on this premise. If so, it would seem to follow in my view that, in exercising those powers, he or she does not act as an employee of the ACC: see by analogy Oceanic Crest Shipping Co v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626. Nor can he or she act, as the applicants allege, at the dictation of another. Conversely, an examiner cannot decide to give examination material to any particular body or agency. That discretion is vested in the CEO and his or her delegates. 42 It may also follow from the fact that the examiner gathers such evidence in the exercise of an independent statutory discretion that the record of the examination and associated documents are not in the ACC's possession until the examiner has given that record to the head of the special ACC operation/investigation on conclusion of the examination in accordance with s 25A(15) notwithstanding that he or she is part of the ACC. If so, it is only at that point that the record of the examination is thereby potentially liable to be disseminated to other agencies under s 59(7) of the ACC Act by the CEO. However, that is not a question put in issue. 43 At the relevant time, s 59(7) of the ACC Act imposed conditions on the exercise of the power to disseminate information in the ACC's possession in the following terms: The CEO may give to: (a) any law enforcement agency; or (b) any foreign law enforcement agency; or (c) any other agency or body of the Commonwealth, a State or a territory prescribed by the regulations; any information that is in the ACC's possession and that is relevant to the activities of that agency or body if: (d) it appears to the CEO to be appropriate to do so; and (e) to do so would not be contrary to a law of the Commonwealth, a State or a Territory that would otherwise apply. 44 It was not in issue that the ATO was an agency of the Commonwealth prescribed by regulations for the purposes of s 59(7) at all material times: see reg 9 and Sched 6, Part 1, item 113, Australian Crime Commission Regulations 2002 (Cth). 45 Subsequently the ACC Act was amended in 2012 and s 59(7) of the AAC Act was substituted by a new provision, s 59AA, which, with other provisions, was intended to make it express that the Commission's power to disseminate material to law enforcement agencies and the Commission's obligation to provide admissible material to prosecuting authorities in s 12, were subordinate to the obligation to make appropriate non-publication directions under s 25A(9). 46 These provisions of the ACC Act are complemented by s 355-70(1) of Schedule 1 to the TAA which creates an exemption in prescribed circumstances to the prohibition under s 355-25(1) on disclosure by a taxation officer of "protected information", being information disclosed or obtained under a taxation law relating to an entity which identifies the entity (s 355-30(1)). Relevantly, the section exempts disclosure to "a Project Wickenby officer, or a court or tribunal" where disclosure "(a) is for or in connection with a purpose of the Project Wickenby taskforce; and (b) is made before 1 July 2015, or a later prescribed day": s 355-25(1)(b); item 3. The "purposes of the Project Wickenby taskforce" are defined in s 355-70(9) as being to: (a) detect; and (b) deter; and (c) investigate; and (d) enforce the law relating to; the promotion of or participation in arrangements of an international character, or purported international character, that relate to one or more of the following: (e) tax avoidance or evasion; (f) breaches of laws regulating financial markets and corporations; (g) criminal activity in the nature of fraud or obtaining benefits by deception (including deceiving investors or creditors); (h) money laundering; (i) concealing income or assets. 47 An entity is a "Project Wickenby officer" if the entity holds an office in, or is employed in, or is performing services for a Project Wickenby taskforce agency or supporting agency and performs duties that relates to a purpose of the Wickenby taskforce (s 355-70(6), Schedule 1, TAA). "Project Wickenby task force agency" is defined to mean the ATO, the ACC, the AFP, ASIC, the CDPP and prescribed agencies. Item 3 of s 355-70 therefore provides a mechanism whereby information obtained by the ATO may be provided to the ACC and other Wickenby taskforce participants without breaching the general prohibition in s 355-25(1) on disclosure by a taxation officer of protected information. 48 Finally, where the ACC obtains "admissible evidence" through an ACC operation or investigation of an offence, it is required to provide that evidence to the State or Commonwealth Attorney General (as the case may be), the relevant law enforcement agency, or any other person or authority authorised to prosecute the offence: s 12(1), ACC Act. Plainly where the immunity in s 30(5) has been invoked by a person giving evidence at an ACC examination, the examination information will not be "admissible evidence" and s 12(1) will not apply.

4.2 Project Wickenby 49 Project Wickenby is an Australian Government multi-agency task force established by the Australian Crime Commission Special Investigation Authorisation and Determination (Wickenby Matters) 2006 (the Wickenby Determination) made by the Board of the ACC on 13 September 2006 pursuant to s 7C of the ACC Act. In broad terms, the Determination provides for the investigation into arrangements and taxpayers involved in the creation and use of offshore structures such as trusts, companies and bank accounts to minimise or avoid paying tax in Australia. By way of an overview, the ATO explains on its website that: Project Wickenby is an integral part of the Australian Government's fight against tax evasion, avoidance and crime. In particular, Project Wickenby addresses the abusive use of secrecy havens by investigating offshore schemes that involve false deductions and concealed income and gains. The Project Wickenby cross-agency task force, established in 2006, consists of eight federal agencies. This cross-agency approach continues to be necessary because Australia is increasingly engaging in the global economy and the size and scale of international tax avoidance and evasion is extensive and growing. The key objectives of the task force are to: • reduce international tax evasion in the Australian taxation system • enhance strategies and capabilities of Australian and international agencies to collectively detect, deter, deal with, and disrupt international tax evasion and money laundering • improve community confidence in Australia's regulatory systems • reform administrative practice, policy and legislation. With their combined legal and administrative efforts and the use of sophisticated technology, the task force has made significant progress in identifying a range of illegal offshore schemes. Three key features of the schemes already under investigation are: • concealing income or gains, or creating false or fraudulent tax deductions • concealing assets offshore to avoid obligations in Australia • returning funds to Australian taxpayers in a deceitful manner, including as laundered money. 50 The purpose of the special investigation for the purposes of s 7C(4)(c) is set out in clause 9 of the Wickenby Determination, namely: (a) to collect and analyse criminal information and intelligence relating to the federally relevant criminal activities, to disseminate that information and intelligence in accordance with the Act and to report to the Board; and (b) to identify and apprehend persons involved in the federally relevant criminal activities, to collect evidence about these activities and to reduce the incidence and effect of those activities; (c) to make appropriate recommendations to the Board about reform of: (i) the law relating to relevant offences; and (ii) relevant administrative practices; and (iii) the administration of the courts in relation to trials of relevant offences. 51 Clause 4 authorises the ACC to investigate the matter mentioned in schedule 1 to the Determination relating to federally relevant criminal activity until 30 September 2007. That period has been extended by amendments made by the Board on 12 September 2007, 16 September 2008, 16 September 2009 and 15 September 2010. The serious and organised crime to which the Determination applies includes offences against a law of the Commonwealth, a law of a State or a law of a Territory (clause 8). 52 Schedule 1 to the Determination states that the authorised investigation is an investigation to determine whether, in accordance with allegations mentioned in clauses 3 and 4 and in the circumstances mentioned in clause 2, federally relevant criminal activity was committed before or at the time the Determination commenced or may be committed in the future. The general nature of the circumstances mentioned in clause 2 includes, relevantly, such federally relevant criminal activity that may be implied from information available to Australian law enforcement agencies indicating that: (a) organised crime identities, networks and groups utilise off-shore associates and arrangements to establish and manage foreign accounts to conceal criminal proceeds and avoid tax obligations in Australia; (b) critical to the success of such activity has been the continued use of professional facilitators such as solicitors, accountants and financial advisors that possess expertise and detailed knowledge of domestic and foreign finance markets, systems and secrecy provisions; (c) Australian citizens and permanent residents have engaged in activities that cannot be readily explained by possibilities other than federally relevant criminal activity, as is apparent from: … (ii) A suspicious pattern of significant financial transaction reports under the [Financial Transaction Reports Act 1988] involving large sums of money: A. entering or leaving the banking system in Australia;… 53 The general nature of the allegations mentioned in clauses 3 and 4 included that certain persons in concert with one another or other persons may be engaged in activities including: (a) conspiracy to defraud within the meaning of section 135.4 of the Criminal Code through evasion of, or making false claims in relation to, tax…; … (c) obtaining financial advantage by deception within the meaning of section 134.2 of the Criminal Code through evasion of, or making false claims in relation to, tax…; … (e) defrauding the Commonwealth within the meaning of section 29D or section 86 of the Crimes Act 1914 through evasion of, or making false claims in relation to, tax…; (f) dealing with money or other property contrary to sections 400.3, 400.4, 400.5, 400.6(1), 4000.6(2) or 400.7(1) of the Criminal Code;… 54 The classes of persons to participate in the investigation (the taskforce) were identified in schedule 2 pursuant to s 7C(1)(e) of the ACC Act as: 1. The CEO [of the ACC]. 2. Each person who is: (a) a member of the staff of the ACC; and (b) identified in writing by the CEO, or a delegate of the CEO, as a person whose duties include providing services in relation to ACC operations and investigations. 3. Each person who is: (a) an officer or member of the staff of any of the following agencies; (i) an agency of which a Board member is head (other than the CEO) in his or her capacity as a Board member; (ii) the Australian Taxation Office; (iii) AUSTRAC; (iv) the Department of Immigration and Multicultural and Indigenous Affairs; (v) the New South Wales Crime Commission; (vi) the Queensland Crime and Misconduct Commission; and (b) identified in writing by the head of that agency, or a delegate of that head, as a person whose duties include providing services in relation to ACC operations and investigations. 55 The ATO's involvement in the project preceded the Determination, commencing in 2004. That involvement has included completion of a large number of audits of numerous taxpayers in which the common theme is taxpayer receives payments from, or makes payments to, overseas entities, particularly in jurisdictions listed by the OECD as tax havens.

4.3 Operation M 56 Operation M was endorsed as a project by the Project Wickenby Cases Forum in 2010. There is no suggestion by the applicants that it was not properly so endorsed by reason of falling outside the scope of the Wickenby investigation or otherwise. 57 Operation M commenced as a multi-agency project including the ATO, ACC, ASIC, the Commonwealth Director of Public Prosecutions (CDPP) and the Australian Federal Police (AFP). The operation forms part of the ongoing compliance activity of the Serious Non-Compliance Audit (SNC). It is concerned with examining offshore arrangements designed to avoid tax which generally involve jurisdictions with strict secrecy provision (so-called "tax havens"). Several of these offshore arrangements involve Australian taxpayers with links to common service providers including a particular Sydney tax agent and Sydney accounting firm (the Sydney tax agent and the Sydney accounting firm respectively). 58 The Operation M Project Outline explained that: ASIC has identified the following hypotheses in relation to Operation [M]: • [redacted] is an offshore wealth accumulation and tax evasion service provider used by Australians • [redacted] sets up and administers structures in tax havens controlled by Australian clients • The service is promoted by Australian legal and accounting professionals • The structures enable anonymous share trading, avoidance of reporting obligations and repatriation of accumulated assets free from ATO scrutiny • Participants in the service create and lodge alleged fictitious company charges and invoices to aid tax evasion on repatriated funds and other income. Analysis indicates that [redacted] are linked foreign entities providing loans to [redacted]. As previously stated, the ATO views the loans as sham arrangements to repatriate assets and avoid taxation with additional funds being sent overseas for alleged unsubstantiated interest payments or loan repayments. It should be noted that there are many company charges which have been lodged with ASIC in order to, it would appear, add a legitimacy to the 'loans'. (The redactions identified above were made in the exhibit on the grounds of relevance and pursuant to the Commissioner's privacy/secrecy obligations). 59 The Operation M Project Outline identified the potential risk as involving: …undeclared world-wide income for Australian residents from offshore profits earned from trading on the ASX. This involves: parking funds offshore and secrecy havens to evade tax and conceal ownership i.e. via the use of Life Bond products • implications relating to Division 7A, Section 44 and Division 6 of the Income Tax Assessment Act 1936 (ITAA) as a result of offshore profits repatriated back to Australian taxpayers and disguised as loans • back to back loans ('Round Robin') which can be proven to appear as far back as 1994 … • offshore profits returned to Australian residents disguised as loans from purported unrelated third parties … • concealment of true beneficial ownership through complex structures in the UK and associated connections to secrecy havens • significant hiding of monies offshore by Australian resident participants and principals 60 One of the key objectives of Operation M is to identify strategic cases for ACC examination, being cases that involve complex, systemic, entrenched non-compliant Australian taxpayer users of the services of the Sydney tax agent and the Sydney accounting firm. The first applicant was identified as a significant participant in Operation M arrangements in the Operation M Project Outline.

4.4 Project Grindelford 61 Pursuant to the Wickenby Determination, the ACC also conducted a special investigation codenamed Grindelford (Project Grindelford). That investigation is a joint ATO/AFP/ACC investigation into suspected tax fraud and money laundering by Australian residents who have used off-shore services and arrangements to conceal criminal proceeds and avoid tax obligations in Australia. The ACC's role in the investigation is to use its coercive powers to gather strategic intelligence and to support additional criminal investigations resulting from the wider Project Wickenby.

4.5 The tax review and commencement of the audit of the first applicant's tax affairs and associated entities in 2009 62 The first applicant and his wife first came to the attention of the Commissioner through information obtained as a result of activities under Project Wickenby. They were also identified as part of Operation M as clients of the Sydney accounting firm. 63 On 14 July 2009, the Deputy Commissioner wrote to the first applicant advising that the ATO was conducting a review of his income tax affairs and those of the second and third applicants, as they had been identified as having conducted at least one international monetary transaction involving the sending or receiving of money to or from an offshore jurisdiction during the financial years ending 30 June 2001 to 30 June 2008. The letter contained a list of the transactions and sought information in answer to certain questions for the purpose of the income tax reviews. On the same day, the Deputy Commissioner also wrote to the fourth applicant and the first applicant's wife regarding the income tax review of the fifth and sixth applicants to similar effect. 64 On 10 November 2009, the Deputy Commissioner wrote to the first applicant advising that the ATO had commenced an audit as part of Project Wickenby of the first applicant's affairs and entities associated with him, namely, the second, third and fourth applicants, commencing on the date of the letter. The letter also advised that the audit would initially cover, but not be limited to, the tax period 1 July 2000 to 30 June 2009. The schedules to the letter identified in a non-exhaustive way events on which the audit would focus, and requested information. Those events included international monetary transfers to a named Asian entity (the Asian entity). The Asian entity had headquarters in Asia offering services in various locations including the Cook Islands, Samoa, the Bahamas, the Cayman Islands and the Seychelles, and was the subject of Operation M.

4.6 ATO officers and their roles in Operation M 65 Cathrine Jay, who gave evidence for the Commissioner, became involved in Project Wickenby in August 2004 before the Determination was made. She has also been involved in Operation M in the role of Regional Director (Executive Level 2.1), SNC Business Line with Project Wickenby, since October 2012 and for some months prior to that during absences of her predecessor in that role. 66 As Regional Director, Ms Jay oversees Operation M compliance activities and, among other things, decides whether to issue s 264 notices and amended assessments in tax fraud and evasion cases. Since Ms Jay's involvement in Operation M, the ATO's primary focus has been on compliance activities, including issuing notices to various persons under ss 264 and 264A of the ITAA 1936. Ms Jay, as delegate of the Deputy Commissioner, SNC, authorised the issue of the s 264 notice in 2014 to the first applicant: see further at [109] et seq below. 67 The day-to-day management of Operation M is undertaken by auditors who conduct the audits under the supervision of team leaders, with both the auditors and team leaders reporting to Ms Jay on Operation M cases. 68 Ms Knappick, an employee of the ATO within the SNC Business Line, was the team leader and strategic project manager of Operation M within Wickenby until 25 February 2011. Sixteen members of staff within the ATO reported to Ms Knappick in those roles. She also worked collaboratively with the ACC, the AFP and ASIC as partner agencies under the Wickenby Determination to achieve the objects of that investigation. 69 Matthew Evans, also a full time employee of the ATO, took over management of Operation M from Ms Knappick in late February 2011. Before assuming that role, Mr Evans was an auditor in the Audit section of the SNC. Other auditors within the same section included Shannon Main (who was tasked with the audit of trusts associated with the first applicant and authored the submission to issue the s 264 notice), Matthew Holden (who also focused on the audit of trusts associated with the first applicant) and Stephen Ching. Mr Ching's role as auditor involved him looking at a person's financial interest, assessing it under a review process and, if required, taking the case to an audit process and raising assessments. In the period 2010 through February 2011, Mr Ching spent a high percentage of his time working on the audit of the first applicant and his entities. 70 Lenore Richards worked as a Technical Specialist in the SNC Technical section assisting the audit team with Operation M matters. SNC Technical supports SNC Audit by providing technical and case advice, and referring matters to Legal Services Branch (now Review and Dispute Resolution (RDR)) and Tax Counsel Network (TCN). While Ms Richards did not work directly under Ms Knappick, she had daily dealings with her. 71 George Velovski, currently Executive Director of Interpretive Assistance within the Small Business/Individual Taxpayers business line, also gave evidence for the Commissioner. He had been employed by the ATO since 1989 and involved in Project Wickenby objections since 15 August 2011.

4.7 The summons issued to the first applicant to attend and give evidence at the ACC examination on 24 February 2011 72 Ms Knappick first considered conducting an examination of the first applicant in 2009. She gave evidence that she considered that it was an appropriate case for an ACC examination because "[t]he use of ACC examinations is to gather further intelligence. It is to intelligence probe persons or interest who have displayed behaviours of possible criminal or civil behaviours in and around tax evasion, money laundering. It is a general purpose of what Wickenby was established for and the use of the ACC examination." 73 On 21 January 2011, the Assistant Commissioner, Investigations, SNC, as a delegate of the Commissioner, approved a request from SNC to disclose information to the ACC required for an Operation Grindelford examination of the first applicant, being in the form of a witness profile of the first applicant prepared by Mr Ching. The witness profile provided background and set out reasons as to why it was said to be appropriate for the ACC to conduct a Grindelford examination on the first applicant, the objectives of the proposed examination, and suggested questions to be asked. The witness profile was sent by email to the ACC later that day. 74 On 9 February 2011, Glenn Pritchard, Head of the Wickenby Determination at the ACC, applied for the issue of a summons under s 28 of the ACC Act to the first applicant pursuant to Project Grindleford. The application explained that: This particular aspect of Grindleford builds upon its strategic intelligence to determine the current environment with international tax planning and the use of tax havens by Australian residents to avoid or evade tax. The strategic intelligence is to be developed by the ACC and may be provided to the ATO and AFP for their further investigation of "federally relevant criminal activity." 75 The application set out background facts based primarily on information provided by the ATO together with some ASIC searches, and made submissions as to the relevance of the witness to the Wickenby Determination by reference to the nature of the oral evidence to be sought. 76 On 11 February 2011, the examiner issued a summons to the first applicant pursuant to s 28(1) of the ACC Act stating that: Pursuant to subsection 28(1) of the Australian Crime Commission Act 2002 ... for the purposes of a special ACC Investigation being conducted by the Australian Crime Commission: 1. being satisfied that it is reasonable in all the circumstances to do so; 2. having recorded in writing the reasons for being so satisfied at 1.27 PM on 11th February 2011 3. I summon you... to appear 77 Paragraph 3 of the summons went on to state that the first applicant was to appear at a specified time on 24 February 2014 before the examiner for an examination unless excused or released from further attendance to give evidence of or about certain federally relevant criminal activity including defrauding the Commonwealth through evasion or making false claims in relation to tax. The examiner recorded his reasons for the issue of the summons at 1.27 pm on 11 February 2011 and the summons was subsequently issued at 1.30 pm on the same day. The examiner's reasons are set out at [156] below.

4.8 The ACC examination on 24 February 2011 and non-publication directions 78 Ms Knappick attended the ACC examination of the first applicant on 24 February 2011 and stated that she did so in her capacity as an ACC member of staff for the examinations under the Wickenby Determination and Project Grindleford. 79 Ms Knappick explained that she understood that she was a member of staff of the ACC when she was working in that environment under the Wickenby Determination and that her role on the day was to assist Counsel understand or further clarify issues that were raised at the Determination, should they require it. 80 At Ms Knappick's request, a number of other ATO employees attended the ACC examination of the first applicant, namely, Mr Evans (in Sydney), as well as Mr Ching and Ms Richards (both by videolink from Brisbane). Mr Evans and Ms Richards were also working within the Serious Non-Compliance Business Line of the ATO on Project Wickenby at the time of the examination. Ms Knappick asked Mr Evans to attend as he was to become the project manager shortly after the examination. 81 I accept Ms Knappick's evidence that her team would have prepared guiding questions for the assistance of the ACC examiner and would normally consult with counsel and examiners before the examination. However, the examiner would decide ultimately what questions he or she asked at the examination. As part of this process, Mr Ching completed the witness profile required for the examination of the first applicant at Ms Knappick's direction. 82 At the start of the examination, the examiner explained to the first applicant that: [THE EXAMINER]:…You must answer the questions and produce documents or things that are required from you even if they may tend to incriminate you or render you liable to a penalty. Mr Johnson [the first applicant's legal representative], I am prepared to offer the witness through you an opportunity to claim self-incrimination. But before I do that I'll put to you that if the witness were to be unrepresented I will go into a lot more detail and explaining what self-incrimination is, what the claim is under the Act, the affect [sic] of the claim. Do I need to do any of that with this witness? MR JOHNSON: No, Your Honour, no, Mr Examiner. [THE EXAMINER]: And does the witness wish to make a claim of self-incrimination? MR JOHNSON: Yes he does. [THE EXAMINER]: And I'll make an order now that we will give him the protection from the entirety of his evidence. I'll make the order under Subsection 5 of Section 30 of the Australian Crime Commission Act that the evidence of this witness is not admissible in evidence against him in any criminal proceedings or a proceeding for the imposition of a penalty other than in confiscation proceedings or a prospective proceeding in respect of, firstly in the case of an answer, the falsity of the answer or secondly in the case of the production of a document, the falsity of any statement contained in the document. [The first applicant], the order I've made gives you the protection from being prosecuted on anything that you might say in this examination subject to those two (2) exceptions. The first (1st) exception being that your evidence is admissible in confiscation proceedings, they are proceedings under proceeds of crime type legislation and the second (2nd) exception where your evidence here can be used against you is if you were to give false or misleading evidence in a material particular in this examination. So do you understand what I've, the order I've done and the affect [sic] of it? [THE FIRST APPLICANT]: Yes, Mr Examiner. 83 It is apparent from this exchange that the first applicant, through his legal representative, made a claim before answering questions that the answers may tend to incriminate him or make him liable to a penalty for the purposes of s 30(4)(c) of the ACC Act. It was accepted that that claim was effective to cover the totality of his evidence at the examination. As a result, none of his answers at the examination are admissible against him in criminal proceedings or proceedings for the imposition of a penalty by virtue of s 30(5) of the ACC Act. 84 At the conclusion of his examination, the examiner made a non-publication direction under s 25A(9) of the ACC Act. That direction provided relevantly that: I am going to give a non-publication direction now [the first applicant] and I give that direction pursuant to Subsection 9 of Section 25A of the Australian Crime Commission Act. I direct that the evidence given by [the first applicant] the contents of the documents and the description of any thing produced to the Commission during this Examination, any information that might enable the witness to be identified and the fact that he has given evidence at this Examination shall not be published except to the Chief Executive Officer of this Commission, the Examiners and members of staff of this Commission. Also to the Australian Taxation Office for any matter within its jurisdiction arising from this investigation. Further as an exception to the non-publication direction, I permit the witness to inform his wife if he deems it necessary that he was summonsed to appear at the Australian Crime Commission today that he has given evidence as a witness and he has concluded that evidence. For the record, the witness's wife's name is [redacted]. Also as an exception to the non-publication direction, I extend the legal representatives to include Mark Douglas of Argyle Lawyers for the purpose of advice in relation to taxation matters that [the first applicant] may be facing in, having to deal with in the future. I also note that there is to be no communication between the witness and any member of staff of [the Sydney accounting firm] in particular [the Sydney tax agent and another]. The Commission's Chief Executive Officer or his delegate may vary or revoke this direction in writing but must not do so if it might prejudice the safety or the reputation of a person or prejudice the fair trial of a person who has been or may be charged with an offence. Any breach of this direction is an offence punishable under the provisions of the Australian Crime Commission Act. This direction, [the first applicant] does not preclude you from further speaking with your legal representative Mr Johnson, Miss Nguyen and Mr Douglas to give instructions and to receive advice. The audio and video tapes of the Examination will be Exhibit two (2). And I direct that a record of the proceedings of the Examination and any other documents or things given to me at or in connection with this Examination be given to the head of the special investigation. (emphasis added) 85 The non-publication direction was in these terms at the time that the transcript of the ACC examination was disseminated to officers in the ATO on 2 June 2011, as I shortly explain.

4.9 Amendments to the Non-publication Direction 86 The original non-publication direction was relevantly varied on a number of occasions. 87 First, on 10 August 2012, the direction was varied under s 25A(10) by a delegate of the CEO so as to read: Information to be published 1. The evidence given by the witness, the contents of any documents or things produced to the Examiner and any information that might enable the witness to be identified or the fact that the witness to be identified or the fact that the witnesses have given evidence to the Examiner (the information). Authorised Publication 2. Subject to paragraph 3, the information set out in paragraph 1 above may only be published:- (a) to the Chief Executive Officer, Examiners and specified members of the staff of the ACC; (b) to the Australian Taxation Office (ATO) and staff for:- (i) confidential intelligence use within the ATO; and (ii) use and publication in connection with the assessment of taxation liability of the witness, his wife [redacted] or any associated entities (the tax assessments); (c) to any member of the AAT and any court (and staff of those bodies) and the parties and their legal representatives in any proceedings in which both the ATO and one or more of the witness, his wife or any associated entity is a party (the tax objection and appeal matters) for confidential use in connection with the tax objection and appeal matters; and (d) by the witness and legal representatives to the persons listed in sub-paragraphs 2(a) to (c) for confidential use in connection with the tax assessments or the tax objection and appeal matters; (e) by the witness advising his wife [redacted] that he has given evidence to the examiner and has concluded that evidence; (f) to Mr Mark Douglas of Argyle Lawyers [amended on 10 August 2013 so as to add "(or any other lawyers engaged by the witness)"] for the purpose of advice in connection with taxation matters involving the witness. 3. Publication of the information is subject to the following: (a) the restrictions on use in sub-section 30(5) of the ACC Act; (b) it may not be publicly released; (c) it may not be considered as part of any proposed adverse administrative action against any person (other than the tax assessments or the tax objection and appeal matters) without prior approval of the ACC. (substantive amendments underlined; double under lining means that the underlining was in the original; footnotes omitted) (my redactions) 88 The non-publication direction was further varied on 10 October 2013 so as to exclude from those entities mentioned in paragraph 3(b)(ii) a named offshore bank (the Offshore Bank) and separately provide for confidential use of information regarding these entities in connection with a confidential application by the witness before the Federal Court. Furthermore, an additional clause was inserted (sub paragraph 3(b)), with consequential renumbering of the other subparagraphs) so as to render publication of the information and attendance information subject to the further express restriction that "the information shall not be published to the prosecutor of any criminal proceedings against the witness, or to any witness in such proceedings" (emphasis in the original). 89 The direction was varied again on 7 April 2014 so as, among other things, to make separate provision with respect to information in relation to the witness's dealings with the Offshore Bank, and to authorise (to the extent necessary) the use of "the general attendance information" in the present proceedings, namely: 7. Subject to paragraph 6, the general attendance information may only be published to the following persons for confidential use in connection with any application by the witness to a court in connection with any proposed interview of the witness by ATO staff (currently scheduled for [redacted]: (a) the persons specified in sub paragraph 4(a) above [i.e. the CEO of the ACC, Examiners and specified members of the staff of the ACC]; (b) the ATO (and staff and lawyers engaged); (c) any Court, or presiding judicial officer (and staff); and (d) legal representatives engaged for the witness; provided that the witness must seek from the court, suppression orders and non-publication orders in respect of the general attendance information that is to be published to the court. (emphasis in original; footnotes omitted) 90 The phrase "[t]he general attendance information" was defined as: The fact that an ACC examination summons was issued and served on the witness, the date the witness attended the ACC and the fact that the witness was required to and did answer questions about the witness's financial dealings, and the terms of any non-publication directions made by the Examiner, and the terms of any variation of those directions, but does not include the evidence of the witness before the Examiner... (emphasis in the original)

4.10 Dissemination of the transcript to the ATO 91 On 2 June 2011, Richard Grant, National Manager, Target Development and Intervention, ACC, wrote to Mr Evans at the ATO enclosing a copy of the transcript of the examination of the first applicant pursuant to s 59(7) of the ACC Act. Mr Grant's position was at the Senior Executive Service Band 1. As such, he fell within the class of persons "SES employees" (SES) to whom the Acting CEO of the ACC had delegated his power to disseminate information under ss 59(7), 59(8), 59(9) and 59(11) of the ACC Act by an instrument dated 1 January 2003 pursuant to s 59A of the ACC Act. 92 The letter advised that "[t]he ACC provides the attached information on the basis that it is relevant to the activities of the Australian Taxation Office." It further advised that the examiner's non-publication directions permit dissemination to the ATO but that the information should not be further disseminated without prior approval of the ACC. 93 The transcript was reviewed by Mr Ching during the conduct of the audit of the first applicant and his wife and may have been made available to Small Business/Individual Taxpayers (SBIT) officers in relation to the objections. It was made available to, and reviewed by, Shannon Main and Matthew Holden who (it will be recalled) were auditors undertaking audits of the five trusts associated with the first applicant. The transcript was also emailed to ATO officers in Review and Dispute Resolution and in Tax Counsel Network. However, while Ms Jay, who ultimately decided to issue the s 264 notice, had access to the transcript, she did not review it. Nonetheless she did review position papers, reasons for decision papers, and other audit papers relating to the audit of the first applicant and his wife and the associated trusts. 94 On 16 August 2012, Mr Grant again wrote to Mr Ching enclosing the audio file of the examination of the first applicant and non-publication direction instrument dated 10 August 2012 in relation to the first applicant's examination. The accompanying letter states that the attached information "is communicated to you pursuant to Section 59AA(1) of the Australian Crime Commission Act 2002 (Cth). The ACC provides the attached information on the basis that it is relevant to the activities of the Australian Taxation Office." By reason of his position as National Manager, Target Development, ACC, Mr Grant fell within the terms of those to whom the CEO's powers under s 59A of the Act to disclose information to government bodies had been delegated under s 59AA by an instrument dated 22 June 2012 (taking effect on 25 June 2012), namely, persons from time to time occupying the SES positions of (relevantly) National Managers.

4.11 Results of audit and amended assessments 95 On 27 September 2012, the ATO wrote to the first applicant enclosing a position paper about his audit for the years ending 30 June 2000 to June 2009, being a statement of the facts as understood by the ATO and its interpretation of the law as applied to those facts. The letter gave the first applicant the opportunity to comment on the position paper and provide further explanation by 29 October 2012. It also stated that the final position will be determined after taking into account any response to the position paper, any further information or any other relevant matter. The letter concluded by advising that the ATO will amend the first applicant's assessments on the basis of the current information if he does not respond by 29 October 2012 or if any new facts and/or views on the interpretation of the law from the first applicant do not affect the ATO's position. 96 The first applicant responded by letter in late October 2012. However, in early November 2012 the ATO wrote advising that, having considered the matters raised by the first applicant, the views outlined in its position paper remained unchanged and amended assessments for the 2000 to 2007 income years reflecting those views would issue shortly. 97 Subsequently in November 2012, the ATO issued amended tax assessments to the first applicant for the income years 2000 to 2007, increasing the first applicant's personal income tax liability across those years by in excess of $10 million. The ATO also imposed penalties on the first applicant in November 2012 in excess of $10 million pursuant to subsection 284-75(1), Schedule 1 of the Taxation Administration Act 1953 (Cth) (TAA 1953) and its predecessor on the basis that the first applicant had engaged in "intentional disregard" of the tax legislation. Alternative assessments were also issued to the first applicant's wife. 98 The Commissioner commenced recovery proceedings in December 2012 against the first applicant and his wife and, this Court made orders freezing the first applicant's Australian assets. These orders remain in place. 99 The first applicant and his wife lodged objections to the amended assessments within the meaning of the TAA 1953 in early 2013. It is not in issue that in those assessments objections, the first applicant and his wife assert the correctness of the income declared in their tax returns for the years 2000 - 2007. 100 Subsequently, the ATO advised the first applicant and his wife that it would endeavour to respond to their objections by October 2013. This does not amount to a representation by the ATO that their assessments "would be determined" by that time, contrary to applicants' submission.

4.12 The decision to issue the s 264 notice 101 The proposal to interview the first applicant appears to have been initially discussed within the ATO in December 2013, with the matter first raised by Wickenby Objections, ATO, in connection with the first applicant's assessments of the first applicant, his wife and the associated trusts in early December 2013. 102 On 9 January 2014, Ms Jay sent an email to various ATO officers having responsibility in relation to the audit, objections and debt recovery matters regarding the first applicant and his wife and the audit of the associated trusts, in which she advised: This afternoon we had a teleconference between objections and audits regarding the proposed interview with [the first applicant]. As you are aware both areas have an interest in having Des Fagan conduct s264 interviews with [the first applicant]. … Audit would like to clarify aspects of the offshore arrangement in order to finalise our audits of [the associated trusts]. These trusts are associated with [the first applicant] and purported loans from the same offshore structure that was the subject of the audit (and now objections) of [the first applicant]. Objections also wish to clarify matters relating to the offshore arrangements in order to determine [the first applicant and his wife's] objections. Aris [Zafiriou - Director, Strategic Recovery Debt] has also expressed an interest in interviewing [the first applicant] in order to better understand the validity of any encumbrances on [the first applicant] and his associated entities' assets … In the circumstances it seems appropriate to issue a combined 264/… Notice to [the first applicant], thus allowing one interview to cover all avenues of investigation.… Alternatively, debt can issue the … notice and either Objections or audit can issue the 264 notice ... 103 Mr Velovski, who also attended the teleconference, considered that the contents of that email accorded with his recollection, explaining that "various staff members from different sections of the ATO were interested in obtaining information for [the first applicant] in relation to his taxation affairs and the taxation affairs of his related entities." 104 Edwina McLachlan, Tax Counsel, TCN, ATO, who had missed the teleconference, responded later that day advising that: Cathy [Jay] and I have had a chat about our approach, and it is clear the purpose of the information gathering is the income tax affairs of [the first applicant] and his associates for raising assessments, and deciding objections and recovery of the taxation liabilities raised by the assessments. … It is important that we are able to present the hypothesis for audit and objections and debt positions clearly to Mr Fagan, supported by the facts we have, and are able to point out where the gaps in our understanding are. We'll do this in our brief, which Ram [Pandey, Senior Lawyer, RDR and I will draft and circulate for finalisation.… I understand objections have drafted their areas of questioning, and audit have drafted position papers.… 105 Jay responded by email at the end of the day with an email to Ram Pandey and Edwina McLachlan. In the email, she attached various documents further to their telephone discussions that afternoon and for the purposes of briefing counsel, namely, an email of the audit position papers now subject to objection containing some relevant information about asset holdings, the draft position paper for one of the trusts associated with the first applicant and an extract of an email from Mr Main, auditor SNC, to Objections outlining a proposed line of inquiry to the first applicant. 106 It was agreed subsequently at a telephone conference on 16 January 2014 that Audit would issue the s 264 notice. The telephone conference was attended by Ms Jay, ATO staff from the SNC business line (including Lenore Richards), SBIT business line (including Effie Mavratzakis who appears to have drafted the submission recommending the s 264 interview and George Velovski), Edwina McLachlan from Tax Counsel Network, and Review and Dispute Resolution (including Ram Pandey). 107 On 6 March 2014, Mr Main sent Ms Jay a submission recommending issue of the notice, together with the draft s 264 notice (in the same terms as that ultimately issued) and covering letter. The submission stated relevantly that: Details of compliance inquiry: Conduct of compulsory interview of [the first applicant] in order to gather further evidence in relation to the offshore arrangements that he, and his associates, participated in. Previous action taken to obtain requested information/evidence/documents: [The first applicant] was interviewed by another Commonwealth agency; the transcript of which was shared with the Commissioner. [The first applicant] has also provided information and documents in response to audit letters, and also in response to s264 notices. Responses of taxpayer to action taken: [The first applicant] generally responds to requests for information and document [sic] in a timely fashion, however the veracity of the documents provided by him and his agents is doubtful. Reasons for proposing issue of notice: The proposed interview is seen as the most direct and appropriate method to test the veracity of the documents supplied by [the first applicant] and his agents. 108 I understand the reference to "another Commonwealth agency" in the second paragraph to be a reference to the ACC and the reference to the transcript to be a reference to the transcript of the ACC interview of the first applicant held on 24 February 2011. 109 Ms Jay authorised the issue of the s 264 notice in March 2014 pursuant to an instrument of authorisation signed by Deputy Commissioner, SNC, on 27 November 2013. By the instrument of authorisation, the Deputy Commissioner relevantly authorised Executive Level 2.1 officers within the SNC business line of the ATO to exercise in the name of the Deputy Commissioner, SNC, all of the powers and functions delegated to that office, as well as the Deputy Commissioner's own powers and functions, subject to exceptions not relevant here. These included all of the Deputy Commissioner's powers and functions under the ITAA 1936, whether in his own right or by delegation, save for those in ss 8, 14 and 263 of that Act. 110 The s 264 notice was sent under cover of a letter from the Deputy Commissioner on the same date. The covering letter advised among other things: Mr Des Fagan SC will be attending the interview to assist the Commissioner. For the purposes of the interview he will be an officer of the Australian Taxation Office and subject to the relevant secrecy provisions. 111 It is not in dispute that Mr Fagan SC has read the transcript of the ACC examination. 112 The s 264 notice was in the following terms: NOTICE PURSUANT TO SECTION 264 OF THE INCOME TAX ASSESSMENT ACT 1936 Pursuant to section 264 of the Income Tax Assessment Act 1936, I require you to attend and give evidence. 1. concerning the income or assessment of [The first applicant and associated trusts being the second to sixth applicants, the applicants' wife, and a number of entities associated with him through which monies were allegedly transferred offshore and repatriated to Australia] for the period 1 July 1999 to 30 June 2013, 2. before any or all of the following officers Mr Shannon Main, Ms Cathrine Jay, Mr Ram Pandey, Ms Cassandra Franklin, Ms Edwina McLachlan Mr George Velovski, and Ms Effie Mavratzakis Whom I authorise for this purpose, 3. at the Australian Taxation Office, 52 Goulburn Street Sydney, NSW, 4. on [redacted] at 9:00am and until you are excused from further attending. You may be required to give evidence on oath or affirmation. The officer who administers the oath or affirmation is authorised by me to do so. The powers of the Commissioner of Taxation under section 264 of the Income Tax Assessment Act 1936 have been delegated to me as Deputy Commissioner of Taxation pursuant to section 8 of the Taxation Administration Act 1953. (emphasis in original) 113 The s 264 interview has since been adjourned to a date at least 7 days after the outcome of the present proceedings. 114 In coming to her decision to authorise the s 264 interview, Ms Jay had access to: (a) draft copies of the s 264 notice and cover letter sent to her by email from Mr Main on 28 February 2014; (b) draft copies of the submission, s 264 notice and covering letter sent to her by Mr Main by email on 6 March 2014 (set out at [107] above); (c) the audit files; (d) emails from Objections including: (i) an email dated 13 December 2013 from George Velovski to Cassandra Franklin (copied to Ms Jay) detailing the reasons why SBIT wanted to engage counsel to conduct the s 264 interview; and (ii) an email dated 10 January 2014 from George Velovski to Edwina McLachlan and Ram Pandey (also sent to Ms Jay) attaching a word document containing a table listing the evidence. 115 Cassandra Franklin and Ram Pandey were Acting Principal Lawyers/Senior Lawyers, RDR, while Edwina McLachlan was Tax Counsel, TCN. 116 With respect to the audit papers, it will be recalled that those tasked with undertaking the audit of the first applicant's tax affairs and those of the associated trusts had been provided with the transcript of the ACC examination in June 2011. It will also be recalled that the terms of the non-publication directions as at the date on which the transcript was sent to the ATO and on which the s 264 decision was made permitted publication "to the Australian Taxation Office (ATO) and staff for (a) confidential intelligence use within the ATO; and (b) use and publication in connection with the assessment of taxation liability of the witness, his wife …, or any associated entities (the tax assessments)" (emphasis in the original). Further, the audio tape was sent to Audit on 16 August 2012 following the variation to the direction set out at [87] above. 117 With respect to the email of 13 December 2013, the reasons for engaging counsel to conduct the interview identified included relevantly: (a) the strategic importance of the first applicant's case given that the taxpayer is a significant participant in Operation M arrangements; (b) the significant value of the first applicant's amended assessments; (c) that the issues "are complex questions of fact … Questions for interview have been drafted which involve multiple topics, multiple use in multiple structures. During the audit a s 264(1)(a) notice was issued to the taxpayer and in response to the notice a taxpayer made indefinite and inconsistent statements in relation to evidence in the Commissioner's possession"; and (d) "If it is a successful interview process with [the first applicant], we will obtain a more definite view of [the first applicant's] affairs. This would be of assistance to other associated cases under investigation in Operation [M]" 118 Consistently with the point made at 117 above, Mr Velovski, Executive Director of SBIT, gave unchallenged evidence that in December 2013 "the objective of undertaking the s 264 interview at objection was to clarify the inconsistencies in responses provided by the tax agent on behalf of [the first applicant] at audit. Furthermore, some of the responses provided were limited and general and did not answer the respective questions posed. By interviewing [the first applicant] further factual material and information could be uncovered that may assist in determining the taxpayer's total taxable income which ought to be subject to taxation in Australia." 119 Ms Jay also considered the following matters in reaching her decision: a) her knowledge and understanding of the audits of the five trusts associated with [the first applicant]; b) her knowledge and understanding of the audit concerning [the first applicant's and his wife's] personal income tax amended assessments for the 2000 to 2007 income tax years issued in November 2012 to which they have lodged objections; and c) her knowledge of various documents including the audit files and the reasons why SBIT wished to engage counsel to conduct the s 264 interview. 120 It was also her unchallenged evidence that: (a) She "agreed that the purpose in issuing the s 264 notice which was identified in the submission: '… in order to gather further evidence in relation to the offshore arrangements that [the first applicant] and his associates, participated in.''"; (b) She "agreed that the reason for issuing the notice was that identified in submission, namely, that 'the proposed interview is seen as the most direct and appropriate method to test the veracity of the documents supplied by [the first applicant] and his agents.'" 121 Notwithstanding some awkwardness in expression, sensibly read I understand her evidence to be to the effect that part of her reasons for issuing the s 264 notice was she agreed "with" the purpose and the reason for issuing the notice identified in the submission. Consistently with this, she also explained that "I had no purpose, in issuing the s 264 notice, other than to gather evidence concerning the income or assessment of the first applicant and his wife and his/their associated entities and other entities identified on the s 264 notice." 122 Ms Jay's evidence was not challenged and is consistent with the reasons put forward in the submission to her for holding the s 264 interview and with the teleconferences and internal email correspondence leading up to the issue of the notice. As such, the evidence that she decided to issue the s 264 notice for these reasons and for the purpose identified by her is overwhelming.

5.1 Relevant provisions relating to the conduct of an examination and the use to which evidence may be put 123 Division 2 (ss 24A-36) of Part II of the ACC Act sets out coercive powers available to an examiner in connection with a special operation or a special investigation, including the powers conferred by s 28 to examine witnesses and by s 29 to obtain documents. An examination held under s 28 must be held "in private" (s 25A(3), ACC Act). 124 An examiner may conduct an examination only for the purposes of a special ACC operation/investigation (ss 24A and 28(7), ACC Act). As the ACC accepted, this means that the power to conduct an examination, including the power of an examiner to issue a summons under s 28, may be exercised only for those purposes. "Plainly enough", therefore, read in the context of the Act, "the purpose of an examination conducted under s 24A is to obtain information in order to further an investigation of serious and organised criminal activity, ordinarily involving sophisticated methods and techniques, in circumstances where persons with relevant information would frequently be expected to refuse to volunteer that information": A v Boulton (2004) 136 FCR 420; [2004] FCAFC 101 (Boulton (FCAFC)) at 435 [57] (Kenny J). 125 As to the issue of a summons to appear, s 28 provided at the relevant time that: (1) An examiner may summon a person to appear before an examiner at an examination to give evidence and to produce such documents or other things (if any) as are referred to in the summons. (1A) Before issuing a summons under subsection (1), the examiner must be satisfied that it is reasonable in all the circumstances to do so. The examiner must also record in writing the reasons for the issue of the summons. The record is to be made: (a) before the issue of the summons; or (b) at the same time as the issue of the summons. 126 A summons under subs (1) must be accompanied by a copy of the Board's determination that the intelligence operation is a special operation or that the investigation into matter relating to federally relevant criminal activity is a special investigation (s 28(2)). Save where the examiner is satisfied that it would prejudice the effectiveness of the special investigation/operation, the summons must also set out, so far as is reasonably practicable, the general nature of the matters in relation to which the person is to be questioned (s 28(3)). However, this does not prevent an examiner from questioning a person in relation to any matter that related to the special ACC operation/investigation (ibid). The summons may also include a notation that disclosure of information about the summons or any official matter connected with it is prohibited (s 29A). 127 A person served with a summons to appear as a witness under s 28 must appear and answer questions and produce documents when required (s 30(2)(b)-(c)), as the failure or refusal to do so is an offence (s 30(6), ACC Act). The examiner may also, as here, require the witness to give evidence on oath or affirmation (s 28(5)(a), ACC Act). It is also an offence for a person at an examination to give evidence that is knowingly false or misleading in a material particular (s 33, ACC Act). Further, the examiner may apply to the Federal Court or a Supreme Court for the failure or refusal to answer a question or to take an oath or affirmation as a contempt of the ACC (ss 34A and 34B, ACC Act). 128 The unqualified obligation in s 30 to provide answers when required has been held by necessary implication to abrogate the privilege to self-incrimination: Boulton (FCAFC) at [72] 439 (Kenny J (with whose reasons Beaumont and Dowsett JJ agreed)); Mansfield v Australian Crime Commission (2003) 132 FCR 251; [2003] FCA 1059 at [49] (Carr J); ABC v Sage (2009) 175 FCR 319; [2009] FCA 170 at [22] (Jessup J). The privilege against self-incrimination is not merely a rule of evidence but a fundamental common law right equally applicable to executive inquiries which "protects the witness not only from incriminating himself [or herself] directly under a compulsory process, but also from making a disclosure which may lead to incrimination or to the discovery of real evidence of an incriminating character": Sorby v Commonwealth (1983) 152 CLR 281; [1983] HCA 10 (Sorby) at 310 (Mason, Wilson and Dawson JJ). 129 The abrogation of this fundamental common law right is ameliorated to some extent by the immunity afforded by s 30(5) against direct use of answers given under compulsion as evidence in a criminal proceeding or proceeding for the imposition of a penalty and is a clear indicator of the legislative intent to abrogate the privilege (Boulton (FCAFC) at [65] (Kenny J)). Section 30(5) must be read together with subsection (4) and provides: Use immunity available in some cases if self-incrimination claimed (4) Subsection (5) limits the use that can be made of any answers given at an examination before an examiner, or documents or things produced at an examination before an examiner. That subsection only applies if: (a) a person appearing as a witness at an examination before an examiner: (i) answers a question that he or she is required to answer by the examiner; or (ii) produces a document or thing that he or she was required to produce by a summons under this Act served on him or her as prescribed; and (b) in the case of the production of a document that is, or forms part of, a record of an existing or past business - the document sets out details of earnings received by the person in respect of his or her employment and does not set out any other information; and (c) before answering the question or producing the document or thing, the person claims that the answer, or the production of the document or thing, might tend to incriminate the person or make the person liable to a penalty. (5) The answer, or the document or thing, is not admissible in evidence against the person in: (a) a criminal proceeding; or (b) a proceeding for the imposition of a penalty; other than: (c) confiscation proceedings; or (d) a proceeding in respect of: (i) in the case of an answer - the falsity of the answer; or (ii) in the case of the production of a document - the falsity of any statement contained in the document. 130 Nonetheless, the protection afforded by s 30(5) is not complete. The use immunity applies only to direct uses of evidence in which the witness has incriminated himself or herself, and not to derivative, as opposed to direct, uses; Boulton (FCAFC) at [65]. For example, it would not exclude evidence located as a result of answers given at the examination. 131 In so providing, the ACC Act introduced a limited use immunity to the same effect that s 30(4) and (5) of the ACC Act. The reasons for the limited use immunity were explained in the Revised Explanatory Memorandum for the National Crime Authority Legislation Amendment Bill 2001 (HR) which stated in relation to proposed subsection 30(4) and (5) of the NCA Bill: …contrary to the current position, any evidence that is derived from that answer, document or thing may be used against the person. The Authority is unique in nature and has a critical role in the fight against serious and organised crime. This means that the public interest in the Authority having full and effective investigatory powers, and to enable, in any subsequent court proceedings, the use against the person of incriminating material derived from the evidence given to the Authority, outweigh the merits of affording for protection to self-incriminatory material. 132 The ACC Act also provides other limited protection for those required to give evidence under compulsion. First, bearing in mind that s 25A(3) requires that an examination be held in private, s 25A(7) requires that if a person other than a member of the staff of the ACC is present at the examination, the examiner must inform the witness and give the witness an opportunity to comment on the presence of that person (see further at [193]-[199] below). 133 Secondly, s 25A(9) provides that: (9) An examiner may direct that: (a) any evidence given before the examiner; or (b) the contents of any document, or a description of any thing, produced to the examiner; or (c) any information that might enable a person who has given evidence before the examiner to be identified; or (d) the fact that any person has given or may be about to give evidence at an examination; must not be published, or must not be published except in such manner, and to such persons, as the examiner specifies. The examiner must give such a direction if the failure to do so might prejudice the safety or reputation of a person or prejudice the fair trial of a person who has been, or may be, charged with an offence. (emphasis added) 134 Furthermore, while the CEO may, in writing, vary or revoke a direction under subsection (9), that power is subject to subsection (11) which provides that: (11) The CEO must not vary or revoke a direction if to do so might prejudice the safety or reputation of a person or prejudice the fair trial of a person who has been or may be charged with an offence. 135 Thirdly the CEO of the ACC, Board members, members of the staff of the ACC (as defined in s 51(4)) and an examiner are bound by strict non-disclosure obligations in s 51 of the ACC Act both during and after holding office, a breach of which constitutes a criminal offence.

5.2 The allegation that the decision to conduct the ACC examination was made for an improper purpose (ground 2(i), statement of grounds)

5.2.1 The issue 136 The decision to conduct the ACC examination of the first applicant on 24 February 2011 is effectively challenged on three grounds: that the examination was convened for an improper purpose, the decision-maker had regard to an irrelevant consideration, and the decision was made under dictation. 137 With respect to the first of these, the applicants allege that, under s 24A of the ACC Act, an examination may be held only for the purpose of a special ACC investigation/operation. So much may be accepted. However, they contend in the Statement of Grounds at 2 that the ACC examination here was convened for an improper purpose, namely: The 2011 ACC examination was not convened for the purpose of investigating with a view purely to laying serious criminal charges but rather for the significant purpose of providing information to the ATO for audit purposes. A special investigation [relevantly, Project Wickenby] does not contemplate intelligence-gathering on behalf of agencies. The ACC Examiner misconceived the role of an examination, which is purely to facilitate criminal prosecutions. 138 The applicants' contention gives rise to two primary issues. First, as a matter of statutory construction, what are the lawful purposes for which an examiner may require a person to attend and answer questions under s 28(1) of the ACC Act? Secondly, was the power under s 28(1) in fact exercised for a lawful purpose? If, as the applicants contend, the examiner misunderstood the nature of the statutory discretion and purported to exercise the discretion for a purpose to which it could not be applied, the discretion would have miscarried and the summons would be invalid: see by analogy GG v Australian Crime Commission (2010) 182 FCR 513; [2010] FCAFC 15 (GG v ACC) at [29] (Jessup and Tracey JJ; Downes J agreeing) and cases referred to therein.

5.2.2 What are the purposes for which the power to issue a summons under s 28(1) of the ACC Act may issue? 139 Section 28(7) limits the power to issue a summons, providing that it is "not exercisable except for the purposes of a special ACC operation/investigation" (emphasis added). Section 7C(4)(c) in turn requires that the purpose of the special operation or investigation be set out in the determination made by the Board. Thus, as Jessup and Tracey JJ held in GG v ACC at [31]: When the definition of 'special ACC operation/investigation'… is read into this provision, it is clear that the power to issue summons is exercisable only for the purposes of the particular intelligence operation or investigation which provides statutory authority for the examiner's act. (emphasis added) 140 Accordingly, their Honours held that it was essential that the examiner be both aware of whether the proceeding before him or her is an intelligence operation or investigation, and also directs his or her mind to the respects in which the issue of the summons will further the purposes of the intelligence operation or investigation (at [31]). In that case, the challenge to the summons was upheld on the ground that errors in the reasons of the examiner set out in the written record created in accordance with 28(1A) of the ACC Act established that he had fundamentally misunderstood the statutory basis of his authority for the issue of the summons in the absence of any contrary evidence from the examiner. 141 The applicants' submission that the summons must be issued "purely [for] laying serious criminal charges" or "purely to facilitate criminal prosecutions", and cannot be issued where intelligence-gathering for other agencies is the significant purpose, is misconceived at a number of levels. 142 First, the submission ignores the fact that it is at the point of making a determination that the Board must consider whether ordinary police methods of investigation into matters relating to federally relevant criminal activity are likely to be effective to permit the laying of criminal charges. Once the Board has determined that they are not likely to be effective and has made (relevantly) the special investigation determination, the question for the examiner is simply whether the proposed examination is for the purpose of the investigation as set out in the Determination and thereby within the scope of the special investigation authorised by the Board. As such, the applicants' submission wrongly conflates the functions conferred on the examiner with those conferred on the Board. 143 Secondly, the applicant's submission seeks to draw a strict dichotomy between an investigation on the one hand, and the gathering of intelligence, on the other hand, suggesting that a special investigation can be concerned only with the former. In my view, that dichotomy is a false one. In this regard, I accept the Commission's submission that the word "intelligence" in this context is not a term of art but refers to material such as hearsay information suggesting lines of inquiry or raising suspicions but falling short of material that could be admissible in a court of law. While a special investigation is primarily concerned with ascertaining facts rather than gathering intelligence, that does not mean that the gathering of intelligence cannot comprise any part of that process. So much is apparent as a matter of common sense and nothing in the Act in my opinion warrants a different construction. To the contrary, the answers given at an examination held in furtherance of a special investigation can give rise only to intelligence in this sense because the answers cannot be used, and therefore are not admissible, in a criminal proceeding or proceeding for the imposition of a penalty. They can be used only derivatively to gather evidence. Not surprisingly, therefore, the Wickenby Determination (which is not challenged) makes express provision for the collection, analysis and dissemination of "criminal intelligence", as well as what is described as "criminal information". 144 Thirdly, the applicants' submission is premised upon an assumption that the dissemination of intelligence obtained through a special investigation is an extraneous purpose or is irrelevant to a determination by an examiner of whether or not to issue a summons to attend and give evidence. However, s 59(7) of the ACC Act and subsequently s 59AA expressly provided for dissemination in vesting the CEO of the ACC with a discretion to disseminate information in his or her possession to "any other agency" where certain statutory pre-conditions are met, and the express terms of the Wickenby Determination authorise its dissemination to, relevantly, the ATO. It follows that, while intelligence obtained through an examination will not necessarily be given to other agencies such as the ATO, it is an inevitable consequence of the holding of an examination that the intelligence thereby obtained is potentially liable to be disseminated to the ATO and other agencies depending upon the terms of any non-publication direction.

5.2.3 Was the power to issue the summons to appear and give evidence at the ACC examination exercised for a lawful purpose?

5.2.3.1 Relevant principles 145 The next question is whether the summons was issued for the purposes of the Wickenby special investigation. Importantly, as I have said, there is no challenge to the special investigation established by the Wickenby Determination. It is not in issue that that Determination was validly made and therefore that the coercive powers under s 28(1) were available to the examiner for the purposes of that Determination. 146 The principles which govern the question of whether the exercise of a power or discretion has miscarried by reason of an improper purpose for its exercise are well-established. 147 First, whether the power was exercised for an improper purpose is a question of fact: Municipal Council of Sydney v Campbell [1925] AC 338 (Campbell) at 343; see also Samrein Pty Ltd v Metropolitan Water Sewerage and Drainage Board (1982) 41 ALR 467 at 469 (Gibbs CJ, Mason, Murphy, Wilson and Brennan JJ). 148 Secondly, a discretion is exercised for a proper purpose within power if it is exercised "in good faith and not with a view of achieving ends or objects extraneous to the purposes for which the discretion exists": Western Australia Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30; [2004] HCA 63 (Temwood) at 56 (McHugh J). 149 Thirdly, the onus lies upon the applicants to establish that the exercise of a power was exercised in furtherance of an improper purpose: Campbell at 343; Industrial Equity Ltd v Deputy Commissioner of Taxation (1990) 170 CLR 64; [1990] HCA 46 (Industrial Equity) at 671-2 (Gaudron J) (dissenting but not on the matter of principle). 150 Fourthly and importantly, the alleged improper purpose must be "substantial" in the sense that no attempt would have been made to exercise the power if it had not been for that purpose (Thompson v Council of Municipality of Randwick (1950) 81 CLR 87 at 105-106 (the Court); Wilderness Society Inc v Turnbull (2007) 166 FCR 154; [2007] FCAFC 175 at 184 [127] (Tamberlin J). In other words, the purpose must be the "operative subjective purpose" of the decision-maker (Re MacTiernan; Ex parte Coogee Coastal Action Coalition Incorporated [2004] WASC 264 at [51] (McLure J). It follows that, where there is "evidence that could reasonably support [the decision-maker's] decision", the improper purpose is not made out: Temwood at [67] (McHugh J). As, for example, the Full Court held in Wong v Minister for Immigration [2002] FCAFC 440 (special leave refused: [2005] HCA Trans 27 (4 February 2005)), at [27]: … unless it can be shown in this particular case that it was not open to the Minister to exercise the power of refusal under s 501(3) of the Act, it cannot be shown that the Minister exercised the power for a purpose not permitted by the Act. (emphasis added) 151 Finally, Gaudron J explained in Industrial Equity that the presumption of regularity has a role to play only where it is sought to infer an improper purpose from facts other than the subject-matter of the decision. As her Honour held at 671-2: … where the subject matter of the decision falls squarely within the terms of the statutory provision, then, in the absence of evidence establishing improper purpose or evidence displacing all possible permitted purposes, it must be accepted, simply because of the absence of such evidence, that the decision was made for a purpose for which such decisions might properly be made. It is only if the purpose attending the decision must be ascertained by inference from other facts that a presumption of regularity [i.e. that all necessary conditions and formalities have been satisfied unless the contrary is proved] has a role to play. An improper purpose will not lightly be inferred and, by application of a presumption of regularity, will only be inferred if the evidence cannot be reconciled with the proper exercise of the power. (emphasis added)

5.2.3.2 Did the exercise of power miscarry by reason of an improper purpose? 152 In my view, the evidence does not lend any support to the contention that the examiner's exercise of discretion miscarried by reason of the examiner issuing the summons otherwise than for the purposes of the Wickenby special investigation. 153 First, it will be recalled that an examiner may conduct an examination for the purposes of a special ACC investigation (s 24A, ACC Act). Here, that purpose is demonstrated by the fact that the subject matter of the decision falls precisely within the terms of the authority conferred on the examiner by the Wickenby Determination. Specifically, paragraph 3(b) of the summons provided that the first applicant was to appear "to give evidence of or about the following federally relevant criminal activity": i. defrauding the Commonwealth contrary to section 29D of the Crimes Act 1914 (Cth) through evasion of, or making false claims in relation to, tax; ii. conspiracy to defraud within the meaning of section 135.4 of the Criminal Code through evasion of, or making false claims in relation to, tax; iii. obtaining financial advantage by deception within the meaning of section 134.2 of the Criminal Code through evasion of, or making false claims in relation to, tax; and iv. dealing with money or other property contrary to sections 400.3, 400.4, 400.5, 400.6 (1) and (2) or 400.7(1) of the Criminal Code. 154 Each of the "federally relevant criminal activit[ies]" identified in the summons falls squarely within the general nature of the allegations identified in clauses 3 and 4 of the Wickenby Determination set out in Part 3.2 above for the purposes of s 7C(4) of the ACC Act. Those allegations define the perimeters of the investigation, as I have earlier explained. Further, in requiring the first applicant to appear to give evidence about those criminal activities, it is properly to be inferred that the examiner intended to examine the first applicant as part of the authorised "special investigation into criminal activities of that kind in the sense of a searching inquiry to ascertain facts (see at [33] above). So understood, absent evidence displacing all possible permitted purposes, i.e., that cannot be reconciled with the proper exercise of the power, in my opinion it must be accepted that the power was exercised for a proper purpose: Industrial Equity at [167]. 155 Secondly, the record of the examiner's reasons for the issue of the summons pursuant to s 28(1A) of the ACC Act is strongly supported by the view that the summons was issued for the purpose of the Wickenby special investigation. In this regard, it has been held that s 28(1A) does not oblige the examiner to provide reasons to the addressee of the summons or entitle the addressee to receive a copy of the examiner's record made under that subsection (Barnes v Boulton (2004) 139 FCR 356; [2004] FCA 1219 (Barnes) at 363 (Finn J); JJ v Board of the Australian Crime Commission (2011) 278 ALR 571; [2011] FCAFC 73; (JJ v ACC) at [51] (Dowsett, Cowdroy and Logan JJ)). Rather, "[t]he clear purpose of s 28(1A) is both to focus and enhance decision-making and to provide an accountability mechanism by requiring the creation of an 'audit trail'." (Barnes at 363). As such, they are not prepared for any reason associated with procedural fairness, or to enable the recipient to make a decision on whether he or she has a right to judicial review; nor to enable a court to determine an application for judicial review (JJ v ACC at [51]: cf Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611; [2010] HCA 16 at 623 (Gummow ACJ and Kiefel J)). Nonetheless, as in Barnes and JJ v ACC, the record of the examiner's reasons was in evidence and no objection was raised to the Court having regard to that record for the purposes of determining the applicants' challenge to the legality of the examiner's decision. 156 The contemporaneous record of the examiner's reasons for the issue of the summons on 11 February 2011 were as follows: MATERIALS CONSIDERED 1) For the purposes of determining whether to issue the proposed summons to the person above under [s] 28 of the Australian Crime Commission Act 2002 (Cth) (the Act), I have had regard to the following: (a) The Determination (b) Statement of Facts and Circumstances dated 7 February 2011 (c) Legal submissions dated 10 February 2011. (d) The summons in draft form, together with the proposed annexures, REASONS 2) I have decided to issue the summons, based upon my consideration of the materials detailed above, and for the reasons outlined below: (a) the summons will be issued for the purposes of the special ACC investigation set out in the Determination (ss 28(7) of the Act); (b) the Determination remains operative (ss 28(7) of the Act); and (c) I am satisfied that it is reasonable in all the circumstances to issue the summons because of the following; • Information provided by [redacted in original] and the ATO, reveals that clients of [the Sydney accounting firm] have transactions with offshore entities. The majority of these transactions are purported to be loan advances and interest/principal payments. The ATO has codenamed their investigation as Operation [M]. • The ATO considers that at least [redacted in original] clients and three principals of [the Sydney accounting firm], have engaged in tax mischief relating to offshore entities; • ATO searches show that clients of [the Sydney accounting firm] have loans with other offshore entities based in the UK. The UK entities, including [the Offshore Bank], trade in ASX shares. The ATO suspects that profits derived from the share trading are remitted to the clients, disguised as loans. Often intermediaries are used to transfer the funds, which in effect creates the appearance of a legitimate transaction. The ATO suspects that the UK entities are controlled by [the Sydney tax agent and another principal of the Sydney accounting firm] or by certain of their clients; • Pursuant to Operation [M] being conducted under Project Wickeby, the ATO has identified an Australian taxpayer, [the first applicant] born [redacted], as a person of interest. The ATO referred this matter to the ACC to gain strategic and operational intelligence relating to the knowledge that [the first applicant] may have in relation to Operation [M]; • [The first applicant] is married to [redacted], born [redacted] and they currently reside at [redacted]. [The first applicant's] postal address according to ATO records is [redacted], with his current tax agent shown [redacted]; • [The first applicant] has been a long term client of [the Sydney accounting firm] and is likely to hold useful intelligence concerning arrangements offered to close associates of [the Sydney tax agent], such as himself to evade tax or conceal assets (redactions added except where otherwise noted; emphasis in original) 157 Thus, the examiner properly had regard to the Wickenby Determination in deciding whether to issue the summons. He also explains that his purpose was to issue the summons for the purposes of the Wickenby Determination, consistently with the federally relevant criminal activity identified in the summons, and explains why he considers that the first applicant may have relevant information about that criminal activity in finding that it is reasonable for the summons to issue. More specifically, the information recited at sub-paragraph 2(c) in support of the reasonableness of the decision suggests that the first applicant is a person who may be able to assist in the Wickenby investigation into serious and systematic tax fraud and evasion of the kind covered by the allegations in clauses 3 and 4 of Schedule 2 to the Wickenby Determination. That information is said to derive from the ATO's investigation, Operation M. In this regard, the subject matter of Operation M correlates with the subject matter of the federally relevant criminal activity identified in the summons and with that identified in the Wickenby Determination, consistently with the endorsement of Operation M by the Project Wickenby Cases Forum in October 2010: see above at [56]. 158 Information of the kind relied upon by the examiner is plainly relevant to determining the reasonableness of the decision to issue the summons. As the Full Court of this Court held in JJ v ACC at [49]-[50] (Dowsett, Cowdroy and Logan JJ): The reasonableness of the decision to issue the summons may depend upon numerous factors, including the degree of likelihood that the recipient has relevant information, its relative importance to the investigation and the inconvenience and other consequences for the relevant person of being compelled to attend and give evidence. In general, the examiner had to be satisfied that his decision to issue the summons was in accordance with reason, appropriate or proportionate. It is not difficult to imagine the kind of information likely to be considered in connection with the decision to issue the summons. There will probably be information suggesting that the relevant person may be able to assist in the relevant investigation. There may also be personal information concerning his or her identity, address, employment and family circumstances. The reasons contemplated by s 28(1A) will therefore probably include a description of the circumstances which suggest that the person is able to give evidence bearing upon the special investigation. 159 The relevance, therefore, of the information relied upon by the examiner to the decision to issue the summons lends further support to evidence that the power was exercised for a proper purpose. 160 In short, I consider that the reasons plainly establish that the examiner concluded that there were reasons to believe that the first applicant had information relevant to the Wickenby special investigation and issued the summons in order to examine him for the purposes of that investigation. 161 In this regard, I do not consider that the fact that the reasons state that the ATO referred the matter to the ACC "to gain strategic and operational intelligence relating to the knowledge that [the first applicant] may have in relation to Operation [M]" suggests the existence of any improper purpose in the decision to issue the summons, contrary to the applicants' submisson. The ATO's purpose is not the relevant purpose in determining whether the power was validly exercised: see by analogy Temwood at 58 [66] (McHugh J). It is the examiner's purpose which is relevant. 162 Further and in any event, the purposes of the Wickenby Determination expressly include the dissemination of information and intelligence in accordance with the Act. It is not possible therefore to separate the purpose of disseminating information from the examination to the ATO from the purpose of the investigation and suggest that it is extraneous as the applicants contend, notwithstanding that it is ultimately the CEO who has authority to disseminate information under s 59(7) of the ACC Act. 163 Not only do the applicants' submissions to the contrary suffer from the misconceptions with which I have already dealt with at [141] - [144] above. It is premised on a false dichotomy between the investigation of "federally relevant criminal activity" in the nature of tax fraud or evasion, on the one hand, and the gathering of evidence on the receipt of previously undisclosed income for the issue of amended assessments, on the other hand. Rather, as the Commissioner submitted there is an overlap between the two inquiries: The facts which it was relevant for the ACC to investigate in relation to alleged 'federally relevant criminal activity' were also relevant to the Commissioner's administration of the tax legislation. The fact that evidence is gathered for the immediate or narrow purpose of ascertaining whether a person is liable to tax does not preclude the inquiry from being part of a wider investigation of whether an offence has been committed. In particular, where possibly fraudulent conduct in respect of failure to return income is under investigation, gathering evidence of the receipt of previous undisclosed income and of a consequent tax liability will be relevant to both an element of the offence of defrauding the Revenue (crime) and to the question whether the Commissioner may issue amended assessments, including for tax years earlier than four years before the date of amending (civil tax liability). (emphasis added) 164 Thus, as the Commissioner also submitted, the provision of tax relevant information to the ATO for the purposes of completing its audits and assessing tax would be an essential part of completing the investigation of criminal activity towards the laying of charges. It cannot be expected, in other words, that the CDPP would consider laying a charge of defrauding the Revenue unless and until the ATO had assessed a liability for tax in excess of that levied on the basis of the original returns lodged by the taxpayer. That extent of overlap between the facts relevant to each inquiry is even stronger in cases such as the present where it was necessary for the Commissioner to find fraud or evasion in conduct of the applicants' affairs in order to reopen their affairs after a two-year amendment period in the case of small businesses or the four-year amendment period otherwise applicable: s 170(1), ITAA 1936. A similar provision applied in relation to pre-2004-2005 assessments: see former s 170(2)(a) ITAA 1936. Fraud is established where a statement is made relevant to the taxpayer's liability to pay tax which the maker knows to be false or is reckless as to its truth or falsity: see Kajewski v Federal Commissioner of Taxation (2003) 52 ATR 455; [2003] FCA 28. The same facts relevant to applying these provisions will be relevant to whether that fraud or evasion amounts to criminal fraud, as tax evasion involves the use of unlawful means to escape payment of tax: R v Meares (1997) 37 ATR 321 at 323 (Gleeson CJ; Sully and Bruce JJ agreeing). Nor ought dissemination of information be considered in isolation from its context in an ongoing investigation where information from the ACC to the ATO may further the ATO's inquiries, as result of which the ATO provides further information of assistance to the ACC in its investigation. In that context, ongoing exchanges of information pursuant to the strict conditions imposed by s 59(7) may result in new lines of inquiry being opened and provide further evidence for both agencies in furtherance of mutually consistent purposes. 165 Furthermore, the dissemination of relevant information to other agencies can assist them insofar as their functions are, or may be, affected by the criminal activity in question to address its incidence and consequences. In this regard, the purposes of the special investigation authorised by the Wickenby Determination include reducing the incidence and effect of the federally relevant criminal activities in question, namely, serious and organised international tax fraud and evasion. It can readily be seen that that purpose is potentially facilitated by dissemination of relevant information to the ATO as the government agency responsible for the assessment and collection of income tax. 166 In short, it is a mistake to assume a dichotomy of mutually exclusive inquiries into ascertaining the tax liability and into potential criminal liability. As Senior Counsel for the Commissioner submitted: So it would be appropriate for the ACC to be giving information to the Tax Office to find out what the result of it was with respect to taxable liability and what should have been returned. And likewise it would be appropriate for the Tax Office to provide to the ACC whatever it had gathered from examining taxpayer's affairs, tending to indicate that any particular taxpayer may have dishonestly understated his income so that the ACC could examine that further in pursuit of the criminal aspect of things. So this overlap, the concurrence of the interest of the civil tax authority and the criminal investigation authority is simply not recognised in the applicant's submissions. 167 I accept that submission. 168 In so far as the applicants seek to rely upon the witness profile prepared by Mr Ching provided to the ACC on 21 January 2011, the short point is that there is no evidence that the document was considered by the examiner in deciding whether to issue the summons. It is not among those documents cited as having been taken into account by him in making the decision. 169 In any event, the assistance provided by the ATO to the examiner in preparing for the examination and suggesting questions does not suggest an extraneous purpose, bearing also in mind that the class of persons authorised to participate under the Determination included ATO members of staff whose duties include providing services in relation to ACC investigations such as Mr Ching. Cooperation though the exchange of information and the capacity to drawn on specialist government agencies, including those whose functions are affected by the criminal activity in question, is precisely the kind of co-operation which the ACC Act both envisages and facilitates between government agencies and the ACC, and for which the Determination provides.

5.3 The allegation that the decision-maker in deciding to conduct the ACC examination had regard to an irrelevant consideration (ground 2(ii), statement of grounds) 170 In a similar vein, the applicants contest the decision to conduct the ACC examination on the ground that the decision-maker had regard to an irrelevant consideration namely, the information gathering requirements of the civil tax audit of the applicants in a jurisdictional sense. In their submission, as the ACC determination pursuant to which the examination was convened was a special investigation as opposed to a special operation, it "permitted a criminal investigation but not information gathering by the ACC on behalf of the ATO for the purpose of assessing tax and filling evidentiary gaps" (Statement of Grounds, at 2). 171 This ground relies on the same evidence as that in support of the contention that the examination was constituted for an improper purpose and is equally unmeritorious. For the reasons already given, it is apparent that the decision was made to issue the summons for the purposes of the special investigation constituted by the Wickenby Determination. There is nothing in the terms of the summons or in the examiner's record of reasons which suggests that the examiner had regard to considerations outside those pertaining to the Wickenby investigation and which may properly bear upon the reasonableness of the decision to issue the summons in line with the criterion in s 28(1A) of the ACC Act, including possible dissemination of information to the ATO. Rather, the applicants' submission is based on the a dichotomy which is false for reasons already given at [162] - [167]. As the ATO submitted in light of s 59(7) of the ACC Act: It is apparent that whenever the ACC undertakes investigation of federally relevant criminal activity that includes alleged tax fraud, it will be likely to accumulate information which would be relevant to the activities of the ATO and which it would be appropriate to provide to the ATO. Given this power of dissemination, it would not have been an irrelevant consideration, at the time of the ACC deciding to summons [the first applicant], that the information accumulated might usefully be provided to the ATO for its audit purposes. 172 In short, the gathering of information for the purposes of assessing tax and the gathering of information for the purpose of investigating possible offences of defrauding the Revenue are not mutually exclusive. Rather, the exchange of information to the ATO to assist it in assessing tax furthers the purpose of the ACC in investigating serious international tax fraud, and vice versa, and therefore is not an irrelevant consideration.

5.4 The allegation that the decision-maker decided to hold the ACC examination under dictation (ground 2(vii), statement of grounds) 173 The final ground on which the decision to convene the ACC examination is challenged is that it "…was made by the relevant ACC examiner at the behest of ATO audit officers, effectively under dictation. ATO audit officers specified persons to be examined and the ATO's request was decisive." (Statement of Grounds at 2). In support of this ground, the applicants relied upon the following matters: a) the examination was convened at the suggestion of an ATO officer; b) statements in the ATO application for a summons suggested that an ACC examination might be more effective than a s 264 interview; c) the fact that the written record of the examiner's reasons adopted passages from the application for the summons made by the ACC officer, Mr Prichard, which in turn drew upon, and to some extent repeated, passages from the witness profile prepared by the ATO. 174 It is apparent from the examiner's reasons that the ACC application for a summons was before him and was one of the documents to which he had regard. Nor was it in issue that the discretion to issue a summons must be exercised by the examiner personally (see also at [40]-[41] above) and that it is a condition precedent to the valid exercise of the power that the examiner be satisfied of the matters specified in s 28(1) of the ACC Act. However, the incorporation by the examiner of part of those submissions in his reasons does not demonstrate that he failed to apply an independent mind to the question of whether the summons should issue. To the contrary, it supports an inference that the examiner adopted only those parts of the submissions with which he agreed as part of his reasons. 175 Furthermore, as I have earlier found at [168], there is no evidence that the examiner had regard to the witness profile prepared by Mr Ching when he made the decision to issue the summons. While the reasons of the examiner record that the ATO had identified the first applicant as a person of interest under Operation M, that was apparent from the ACC application for the summons. By contrast, the witness profile itself is not included in the list of documents to which the examiner had regard. 176 It follows that the sequence of events does not provide a sound basis on which to infer that the examiner acted effectively under dictation at the behest of the ATO. As the ACC submitted, "[t]here is nothing surprising about a sequence of events that has a person identified as being of interest (21 January 2011), an application being made for a summons (9 February 2011) and a subsequent decision to examine that person (11 February 2011)." 177 In any event, there is nothing in the Act that would preclude the examiner from considering the ATO's invitation, as a participant in Project Wickenby, to conduct an examination of the first applicant. To the contrary, this is part of the purpose of making provision for other agencies to participate in special investigations/operations under the ACC Act and more particularly for the ATO's participation in the Wickenby Project. It does not logically follow from the fact that the examiner may consider the views of the ATO or other agencies that he has acted at their dictation in the exercise of discretion: Bread Manufacturers of New South Wales v Evans (1981) 180 CLR 404 at 418 (Gibbs CJ) 430-431 (Mason and Wilson JJ). 178 Nor logically does the presence of ATO officers subsequently at the examination provide a basis for any such inference to be drawn. As the ACC submitted, the fact that four ATO audit officers subsequently attended the examination says nothing about the examiner's reasons for deciding to issue the summons in the first place. 179 The applicants also appear to contend that the Court should infer that the examiner adopted the whole of the application for a summons in line with the decision in JJ v ACC. However, in JJ v ACC, the examiner, after stating in his reasons that he had regard to certain documents in being satisfied that it was reasonable to issue the summons, then simply recorded a series of bald conclusions as to the matters on which he was satisfied. In those circumstances, the Court considered that it was impossible to avoid the inference that the examiner had concluded on the basis of the document that there was reason to believe that the appellant had information relevant to the investigation, and therefore rejected the submission that the examiner had given no reasons: at [53]. 180 The present case is distinguishable. The record of reasons here does not simply record bald conclusions. The examiner has set out the information in his record of reasons which led him to the view that it was reasonable to issue the summons and the source of that information. There is no basis for saying instead that the application for a summons contains the examiner's reasons. 181 In short, there is no evidence suggesting that the decision was made otherwise than by the examiner in the exercise of his independent discretion. The applicants' submission has no merit.

5.5 Challenges to the legality of the ACC examination based on the way in which the examination was conducted

5.5.1 The mixed purposes for which the evidence was allegedly taken at the ACC examination (ground 2(iv), statement of grounds) 182 The way in which the ACC examination was conducted is challenged by the applicants first on the ground that the evidence was not taken "solely for the purpose of determining whether to ultimately bring criminal charges [but]… for mixed purposes, including the significant purpose of filling evidentiary gaps for the ATO, and as a substitute for a s 264 interview" (Statement of Grounds at 2). 183 I have already found that the examiner issued the summons for a proper purpose. There is no evidence of the examiner having any different purpose when he came to conduct the examination. To the contrary, the subject matter of the questions asked by the examiner at the examination are consistent with the examination having been conducted for the purposes of the Wickenby investigation. 184 In support of this ground, the applicants rely upon the witness profile prepared by Stephen Ching for submission to the ACC suggesting that an ACC examination be held of the first applicant and stating that it "would be more effective" than a s 264 interview and, in particular, that "more valuable intelligence will be gained through an ACC examination if [the first applicant] does not consider it to be related to his tax affairs." 185 The short point, however, is that there is simply no evidence that the same concern played any role in the examiner's conduct of the examination. Nor is there any reference to the point in the examiner's reasons for issuing the summons. Rather, while the ACC application for the issue of a summons to which the examiner had regard in reaching his decision submits that an ACC examination would be more effective in gaining useful intelligence than a s 264 interview, the only reason given by the examiner is: … because the secrecy clauses of ACC examinations reduces the likelihood of [the first applicant] informing anyone else connected to the intelligence/investigation probe (including friends and family) and possibly jeopardising any formal and investigations. As such, the risk may involve many resident and non resident taxpayers and requires Wickenby to pursue these inquiries with appropriate secrecy and probity. 186 The submission by Mr Ching is simply irrelevant to determining the purpose of the examiner. 187 The applicants also rely upon the fact that some of the questions for the first applicant proposed in the witness profile prepared by Mr Ching were put to the first applicant during this examination. However, there is no reason why the examiner should not have drawn upon the information and suggested questions in the witness profile in conducting the interview in furtherance of the purposes of the Wickenby investigation. 188 In short, the applicants did not identify any evidence that suggested that the examination was conducted otherwise than lawfully for the purposes of the Wickenby investigation pursuant to the summons. The argument was again without merit.

5.5.2 The presence of the ATO audit officers at the ACC examination and alleged failure to give the first applicant an opportunity to comment on their presence (ground 2(v), statement of grounds)

5.5.2.1 The applicants' contentions 189 The applicants challenge the way in which the ACC examination was conducted by reason of the fact that four ATO audit officers watched the examination. As a consequence, the applicants allege that "the examination of [the first applicant] was not held 'in private' as required by s 25A of the [ACC Act] and as required (by necessary implication) by the statutory controls on dissemination of ACC information" (Statement of Grounds at 2). 190 Specifically, the applicants contend that: … the four ATO officers were not 'made available to the ACC' in any sense that that permits them to be regarded as staff of the ACC. Three of the four individuals were ATO employees working under the overall guidance of Kathryn Knappick, and Kathryn Knappick was in turn the person managing Operation [M]. The full extent of their engagement with the ACC was their desire to utilize (sic) the coercive powers of the ACC in the performance of their duties. 191 They also contend that the ATO staff had no role to perform in connection with the examination.

5.5.2.2 Relevant statutory provisions 192 Section 25A(3) provides that: An examination before an examiner must be held in private and the examiner may give directions as to the persons who may be present during the examination or a part of the examination. 193 The meaning of the words "in private" must be read in the context of an examiner's capacity to give directions and other provisions concerning who may be present. 194 First, s 25(3) is subject to subs (4) which provides that nothing in a direction under subs (3) prevents the presence during the taking of evidence of a legal representative for the witness. 195 Secondly, if a person "other than a member of the staff of the ACC is present at an examination before an examiner while another person (the witness) is giving evidence at the examination", the examiner must under s 25A(7) inform the witness that the person is present and give the witness an opportunity to comment on the presence of the person. The provision therefore entitles a witness to be heard at the examination on the question of who may be present at an examination during the giving of evidence by the witness where the person is not a member of the staff of the ACC. 196 The entitlement to be heard in s 25A(7) is a significant one. At an examination, a witness cannot invoke the privilege against self-incrimination if required to answer a question. The evidence which the witness can be required to give may also have implications, for example, for the witness' safety or reputation or the safety or reputations of others, as s 25A(9) recognises. 197 Nonetheless, s 25A(8) provides that: To avoid doubt, a person does not cease to be entitled to be present at an examination before an examiner or part of such an examination if: (a) the examiner fails to comply with subsection (7); or (b) a witness comments adversely on the presence of the person under paragraph (7)(b). 198 Aside from the examiner and the witness' legal representative, a person's entitlement to be present derives, as I have mentioned, from a direction made by the examiner under s 25A(3). The effect, therefore, of s 25A(8) is that the statutory authority to be present under a direction made by the examiner is unaffected by any breach of the statutory procedural fairness requirement in s 25A(7). In other words, the presence of subs (8) evinces a clear and plain legislative purpose that a failure to comply with s 25A(7) will not invalidate a direction made under s 25A(3): Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at 388-90 [91]-[93] (McHugh, Gummow, Kirby and Hayne JJ), c.f: Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57 at [4] Gaudron and Gummow JJ and Minister for Immigration and Multicultural Affairs; ex parte Miah (2001) 206 CLR 57; [2001] HCA 22 at [126] McHugh J. 199 Read in context, therefore, the expression "held in private" in s 25A(3) means that only the examiner, the witness, legal representatives of the witness, and those lawfully permitted to be present by a direction made by the examiner may be present at an examination. The public, meaning any other person, is excluded.

5.5.2.3 The directions made by the examiner for ATO staff to be present 200 On 24 February 2011, the examiner signed an authorisation for Ms Knappick, Mr Evans, Ms Richards and Mr Ching to be present at the ACC examination pursuant to s 25A(3) of the ACC Act. In my opinion, that authorisation was validly made as a consequence of which the examination complied with the requirement that it be held in private. 201 First, the applicants' written submissions appear to suggest that the ATO officers could be entitled to be present only if they were members of the staff of the ACC or had some role to perform in connection with the examination. However, no such limitation is express. Nor is there any foothold in the language of the provision or otherwise in the Act for implying such a limitation into s 25A(3). To the contrary, it is evident that the examiner can authorise such persons to be present from the fact that they remain entitled to be present where a direction is made notwithstanding non-compliance with the statutory requirement to afford a witness an opportunity to comment on their presence or adverse comment by the witness (ss 25A(7) and (8)(b)). 202 This is not to suggest that there are no limits of the examiner's power to make such directions. Where there is an absence of express considerations, the relevant factors to be taken into account in the exercise of discretion are determined by implication from the subject-matter, scope and purpose of the Act: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 (Peko-Wallsend) at 39-40 (Mason J). As an examination may be conducted under s 24A for the purposes of the special ACC operation/investigation, in my opinion it follows that the power to direct those who may be present at an examination is similarly constrained. While the applicants did not put the submission in these terms, this would seem to be the only tenable premise for their submission. 203 That being so, in my view the evidence leads irresistibly to the inference that the examiner authorised the presence of the four ATO officers for the purposes of the Wickenby investigation. First, I have already pointed to the cooperation between relevantly the ATO and the ACC in accordance with the Wickenby Determination and, pursuant to that, Operation M. In particular, the assessment of tax by the ATO in the discharge of its functions is integrally intertwined with the purposes of the special investigation in the manner earlier explained (at [163]-[172]). The applicants' submission that "[t]he full extent of their engagement with the ACC was their desire to utilize [sic] the coercive powers of the ACC in the performance of their duties" is based on the same false dichotomy between investigating serious tax fraud or evasion, on the one hand, and the gathering of information on previously undisclosed income for the issue of amended assessments, on the other hand. 204 Secondly and in any event, it will be recalled that the Wickenby Determination specified the class of persons to participate in the special investigation pursuant to s 7C(1)(e) of the ACC Act which included (relevantly) officers and members of the staff of the ATO identified in writing by the Commissioner's delegate as persons whose duties include providing services in relation to ACC operations and investigations. As I explain below, each of the four ATO employees in question were persons whose duties included the provision of services to ACC operations and investigations, including the Wickenby investigation pursuant to which Operation M was conducted. 205 Thirdly, each of these employees worked within the audit team engaged on Operation M matters save for Ms Richards, who worked in the SNC Technical section. Nonetheless, Ms Richards assisted the audit team with Operation M matters and had daily dealings with Ms Knappick. As such, her involvement in the ACC investigation is not accurately described as merely "nominal". Mr Ching prepared the witness profile on the first applicant for the ACC as an agent of that operation which document provided detailed information about the first applicant's apparent involvement in tax arrangements of the kind within Project Wickenby and Operation M. Added to this, it will be recalled that Mr Evans was shortly to assume Ms Knappick's role in the on-going investigations. 206 Finally, it can be inferred from these matters and Ms Knappick's evidence that the examiner wished to have Ms Knappick and members of her team, with their long-standing background in the audit of the first applicant and his various trusts, present so that he may consult with them as a result of matters that might arise during examination, should the need arise. 207 In these circumstances, the direction given authorising each of the four ATO persons to attend the ACC examination was plainly made for the purposes of the Wickenby investigation.

5.5.3 The failure to advise the first applicant of the presence of the ATO officers and to invite him to comment (ground 2(vi), statement of grounds) 208 Finally, the applicants challenge the way in which the ACC examination was conducted on the ground that the ACC examiner did not notify the first applicant of the presence of people who were not ACC staff and invite the first applicant to comment (Statement of grounds at 2). 209 The contention is, with respect, misconceived. 210 First, it will be recalled that s 25A(7) requires the examiner to notify a witness of any persons present at the examination "other than a member of the staff of the ACC" and give them an opportunity to comment. However, for the reasons given at [197] - [198] above, a failure to comply with s 25A(7) will not invalidate a direction under s 25A(3) authorising a person to be present. It follows that the requirement that the examination be held "in private" will have been complied with if a direction has been made under s 25A(3) despite any failure to comply with the statutory procedural fairness requirement. In the circumstances, it is unnecessary for me to consider what legal consequences may follow if an examination did not comply with the requirement that it be held in private. 211 Secondly and in any event, the four ATO officers for whom authority to attend was given and who in fact attended the ACC examination were each a "member of the staff of the ACC", as the authority to attend stated. 212 In this regard, s 4(1) of the ACC Act defines a "member of the staff of the ACC" to mean: (a) a member of the staff referred to in subsection 47(1) [being staff of the ACC who, subject to ss 48 and 49, must be engaged under the Public Service Act 1999]; or (b) a person participating in an ACC operation/investigation; or (c) a member of a task force established by the Board under paragraph 7C(1)(f); or (d) a person engaged under subsection 48(1) [being a consultant engaged by the CEO of the ACC]; or (e) a person referred to in section 49 whose services are made available to the ACC; or (f) a legal practitioner appointed under section 50 to assist the ACC as counsel. (emphasis added) 213 Section 49 of the ACC Act in turn provides that: In addition to the members of staff referred to in subsection 47(1) and persons engaged under subsection 48(1) of the ACC shall be assisted in the performance of its functions by: (a) members of the Australian Federal Police whose services are made available to the ACC; (b) officers and employees of authorities of the Commonwealth whose services are made available to the ACC; and (c) persons who services are made available to the ACC pursuant to arrangements made under section 58. 214 The four ATO officers were employees of a Commonwealth authority whose services had been made available to the ACC by determinations made under s 25 of the Public Service Act 1999 (Cth) (Public Service Act). Specifically, Ms Knappick and Messrs Evans and Ching were each ATO employees whose duties included providing services in relation to (relevantly) the Wickenby Determination by a determination made on 4 August 2010 by the Assistant Commissioner of Taxation, SNC, as a delegate of the Commissioner (the 2010 ATO Services Determination). Ms Richards was also identified as such a person by an instrument dated 15 February 2011 (the 2011 ATO Services Determination). Section 25 of the Public Service Act provided at the relevant time that: An Agency Head may from time to time determine the duties of an APS employee in the Agency, and the place or places at which the duties are to be performed. 215 It follows that Ms Knappick, Ms Richards and Messrs Evans and Ching satisfied subs (e) of the definition of a "member of the staff of the ACC" in s 4(1). 216 In reliance on the heading to s 49 of the ACC Act stating "Staff to be seconded to ACC", the applicants submitted that only those persons who participated in a "formal secondment to the ACC" would be a person whose services were made available to the ACC for the purposes of subparagraph (e) of the definition of a "member of the staff of the ACC". However, under s 13(3) of the Acts Interpretation Act 1901 (Cth) as at the relevant time, no heading to a section of an Act is taken to be part of the Act. As such, section headings can be taken into account in the process of statutory construction only as extrinsic material. In the present case, however, there is no case for resorting to extrinsic material. The meaning of paragraph (e) of the definition is clear: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 (Alcan) at [47] (Hayne, Heydon, Crennan and Kiefel JJ). 217 Finally, while the relevance of the submission was not apparent, there is no support in the evidence for the applicants' submission that an inference should be drawn from the two ATO Services Determinations and the steps taken to authorise Ms Richards to attend the examination that: …the ATO routinely designates its employees as persons who 'provide services to the ACC' with no intention that the designated persons will provide services to the ACC… but rather with the intention that these ATO employees will attend ACC examinations as they see appropriate in order to use of [sic] ACC information in furtherance of their own duties at the ATO. 218 The facts referred to at [203]-[206] above, by way of example, demonstrate the contrary.

5.5.4 The submission that the ATO officers' presence was not authorised on the basis that they were persons associated with the possible prosecution of the first applicant 219 Finally, by supplementary submissions filed after the hearing, the applicants contended that: a) the four ATO officers were "persons associated with the possible prosecution of the person giving evidence" whose attendance at the ACC examination may thwart any subsequent non-publication directions (Lee v R (2014) 308 ALR 352; [2014] HCA 20 (Lee v R) at [29] by analogy); and b) their presence could not therefore be authorised under the ACC Act; with the consequence that the conduct of the examination was vitiated by error. 220 The applicants relied in this regard first upon Lee v R. In that case, the appellants were summonsed to give evidence before the New South Wales Crime Commission (NSWCC) as part of an investigation pursuant to the exercise of compulsive powers. As a consequence of the publication of their evidence to the New South Wales Police Force and the State DPP, the appellant submitted that their joint trial on various drug and firearms offences miscarried. 221 Section 13(9) of the (now repealed) Crime Commission Act 1985 (NSW) (NSWCC Act) conferred a power, and imposed a duty, on the NSWCC to make a non-publication direction in similar terms to that imposed by s 25A(9) of the ACC Act. The High Court held at [39] that the decision to publish the transcript to the prosecution, directly to the DPP officer and indirectly through the police which was subject to a statutory duty to disclose the information to the DPP: …without regard to the protective purpose of s 13(9), was not authorised by the NSWCC Act. The publication to the DPP, in particular, was for a patently improper purpose, namely the ascertainment of the appellants' defences. 222 In a passage on which the applicants here placed particular reliance, the Court also observed at [29] that the making of a direction under s 13(9) was not the first, or only occasion on which the NSWCCA was required to consider the possible effects of a compulsory examination on a person's trial. Rather: Section 13(5) required that the Commission determine who should (and, it would follow, who should not) be present at the private hearing. It could set at nought the protection afforded by s 13(9) if persons associated with the possible prosecution of the person giving evidence were present. 223 Nonetheless, the Court held that the critical question was not whether the publication was unlawful and wrongful but "whether, as a result of the prosecution being armed with the appellants' evidence, there has been a miscarriage of justice in the eyes of the law" (at [39]). In holding that there had been a miscarriage, the Court held at [51] that: … these appeals concern the effect of the prosecution being armed with the appellant's evidence. It is not necessary to resort to questions of policy to determine whether a miscarriage of justice has occurred. What occurred in this case affected this criminal trial in a fundamental respect, because it altered the position of the prosecution vis-à-vis the accused. There was no legislative authority for that alteration. Indeed it occurred contrary to the evident purpose of s 13(9) of the NSWCC Act, directed to protecting the fair trial of examined persons. 224 The decision in Lee v R was recently followed by Logan J in QAAB. In that case the applicants sought an injunction restraining his examination by the ACC pursuant to a summons issued under s 28 of the ACC Act to compel him to give evidence in the context of an intelligence operation. The applicant had not then been charged with any offence but had been found at premises where a quantity of chemicals was found on execution of a search warrant. It was common ground that if he were convicted of the criminal offence of possession of the chemical, he would face a maximum penalty of imprisonment of 25 years (at [6]). Relevantly, a State police officer with responsibility for the investigation in which the search warrant was executed, had been present at the ACC interview up until the time when proceedings were instituted. 225 Logan J considered that the presence of the police officer at the examination may prejudice the examinee's fair trial if he were charged. Specifically, at [39] his Honour held that: In Lee v R, at [29], the High Court contemplated that a power akin to s 25A(5) of the ACC Act might in a particular case be exercised so as to exclude from being present during an examination "persons associated with the possible prosecution of the person giving evidence". In my view, the class of persons thus described is not limited to persons in the office of a Director of Public Prosecutions but extends to police officers and others investigating the possible commission of offenses. Even though a non-publication order of the kind foreshadowed by the examiner may be made, it is by no means impossible to see how police of or other investigating officer who is present might be inspired to pursue the other lines of inquiry directed to the gathering of evidence for the prosecution of an examinee just by hearing that person's evidence under examination. The pursuit of such lines of inquiry might not necessarily violate a non-publication order but might nonetheless prejudice the examinee's fair trial were he to be charged. 226 Nonetheless, Logan J rejected the application for an injunction but rather held at [40] that "If upon the resumption of the examination, such an objection is taken, it will, in the first instance, be for the examiner to decide whether that investigator should be excluded. If the applicant is aggrieved by that decision, it would be possible to seek judicial review in this court: Lee v R at [30]." 227 By analogy, the applicants here contend that the four ATO officers fell squarely within the class of persons identified in QAAB and Lee v R to whom disclosure is likely to result in impermissible prejudice, namely, "persons associated with the possible prosecution of the person giving evidence" whose attendance therefore at the ACC examination may thwart any subsequent non-publication directions. On this basis, they contend that their presence could not be authorized under the ACC Act with the consequence that the conduct of the examination was vitiated by error. It would seem to be on this basis that the applicants contend that if the ACC examination was a nullity, the transcript would not have been available to the ATO for the purposes of s 264. 228 In my view, the submission is flawed. 229 First, as I have explained, the ATO is not a prosecuting authority, nor is it an authority charged with the function of investigating whether or not an offence has been committed such as a police officer. The ATO rather seeks to make its own inquiries for the purposes of assessing the applicants' and the first applicant's wife's taxable income. That evidence, to the extent to which questions might be formulated at s 264 interview with the assistance of the transcript of the ACC examination, would constitute derivative evidence but again as I have explained there is no immunity against derivative use of incriminatory material from an ACC examination. On the other hand, the ATO could not be a conduit through which the transcript of evidence before the ACC could be provided to the law enforcement or prosecuting authorities. The non-publication direction made by the examiner did not permit further dissemination of the transcript by the ATO without consent of the ACC and the direction as varied subsequently expressly proscribed dissemination to the prosecuting authorities, including by the ACC. 230 Secondly, it is not sufficient, as is apparent from Lee v R, to found relief merely to find that publication was wrongful or, as the applicants contend here, that the presence of ATO officers was not authorised. The applicants submitted without reference to any authority that the examination is a nullity by reason of the presence of the ATO officers and therefore that the transcript would not been available to give to the ATO. Yet that contention makes no sense. The examination has occurred as a matter of fact. The transcript exists as a matter of fact. The time at which any objection might have been raised in reliance on QAAB to the presence of the ATO officers at the ACC examination with relief which might sound in their exclusion when particular lines of questioning are pursued has passed. And, as the ATO submit, "even if a charge should in the future be laid, there would be no basis upon which [the first applicant] could assert any risk of unfairness to himself in the conduct of his defence unless it should also be threatened (or actually carried out ) a dissemination of the s.264 transcript to prosecuting authorities. At the present, there has not even arisen the possibility of such a dissemination (in the absence of the charge or any authority prosecuting a charge), let alone an impending threat which would warrant the grant of an injunction." In short, the relief sought is premature and based upon hypothetical assumptions.

6.1 The issue 231 The applicants contend that the Commissioner lacked power to issue the s 264 notice after the first applicant lodged his objection in early 2013 to the amended assessments issued in November 2012 on two grounds: a) s 14ZYA(1)(b) of the TAA is a "code" with respect to the Commissioner's power to obtain information in order to determine an objection, that is, the provision is the sole source of the Commissioner's power to gather information once an objection has been lodged (the first s 14ZYA contention); or, in the alternative, b) any s 264 notice must, by operation of s 14ZYA(1)(a) and (b), be issued within 60 days of the lodgment of the objection (the second s 14ZYA contention). 232 On either ground, the applicants contend that the end result is that "s. 14ZYA operates to constrain not only the time period in which the Commissioner must determine an objection but also the powers that can be validly used in the determination of an objection."

6.2 Relevant principles and statutory provisions 233 The starting point in any task of statutory construction is the text of provision which falls to be construed in its context, in which statutory purpose is integral. As French CJ, Hayne, Kiefel, Gageler and Keane JJ recently stated in Thiess v Collector of Customs (2014) 250 CLR 664; [2014] HCA 12 at 671 - 672 [22]-[23]: Statutory construction involves attribution of meaning to statutory text. As recently reiterated [in Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at 519 [39]]: "'This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text'. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text." Objective discernment of statutory purpose is integral to contextual construction. The requirement of s 15AA of the Acts Interpretation Act 1901 (Cth) that "the interpretation that would best achieve the purpose or object of [an] Act (whether or not that purpose or object is expressly stated …) is to be preferred to each other interpretation" is in that respect a particular statutory reflection of a general systemic principle. For: "it is one of the surest indexes of a mature and developed jurisprudence not to make a fortress out of the dictionary; but to remember that statutes always have some purpose or object to accomplish, whose sympathetic and imaginative discovery is the surest guide to their meaning." (Cabell v Markham (1945) 148 F (2d) 737 at 739, quoted in Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [27]] 234 Consistently with these principles, Hayne, Heydon, Crennan and Kiefel JJ earlier stated in Alcan at [47] that "[h]istorical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention." 235 Section 264 of the ITAA 1936 provides that: (1) The Commissioner may by notice in writing require any person, whether a taxpayer or not, including any officer employed in or in connexion with any department of a Government or by any public authority: a) to furnish the Commissioner with such information as the Commissioner may require; and b) to attend and give evidence before the Commissioner or before any officer authorized by the Commissioner in that behalf concerning the person's or any other person's income or assessment, and may require the person to produce all books, documents and other papers whatever in the person's custody or under the person's control relating thereto. (2) The Commissioner may require the information or evidence to be given on oath or affirmation and either verbally or in writing, and for that purpose the Commissioner or the officers so authorized by the Commissioner may administer an oath or affirmation. (3) The regulations may prescribe scales of expenses to be allowed to persons required under this section to attend. 236 The substance of s 264 has remained relevantly unchanged since its enactment. 237 The power in s 264 may be delegated by the Commissioner in writing either generally or as otherwise provided by the instrument of delegation to a Deputy Commissioner or other person under s 8 of the TAA: Federal Commissioner of Taxation v Australian and New Zealand Banking Group Ltd; Smorgon v Commissioner of Taxation (1979) 143 CLR 499 (Smorgon) at 517 (Gibbs ACJ). The obligation to comply with a s 264 notice derives from s 8C(1) of the TAA pursuant to which a person who refuses or fails, when and as required under or pursuant to a taxation law, to give information or documents to the Commissioner is guilty of an offence. An offence under s 8C(1) is an offence of absolute liability as defined in s 6.2 of the Criminal Code 1995 (Cth) (Criminal Code) (s 8C(1A)). However, subs (1) does not apply to the extent that the person is not capable of complying with the requirement, the burden of proof of which lies on the person (see 8C(1B), TAA, and s 13.3(3), Criminal Code). 238 While the Commissioner's obligation in s 14ZY(1) to made a decision on a taxation objection (an "objection decision") is not defined by reference to a specific period of time, s 14ZYA of the TAA provides a mechanism whereby a person may obtain a ruling on a taxation objection within 60 days after a specified period has elapsed. Specifically, s 14ZYA provides that: (1) This section applies if the taxation objection (other than one under subsection 155-30(2) or 359-50(3) in Schedule 1) has been lodged with the Commissioner within the required period and the Commissioner has not made an objection decision by whichever is the later of the following times: (a) the end of the period (in this section called the original 60-day period) of 60 days after whichever is the later of the following days: (i) the day on which the taxation objection is lodged with the Commissioner; (ii) if the Commissioner decides under section 14ZX to agree to a request in relation to the taxation objection - the day on which the decision is made; (b) if the Commissioner, by written notice served on the person within the original 60-day period, requires the person to give information relating to the taxation objection - the end of the period of 60 days after the Commissioner receives that information. (2) The person may give the Commissioner a written notice requiring the Commissioner to make an objection decision. (3) If the Commissioner has not made an objection decision by the end of the period of 60 days after being given the notice, then, at the end of that period, the Commissioner is taken to have made a decision under subsection 14ZY(1) to disallow the taxation objection. (emphasis added) 239 The reference in s 14ZYA(1)(a)(ii) to a decision by the Commissioner to agree to a request under s 14ZX is a reference to a decision to extend the time within which a person may lodge a taxation objection beyond the period specified in s 14ZW. Where such a decision is made, s 14ZX(3) provides that "...for the purposes of [Part IVC], the objection is taken to have been lodged with the Commissioner within the required period." 240 It was not in issue that the reference to "the person" in s 14ZYA(1)(b) is a reference to the taxpayer whose assessment is under objection. As the Commissioner pointed out in his submissions, this is apparent from the context in which the term is used and, in particular, the use of the same expression, "the person", in s 14ZYA(2). 241 It was also not in issue that the first applicant's objection lodged in early 2013 to the amended assessments issued in late 2012 constituted a "taxation objection" within s 14ZYA(1) of the TAA and was lodged within the required period; nor that the s 264 notice was issued in March 2014 and therefore more than 60 days after the objection was lodged. 242 Finally, while the first applicant served a notice under s 14ZYA on early 2014, he withdrew that notice as part of an agreement recorded in orders made in these proceedings. Upon my raising the matter with the parties, no party contended that this matter had any bearing on the present proceedings.

6.3 The first s 14ZYA contention 243 The applicants contend that s 14ZYA of the TAA confers power on the Commissioner to gather information after an objection has been lodged and, as such, constitutes the more specific provison which takes priority over the general information gathering power in s 264 of the ITAA 1936. This construction means, so the applicants submit, that "the specific s.14ZYA(1)(b) information-gathering power that becomes available after an objection is lodged has the effect of excluding any further operation of s.264, which, by implication, from the existence of s.14ZYA(1)(b) is only available up until the time of lodging an objection." In support of this contention, the applicants relied upon the decision in Anthony Hordern & Sons Ltd v The Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 (Hordern). In that case the majority held that it was apparent from the express conferral of a special power to grant preferences to unionists on the Court of Conciliation and Arbitration (CC&A) which was subject to limitations and qualifications, that Parliament did not intend that the CC&A could exercise the general power to hear and determine industrial disputes to do the same thing. As Gavan Duffy CJ and Dixon J said at 7 (in the passage relied upon by the applicants): When the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power. 244 The reasons of McTiernan J (also in the majority) were to similar effect: ibid at 20. 245 As is apparent, the applicants' first s 14ZYA contention turns in the first instance upon whether s 14ZYA(1)(b) confers power on the Commissioner to gather information. However, unlike the provision considered in Hordern, s 14ZYA(1)(b) does not expressly confer any power relevantly here to require the provision of information. Nor does it so by implication. The purpose of subsection (1) is to define the day from which a person may give notice to the Commissioner requiring him or her to determine that person's taxation objection. Under subsection (1)(a), that notice may be given 60 days after the taxation objection was lodged or is taken to have been lodged by virtue of s 14ZX(3). However, where the Commissioner gave notice within the original 60 day period requiring the person to give information relating to their objection, the date from which that person can give notice requiring the objection decision to be made is deferred by s 14ZYA(1)(b) until 60 days after the information is received. On a plain reading, therefore, s 14ZYA simply has nothing to say about the conferral or exercise of powers by the Commissioner for the provision of information from a taxpayer to determine the objection. Consistently with this being the sole object of s 14ZYA, the provision does not prescribe the means by which such information is to be given nor any conditions which circumscribe its exercise in contrast, for example, to s 264 of the ITAA 1936. 246 It follows on my construction that the question of whether s 14ZYA constitutes a "code" as alleged by the applicants does not arise.

6.4 The second s 14ZYA contention 247 In support of their alternative construction, the applicants contend that the reference in s 14ZYA(1)(b) to the "written notice served on the person" is to a s 264 notice issued in the original 60 day period. It was not in issue that the reference in s 14ZYA(1)(b) to written notice requiring the person to "give information" relating to the taxation objection is sufficiently wide to be engaged either by a notice to "furnish… information" under s 264(1)(a) or by notice to "give evidence" under s 264(1)(b), in either case "on oath or affirmation [or neither] and either verbally or in writing". 248 The Commissioner also submitted that the reference was sufficiently wide to embrace a request for information otherwise than in reliance on s 264, such as simply by letter. However, the reference to a written "notice" in s 14ZYA in my opinion strongly suggests an intention to capture only written notices issued pursuant to the exercise of a statutory power. I do not consider that the word "notice" in its ordinary meaning would convey a mere written request. In this regard, it is also highly unlikely, in my view, that the Parliament would defer the date by which a person could require the provision of an objection decision merely because the Commissioner had made a request for information which the recipient was at liberty to disregard. 249 Irrespective of whether I am right in my construction of notice, however, it does not follow from the fact that the words "written notice" are apt to pick up a notice under s 264 that s 14ZYA(1)(b) limits the time within which the Commissioner can serve a s 264 notice to the original 60 day period. No foothold can be found, in my opinion, in the language of the provision for such a limitation and no cogent reason for departing from the clear words of statute was identified by the applicants. As the Commissioner submitted, the section "contains no reference to a temporal confinement of its exercise, either by reference to any of the stages of audit, assessment and determination of the objections, or by reference to any other date or event." As the Commissioner also submitted, "there is not the slightest hint in Part IVC or anywhere else in either of these Acts [the ITAA 1936 or the TAA] that there should be a difference in the availability of s.264 according to which function the Commissioner is discharging with respect to assessment (i) making an assessment in the first place, (ii) amending (for example if additional information should come to light or if a different view should be formed), (iii) further amending or (iv) adhering to an assessment, or not, in the determination of an objection to it." Rather, applying the ordinary words of s 14ZYA, where the Commissioner serves a s 264 notice after the original 60 day period, the time within which the taxpayer may give notice to the Commissioner is defined by s 14ZYA(1)(a). The criteria in subs (1)(b) for deferring that time are simply not met. That consequence operates to the benefit of the taxpayer in securing a more speedy resolution of his or her objection and can scarcely, in my opinion, be said to be an absurd or incongruous result. Nor does it undermine the legislative object in s 14ZYA of ensuring that decisions are given on objections within a statutorily mandated time: cf Ex parte Australena Investments Pty Ltd (1983) 15 ATR 162.

6.5 The applicants' contention that their construction of s 14ZY is supported by the manner in which s 264 has been interpreted 250 In their submissions dated 1 October 2014 after the grant of leave to re-open, the applicants sought to argue that the context in which s 14ZYA falls to be construed includes the manner in which s 264 has been interpreted. In this regard, the applicants sought to rely upon a line of cases adopting the observations of Mason J from Smorgon and Industrial Equity as to the purposes for which a s 264 notice may issue. 251 The first line of authority was said to support the proposition that a s 264 notice is "required to be 'exclusively' directed for the purposes of raising assessments (whether original or amended assessments) for the purposes of ascertaining taxable income and should not be issued at the subsequent objection stage." It is questionable whether this submission fairly fell within the grant of leave to the applicants to reopen their case. If the proposition were correct, it would seem to be unnecessary for the applicants to adopt the circular reasoning that a construction of s 264 provided contextual support for their construction of s 14ZYA which in turn supported their construction of s 264. Be that as it may, no objection on that ground was raised by the Commissioner to the submission. 252 In any event, in my view the point has no merit. Neither the authorities in question, nor a consideration of the statutory scheme, lend it any support. 253 It is convenient first to consider the decision in Smorgon on which the applicants rely. That case concerned the validity of notices given for the production of documents in safety deposit boxes at a bank in the intended exercise of the power conferred by s 264(1)(b) of the ITAA 1936. Relevantly, it was said that certain conditions precedent to the exercise of the Commissioner's rights under s 264(1) should be implied so as to prevent the Commissioner from undertaking a "fishing expedition". The conditions precedent were put in various ways but amounted essentially to whether the Commissioner considered that the documents would provide evidence on a particular issue. That construction was unanimously rejected by the Court which held that the power given to the Commissioner in s 264 was circumscribed by reference only to the purpose of performing his functions under the Act, relevantly, to ascertain a person's taxable income and the express conditions in s 264(1)(b): at 524 (Gibbs ACJ), 535-536 (Mason J (with whom Jacobs J relevantly agreed at 542)), and 546 (Murphy J). 254 In rejecting the suggestion that an issue or dispute of fact must first arise between a taxpayer and the Commissioner before the Commissioner can invoke s 264, Mason J at 536 held that: There is simply no basis for the implication of such a limitation. The strong reasons which inhibit the use of curial processes for the purposes of a "fishing expedition" has no application to the administrative process of assessing a taxpayer's income tax. It is the function of the Commissioner to ascertain the taxpayer's taxable income. To ascertain this he may need to make wide-ranging inquiries, and to make them long before any issue of fact arises between him and the tax-payer. Such an issue will in general, if not always, only arise after the process of assessment has been completed. It is to the process of investigation before assessment that s. 264 is principally, if not exclusively, directed. (emphasis added) 255 The applicants placed particular reliance upon this passage and submitted that: … such a statement is unambiguous as to its implications, namely, s. 264 notices are required to be "exclusively" directed for the purposes of raising assessments (whether original or amended assessments) for the purposes of ascertaining taxable income. 256 The applicants explained further that this was, in their submission: …because an assessment - whether on the making of an original or amended assessment - the Commissioner is exercising his key function under s 17 of the ITAA, namely, ascertaining taxable income and collecting the tax imposed on that income. The objection and review function is directed at a subsequent stage, namely, the review of the taxpayer's grounds for contending that the assessment (whether an original or amended assessment) is excessive. 257 I reject that submission. First, I do not consider that Mason J was suggesting that s 264 should be limited in the manner suggested. As Mason J said previously at 535: Except in one respect the powers given by s. 264 should be circumscribed only by reference to the limitations which are expressed in that section. Thus in s. 264(1)(b) the power to compel evidence is restricted to evidence "concerning his or any other person's income or assessment" and the power to require production is confined to documentary records "relating thereto", that is, to "his or any other person's income or assessment". However, the power to require information contained in par. (1)(a) is not similarly limited. As it is a power given to the Commissioner for the purpose of enabling him to perform his functions under the Act it must be circumscribed by reference to this purpose. See also e.g. Australia and New Zealand Banking Group Lt v Konza (2012) 206 FCR 450; [2012] FCAFC 127 at [36]-[38] (the Court). 258 Secondly, the submission finds no support in the reasons of the other members of the Court. Thus Gibbs ACJ held at 524 that: For the purpose of ascertaining a person's taxable income the Commissioner may need to see the documents that relate thereto, even though there is no evidence that can be given on the question. There is no justification for reading into s. 264 (1)(b) a condition precedent which it does not express. There are likely to be many cases in which documents that relate to a taxpayer's taxable income will be of great assistance to the Commissioner in performing his duties under the Act, although the Commissioner is unable, before seeing the documents, to say that they are relevant to a particular issue. … The apparent intention of the Parliament is that the Commissioner is entitled to have produced any books and documents that relate to the taxpayer's income or assessment, even if he does not know what those books and documents may reveal. A document may be required to be produced only if it in fact relates to the income or assessment of the person in question, but if it is of that description, that is enough. In other words the Commissioner is entitled to make what was described as a "roving inquiry" into the income or assessment of a particular taxpayer and for that purpose to have produced such documents as relate to that income or assessment. 259 Murphy J in his separate judgment reached a similar conclusion: at 546. The applicants' attempt here to read into s 264(1)(b) a limitation which it does not express is no less fallacious and finds no support in Smorgon. 260 Thirdly, an attempt to constrain the power in s 264(1) beyond those expressed in subsection (1)(b) and the purposes of the Act was firmly rejected by the High Court subsequently in Industrial Equity. In that case, the appellants sought judicial review of the Deputy Commissioner's decisions to require production of documents pursuant to s 264(1) solely in furtherance of the ATO's then policy of auditing the top one hundred companies. The appellants contended as a result that the Commissioner was engaged in a "random audit, an exercise which, it was said, the Act did not authorize, and therefore that any power exercised to that end could not be for a purpose of the Act." (at 660). 261 In rejecting that submission, the majority (Mason CJ, Brennan, Deane, Dawson, Toohey and McHugh JJ) held at 660-1: … the powers contained in s. 264(1), like those contained in s. 263, must be exercised for the purposes of the Act. The question whether a purpose is a purpose of the Act should be considered in the context of s. 17 [of the ITAA 1936]. That section provides for the levy of tax upon the taxable income of a person derived during a year of income and it is by reference to this primary purpose that all other purposes of the Act are to be determined. Section 8 charges the Commissioner with the general administration of the Act which includes the due making of assessments to tax (s. 169 [ITAA 1936]) and the recovery of tax payable by taxpayers pursuant to the Act (Pt VI, Div. 1 [ITAA 1936]). Sections 263 and 264(1) each confers on the Commissioner a power to enable him to perform his functions under the Act. Therefore, the power "must be circumscribed by reference to this purpose": Smorgon's Case. 262 Thus, their Honours held that "… the Commissioner will still be acting for the purposes of the Act so long as he is endeavouring to fulfill his function of ascertaining the taxable income of taxpayers" (at 661). No further limitation on the exercise of the Commissioner's powers under s 264 was therefore held to be warranted notwithstanding that there may be a random aspect in selecting the affairs of particular taxpayers or categories of taxpayers for closer examination (at 660-661). 263 Thirdly, it was not suggested (and rightly so, in my view) that amendments to the scheme of taxation laws since the decision in Industrial Equity justified reading a further limitation into s 264(1). To the contrary, while some of the provisions referred to in the passage quoted at [261] above have been amended and their successor provisions appear in a different location, nonetheless the essential features of the tax legislation remains the same. The successor provision to s 17 of the ITAA 1936 levying tax for each financial year upon the taxable income of a person is now found in s 4-10 of the Income Tax Assessment Act 1997 (Cth) (ITAA 1997), and it remains the case that the Commissioner is charged with the general administration of the taxation laws (see ITAA 1936, s 8; ITAA 1997, s 1-7; and the TAA, s 3A). This includes, as at the time of Industrial Equity, the due making of assessments: see ss 166 (the Commissioner shall make an assessment), 167 (default assessments), 169 (Commissioner to assess amount of tax where person liable), and 170 (amendment of assessments), ITAA 1936. It also includes the recovery of tax payable by taxpayers (Part 4-15, TAA and, in particular, s 255-5 providing that a tax-related liability is a debt due to the Commonwealth payable to the Commissioner who may sue to recover such amounts). The High Court's conclusions as to the purpose circumscribing the exercise of the power relevantly conferred by s 264(1) are therefore equally apposite to the scheme in its current form. 264 Fourthly, as the majority held in Industrial Equity "[t]he existence of an assessment, even of an amended assessment, cannot itself deny to the Commissioner the powers contained in ss. 263 and 264." (at 659). This is so notwithstanding that the definition of "assessment" in the ITAA 1936 means "the completion of the process by which the provisions of the Act relating to liability to tax are given concrete application in a particular case with the consequence that a specified amount of money will become due and payable as the proper tax in that case", as the majority accepted at 658 (quoting Kitto J in Batagol v Federal Commissioner of Taxation (1963) 109 CLR 243 at 252 with approval). That being so, the distinction which the applicants seek to draw between the assessment process before and after a taxpayer makes an objection cannot, in my view, be sustained. Rather, the regime for the determination of taxation objections constitutes part of the means by which the Commissioner performs the function under the taxation laws of ascertaining the amount of a person's taxable income and therefore results in an "assessment" as defined in s 6(1) of the ITAA 1936. Specifically, a taxpayer dissatisfied with an assessment made in relation to the taxpayer may object against it under Part IVC of the TAA (s 175A(1), ITAA 1936). The application must state the grounds on which objection is made (s 14ZU, TAA). The Commissioner is under an obligation to decide whether or not to allow a taxation objection in whole or in part, or disallow it (s 14ZY(1), TAA). In determining whether to allow the objection, it is necessary for the taxpayer to show that the amount of money for which tax is levied by a notice of assessment exceeds his or her actual substantive liability: Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614; [1990] HCA 3 at 619-620 and 625 (Brennan J) and 631 (Toohey J; Mason CJ, Dawson, Gaudron and McHugh JJ agreeing with both Brennan and Toohey JJ); Mulherin v Commissioner of Taxation [2013] FCAFC 115; (2013) 2013 ATC 20-423 at [42] (Edmonds, Griffiths and Pagone JJ). Moreover, as the Full Court held in Lighthouse Philatelics Pty Ltd v Federal Commissioner of Taxation (1991) 32 FCR 148 at 155 (Lockhart, Burchett and Hill JJ): The Commissioner cannot be said to be confined in the course of considering the taxpayer's "objection" to the matters raised by the taxpayer in that "objection". He has an obligation to administer the Act and may determine to allow the objection for grounds totally unrelated to those raised by the taxpayer, if that be the correct course, just as he could form the view, based on a reconsideration of the matter, that the assessment should be confirmed for reasons which he had not previously considered. His task is to ensure that the correct amount of taxes is paid, "not a penny more, not a penny less". 265 Furthermore, if allowed, s 170 of the ITAA 1936 provides for the Commissioner to amend an assessment to give effect to a decision on review or appeal, or as a result of an objection made by the taxpayer or pending a review or appeal, with s 14ZZQ of the TAA imposing an obligation upon the Commissioner to amend any assessment as necessary to give effect to orders of the Court on review. Moreover, every amended assessment is an assessment for all the purposes of the Act (s 173, ITAA 1936). The tax law does not differentiate between assessments for present purposes, whether they be original assessments or amended assessments; nor between amended assessments depending upon the means by which the amended assessment was reached. Thus, in upholding the validity of a s 264 notice issued for the purpose of making a decision on taxation objections, the Full Court in Binetter v Deputy Commissioner of Taxation (2012) 206 FCR 37; [2012] FCAFC 126; (Binetter) expressed no doubt about the issue of a notice under s 264 for that purpose, albeit that it was not argued in that case that s 264 could not be relied upon once an objection was made: at 48 [35]-[38]. An application for special leave to appeal to the High Court from that decision was refused: [2013] HCATrans 32. 266 It follows for these reasons that the objection process remains as much concerned with ascertaining the correct amount of taxable income as the processes of assessment that precede it. In these circumstances, the limitation which the applicants seek to imply which would preclude the Commissioner from seeking further information once the objection process was instituted could serve no useful purpose and in fact impede the Commissioner in discharging his functions under the Act. 267 Contrary to the applicant's submissions, the fact that tax can be recovered by the Commissioner notwithstanding that the assessment is under objection or review leads to no different result. The submission ignores the features of the legislative scheme to which I have referred. It also ignores the fact that where a person's liability to tax is reduced by an amended assessment, the amount by which the tax so reduced is taken never to have been payable for the purposes of the general and shortfall interest charges, and any tax overpaid must be applied and repaid in accordance with Divisions 3 and 3A of Part IIIB of the TAA (s 172, ITAA 1936). 268 In short, the distinction which the applicants seek to draw between the assessment process before and after a taxpayer makes an objection finds no foothold in the language of s 264 of the ITAA 1936, nor in the legislative scheme for the assessment of income tax.

6.6 Conclusion as to the power to issue a s 264 notice 269 It follows that I reject the contention that the s 264 notice could not validly issue to the first applicant because the notice was issued more than 60 days after his objection was lodged. 270 Further and in any event, even if I am wrong in my construction of s 14ZYA, I accept the Commissioner's submission that that would not justify setting aside the s 264 notice in its entirety. It is apparent from the face of the notice that it was issued not only for the purpose of gathering information relevant to the first applicant's objection, but also for the purposes of the ongoing audit of trusts associated with him and the first applicant's wife's income or amended assessments.

7. THE CHALLENGE TO THE LEGALITY OF THE DECISION TO ISSUE THE S 264 INTERVIEW

7.1 Alleged lack of authority for the ATO to use the transcript for the purposes of a s 264 interview

7.1.1 Applicants' contentions: an overview 271 The applicants contend that "the circumstances under which the ACC transcript was obtained (viz: by exercise of coercive power by the ACC) limit its permissible use in the hands of the ATO and, in particular, prevents the knowledge contained in the transcript, as well as the fact the ACC examination occurred, from being used to obtain information directly from [the first applicant] at a s.264 interview." In their submissions on s 264 (as pressed), the applicants put their submission on a number of alternative bases: a) the statutory provisions pursuant to which the ACC examination was held and the transcript disseminated, properly construed, do not contemplate that the details of the examination will be used in determining whether to issue a s 264 notice or in conducting a s 264 interview; b) in the alternative, the non-publication directions preclude the ATO from using the ACC transcript in deciding whether to issue a s 264 notice; c) in the further alternative, the non-publication directions made at the conclusion of the ACC examination, or conditions imposed on dissemination of the transcript, should have enjoined publication of the transcript in connection with a s 264 interview of the first applicant.

7.1.2 The substratum of the applicants' arguments 272 According to the applicants, a number of propositions underlay the several limbs of their arguments concerning s 264 of the ITAA 1936, namely that: [The first applicant] has no privilege against self-incrimination in a s.264 interview, and pursuant to s.355-70(1) Item 1 of the Taxation Administration Act 1953, at the conclusion of the interview any ATO employee would be able to lawfully disclose the s.264 transcript to the Director of Public Prosecutions, the Federal Police and other Commonwealth agencies. … The substratum of all of the Applicant [sic] arguments is that [the first applicant] should not, having given evidence at an ACC examination in good faith, based on assurances about the protections available to him and the limited ways in which his evidence could be used, be forced to reproduce and elaborate on that evidence in a s. 264 interview where the evidence he gives could both facilitate a criminal prosecution, or be tendered against him in a prosecution. 273 No charges are pending against the first applicant. The applicant's case turns, therefore, on a perceived risk of prosecution. 274 In my view, the substratum on which the applicant's contentions with respect to the s 264 notice are said to be constructed is misconceived. 275 First, the proposition that the first applicant answered questions at the examination "in good faith" and in reliance upon so-called "assurances" suggests that in some way the Commissioner is estopped or otherwise precluded from exercising the power conferred by s 264. Yet the first applicant gave evidence at the ACC examination because he was required by law to answer questions of the ACC examiner on oath. Whether he gave evidence in good faith is irrelevant. Equally, the so-called "assurances" were no more than a statement by the examiner (albeit misdescribed as an "order") of the statutorily prescribed consequences of the claim by the first applicant that his answers may tend to incriminate him, namely, that his evidence is not admissible in evidence against him in criminal proceedings or proceedings for a penalty (see s 30(5) of the ACC Act and the transcript quoted at [82] above). There is simply no basis in law by which compliance by the first applicant with his statutory obligation to answer questions or his claim to self-incrimination could provide a basis for restraining the Commissioner from exercising the power in s 264. 276 Secondly, the ACC Act envisages and provides for the dissemination to a government agency of examination information in accordance with, and subject to, non-publication directions made under the ACC Act and subject otherwise to the question of whether such dissemination and use would impermissibly interfere with the administration of criminal justice (which I consider later). Conversely, information could be disclosed by ATO officers to relevantly Project Wickenby officers, including the ACC, for the purposes of the Project Wickenby taskforce as defined in s 355-70(9) of Schedule 1 to the TAA. The ATO did not take issue with the proposition that the transcript could be disclosed under item 1 as assumed by the applicants and no argument was directed by any party on the question of construction. I have my doubts as to whether or not disclosure could be permitted under item 1. However, on any view I do not consider that the Parliament intended to authorise disclosure of information under item 1 contrary to a non-publication direction under s 25A; nor that the Parliament intended to authorise disclosure in circumstances where it may interfere with the fundamentally accusatorial system of criminal justice (indeed, if the contrary were the case questions would arise as to the compatibility of the provision with Chapter III of the Constitution). 277 Thirdly, that being so and subject to these caveats, nothing in the ACC Act or taxation laws precludes the use of examination information provided to the ATO by the ACC in making a decision to require the giving of evidence under s 264, nor the use of such information at the s 264 interview. To the contrary, the intention is to permit derivative uses of examination information which may result in the gathering of admissible evidence, as earlier explained. As Bathurst CJ held in R v Ross Edward Seller; R v Patrick David McCarthy [2013] NSWCCA 42 (Seller) at [80] - [81], having regard to the repeal of the protection against derivative use contained in the predecessor legislation, that immunity has been abrogated by necessary implication: see also Boulton (FCAFC) at [65]-[72]. This intention is confirmed by the Revised Explanatory Memorandum for the National Crime Authority Legislation Amendment Bill 2001 (HR) which explained in relation to proposed s 30(4) and (5) of the NCA Bill: (succeeded by S 30(4) and (5), ACC Act): …contrary to the current position, any evidence that is derived from that answer, document or thing may be used against the person. The Authority is unique in nature and has a critical role in the fight against organised crime. This means that the public interest in the Authority having full and effective investigatory powers, and to enable, in any subsequent court proceedings, the use against the person of incriminating material derived from the evidence given to the Authority, outweigh the merits of affording for protection to self-incriminatory material. 278 Fourthly, it is well established, and was not in issue, that a person examined under s 264 of the ITAA 36 cannot refuse to answer any question put to him or her on the grounds that the answer might tend to self-incriminate: Deputy Commissioner of Taxation v De Vonk (1995) 61 FCR 564 (De Vonk) at 566 (Foster J) and 583-584 (Hill and Lingren JJ); Binetter at [30] (the Court). However, this does not mean that the inability to claim the privilege against self-incrimination in a s 264 interview could constitute a "detriment" on which the applicants could rely in an estoppel or otherwise to preclude the exercise of the power in s 264. Rather, the very object of the power conferred by s 264 is to abrogate the privilege. As, for example, Hill and Lindgren JJ held in De Vonk at 583: Clearly it is of the utmost importance that a taxpayer disclose to the Commissioner all sources of income. Failure to do so would constitute an offence. If the argument were to prevail that the privilege against self-incrimination was intended to be retained in tax matters, it would be impossible for the Commissioner to interrogate a taxpayer about sources of income since any question put on that subject might tend to incriminate the taxpayer by showing that the taxpayer had not complied with the initial obligation to return all sources of income. Such an argument would totally stultify the collection of income tax. (emphasis added) See also by analogy Pyneboard Pty Ltd v Trade Practices Commission (1983) 152 CLR 328; [1983] HCA 9 at 341 (Mason ACJ, Wilson and Dawson JJ). 279 As such, it is not sufficient merely to point to the fact, as do the applicants, that the evidence obtained in the proposed or any s 264 interview could facilitate a criminal prosecution of the first applicant or be tendered against him in a prosecution and thereby be "detriment[al]" to his interests. Put another way, dissemination and use by the ATO for a s 264 interview per se does not defeat the "protections" under the ACC Act (cf ground 4(iii), statement of grounds). 280 Finally, the applicants' proposition that the giving of answers pursuant to the exercise of compulsive powers under s 264 will "facilitate a criminal prosecution" or "be tendered against [the first applicant] in a prosecution" is, as the Commissioner submitted, empty speculation unsupported by any evidence of any charge having been laid or of any information that a charge will or may be laid. 281 This is not to deny the court's jurisdiction to restrain the exercise of compulsory powers to require the giving of evidence on the subject matter of offences with which the examinee has been charged where the privilege against self-incrimination has been abrogated: Hammond v Commonwealth (1982) 152 CLR 188; [1982] HCA 42 (Hammond); Hamilton v Oades (1989) 166 CLR 486; [1989] HCA 21; Seller at [81]-[82]; X7; Lee v R. That principle, deriving from the fundamentally accusatorial process of criminal justice engaged with respect to indictable Commonwealth offences, can be displaced only by express words or necessary intendment: X7 at [125] (Hayne and Bell JJ) and [157] (Kiefel J). In X7, the majority (Hayne and Bell JJ (with whose reasons Kiefel J substantially agreed)) held that no such intention was evident in the ACC Act so as to authorise an examiner appointed under s 46B(1) to require a person charged with a Commonwealth indictable offence to answer questions about the subject matter of the charged offence. Nor did any party here (rightly in my view) suggest that any such intention was evident in s 264 of the ITAA 1936. 282 However, it is evident from their Honours' reasons in X7 that that principle does not extend to persons who have not been charged: see also Hammond at 198 (Gibbs CJ); Boulton at [128]-[129] (Weinberg J) (upheld in Boulton (FCAFC)); R v Seller [80]-[82] (Bathurst CJ). In this regard, Hayne and Bell JJ in X7 held that "at every stage, the process of criminal justice is accusatorial" and, together with the privilege against self-incrimination, "both reflect and assume the proposition that an accused person need never make any answer to any allegation of wrong-doing" (at [118] and [104] respectively). Furthermore, in holding that it was no answer to say that the answers given under compulsion would remain secret, their Honours held at [124]-[125] that: Even if the answers given at a compulsory examination are kept secret, and therefore cannot be used directly or indirectly by those responsible for investigating and prosecuting the matters charged, the requirement to give answers, after being charged, would fundamentally alter the accusatorial judicial process that begins with the laying of a charge and culminates in the accusatorial (and adversarial) trial in the courtroom. No longer could the accused person decide the course which he or she should adopt at trial, in answer to the charge, according only to the strength of the prosecution's case as revealed by the material provided by the prosecution before trial, or to the strength of the evidence led by the prosecution at the trial. The accused person would have to decide the course to be followed in light of that material and in light of any self-incriminatory answers which he or she had been compelled to give at an examination conducted after the charge was laid. That is, the accused person would have to decide what plea to enter, what evidence to challenge and what evidence to give or lead at trial according to what answers he or she had given at the examination. The accused person is thus prejudiced in his or her defence of the charge that has been laid by being required to answer questions about the subject matter of the pending charge. As has been explained, if an alteration of that kind is to be made to the criminal justice system by statute, it must be made clearly by express words or by necessary intendment. If the relevant statute does not provide clearly for an alteration of that kind, compelling answers to questions about the subject matter of the pending charge would be a contempt. 283 Thus, in holding that the ACC neither expressly nor by necessary implication provided for the compulsory examination of a person charged with an indictable Commonwealth offence, the majority held that the condition in s 7C(3) of the ACC Act that a special investigation cannot be undertaken with the Board first considering whether ordinary police methods of investigation "are likely to be effective" means "effective to permit the laying of charges against offenders." (at [146]; emphasis added). It did not embrace "…any larger task of deciding whether individual criminal guilt is demonstrated. It is only by the engagement of judicial power consequent upon the laying of a charge that individual criminal guilt will be determined" (ibid). As such, the majority concluded at [147] that: The ACC may therefore execute its function of investigating matters relating to federally relevant criminal activity by using the extraordinary processes of compulsory examination only when the Board of the ACC has determined that ordinary police methods are not "likely to be effective" to lead to the laying of charges. The performance of that investigative function is in no way restricted or impeded if the power of compulsory examination does not extend to examination of a person who has been charged with, but not yet tried for, an indictable Commonwealth offence about the subject matter of the pending charge. The general provisions made for compulsory examination, when read in their context, do not imply, let alone necessarily imply, any qualification to the fundamentally accusatorial process of criminal justice which is engaged with respect to indictable Commonwealth offences. 284 In short, as Bathurst CJ explained in Seller, the principle "…is dependent on court proceedings being in existence as there can be no interference with the administration of justice unless and until that occurs" (at [77]). It follows that the principle simply cannot be invoked here. Should however, charges be laid against the first applicant at some other date, depending upon the circumstances and uses to which material derived from the interview is sought to be put, the ATO and ACC correctly accepted that relief may be available to apply to restrain the prosecution from having access to the s 264 interview, to apply for a stay of prosecution if it is contended that he is unable to secure a fair trial (cf Seller), or the evidence may be excluded should the Crown seek to tender it.

7.1.3 Does the non-publication direction preclude the ATO from using the ACC transcript in deciding whether to issue a s 264 notice (ground 4(vi), statement of grounds)? 285 The applicants next allege that the non-publication directions did not, and do not, permit the ACC transcript to be taken into consideration in a decision to require a s 264 interview because the requirement for the first applicant to attend such an interview where he would be required to answer questions on pain of criminal liability is "an adverse administrative action" against the applicant for the purposes of paragraph 5(d) of the non-publication directions (as varied on 10 October 2013) (Statement of Grounds at 4). Paragraph 5(d) read: Publication of the information and attendance information is subject to the following: ... (d) it may not be considered as part of any proposed adverse administrative action against any person (other than the tax assessments) without prior approval of the ACC. (emphasis in the original) 286 The applicants did not develop their contention that a requirement to attend an interview under s 264 is an adverse administrative action in their submissions beyond mere assertion. In any event, the contention ignores the terms of clause 6(d) which carves out "the tax assessments" from the prohibition against considering the information as part of any proposed adverse administrative action. "The tax assessments", in turn, are defined in clause 4 of the non-publication direction which authorizes publication to the ATO and staff for "use and publication in connection with the assessment of taxation liability of the witness, his wife…, or any associated or connected entities (other than the [Offshore Bank] …) (the tax assessments)" (emphasis in the original). Use of the examination information both in considering whether to issue the s 264 notice, or at or in preparation for an interview under s 264, is such a use. The purpose of issuing the s 264 notice is to assist the Commissioner in determining the objections made by the applicants and the first applicant's wife to the amended assessments and the regime for the determination of taxation objections constitutes part of the means by which the Commissioner performs his or her function of assessing income tax.

7.1.4 The challenge to the non-publication direction on the ground that the ACC examiner should have enjoined the use of the ACC transcript in connection with a s 264 interview (grounds 4(iii), 6 and 8, statement of grounds) 287 In the alternative, the applicants submit that the non-publication directions made by the ACC examiner should have enjoined the use of the ACC transcript in connection with a s 264 interview. Specifically, the applicants contend that, because at the s 264 interview (or any future interview) the first applicant may be asked to elaborate on explanations given by him of certain transactions at the ACC interview, this has the potential to prejudice a fair trial relying on Seller at [101]-[104]. On the same grounds, the applicants contend that dissemination of the transcript under s 59(7) should have been accompanied by conditions preventing its use in a way said to defeat the protections under the ACC Act. An injunction is therefore said to be warranted in order to give effect to s 25A(9) of the ACC Act which requires the making of such a direction "if the failure to do so might … prejudice the fair trial of a person who has been, or may be, charged with an offence." Alternatively an order requiring the non-publication directions to be remade according to law is sought. 288 It is necessary first to place the passages relied upon by the applicants in Seller in context. 289 In Seller, the non-publication direction made by the examiner under s 25A(9) was varied so as to permit publication of the transcript of the appellants' ACC examinations to the CDPP. A further variation was made after one of the appellants had been arraigned permitting distribution to the prosecuting authorities and their lawyers for use in any court proceedings against the appellant, subject only to the restriction on its admissibility under s 30(5) of the ACC Act (Seller at [24]-[26]). 290 The Court of Appeal (Bathurst CJ (with whose reasons McClelland CJ at CL agreed, as did Rothman J subject to additional comments) upheld the primary judge's findings that the nature of the material supplied to the CDPP justified the conclusion that dissemination to the CDPP might prejudice a fair trial and should not have occurred having regard to the requirements of s 25A(9). However, the Court of Appeal found that the primary judge had erred in holding that the circumstances warranted the grant of a permanent stay of proceedings. 291 Secondly, turning to s 25A(9), Bathurst CJ held that the word "might" means "a real risk as distinct from one that is remote or fanciful" (at [91]). However, what constitutes prejudice to a fair trial for the purpose of the subsection was more difficult and not capable of precise definition (at [92]). In this regard, it will be recalled that s 25A(9) expressly envisages that a non-publication direction may be required to ensure a fair trial where a person "may be" charged with an offence and not only where a person has been charged. As such, the protection afforded by s 25A(9) casts a wider net than that afforded at common law. 292 Having reviewed the authorities, including notably Environment Protection Authority v Caltex Refining Co Pty Limited (1993) 178 CLR 477; [1993] HCA 74 (Caltex) and NSW Food Authority v Nutricia Australia Pty Ltd (2008) 72 NSWLR 456; [2008] NSWCCA 252 (Nutricia), the Chief Justice concluded that: …it would seem to me that if the privilege against indirect or derivative self-incrimination had not been abrogated, s 25A(9) and s 25A(11) would require a direction to be made prohibiting the dissemination of self-incriminating material to prosecuting authorities both in case of a person charged and the person who might be charged. This is because the use of such material by the Crown might prejudice a fair trial… (emphasis added) 293 However, his Honour rejected the submission that the abrogation of privilege against indirect incrimination by s 30(5) meant that a fair trial could not be compromised by the disclosure of direct or indirect incriminating material to prosecuting authorities, and that s 25A(9) has no application in such cases (at [99]-[100]). It is in this context that the critical passages at [101] - [104] on which the applicants seek to rely here are found. Specifically, Bathurst CJ found that: As I indicated, the legislation as originally enacted contained two safeguards, the first in the original s 30 and the second in s 25A. As was said in [Australian Crime Commission v OK [2010] FCAFC 61; (2010) 185 FCR 258] at [109], the object of s 25A was to preserve a statutory safeguard to the right to a fair trial. If it was intended that the amending legislation was to take away that right, such an intention in my opinion, would need to have been clearly expressed… That does not mean that s 25A would prohibit all derivative use of the material. So, for example, I do not believe a fair trial generally will be prejudiced by the use of information obtained during the course of an examination to obtain admissible evidence. Thus, answers which would tend to indicate the availability of admissible evidence could properly be used for this purpose. For example, in cases such as the present this may include the location of bank accounts. Further, it does not seem to me that the use by the prosecution of documents produced during the course of an examination which supported the Crown case, usually would compromise a fair trial. However, the question of whether derivative use of such material could have that effect will always depend on the material in question and the circumstances of its use. This in my opinion is consistent with what was said by Mason CJ and Toohey J in Caltex supra at 503, and by Spigelman CJ in Nutricia supra at [164] - [174]… It is also consistent with what was said by McClellan CJ at CL in CB supra at [99]. It also means that s 25A would not preclude the ACC from carrying out the investigatory functions imposed on it by s 7A and s 12 of the Act. The position is different in my opinion if the provision of the material in question discloses defences or explanations of transactions by the accused which he or she may raise at a trial, and possibly evidence or information which would tend to show that documents or transactions apparently regular on their face in fact tend to support the proposed charges. This would be contrary to the principles stated by Gibbs CJ in Sorby supra, and by Deane, Dawson and Gaudron JJ in Caltex that the onus is on the Crown to prove its case and that the prosecution must prove it without reliance on incriminating answers. To provide to prosecutorial authorities material compulsorily obtained relating to such matters could compromise a fair trial in accordance with these principles. (emphasis added) 294 The applicants contend that the ACC examination and proposed s 264 interview of the first applicant are squarely within the class of derivative use identified in Seller which the Court of Appeal said should be prohibited by non-publication directions at [101]-[104]. Specifically, they submit that: At the ACC examination [the first applicant] gave significant evidence about his understanding of the various transactions. The purpose of the proposed s.264 interview is not to identify new transactions, bank accounts and the like. Rather it is to explore transactions that are already known to the ATO and where it is alleged these transactions of fraudulent. The goal of the s.264 examination will be to obtain evidence "that documents or transactions apparently regular on their face in face [sic] tend to support the proposed charges" [quoting from Seller at [104]], which is evidence the Court of Appeal said cannot be legitimately pursued through derivative use of an ACC examination. To the extent the… Non-Publication Directions fail to prevent the s.264 interview, they do not properly reflect the s.25A(9) obligation to prevent possible prejudice to criminal proceedings. 295 However, the decision in Seller concerned a very different circumstances from the present. Unlike Seller, this case does not concern the potential impact on a fair trial of the dissemination of information to prosecutorial authorities. The ATO is not a prosecuting authority. Nor have charges been laid or are pending (or "proposed") against the first applicant. And the purpose of exercising the s 264 power is to assess the applicants' taxable income. Contrary, therefore, to the applicants' submission, it cannot be said that the goal of the s 264 examination will be to obtain evidence "that documents or transactions apparently regular on their face in fact tend to support the proposed charges". 296 Consistently with this, when the ACC gave a copy of the transcript to ATO officers on 2 June 2011, the operative non-publication direction which was made at the examination direction directed that the first applicant's evidence and the fact that he had given evidence should not be published except, relevantly, to "the Australian Taxation Office for any matter within its jurisdiction arising from this investigation". The use to which the ATO could, therefore, use the examination information was limited to the assessment of taxation, including the resolution of the applicants' objections and the first applicants' wife to the amended assessments, being matters arising from the special Wickenby investigation and more particularly Operation M. The fact that inevitably the discharge of that function involves the ATO considering whether the applicants have engaged in tax evasion and fraud particularly because the assessments cannot otherwise be re-opened does not change the nature of its inquiry. In these circumstances, there is nothing against which to conclude that there is a "real risk" that the failure by the examiner to give a direction precluding the use of the examination material in the exercise of powers under s 264 of the ITAA 1936 might prejudice the fair trial of the first applicant as a person who may be charged with an offence. Any such risk at the time of the examination when the direction was made (and presently) is remote.

7.2 The alleged failure to have regard to a relevant consideration (ground 4(i), statement of grounds) 297 The applicants contend that the decision-maker failed to take into account a relevant consideration in deciding to issue the s 264 notice, namely, "the detriment to [the first applicant] of being made to attend a s 264 interview" in his particular circumstances (Statement of Grounds at 4).

7.2.1 Relevant principles 298 The failure to have regard to a relevant consideration, being a consideration which the decision-maker was bound to take into account in making a decision, will sound in jurisdictional error: Peko-Wallsend at 39 (Mason J); Craig v South Australia (1995) 184 CLR 163; [1995] HCA 58 at 179 (Brennan, Deane, Toohey, Gaudron and McHugh JJ). Those factors which the decision maker is bound to consider are determined by construction of the statute rather than the particular facts of the claim. As McHugh, Gummow and Hayne JJ explained in Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 32; [2001] HCA 30 at 347-348 [73]-[74]: The considerations that are, or are not, relevant to the Tribunal's task are to be identified primarily, perhaps even entirely, by reference to the Act rather than the particular facts of the case that the Tribunal is called on to consider.… This does not deny that considerations advanced by the parties can have some importance in deciding what is or is not a relevant consideration. It may be, for example, that a particular statute makes the matters which are advanced in the course of a process of decision-making relevant considerations for the decision-maker. What is important, however, is that the grounds of judicial review that fasten upon the use made of relevant and irrelevant considerations are concerned essentially with whether the decision-maker has properly applied the law. They are not grounds that are centrally concerned with the process of making the particular findings of fact upon which the decision-maker acts. 299 Where the statute does not list those considerations to which regard must be had, those considerations must be ascertained as a matter of statutory construction from the subject matter, scope and purpose of the Act. However, as Mason J cautioned in the leading decision of Peko-Wallsend at 40: ...the court will not find that the decision-maker is bound to take a particular matter into account unless an implication that he is bound to do so is to be found in the subject-matter, scope and purpose of the Act.

7.2.2 No failure to consider a relevant consideration 300 First, the applicants contend that where a government agency proposes to exercise a power in a way that will infringe a common law right or privilege, the detriment to the person whose rights will be infringed must be taken into consideration. Equally, they contend, the fact that s 264 abrogates the privilege against self-incrimination is a factor that must be taken into account by the decision-maker before deciding to exercise the power. 301 The purpose of the power in s 264 is to require answers in circumstances where persons are unlikely voluntarily to provide the information sought precisely because it may be of an incriminating nature: Boulton (FCAFC) at [57]. In so doing, the power gives priority to the protection of the revenue over the fundamental common law privilege against self-incrimination. From this, it can be implied that the decision-maker deciding whether or not to exercise the power in s 264 must consider the appropriateness of taking so serious a step in all of the circumstances. As for example, Lockhart J observed in Citibank Limited v Commissioner of Taxation (1988) 19 ATR 1479 (Citibank) (on which the applicants relied), "[p]lainly the revenue must be protected, but so must the rights of citizens". As such, I consider that there is considerable force in the submission that it is relevant for the ATO to consider whether there are other means which do not impinge upon the privilege against self-incrimination available by which such information might be obtained. (see by analogy Citibank at [39] (appeal allowed in part but not on relevant grounds: Commissioner of Taxation v Citibank Limited (1989) 20 FCR 403)). 302 However, in the present case, the evidence discloses that the ATO had sought first to obtain information about the transactions in question from the applicants by other avenues, including through affording the first applicant the opportunity to respond to the draft audit position paper and provide further evidence before deciding to issue the amended assessment: at [95]-[97] above. However, the information obtained via these alternative avenues was considered deficient as a consequence of which the proposed s 264 interview was considered by the decision-maker, to be the most direct and appropriate method to test the veracity of the documents supplied by the first applicant and his tax agent: see part 4.12 above. In these circumstances, I do not consider that there is any force in the contention that the decision-maker failed to have regard to the appropriateness of taking such a step in the all of the circumstances. Rather, the applicants seek to take issue with the merits of the exercise of the power by her, as is apparent for example from their submission that any benefits to be obtained from holding the interview are "meagre". 303 Secondly, the first applicant contends that his answers in a s 264 examination would deny him the protections granted under the AAC Act in respect of his ACC examination as any s 264 transcript could be disclosed under s 355-70 of the TAA to the DPP, the AFP and other Commonwealth agencies for the purpose of enforcing the criminal law. This was said to constitute part of the detriment which the decision-maker was required to consider. This submission depends upon the substratum identified by the applicants as underlying their s 264 submissions and therefore suffers from the difficulties which I have already identified. 304 Thirdly, the applicants rely upon the fact that substantial amended assessments had been raised against the first applicant and were in the process of being raised against his five trusts. In that context, it was said that a s.264 examination in which it was proposed that Senior Counsel would test the first applicant's evidence on the very matters likely to be at issue in any Part IVC appeal, in the absence of a judge, would impose a significant forensic disadvantage on the first applicant. This submission is based upon the misconception which I identify at [314]-[315] below.

7.3 The challenge to dissemination of the ACC transcript on the ground that the first applicant was not given the opportunity to make submissions about dissemination (ground 4(v), statement of grounds) 305 In the further alternative, the applicants submit that the dissemination of the ACC transcript was a nullity because the first applicant was not permitted to make submissions about its prospective dissemination to the Commission and in the ordinary course the transcript would not been available to the ATO for s 264 purposes (Statement of Grounds at 4). The applicants rely upon the decision in Johns v Australian Securities Commission (1993) 178 CLR 408; [1993] HCA 56 (Johns). No relief is sought declaring the dissemination a nullity but it is presumably submitted that in some way this invalidated the s 264 decision. 306 Contrary to the applicants' submissions, the decision in Johns is distinguishable. In that case, the High Court held that the decision to release a transcript of evidence given before the Australian Securities Commission in private in the exercise of coercive powers for use in public hearings at a State Royal Commission was invalid on the ground that the delegate ought to have given the witness the opportunity to oppose that course. However, in so holding, the majority distinguished between a decision to disseminate examination information to a government agency for authorised purposes reflected in conditions on that agency's use or disclosure of the information, on the one hand, and a decision in effect to lift any conditions on the agency's use or disclosure of the examination information, on the other hand. It was only in the latter case that the Court held that an opportunity to be heard must first be afforded to the witness: 429-431 (Brennan J), 435-436 (Dawson J) and 458 (Gaudron J). As for example, Gaudron J explained at 458, in agreeing with Brennan J: … The Australian Securities Commission came under a statutory duty of confidence with respect to the information it obtained from examination of Mr Johns, by use its coercive power under Pt 3, Div. 2 of the Australian Securities Commission Act 1989 (Cth). I agree also that the statutory duty involved is not absolute, it being qualified by the right of the ASC to use and disclose information for the purposes of performing or exercising any of its functions and by the provisions of the Act authorizing disclosure for particular purposes and by particular means. I also agree with his Honour that, in the circumstances of this case, the ASC was obliged to afford the appellant an opportunity to oppose permission for the use of the transcripts of his examination in the public hearings of The Royal Commission Into The Tricontinental Group of Companies. (acronyms omitted) 307 The circumstances of the present case are very different from those in Johns. There is no question of public disclosure with its consequential prejudice to the applicants' rights and interests attracting a right to be heard. Rather, the non-publication directions made by the examiner at the conclusion of the hearing here authorised disclosure to the ATO "for any matter within its jurisdiction arising from" the Wickenby investigation. For the reasons already given, release to the ATO for such purposes was authorised under the ACC Act and was limited to the purposes for which the power to disseminate information may be exercised. These conditions circumscribed the use which might be made by the ATO at the time that the transcript was released to it (Johns at 428). Subsequent variations to the non-publications directions have sought only to define the conditions more strictly, and expressly to exclude the public release of the information and its disclosure to prosecutorial authorities. As such, the circumstances of this case fall outside those which attract an opportunity to be heard as explained in Johns. Moreover the first applicant was legally represented at the ACC examination when the non-publication direction, authorising conditional release of the transcript to the ATO was first made. No objection was then made to the terms of the direction or subsequently until now.

7.4 Wednesbury unreasonableness (ground 4(ii), statement of grounds) 308 The applicants submit that the proposed s 264 interview is vitiated by Wednesbury unreasonableness in the sense outlined by Edelsten v Wilcox (1988) 83 ALR 99; [1988] FCA 204 at [36] and [41], namely, that "'reasonable' administrative conduct is not simply a matter of rational behaviour, but also the use of government powers in a measured and proportionate fashion." (Statement of Grounds at 4) 309 In oral submissions, counsel for the first applicant explained the manner in which the proportionality issue was said to arise in the following terms: The submission is that on the one hand, we have [the first applicant] who's being summoned specifically so that it can be put to him that his arrangements are a sham in the circumstances with which we're familiar where there was an ACC examination and so forth and he will have no privilege against self-incrimination. So it's from the point of view of the interviewee, a very, very onerous imposition. From the point of the ATO, the respondent - as I said, the advantage related to the determination of assessable income is meagre, I would submit, and the main advantage is - is one that barely falls within the proper ambit of the exercise of the power. 310 In expanding upon the alleged detriment, counsel for the first applicant submitted that: …it appears from the documents that not only will [the first applicant] be interviewed pursuant to a statute that abridges his privilege against self-incrimination, but in a very real sense the point is to incriminate him. If I could just unpack that a bit: there's a suggestion that a series of loans from offshore to [the first applicant] and his entities are shams and the proposal is to sit down with him and interrogate him about those very matters. So, in that sense, it's not just use of a power with certain common low [sic] protections that might be purely academic under the circumstances being swept to one side, it's the exercise of a power in a way that - in which that will cause, potentially, a huge amount of detriment to [the first applicant]. 311 I reject the submission that the decision to issue the s 264 Notice is unreasonable. 312 First, the applicants' submissions take no account of the principle that, in its application to a statutory discretion, the legal standard of unreasonableness must be determined by reference to the true construction of the statute. This is so "because the question to which the standard of reasonableness is to be addressed is whether the statutory power has been abused": Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 at [67] (Hayne, Kiefel and Bell JJ). It is, therefore, only when by reference to the scope and purpose of the statute, that a decision-maker has, for example, given disproportionate weight to some factor or reasoned illogically or irrationally, that the final conclusion will be that the decision-maker has been unreasonable in a legal sense: ibid at [72]; see also at [76]. 313 Secondly, the evidence establishes that the Commissioner decided to issue the notice in order to obtain information necessary for the investigation of certain transactions, his suspicions having been aroused. While the assessments had been made, the assessments were the subject of an objection by the first applicant on the basis that the income declared in the original tax returns was accurate. In other words it was based on an assertion that there was no intention to evade tax, and all of the transactions were exactly what they seem to be. The issue of the s 264 notice sought to achieve no more than to enable the Commissioner to determine the objection and, thereby, discharge his obligation to make a true and accurate assessment of the taxpayer's taxable income. 314 Thirdly, the applicants sought to rely upon an internal email within the ATO to Ms Edwina McLachlan from Effie Mavratzakis, objections office, Project Wickenby Objections, SBIT business line. Ms Mavratzakis is the SBIT Objections officer responsible for responding to the objections filed by the first applicant and his wife to the amended assessment issued by the ATO in November 2012. In the email Ms Mavratzakis stated "Hi Edwina, the objection is drafted completely to uphold the order decision, just awaiting the outcome of the interview to strengthen the position." In particular, the applicant submitted that it should be inferred from the email that the objection decision was already drafted and the intention in holding the examination was simply to strengthen that decision against likely Part IVC proceedings to challenge the objection decision by obtaining further information and to give counsel who may ultimately appear for the Commissioner in Part IVC proceedings the opportunity to ask the first applicant questions about relevant transactions. In those circumstances, the applicants contended that the forensic advantage which the Commissioner might gain by holding the interview was "meagre" and outweighed by the significant detriment to the first applicant. 315 However, this is not a case where the Commissioner could be seeking the information in order to make a decision on whether or not to institute legal proceedings as the function which the Commissioner was seeking to exercise was to determine the applicant's objections. Nor, while Part IVC proceedings may be foreseeable, are Part IVC proceedings imminent or pending. The decision in Binetter is apposite. In that case the appellant also claimed that the primary judge ought to have held that the guiding or dominant purpose in issuing a s 264 notice was to affect the outcome of anticipated court or tribunal proceedings under Part IVC of the TAA. In rejecting that submission, the Full Court agreed at 48 [36] with the primary judge's reasons at [2012] ATC 20-331 at [91] in terms equally apt to address the applicants' contention here: … the first element of the submission pays insufficient regard to the function the Commissioner was in fact seeking to exercise; that is, to make a decision on the applicant's objections. This is not a case where the question can be approached by asking whether the decision maker had or had not decided to commence legal proceedings: compare Korean Airlines Co Ltd v Australian Competition and Consumer Commission (No 3) [2008] FCA 701; (2008) 247 ALR 781 at [70]. This is because the administrative process of assessment, which includes making a decision on the objections, precedes the commencement of either tribunal proceedings or court proceedings by the taxpayer. Further, in the present case there are no proceedings in the Tribunal or in the Court. The Commissioner was not deciding whether proceedings should be instituted by him. Such proceedings were neither imminent nor pending although they were foreseeable if the objections were disallowed. But there was no intrusion on judicial power nor any exercise of power for an improper purpose. Thus at that level of abstraction the ground fails.(emphasis in the original) 316 Insofar as the applicants submit that any benefits from the proposed s 264 interview would be "meagre", the submission takes issue impermissibly with the merits of the decision and fails to grapple with the fact that s 264 is intended to facilitate the proper and informed discharge of the Commissioner of his duty accurately to assess the person's taxable income in the face of objections from the applicant and the first applicant's wife. The submissions, as Robertson J held in Binetter at [108], fail to recognise that "the better the information before the Commissioner at the objection stage the better the decision on the objection." Provided that the notice is issued for the purpose of making an assessment taxpayer's taxable income, it is not for the court to pre-empt the outcome of the exercise of that discretion and weigh up the potential benefits to the Commissioner of proceeding with the proposed s 264 interview. As Robertson J also held in Binetter at [108] (in a passage with which the Full Court agreed at 48 [37]), "To contend that the [objections] decisions could have been made without the material sought or had been held up to obtain that material is to invert the inquiry." It may well be that the information ultimately gleaned from the holding of the interview proves to be of value to the Commissioner. At the present time, that is unknown but it is a matter which the Commissioner is entitled to investigate through the exercise of these powers.

8. CONCLUSION 317 For these reasons, the application should be dismissed. I will hear the parties as to costs. I certify that the preceding three hundred and seventeen (317) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perry.