Mandalinic v Stone

Solicitor for the Intervener: Craddock Murray Neumann

AND: RICHARD STONE IN HIS CAPACITY AS LIQUIDATOR OF RIC ADMIN PTY LTD (IN LIQUIDATION) ACN 603 418 908 First Respondent

RIC ADMIN PTY LTD (IN LIQUIDATION) Second Respondent

DEPUTY COMMISSIONER OF TAXATION Intervener

order made by: STEWART, MCELWAINE AND BUTTON JJ DATE OF ORDER: 4 SEPTEMBER 2023

1. The appeal be dismissed.
2. Any application for costs is to be made in writing, limited to three pages and filed within seven days of the publication of these reasons and if made responded to within a further period of seven days.
3. Subject to any further order of the Court, the determination of any costs application will proceed on the papers. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 We have had the considerable benefit of reading a draft of the reasons for judgment prepared by McElwaine J. His Honour's explanation of the proceedings, the primary judgment (PJ) and the questions arising on the appeal, and his identification of the various statutory provisions and their history, make it unnecessary for us to canvass those matters in any detail. In our view, the appeal can and should be decided with reference to the first question that the primary judge determined. For the reasons that follow, that question is to be decided against the appellant. It is therefore unnecessary to decide any of the remaining questions, although for reasons that we will come to, we will say some things with regard to the second question. 2 At the request of the parties, the primary judge agreed to determine four separate questions, only the first two of which are presently relevant: (a) can an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company for recovery of an estimate constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA [ie, Taxation Administration Act 1953 (Cth)]; (b) if yes to (a), can an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company in liquidation for recovery of an estimate constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; … 3 For clarity, and because the proceeding against the director is not to recover the estimate but to recover a penalty, the first question can be rephrased as follows: Can an affidavit filed by a director of a company in a proceeding brought by the Commissioner against the director for recovery of a debt arising from a director penalty notice which is in turn based on a notice of estimate by the Commissioner of the company's indebtedness constitute an affidavit for the purposes of item 2 in s 268-40(1) of the TAA? 4 It can be seen, as recognised in its wording, that the second question only arises if the first question is answered affirmatively. Indeed, if the first question is answered negatively, it follows as a matter of logic that the second question, which is narrower and encompassed within the parameters of the first question, must be also be answered negatively, ie, if in the penalty notice proceeding against the director an affidavit filed by the director cannot cause the company's penalty estimate to be revoked then that conclusion also applies, only with more force, in the event that the company is in liquidation. Also, any reasoning in support of answering the first question affirmatively would inevitably be relevant to answering the second question. For those reasons, in our view it is necessary to answer the first question. 5 On the first two questions, his Honour concluded (at PJ [15]): (a) an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company for recovery of an estimate cannot constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; (b) an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company in liquidation for recovery of an estimate cannot constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; … 6 For simplicity, all section references below, unless the contrary is indicated, are to Sch 1 of the TAA, ie, the Taxation Administration Act 1953 (Cth).

The essential facts 7 By way of recapitulation, the essential facts are straightforward. They are extracted here from the primary judgment (at PJ [16]). 8 The Commissioner issued an estimate for PAYG withholding to the company, RIC Admin Pty Ltd, which the company has never paid although a small amount was recovered by way of garnishee notice. 9 The Commissioner subsequently issued a director penalty notice to the appellant, Mr Mandalinic, who was at all relevant times a director of the company, for the unpaid amount of the PAYG withholding estimate. 10 The company took no steps to contest the estimate. The Commissioner then served a creditor's statutory demand on the company and thereafter successfully applied for the company to be wound up. 11 The Commissioner then commenced a proceeding in the Supreme Court of New South Wales against Mr Mandalinic to recover the debt reflected in the director's penalty notice. Mr Mandalinic filed an affidavit in the Supreme Court proceeding purporting to challenge the debt underlying the notice of estimate and to thereby revoke the debt of the company under item 2 of the table in s 268-40(1). 12 The Commissioner then commenced the proceeding below against Mr Mandalinic in which claims for insolvent trading and unreasonable director-related transactions were brought. A component of the insolvent trading claim arises from the company's indebtedness to the Commissioner as reflected in the notice of estimate. In respect of that aspect of the claim, Mr Mandalinic sought to rely on the affidavit filed in the Supreme Court proceeding to contend that the estimate had been revoked by operation of the item 2 referred to. It was the validity of that contention that arose for determination by the primary judge in an interlocutory application.

The appellant's submissions 13 The appellant submits that the Commissioner's powers to create a liability by issuing an estimate are "extraordinary" and, unsurprisingly, are tempered by legislative safeguards, which are consistent with the purpose of the TAA to facilitate the recovery of unpaid amounts that are actually owed. The opportunities afforded by the legislative scheme "to overcome the potentially harsh consequences" of the estimates regime are indicative of a legislative purpose to encourage taxpayers to engage with the Commissioner "with a view to ascertaining the true liability". 14 The appellant submits that the conclusion reached by the primary judge on the first question is wrong for essentially five reasons. 15 First, it is said that the primary judge erred by construing the words "relate to" and "you" in s 268-40 narrowly when a broad reading of those words is not merely open but proper. The words "relate to" in s 268-40 are of "wide import" and broad enough on their face to apply to director penalty proceedings, a position which was noted by the New South Wales Court of Appeal in Lee v Deputy Commissioner of Taxation; Silverbrook v Deputy Commissioner of Taxation [2020] NSWCA 95; 102 NSWLR 825 at [41], and the primary judge considered that director penalties "relate to" unpaid amounts of estimates elsewhere in the primary judgment (at PJ [6]). The appellant submits that the primary judge's construction of the word "you" in item 2 of s 268-40 is incorrect because each of the items in s 268-40 are independent of each other, providing a separate source of power to reduce or revoke an estimate that may become available at different times. The appellant accepts that the word "you" in item 1 of s 268-40 refers to the company, but contends that the word "you" has a sufficiently flexible meaning such that, in item 2, it can encompass proceedings against a director. It is said that this is a logical reading of item 2 in circumstances where it is conceivable that the Commissioner could elect to bring director penalty proceedings against a director before, or instead of, pursuing a company and so it would be "curious" and unjust if a director were unable to swear an affidavit reducing or revoking the estimate in the context of a director penalty proceeding, rendering them "liable for the payment of taxes that did not exist" should the estimate be wrong. 16 Secondly, the appellant submits that the fact that there are different statutory defences available for directors does not mean that there are no other means by which a director might defend themselves and the existence of those provisions does not limit the plain words in item 2 of s 268-40. 17 Thirdly, the appellant submits that there is no anomaly in finding that the legislative scheme enables a current but not a former director to swear an affidavit because s 268-40 empowers a person with knowledge of the asserted facts to provide information to the Commissioner and that descriptor befits a current but not a former director. 18 Fourthly, the appellant submits that it is not inimical to the legislative purpose of efficiency to provide multiple opportunities to taxpayers to correct estimates when the legislative scheme puts timeframes on each such opportunity. 19 Finally, it is said that it is not "telling" that the Explanatory Memorandum to the Tax Laws Amendment (2012 Measures No. 2) Bill 2012 (Cth) does not identify that a director can extinguish their personal liability by filing an affidavit in director penalty proceedings to reduce or revoke the estimate because the Explanatory Memorandum is only directed to methods of extinguishing the personal liability of directors rather than eliminating the estimate.

Consideration and disposition 20 There are a number of cumulative considerations which lead to the conclusion that in item 2 of the table in s 268-40(1) the "you" who can file an affidavit is the person or entity that is the subject of the estimate notice and not some other person or entity the claimed liability of whom is in some way based on or related to the liability under the estimate notice. In the factual circumstances of the present case, the company to whom the estimate notice was directed could avail itself of the opportunity provided by item 2 to revoke or reduce the estimate, but the director who was the subject of a director's penalty notice could not. 21 First, as submitted by the Commissioner, the provisions containing the word "you" were introduced into the TAA as a result of the Tax Law Improvement Project, which aimed to simplify the legislative scheme without changing the underlying taxation policy: Explanatory Memorandum, Income Tax Assessment Bill 1996 (Cth) at 17-18 and 149; Joint Committee of Public Accounts and Audit, "An Advisory Report on the Delayed Provisions of the Tax Law Improvement Bill (No. 2) 1997" (1997) 1. The predecessor to Div 268 used the term "person liable" rather than "you", with the words "person liable" being defined as a person who has "become liable under a remittance provision to pay to the Commissioner" and where a "person liable" was the only person (save for their trustee) who could file an affidavit to revoke or reduce the estimate. Therefore, under the former regime the "person liable" was the person who was the subject of the remittance obligations, the recipient of the estimate and the party to the proceedings that related to the recovery of the unpaid amount of the estimate. If the legislative intention behind the amendments to the statutory scheme was to preserve their legal effect then "you" in Div 268 means the company and not the director. 22 Secondly, ss 268-40 and 268-90 are to be read and understood together. That arises from the reference to s 268-90 in note 2 to s 268-40, from the reference to s 268-40 in s 268-90(1), and from the obvious point that the statutory declaration and affidavit referred to in s 268-40 are the same as the statutory declaration and affidavit dealt with in s 268-90. While s 268-40 defines who can give or file the affidavit or statutory declaration and by when they must do so, s 268-90 sets out its requirements as to scope, content and its maker (see the headings within the section). This observation weighs against the appellant's submission that "you" can refer to different entities in s 268-40 and s 268-90. 23 Thirdly, the express terms of s 268-90(2) indicate that the entity giving or filing the statutory declaration or affidavit is the entity that is the recipient of the notice of estimate. No other sensible construction is possible, in particular because it refers to the amounts "you withheld", or "you were required to pay" under the estimate of liability regime in s 268-10(1). The result is that the word "you" in s 268-90(2) must refer to the recipient of the notice of estimate. In this case, that is the company. If, as for the sake of consistent construction it must, "you" in s 268-40 has the same meaning as it does in s 268-90, then it is also a reference to the company and not to the subject of a director penalty notice. 24 Fourthly, although the words "relate to" are obviously capable of broad meaning, the breadth of meaning or relationships must be gleaned from the statutory context and purpose. There is existing authority that has considered the breadth of the phrase "you are a party to proceedings before a court that relate to the recovery of the unpaid amount of the estimate" in item 2. The existing authority must be considered. 25 In Transtar Linehaul Pty Ltd v Deputy Commissioner of Taxation [2011] FCA 856; 196 FCR 271, the Commissioner served a notice of estimate for PAYG withholding liability on the company. The company provided a statutory declaration to the Commissioner, purportedly in terms of s 268-40(1) although it was outside the applicable period. The company then brought the proceeding in question seeking declarations that the estimate was revoked, either by way of the statutory declaration having been given by the Commissioner or by way of an affidavit filed in the proceeding (at [39]). One issue was whether the proceeding "relate[d] to the recovery of the unpaid amount of the estimate" within the meaning of item 2 of s 268-40(1) (identified at [41]). Robertson J concluded (at [48]) that it was not. 26 His Honour reasoned (at [49]), first, that the statutory context suggests that the recovery proceedings referred to in item 2 are those referred to in s 268-5, the object of Div 268 being to enable the Commissioner to take prompt and effective action to recover amounts not paid as required by Pt 2-5 (ie, PAYG withholding). Secondly (at [50]), the scheme of the legislation is that the estimate is revoked in the recovery proceedings so that the court is then in a position to determine the underlying liability rather than the accuracy of the estimate. Thirdly (at [51]), paying close attention to the terms of item 2, it is proceedings which relate to the recovery of the unpaid amount of the estimate that are referred to, and the proceeding in that case being for a declaration that the estimate is revoked is not such a proceeding. That is because in that context there is a difference between proceedings that relate to the recovery of the unpaid amount and proceedings that forestall the recovery of that amount (at [52]). Lastly (at [62]), his Honour considered that the extrinsic material supports the conclusion that the affidavit would operate where the Commissioner brought proceedings to recover the unpaid amount of the estimate, and not where the debtor brings proceedings to declare that there is no liability. 27 In Re Priority Matters Pty Ltd [2022] NSWSC 3; 160 ACSR 1, the Commissioner served a notice of estimate of liability for PAYG withholding amounts on the company. The company did not pay, so the Commissioner served a statutory demand. The company commenced a proceeding seeking to set aside the statutory demand or vary the amount of the demand. It relied on an affidavit affirmed by a director of the company as an affidavit referred to in item 2 of the table in s 268-40(1) to have the effect of revoking the estimate. The issue was whether the proceeding to set aside the statutory demand was a proceeding "that relate[s] to the recovery of the unpaid amount of the estimate". Rees J held that it was not. 28 Her Honour (at [29] and [35]) adopted the reasoning of Robertson J in Transtar at [49]-[53] and [62], in particular that the affidavit would operate where the Commissioner brought proceedings to recover the unpaid amount of the estimate. That conclusion was said to be supported by the Explanatory Memorandum to the Insolvency (Tax Priorities) Legislation Amendment Bill 1993 (Cth) and the former s 222AHC which clearly envisaged proceedings brought by the Commissioner. Her Honour said that "the taxpayer is cast as a defendant in recovery proceedings". 29 Further, her Honour held (at [45]) that proceedings to set aside a statutory demand, which have the aim of preventing a presumption of insolvency arising (being the effect of service of the statutory demand), have a tenuous link with the recovery of the underlying debt (being the unpaid estimate). Her Honour reasoned that the proceeding was a proceeding to forestall the recovery of the debt and was not a proceeding for the recovery of the debt, citing Transtar at [52]-[53]. On that basis, it was held that an affidavit filed by a taxpayer in a proceeding to set aside a statutory demand based upon an estimate is not a proceeding "'that relate[s] to the recovery of the unpaid amount of the estimate' within the meaning of item 2, s 268-40". 30 The application for leave to appeal against the judgment in Priority Matters was dismissed, although that was on the basis that even if the affidavit filed by the director in the proceeding to set aside the statutory demand could be an affidavit within the meaning of item 2, in the particular case the affidavit did not meet the requirements of s 268-90 because it did not verify facts sufficient to prove that the underlying taxation liability never existed: Priority Matters Pty Ltd v Deputy Commissioner of Taxation [2022] NSWCA 208 per Griffiths AJA, Ward P and Macfarlan JA agreeing. The result is that the Court of Appeal did not consider the reasoning of Rees J on the point relevant to the present case. 31 The conclusions and reasoning in Transtar and Priority Matters are pertinent to the question that arises in the present case as they direct attention to the question of whether the proceeding in question is one that relates to recovery of the unpaid amount of an estimate. A proceeding against a director for recovery of a penalty is not a proceeding that can be said to relate to recovery of the unpaid amount of an estimate. Although recovery of a penalty will reduce the amount of the estimate (s 269-40), a proceeding against a director which results in recovery of a penalty will not, by virtue of the effect of payment of the penalty on the estimate, be a proceeding that relates to recovery of the estimate. The estimate is a separate and distinct liability, and one that is borne by a different legal entity (viz, the company, as distinct from the director). The proceeding against Mr Mandalinic is also not one in which the underlying liability of the company can be determined in the event that the estimate is revoked (cf Transtar at [50]). 32 Fourthly, if neither a proceeding by a taxpayer who is the recipient of the estimate notice for a declaration that the estimate notice is revoked (Transtar), nor a proceeding by a taxpayer seeking to set aside a statutory demand (Priority Matters), is a proceeding that "relates to" the recovery of the unpaid amount of the estimate, it is difficult to conceive how the proceeding against Mr Mandalinic for recovery of a director penalty might fall within the bounds of that relationship - it is surely even further removed because the taxpayer (the company) is not even a party and the relevant debt that is the subject of the proceeding is not the estimate. 33 Fifthly, there is the question of the appellant's reliance on the concession made by the Commissioner in Lee referred to at [41] and [67], that in a penalty notice proceeding, a director can file an affidavit under item 2 of s 268-40(1) which can have the effect of revoking or reducing the estimate. However, no particular consideration was given to this issue, so the judgment is no authority for the correctness of the Commissioner's concession. It therefore plays no role in the proper construction of the provisions. 34 Sixthly, as reasoned by the primary judge (at PJ [85]), the construction that prevents a director in a penalty notice proceeding from relying on an affidavit filed in that proceeding to revoke the estimate does not shut out a director in that position. Section 269-35 provides for "illness or for some other good reason" and "all reasonable steps" defences. As observed by the primary judge, the defences in s 269-35 are specific defences for directors the subject of proceedings brought by the Commissioner seeking to recover by way of penalty amounts equal to unpaid amounts of estimates issued to a company. 35 For those reasons, we agree with the primary judge's conclusion with respect to issue 1. The appeal should accordingly be dismissed. As submissions were not made on costs, the parties should have the opportunity to address costs in writing. We therefore agree with the orders proposed by McElwaine J.

Issue 2 36 Although we have disposed of the appeal based on issue 1, we should say something about issue 2 as it constitutes the basis upon which McElwaine J would determine the appeal (separate reasons - SR) and there is little authority on the point. Issue 2 was also addressed by the primary judge. 37 Both the primary judge and McElwaine J conclude that an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company in liquidation for recovery of a penalty cannot constitute an affidavit for the purposes of s 268-40 of Sch 1 to the TAA. For the reasons explained above on issue 1, we agree with this conclusion. However, as we explain below, we disagree in certain respects with the reasoning of their Honours. 38 Justice McElwaine has concluded (SR [123]) that, where there is a supervising entity, the statutory declaration "is for the [supervising] entity to make and, where it is, is 'taken' to have been given or filed by the person or entity the subject of the supervising entity appointment". This conclusion arises from his Honour's view that s 268-90(3) is to be construed on the basis that the words "if and as applicable" in s 268-90(3)(b) mean that the statutory declaration or affidavit must be made, sworn or affirmed by a supervising entity, if there is one. 39 In our view, s 268-90(3) does not provide that, where there is a supervising entity, the maker of a statutory declaration, or the deponent of an affidavit, must, and can only, be the supervising entity him- or herself (and cannot be a company director or secretary, or the public officer of a body corporate). In our view, the statutory scheme allows for a director to swear an affidavit or make a statutory declaration. The question of who can choose to file such an affidavit, or give such a statutory declaration is a separate question. In short, the question of who controls the taxation affairs of a taxpayer which has received notice of an estimate must not be conflated with the question of who the deponent of an affidavit, or the maker of a statutory declaration, must be. 40 Division 268 in Sch 1 to the TAA is concerned with estimates. The liability of an entity to pay the amount of an estimate notified by the Commissioner is separate and distinct from the underlying liability. That subdivision includes s 268-30, which provides that estimates are provable in a bankruptcy or winding up. Subdivision 268-D contains provisions for the reduction and revocation of estimates. 41 In addition to the general power of the Commissioner to reduce or revoke an estimate established by s 268-35, s 268-40 provides for a procedure whereby estimates can be unilaterally reduced or revoked by the stated means. Those means include: (1) "you" giving the Commissioner a statutory declaration; (2) "you" filing an affidavit in proceedings "that relate to the recovery of the unpaid amount of the estimate" and serving a copy of the affidavit on the Commissioner; and (3) "the company" filing and serving an affidavit where a winding up application is made to a court following a statutory demand having been served by the Commissioner on a company. 42 For the reasons we have addressed in relation to issue 1, references to "you" in s 268-40 are to the taxpayer. It follows that where s 268-40(1) sets out, as a condition, that "you give the Commissioner a statutory declaration…", the section refers to a statutory declaration given by the taxpayer to the Commissioner. 43 Necessarily, where the taxpayer is a corporation, someone is in control of its affairs. These provisions were drafted cognisant of, and referring to, provisions of the Corporations Act 2001 (Cth) (Corporations Act). Section 268-100 provides that the Division is not intended to limit or exclude the operation of Ch 5 (External administration) or Sch 2 to the Corporations Act, or the Bankruptcy Act 1966 (Cth), to the extent those provisions or that Act can operate concurrently with the Division. 44 Pursuant to s 477 of the Corporations Act (which is part of Ch 5), liquidators have extensive powers. Those powers include carrying on the business of the company, dealing with its debts (including by way of compromise), and bringing and defending proceedings in the name of the company. Officers of a company under external administration must not perform or exercise a function or power of that office: s 198G(1) of the Corporations Act. As such, directors are deprived of their usual power (as provided for by s 198A, which is a replaceable rule) to manage the business of the company. 45 Section 268-40 says nothing about who the deponent of an affidavit, or the maker of a statutory declaration, is to be. It is s 268-90 that sets out the requirements for a statutory declaration that is given, or an affidavit that is filed, for the purposes of s 268-40 or s 268-45. 46 Section 268-90 establishes a single set of provisions that must be applied to both of the distinct regimes for the reduction or revocation of estimates established by ss 268-40 and 268-45. The unilateral revocation mechanism provided for by s 268-40 has already been addressed. Section 268-45 sets up another, separate, mechanism whereby estimates may be reduced or revoked. That mechanism is available where the Commissioner lodges a proof of debt relating to the unpaid amount of an estimate and "section 268-95 applies to an entity (your supervising entity) in relation to you": s 268-45(1). The mechanism provided for by s 268-45(2) allows "[y]our supervising entity" to "give the Commissioner a statutory declaration" to the effect that the underlying liability has been discharged in full, never existed, or is a specified and lesser amount. Where such a statutory declaration has been given, the supervising entity may reject the proof of debt in whole or in part. 47 Unlike the previous legislation (addressed further below), the proof of debt rejection mechanism (now s 268-45) and the unilateral revocation mechanism (now s 268-40) do not each have their own, bespoke, provision. Section 268-90 specifies the required contents of, and the permissible maker or deponent of, the statutory declarations and affidavits required to invoke either of those mechanisms. 48 Section 268-90 is to be read with s 268-95, which applies to a "supervising entity" in relation to "you" in the circumstances set out in that section. Sections 268-95(6)-(8) deem actions taken by a supervising entity to have been taken by the person subject to the appointment of that supervising entity. However, the section does not provide that only the supervising entity may make the statutory declaration, or swear or affirm an affidavit, the giving or filing of which by the supervising entity is subject to the deeming provision. Likewise, s 268-95's deeming provision concerning affidavits is directed to the filing of the affidavit by the supervising entity. It says nothing of who is to swear the affidavit. If any requirement that a statutory declaration can only be made, or an affidavit can only be sworn or affirmed by, the supervising entity (ie, the liquidator, receiver or trustee) exists, that requirement must be found in s 268-90(3). 49 It should also be noted that, where there is a supervising entity, the mechanism for unilateral revocation or reduction under s 268-40 is still available. Section 268-30(1) expressly provides for estimates to be made after the commencement of a bankruptcy, or the "relevant date" in respect of a company under the Corporations Act. The "relevant date" is the day the winding up is taken to have commenced, which is, in some circumstances, the day when a winding up order is made or a special resolution is passed in a members' voluntary winding up (Corporations Act ss 9, 513A, 513B). 50 This means that, just because a company that has received an estimate is in, or goes into, liquidation does not mean that the only mechanism by which the estimate may be reduced or revoked is the rejection of proof procedure under s 268-45. Sections 268-40 and 268-90 must be construed on the basis that they apply (inter alia) where the company receiving an estimate is in liquidation. 51 Section 268-90 must be construed in light of both the tight timeframes involved for taking the steps required to invoke the estimate reduction mechanisms. Those timeframes have been imposed where the stated object of Div 268 is to enable the Commissioner to take "prompt and effective action" to recover unpaid amounts: s 268-5. 52 Section 268-90's requirements as to the maker or deponent must also be construed in light of the required content of the statutory declaration or affidavit. Notably, for each type of estimate, the affidavit or statutory declaration must address not only facts concerning the liability in question, but also what has been done to comply with the taxpayer's obligations to comply with the taxation legislation which establishes the relevant obligations. Plainly, these are matters that those involved in the operations of a corporate taxpayer which receives an estimate will be much better placed to address than a liquidator, who would be relying on information received from company officeholders, and company records. While the provisions do not preclude a liquidator, receiver, or trustee in bankruptcy making a statutory declaration, or swearing an affidavit based on information and belief, we do not consider that the absence of a hearsay exclusion provides a strong signal that only a supervising entity may be the maker or deponent where there is a supervising entity (cf SR [120]). 53 The task of construction must be undertaken without losing sight of the distinction between who can make a statutory declaration or swear or affirm an affidavit, on the one hand, and, on the other, who controls and decides whether a statutory declaration will be "given" to the Commissioner, or whether an affidavit will be filed in proceedings to which an entity that is a company is party and a copy served on the Commissioner. 54 Section 268-90(3) is the only provision in Div 268 regulating who makes statutory declarations or swears or affirms affidavits. The construction of that provision does not need to be, and ought not be, guided by a perceived need to avoid the control of liquidators over the taxation affairs of companies in liquidation being eroded by directors taking unilateral steps. The control of liquidators over the affairs of companies, and the related withdrawal of the ordinary powers of directors, is secured and effected by the provisions of the Corporations Act (relevantly, in a corporate liquidation, ss 477(1)(a) and 198G). When a company in liquidation is in receipt of an estimate, it will be for the liquidator to decide what the company should do about it. It will be for the liquidator to decide, where a proof of debt is lodged in respect of an estimate, whether a statutory declaration should be given to the Commissioner to reduce or revoke the estimate under s 268-45. 55 But is the liquidator in that circumstance confined to swearing or affirming an affidavit him- or herself, or personally making the statutory declaration? We can perceive no such limitation in the legislation. Section 268-90(3) provides as follows (in part): Maker or deponent (3) The statutory declaration or affidavit must be made, sworn or affirmed by: (a) an individual specified in the following table; or (b) your liquidator, receiver or trustee in bankruptcy (if and as applicable). Who must make the statutory declaration or swear or affirm the affidavit Item A statutory declaration or affidavit in relation to an estimate of a liability of ... must be made, sworn or affirmed by ... 1 an individual that individual. 2 a body corporate (a) in the case of a company that has a director or a company secretary (within the meaning of the Corporations Act 2001) - a director of the company or the company secretary; or (b) in the case of an *Australian government agency - an individual prescribed by the regulations; or (c) in any case - the public officer of the body corporate (for the purposes of the Income Tax Assessment Act 1936).

56 In our view, the words "if and as applicable" in s 268-90(3)(b) do no more than enable a liquidator, receiver or trustee in bankruptcy to make the statutory declaration or swear or affirm the affidavit if such a person has been appointed, and "as applicable" depending on whether the person appointed is a liquidator, receiver or trustee. The word "or", located between sub-sections (a) and (b), serves to expand the range of potential makers and deponents as liquidators, receivers and trustees in bankruptcy are not included in the table. 57 Given the matters we have mentioned concerning the control of liquidators over the affairs of companies in liquidation, there is no need to construe "or" as excluding the individuals referred to in sub-section (3)(a) and the table to avoid any erosion of ss 268-45 and 268-95. On the contrary, the statutory requirements dictating the content of the statutory declarations and affidavits required to effect a reduction or revocation of estimates - which, as we have noted, require provision of information that a liquidator, receiver or trustee is unlikely to have and may have difficulty pulling together - together with the tight timeframes, point the other way and suggest that supervising entities are not precluded from giving a statutory declaration, or filing an affidavit, made, sworn or affirmed by a person listed in the table. 58 As we have endeavoured to emphasise, control of the decision whether to do so is not to be confused with the specific statutory issue of whether only the supervising entity may make the statutory declaration or swear or affirm the affidavit. 59 It is for these reasons that we do not share the view of McElwaine J that the effect of s 268-90(3) is that only the supervising entity may make the statutory declaration or swear or affirm the affidavit, or that the contrary conclusion erodes the regime established by ss 268-45 and 268-95 (cf SR [123]-[124]). Likewise, the issue adverted to by the Commissioner in the submission referred to in SR [126] does not arise, once questions of power to give the statutory declaration or file the affidavit are properly distinguished from questions concerning who the deponent or maker can be. 60 The construction we prefer also means that the potential difficulties in the operation of the division where a receiver is appointed to limited assets (addressed in SR [127]) do not arise. The power of any receiver to dictate the response of the recipient of an estimate will be determined by the relevant instrument(s) of appointment. It would, in our view, be a peculiar outcome if the appointment of a receiver to any company asset meant that only the receiver could make a statutory declaration or swear or affirm an affidavit, leaving the directors unable to take steps in relation to an estimate without the cooperation of a receiver whose appointor may have no interest in the company's tax affairs or overall solvency position. 61 We are fortified in our views by the predecessor provisions of the Income Tax Assessment Act 1936 (Cth). As noted above, when the relevant taxation laws were rewritten, they were rewritten in clearer language, but on the basis that it was not intended to alter the underlying taxation policy in significant respects: see the Joint Committee of Public Accounts and Audit, "An Advisory Report on the Delayed Provisions of the Tax Law Improvement Bill (No. 2) 1997" (1997) 1 [1.1]. 62 The predecessor provisions unequivocally permitted a liquidator or trustee in bankruptcy to use a statutory declaration made by the bankrupt or a director or company secretary of a company in liquidation. This much is clear from s 222AIH, which specified the requirements for a statutory declaration under s 222AIG. Section 222AIG set out the procedures for rejection of a proof of debt relating to an estimate. As such, s 222AIG was a provision that only ever applied where there was a liquidation or bankruptcy, yet the bespoke provision stipulating who "must" be the maker of the statutory declaration expressly allowed for the bankrupt individual, a director or secretary of the company to make the declaration, or "in any case" the trustee (defined by s 6 to extend to liquidators - see SR [132]). As such, we do not agree with the conclusion stated (SR [133]) that, under the predecessor provisions, the only eligible deponent of a company in liquidation was the liquidator. 63 As issue 2 was framed, it was contingent on the answer to the first issue being that an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company to recover a penalty can constitute an affidavit for the purposes of s 268-40. We have concluded that an affidavit filed in such circumstances does not constitute an affidavit for the purposes of s 268-40 and have set out the respects in which we disagree with the analysis of McElwaine J concerning who the deponent of an affidavit need be where a supervising entity has been appointed. Accordingly, we need say no more about issue 2. 64 Finally, we note that we agree with McElwaine J's observations regarding the harsh consequences said to be visited upon the appellant (SR [135]-[139]). As his Honour explains, the consequences for the appellant are the result of his inaction. The regime for the imposition of penalties on directors, and relief from those penalties, is set out in a separate division (Div 269). The appellant failed to avail himself of the opportunities afforded by that regime. I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Stewart and Button.

Background 65 This appeal primarily concerns whether it is open to a director of a company in liquidation to file an affidavit in a proceeding brought by the Deputy Commissioner of Taxation (Commissioner) against the director which has the effect of reducing or revoking an estimated liability for the purposes of s 268-40 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA). If that is so, relatedly does it affect the liability of the appellant in a proceeding brought by Mr Richard Stone as liquidator of RIC Admin Pty Ltd (in liq) (Liquidator and Company) against him for insolvent trading pursuant to s 588M(2) of the Corporations Act 2001 (Cth). 66 As the appellant correctly accepts, leave to appeal is required by s 24(1A) of the Federal Court of Australia Act 1976 (Cth) as the order appealed is one that dismissed the interlocutory application. We accepted the appellant's general submission that the issues raised important questions concerning the interpretation and administration of the TAA, upon which there is no direct authority. Neither the Liquidator nor the Commissioner opposed a grant of leave. For those reasons, we granted leave to appeal at the commencement of the hearing of the appeal on 15 May 2023. Accordingly, the balance of these reasons concern the substance of the appeal. 67 The Liquidator commenced a proceeding against the appellant in this Court on 3 September 2020. The amended statement of claim pleads that between 27 August 2018 and 13 November 2019, the Company incurred debts totalling $2,014,386.38 (Debt) to the Australian Taxation Office (ATO) based on a notice of estimate of liability for unreported pay as you go withholding tax (PAYG) dated 2 April 2019 (Estimate). The Debt founds a component of the claim against the appellant for his director liability for insolvent trading pursuant to s 588M(2) of the Corporations Act. The appellant admits the Estimate, but pleads in his defence that he revoked it by filing an affidavit on 29 October 2021 (Revocation Affidavit) in accordance with s 268-40 of Schedule 1 to the TAA in a proceeding brought against him in the Supreme Court of New South Wales by the Commissioner (Supreme Court proceeding). The Supreme Court proceeding is yet to be determined. 68 In this Court, the appellant filed an interlocutory application on 26 August 2022 for relief framed as: Pursuant to section 198G(3)(b) of the Corporations Act 2001 (Cth) the Court gives approval, nunc pro tunc, for Mr John Mandalinic to have filed his affidavit dated 29 October 2021 in the Supreme Court of NSW proceedings number 2021/00164939. 69 The primary judge granted leave to the Commissioner to make submissions in the proceeding without becoming a party concerning the effect of s 198G of the Corporations Act on the Revocation Affidavit on the basis of an undertaking that the Commissioner agreed to be bound in the Supreme Court proceeding by the decision of this Court. 70 At the request of the parties, the primary judge agreed to determine four separate questions: (a) can an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company for recovery of an estimate constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; (b) if yes to (a), can an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company in liquidation for recovery of an estimate constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; (c) was the Revocation Affidavit filed by Mr Mandalinic in contravention of s 198G of the Corporations Act; and (d) if yes to (c), should the Court grant approval to Mr Mandalinic, nunc pro tunc, pursuant to s 198G(3)(b) of the Corporations Act to file the Revocation Affidavit. 71 For reasons published on 11 November 2022 in Stone (Liquidator), in the matter of RIC Admin Pty Ltd (in liq) v Mandalinic [2022] FCA 1346 (PJ), his Honour concluded at [15]: (a) an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company for recovery of an estimate cannot constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; (b) an affidavit filed by a director in proceedings brought by the Commissioner against a director of a company in liquidation for recovery of an estimate cannot constitute an affidavit for the purposes of s 268-40 of Schedule 1 to the TAA; (c) Mr Mandalinic did not contravene s 198G of the Corporations Act in filing the Revocation Affidavit; and (d) if contrary to my conclusions above, Mr Mandalinic did contravene s 198G of the Corporations Act, he should not be given leave, nunc pro tunc, pursuant to s 198G(3)(b) of the Corporations Act to file the Revocation Affidavit. 72 Before us, Mr CD Wood SC with Mr T Cleary appeared for the appellant, Mr J Baird with Mr A Bailey appeared for the Liquidator and Mr L Livingston SC appeared with Mr K Josifoski for the Commissioner as intervener. 73 In my view, the second question is determinative of the appeal and is the only one that need be addressed although in resolving it there is a need to traverse much of the territory of statutory construction that is relevant to the first question. For the reasons that follow, I conclude that the primary judge was correct in his conclusion, and I would dismiss the appeal.

Essential facts 74 The appellant has been the sole director of the Company since incorporation on 17 December 2014. The appellant describes the business of the Company as confined to receiving money from companies in the building and construction industry "that it had a business relationship with", and from those funds would pay creditors of those companies, including sub- contractors, suppliers and amounts owed to the Commissioner. The Company did not have any employees, although the appellant concedes that "at times" payments were made by the Company to individuals. He denies that those persons were employees. On 2 April 2019, the Commissioner issued the Estimate to the Company for the period 1 September 2017 to 31 December 2017 in the amount of $2,033,381. The Company did not pay the Estimate. Later, the Commissioner recovered pursuant to a garnishee notice an amount of $373,704.18. The Company failed to take any step under s 268-40 of Schedule 1 of the TAA within the prescribed 14 day period to contest the Estimate, or at any subsequent time. As at 6 June 2019, the Company had a deficit debt on its running balance account (RBA) in the amount of $1,941,100.91. 75 On 6 June 2019, the Commissioner served a creditor's statutory demand on the Company for the amount of $1,941,101.91, which included the balance of the Estimate then owing. No application was made by the Company to set aside the statutory demand. On 27 August 2019, the Commissioner filed an application for the winding up of the Company and on 13 November 2019 the Company was wound up in insolvency and the Liquidator was appointed. No step was taken by the Company to resist that order. 76 On 9 May 2019, the Commissioner issued to the appellant a director penalty notice for the unpaid amount of the Estimate pursuant to Div 269 of the TAA (Penalty Notice). On 8 June 2021, the Commissioner commenced the Supreme Court proceeding. On 29 October 2021, the appellant filed the Revocation Affidavit in the Supreme Court proceeding. 77 The Revocation Affidavit, in somewhat vague terms, describes the business of the Company as a receiver and distributor of funds on behalf of other corporations involved in the building and construction industry with no employees. Weekly payments to the appellant are characterised as amounts due to him as a contractor plus GST. The Company did not withhold any amounts for PAYG. The Company did not have any physical assets: the only assets were monies held in cash and in a bank account. The appellant explains the consistent failure by the Company to respond to notices from the Commissioner was caused by an oversight in not providing notification of the change of registered office of the Company. The appellant says that he is at "a loss" to understand how it can be that the Company is liable for the debt based on the Estimate because it did not have any employees and did not make any payments to employees of any of the corporations for whom it acted. The appellant contends that the statutory demand was "purportedly served" at a previous registered office of the Company and in consequence the appellant "does not recall" receiving that document. The appellant further contends that he did not receive the Penalty Notice from the Commissioner in a timely way because it was sent to a previous residential address of his. In consequence he did not become aware of it until February 2021, when he was advised of the fact of the notice by his solicitor. In various ways, the appellant asserts his belief that the Estimate should be reduced to nil. 78 The affidavit of the appellant, together with two from his solicitor, were received in evidence before the primary judge without an application to cross-examine. At PJ [11] his Honour records that the affidavits "were admitted into evidence as evidence of the factual substratum upon which the relief sought in the interlocutory application would be determined", despite that there are several unsatisfactory aspects of the evidence of the appellant: in particular the paucity of detail as to the business of the Company, the nature of its contractual relationship with the other corporations for whom it acted, whether the true nature of the relationship was one of trustee and beneficiary, how and by what mechanism the Company derived profit and whether any satisfactory explanation was provided by the appellant for the failure by the Company, and himself, to respond in a timely way to notices issued and proceedings commenced by the Commissioner. In any event, these matters were not raised before the primary judge as reasons to dismiss the interlocutory application.

The statutory scheme 79 Part 2-5 of Schedule 1 to the TAA contains provisions that are concerned with PAYG liabilities. For ease of reference, each section of the TAA referenced in these reasons is to a provision in Schedule 1, unless stated otherwise. Section 12-35 provides that, subject to certain exceptions: An entity must withhold an amount from salary, wages, commissions, bonuses or allowances it pays to an individual as an employee (whether of that or another entity). 80 This extends to the obligation that a company must withhold an amount from payment of remuneration it makes to an individual who was a director, or who performs the duties of a director: s 12-40. 81 Amounts so withheld must be paid to the Commissioner (s 16-70), in accordance with the time that is determined by s 16-75. Division 268 operates to permit the Commissioner to make an estimate of unpaid amounts, the object of which is set out at s 268-1: This Division enables the Commissioner to make an estimate of: (a) amounts not paid as required by Part 2-5 of this Act (Pay as you go (PAYG) withholding); or (b) unpaid superannuation guarantee charge; or (c) net amounts in respect of GST, wine equalisation tax and luxury car tax; and to recover the amount of the estimate. If you are given an estimate, you are liable to pay the amount of the estimate. That liability is distinct from your liability to pay the amounts required by Part 2-5 or the Superannuation Guarantee (Administration) Act 1992 . In the case of an estimate of a net amount that has been assessed by the Commissioner, that liability is distinct from your liability to pay the amount of the assessment. However, you can ensure that the Commissioner does not require you to pay more than the relevant unpaid amounts. Other Divisions of this Part provide for the recovery of amounts payable under this Division. 82 Section 268-5 states that the object of the Division "is to enable the Commissioner to take prompt and effective action to recover", inter alia, amounts that are not paid for PAYG as required by Part 2-5. Section 268-10 provides: Estimate (1) The Commissioner may estimate the unpaid and overdue amount of a liability (the underlying liability) of yours: (a) under section 16-70 in this Schedule (requirement to pay to the Commissioner amounts you have withheld under the Pay as you go withholding rules); or (b) to pay superannuation guarantee charge for a *quarter under section 16 of the Superannuation Guarantee (Administration) Act 1992, to the extent the superannuation guarantee charge has not been assessed before the Commissioner makes the estimate; or (c) to pay a *net amount for a *tax period, to the extent that the net amount has not been assessed before the Commissioner makes the estimate. (1A) For the purposes of this Division, your superannuation guarantee charge for a *quarter is treated as being payable on the day by which you must lodge a superannuation guarantee statement for the quarter under section 33 of the Superannuation Guarantee (Administration) Act 1992, even if, on that day, the charge has not been assessed under that Act. (1B) For the purposes of this Division, if you have a *net amount for a *tax period: (a) you are treated as being liable to pay that net amount; and (b) that liability is treated as having arisen on the day by which you must give your *GST return for the tax period to the Commissioner in accordance with Division 31 of the *GST Act; and (c) that liability is treated as being payable on that day; and (d) the entire amount of that liability is treated as being unpaid. Amount of estimate (2) The amount of the estimate must be what the Commissioner thinks is reasonable. (3) In making the estimate, the Commissioner may have regard to anything he or she thinks relevant. Example 1: In the case of an underlying liability under section 16-70 (requirement to pay to the Commissioner amounts you have withheld under the Pay as you go withholding rules), the Commissioner may have regard to information about amounts you withheld under the Pay as you go rules before the period in relation to which the underlying liability arose. Example 2: In the case of an underlying liability to pay superannuation guarantee charge for a quarter, the Commissioner may have regard to information about your contributions to RSAs and complying superannuation funds for earlier quarters. Only one estimate for each liability (4) While the estimate is in force, the Commissioner cannot make another estimate relating to the underlying liability. (5) For the purposes of subsection (4), the estimate is in force if: (a) the Commissioner has given you notice of the estimate; and (b) the estimate has not been revoked; and (c) your liability to pay the estimate has not been discharged. 83 Notice of an estimate is required to be given in writing (s 268-15), whereupon a liability to pay is imposed by s 268-20: Liability to pay amount of estimate (1) You must pay to the Commissioner the amount of the estimate if the Commissioner gives you notice of the estimate in accordance with section 268-15. The amount is due and payable when the Commissioner gives you the notice. Note: The amount of the estimate may be reduced, or the estimate revoked, under Subdivision 268-D. Liability to pay amount of estimate is distinct from underlying liability (2) Your liability to pay the amount of the Estimate is separate and distinct from the underlying liability. It is separate and distinct for all purposes. Example: In a case covered by paragraph 268-10(1)(a) or (b), the Commissioner may take: (a) proceedings to recover the unpaid amount of the estimate; or (b) proceedings to recover the unpaid amount of the underlying liability; or (c) proceedings of both kinds. 84 The accuracy of the estimate is irrelevant to the liability to pay: s 268-25, which operates even if "the underlying liability never existed or has been discharged in full". However, note 1 to this provision states: Section 268-40 revokes the estimate if you give the Commissioner a statutory declaration, or file an affidavit, to the effect that the underlying liability never existed. 85 An estimate is provable in bankruptcy or in a winding up, even if made after a sequestration or winding up order: s 268-30. An estimate may be reduced or revoked in accordance with subdivision 268-D. Relevantly, the Commissioner has discretionary power at any time to reduce the amount of an estimate or to revoke it, but is not obliged to do so: s 268-35. Section 268-40 concerns when an estimate may be reduced by statutory declaration or affidavit: Scope (1) This section applies as set out in the following table: Statutory declaration or affidavit Item This section applies if ... and ... within ... 1 the Commissioner gives you notice of the estimate you give the Commissioner a statutory declaration for the purposes of this section (a) 7 days after the Commissioner gives you the notice; or (b) a longer period allowed by the Commissioner. 2 you are a party to proceedings before a court that relate to the recovery of the unpaid amount of the estimate you: (a) 14 days after you first take a procedural step as a party to the proceedings; or (a) file an affidavit for the purposes of this section; and (b) a longer period allowed by the court. (b) serve a copy on the Commissioner 3 (a) the estimate is of the unpaid amount of a liability of a company; and the Company: (a) 14 days after notice of the application was served on the Company; or (b) the Commissioner serves on the Company a *statutory demand relating to the Company's liability to pay the unpaid amount of the estimate; and (a) files an affidavit for the purposes of this section; and (b) a longer period allowed by the court. (c) an application is made to a court under section 234, 459P, 462 or 464 of the Corporations Act 2001 for the Company to be wound up (b) serves a copy on the applicant

Example: For the purposes of item 2 of the table, taking a procedural step as a party to proceedings includes entering an appearance, filing a notice of intention to defend, or applying to set aside judgment entered in default of appearance. Note 1: Section 459C of the Corporations Act 2001 creates a presumption that a company is insolvent, and may be wound up, if the Company fails to comply with a statutory demand. Note 2: See section 268-90 for what the statutory declaration or affidavit must contain and who must make, swear or affirm it. Reduction (2) The amount of the estimate is reduced if the statutory declaration is to the effect, or the affidavit verifies facts sufficient to prove, that a specified lesser amount is the unpaid amount of the underlying liability. Example: Subsection (2) will apply if the statutory declaration etc. is to the effect that the underlying liability has been discharged in full (and therefore the unpaid amount of the liability is nil). (3) The amount of the reduction is the amount by which the unpaid amount of the estimate (just before the reduction) exceeds the amount specified. Note: The effect of subsection (3) is to reduce the unpaid amount of the estimate to the amount specified. Revocation (4) The estimate is revoked if the statutory declaration is to the effect, or the affidavit verifies facts sufficient to prove, that the underlying liability never existed. 86 Also relevant to this appeal is s 268-45 which operates in the case of the liquidation of companies and in the bankruptcy of individuals where a liquidator, an administrator of a deed of company arrangement or a trustee in bankruptcy are each a "supervising entity": Scope (1) This section applies if: (a) the Commissioner lodges a proof of debt relating to the unpaid amount of the estimate; and (b) section 268-95 applies to an entity (your supervising entity) in relation to you. Rejection of proof of debt (2) Your supervising entity may give the Commissioner a statutory declaration to the effect that: (a) the underlying liability has been discharged in full; or (b) the unpaid amount of the underlying liability is a specified, lesser amount; or (c) the underlying liability never existed. Note: See section 268-90 for what the statutory declaration must contain and who must make it. (3) If your supervising entity does so, he or she may reject the proof of debt (in whole or in part) on the ground made out in the statutory declaration. (4) If the Commissioner appeals, or applies for review of, your supervising entity's decision to reject the proof of debt, nothing in subsection (2) or (3) prevents evidence being adduced to contradict statements in the declaration. Note: Such evidence might also be relevant to a prosecution for an offence, such as an offence against section 11 of the Statutory Declarations Act 1959 (False declarations). Revocation or reduction of estimate (5) The following table applies in relation to the outcome following all (if any) appeals from, and applications for review of, your supervising entity's decision to reject the proof of debt. (If there are no appeals or applications for review, the outcome is your supervising entity's decision as originally made.) Rejecting proof of debt Item If the outcome is that ... then ... 1 the proof is rejected in whole on the ground that the estimate has been discharged in full the amount of the estimate is reduced by the unpaid amount of the estimate (just before the reduction). 2 the proof is rejected in part the amount of the estimate is reduced by so much of the unpaid amount of the estimate (just before the reduction) as is rejected. 3 the proof is rejected in whole on the ground that the underlying liability never existed the estimate is revoked.

Note 1: The effect of item 1 of the table is to reduce the unpaid amount of the estimate to nil. Note 2: The effect of item 2 of the table is to reduce the unpaid amount of the estimate to the amount admitted to proof. 87 Any reduction in or revocation of an estimate does not affect the Commissioner's rights or remedies in relation to the underlying liability (s 268-70) and the fact of entry of judgment for the unpaid amount of an estimate or the underlying liability, does not affect the liability to pay the unpaid amount: s 268-85. Section 268-90 sets out the requirements for a statutory declaration or an affidavit: Scope (1) This section applies to a statutory declaration given, or an affidavit filed, for the purposes of section 268-40 or 268-45 in relation to the estimate. Content (2) In a case covered by paragraph 268-10(1)(a) (estimate of liability under requirement to pay to the Commissioner amounts you have withheld under the Pay as you go withholding rules), the statutory declaration or affidavit must verify the following facts: (a) whichever of the following are applicable: (i) the sum of all amounts you withheld under Division 12 during the relevant period, or the fact that you did not withhold any such amounts during the period; (ii) the sum of all amounts you were required to pay under Division 13 (Alienated personal services payments) during the relevant period, or the fact that you were not required to pay any such amounts during the period; (iii) the sum of all amounts you were required to pay under Division 14 (non-cash benefits and accruing gains) during the relevant period, or the fact that you were not required to pay any such amounts during the period; (b) what has been done to comply with Division 16 (Payer's obligations and rights) in relation to the amounts referred to in paragraph (a). (2A) In a case covered by paragraph 268-10(1)(b) (estimate of liability to pay superannuation guarantee charge), the statutory declaration or affidavit must verify the following facts: (a) your name and address; (b) for each employee for whom you have an *individual superannuation guarantee shortfall for the relevant *quarter: (i) the employee's name and postal address and, if the employee has *quoted the employee's *tax file number to you, the employee's tax file number; and (ii) the amount of the shortfall; (c) what has been done to comply with your obligation to pay the relevant superannuation guarantee charge to the Commissioner. Note: The amount of the individual superannuation guarantee shortfall mentioned in paragraph (b) is a factor in determining the amount of the superannuation guarantee charge mentioned in paragraph 268-10(1)(b). The lesser amount mentioned in subsection 268-40(2) may therefore differ from the amount of that shortfall. (2B) In a case covered by paragraph 268-10(1)(c) (estimate of liability in relation to net amount under GST Act), the statutory declaration or affidavit must verify the following facts: (a) your *net amount for the *tax period; (b) what has been done to comply with Division 31 and 33 of the *GST Act (obligation to give GST return and liability in respect of assessed net amounts) in relation to that tax period; (c) your *taxable supplies and *creditable acquisitions that are attributable to that tax period; (d) your assessable dealings (within the meaning of the *Wine Tax Act) and *wine tax credits that are attributable to that tax period. Maker or deponent (3) The statutory declaration or affidavit must be made, sworn or affirmed by: (a) an individual specified in the following table; or (b) your liquidator, receiver or trustee in bankruptcy (if and as applicable). Who must make the statutory declaration or swear or affirm the affidavit Item A statutory declaration or affidavit in relation to an estimate of a liability of ... must be made, sworn or affirmed by ... 1 an individual that individual. 2 a body corporate (a) in the case of a company that has a director or a company secretary (within the meaning of the Corporations Act 2001) - a director of the Company or the Company secretary; or (b) in the case of an *Australian government agency - an individual prescribed by the regulations; or (c) in any case - the public officer of the body corporate (for the purposes of the Income Tax Assessment Act 1936). 3 a body politic an individual prescribed by the regulations. 4 a partnership a partner of the partnership. 5 any other unincorporated association or body of persons (a) a member of the association's or body's committee of management; or (b) the public officer of the association or body (for the purposes of the Income Tax Assessment Act 1936). 6 a trust (a) the trustee of the trust; or (b) the public officer of the trust (for the purposes of the Income Tax Assessment Act 1936). 7 a *superannuation fund or an *approved deposit fund (a) the trustee of the fund; or (b) if the fund does not have a trustee - the entity managing the fund.

(4) If the entity specified in the table in subsection (3) is not an individual, the table is taken to specify the individual who, under that subsection, would be eligible to make a statutory declaration in relation to an estimate of a liability of that entity. 88 By s 268-95(3) a notice given by the Commissioner "to your supervising entity is taken to have been given to you" and it is then provided: (6) For the purposes of this Division, a statutory declaration given to the Commissioner by your supervising entity is taken to have been given by you. (7) For the purposes of this Division, an affidavit filed by your supervising entity is taken to have been filed by you. (8) For the purposes of item 2 in the table in subsection 268-40(1) (recovery proceedings), a procedural step taken by your supervising entity is taken to have been taken by you. Multiple supervising entities (9) If you have 2 or more supervising entities, anything this Division provides for to be done by or in relation to your supervising entity may be done by or in relation to any of them. 89 Division 269 is concerned with director penalties for non-complying corporations. It is sufficient for the purposes of this appeal to note that a director of a company is obliged to cause the company to comply with its obligation to collect and pay withheld amounts (s 269-15) and is liable to pay a penalty to the Commissioner that is equal to the unpaid amount of the company's liability (s 269-20), even if the corporate obligation is an estimated amount that "never existed or has been discharged in full": s 269-15(2A). 90 Certain defences are available to a director as provided by s 269-35 which is concerned with where, because of illness or for some other good reason, it would have been unreasonable to expect the director to take part in the management of the company or where the director took all reasonable steps to ensure that the directors caused the company to comply with its obligations, caused an administrator to be appointed or caused the company to begin to be wound up. 91 The appellant's argument is that the reference to "you" in item 2 of the table at s 268-40 is to be construed as extending to a director, in the circumstances of the appellant, of a company that is being wound up and where the director is a party to a proceeding by the Commissioner for recovery of a director penalty pursuant to s 269-20. On that argument "you" is not confined to the company as the recipient of the notice from the Commissioner and is not otherwise affected by the winding up of the company.

The primary judgment 92 The primary judge at [18]-[20] set out from three High Court cases the settled principles applicable to statutory interpretation: In 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) stated: This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical 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. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy. (Footnotes omitted). The passage in Alcan was expanded upon by in [sic] Federal Commissioner of Taxation v Consolidated Media Holdings Pty Ltd (2012) 250 CLR 503; [2012] HCA 55 at [39] (French CJ, Hayne, Crennan, Bell and Gageler JJ) where it was stated: 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. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself. (Footnotes omitted). In SZTAL v Minister for Immigration & Border Protection and Another; SZTGM v Minister for Immigration and Border Protection and Another (2017) 262 CLR 362; [2017] HCA 34 it was stated at [14] (Kiefel CJ, Nettle and Gordon JJ): The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose. Context should be regarded at this first stage and not at some later stage and it should be regarded in its widest sense. This is not to deny the importance of the natural and ordinary meaning of a word, namely how it is ordinarily understood in discourse, to the process of construction. Considerations of context and purpose simply recognise that, understood in its statutory, historical or other context, some other meaning of a word may be suggested, and so too, if its ordinary meaning is not consistent with the statutory purpose, that meaning must be rejected. 93 In resolving the first issue, the primary judge noted at PJ [50]-[51] that a necessary anterior question to whether a director of a company in liquidation may file an affidavit that has the effect of revoking an estimate, is whether a company director may do so in a director penalty notice enforcement proceeding. The appellant submitted that it can, the Liquidator submitted that it cannot and the Commissioner, conformably with a concession made in Lee v Deputy Commissioner of Taxation; Silverbrook v Deputy Commissioner of Taxation [2020] NSWCA 95; 102 NSWLR 825(Lee), and the general practice followed by the Commissioner, "did not seek to contend that affidavits filed by directors of companies, including companies in liquidation, could not be affidavits falling within s 268-40": PJ [60]. 94 The primary judge noted the "dearth of authority" on the question (PJ [61]) but did reference obiter remarks of Payne JA in Lee (with whom McCallum JA and Simpson AJA agreed) at [41] and [67] which record the Commissioner's acceptance that the directors in that case were parties to a proceeding relating to the recovery of unpaid estimates within the meaning of s 268-40 and that it is open in such proceedings for a director to file an affidavit to reduce an estimate. As the primary judge noted, no affidavit of that type was filed in Lee, there was no contradictor and the case did not give rise to any need to determine that question: PJ [67]-[68]. 95 Commencing at PJ [70] the primary judge gave detailed consideration to the statutory text including the statutory history as enacted by ss 222AGC, 222AGD, 222AHC, 222AHD, 222AIB and 222AIC of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936) noting that the current provision is a consolidation. At PJ [78] the primary judge identified as "[t]he critical issue to be determined" whether the Supreme Court proceeding was one that related "to the recovery of the unpaid amount of the estimate" within the meaning of item 2 of the table in s 268-40. In concluding that it did not, his Honour carefully focused upon the statutory text, the context and the legislative purpose including each reference to "you" in Div 268 which is to be construed pursuant to subdivision 4-5 of the Income Tax Assessment Act 1997 (Cth) (ITAA 1997): the expression "applies to entities generally, unless its application is expressly limited." 96 The primary judge then reasoned and concluded at PJ [83]-[86]: The references to "you" in Items 1 and 2 are to the recipient of the "notice of the estimate" from the Commissioner. In the present context that is the Company. Given the use of the definite article in Item 2 to refer to "the unpaid amount" of "the estimate" there is no textual support for the proposition that the "you" in Item 2 can be a different "you" to the "you" in Item 1. The plain and ordinary meaning of s 268-40 is that the recipient of a notice of estimate, in this case the Company, can seek to have that estimate reduced or revoked by giving the Commissioner a statutory declaration within the specified time period or if proceedings are commenced against the recipient of the notice to recover the unpaid amount of the estimate, again in this case the Company, by filing an affidavit within the specified period. The statutory regime established by Divisions 268 and 269 does not contemplate that a director may file an affidavit in proceedings for the purpose of reducing or revoking an estimate against a company pursuant to s 268-40, other than in proceedings brought against the company for recovery of the unpaid amount of the estimate. Rather, as outlined above, s 269-35 provides for "illness or some other good reason" and "all reasonable steps" defences. The defences in s 269-35 are specific defences for directors the subject of proceedings brought by the Commissioner seeking to recover by way of penalty amounts equal to unpaid amounts of estimates issued to a company. Further, the statutory regime makes clear that a director's liability for penalties does not terminate on the director ceasing to hold office. Section 269-15 relevantly provides that "directors of the company (from time to time) continue to be under their obligation" to cause the company to comply with its obligations with respect to an estimate. 97 Next the primary judge turned to the requirements for a statutory declaration or affidavit at s 268-90. His Honour reasoned that this provision could not be construed so as to extend to an affidavit filed by a former director because of the explicit reference to "a director of the company" at item 2 of the table at s 268-90(3) (PJ [90]) and on that premise his Honour reasoned at PJ [91]: It would give rise to an unfortunate anomaly if s 268-40 was construed to permit a current director to file an affidavit in director penalty enforcement proceedings that had the effect of reducing or revoking estimates issued against a company but a former director was deprived of such an opportunity. The existence of such an anomaly provides further support for the conclusion that the statutory context does not support a construction, as advanced by Mr Mandalinic and the Commissioner that an affidavit filed by a director in director penalty notice enforcement proceedings is capable of reducing or revoking an estimate issued against a company… 98 His Honour found no support for the appellant's construction argument in the Explanatory Memorandum to the Insolvency (Tax Priorities) Legislation Amendment Bill 1993 (Cth) (which inserted the estimates and penalty provisions into the ITAA 1936) or the Explanatory Memorandum to the Tax Laws Amendment (2012 Measures No 2) Bill 2012 (Cth) (which made amendments to the TAA designed to expand and strengthen the director penalty regime) concluding at PJ [98]: For the foregoing reasons, I am satisfied that the text, statutory context, legislative history and legislative purpose all support a construction of ss 268-40 and 268-90 of Schedule 1 to the TAA that only affidavits filed by a director or secretary of the company in recovery proceedings commenced by the Commissioner against the company can have the effect of reducing or revoking estimates of PAYGW against that company. 99 Having so concluded, the primary judge turned to the second issue and focussed particular attention on s 268-90(3) and the disjunctive between limbs (a) and (b). At PJ [103], his Honour observed that "or" in an Act often gives rise to a constructional choice as to whether the provisions are disjunctive or conjunctive, which is typically determined having regard to the statutory purpose as required by ss 15AA and 46 of the Acts Interpretation Act 1901 (Cth). His Honour emphasised the statutory context informed by s 268-95 which (at PJ [104]): …provides that it "applies" to a "supervising entity" if, inter alia, the supervising entity is a liquidator of the corporation the subject of the estimate and stipulates that an affidavit filed by the supervising entity is taken to be an affidavit filed by the corporation. 100 From there at PJ [105] his Honour considered s 268-90(3)(b) and construed it in the context of the addition of "if and as applicable" which appears in parenthesis at subparagraph (b) (with his Honour's emphasis): The significance of this addition is that the use of "or" is best construed in s 268-90(3) as providing that (additional words added in emphasis to demonstrate construction): The statutory declaration or affidavit must be made, sworn or affirmed by: (a) an individual specified in the following table; or if you are a company in liquidation or receivership or you have a trustee in bankruptcy appointed then; (b) your liquidator, receiver or trustee in bankruptcy (if and as applicable). 101 Finally at PJ [109], his Honour accepted a submission of the Liquidator that: …[I]t would be contrary to all principles of insolvency law to accept the contention that the director of a company in liquidation could by a unilateral act on his or her behalf file an affidavit in proceedings in which the Company was not a party that had the effect of affecting the liabilities of the Company and independently of the liquidator to determine whether the Commissioner is or is not a creditor of the company. It is the liquidator not the director of a company in liquidation who is responsible for and authorised to undertake a realisation of the company's assets, the determination of its liabilities and the distribution of its assets in accordance with the statutory order of priorities. 102 The balance of his Honour's reasons concern the third and fourth questions which I do not find necessary to address in resolving this appeal.

The appeal submissions 103 The notice of appeal filed pursuant to our grant of leave asserts two grounds of error: 1. The Trial Judge erred in finding that an affidavit filed by a director in proceedings brought by the Deputy Commissioner of Taxation against a director of a company (whether in liquidation or not) for recovery of an estimate can not constitute an affidavit for the purposes of item 2 of the table in s 268-40 of Schedule 1 to the Taxation Administration Act 1953 (TAA) (Item 2), in particular: a. The Trial Judge failed to properly construe Item 2, and in particular, the words "relate to" in the context of the purpose of the Estimate provisions contained at Division 268 of schedule 1 the TAA; b. The Trial Judge erred in finding at [83] that the reference to "you" in item 2 must refer to the relevant company and not a director; c. The Trial Judge erred in finding at [85] that the availability of defences under section 269-35 of Schedule 1 to the TAA suggested that a director cannot file an affidavit pursuant to Item 2; d. The Trial Judge erred in finding at [93] that the fact a former director had no standing to file an affidavit pursuant to Item 2 suggested that a director also cannot file and [sic] affidavit pursuant to Item 2; e. The Trial Judge erred in finding at [97] that the failure of the explanatory memorandum to the director penalty provisions to mention an affidavit pursuant Item 2 suggested that a director could not file an affidavit pursuant to Item 2; f. The Trial Judge erred in finding that a director of a company in liquidation filing an affidavit was contrary to all principles of insolvency law in the context of both the CA and more relevantly the TAA. 2. The Trial Judge erred in finding that if the appellant contravened 198G of the Corporations Act 2001 (CA) (contrary to the Trial Judge's findings), the appellant should not be given leave, nunc pro tunc, to have filed the affidavit on 29 October 2021. 104 We heard argument on each ground, covering the four issues determined by the primary judge. In my view it is only necessary to resolve the appeal grounds as they relate to the second issue which is dispositive of the outcome. If it is not open to a director of a company in liquidation to file an affidavit to reduce or revoke an estimate pursuant to s 268-40, then the primary judge was right to dismiss the interlocutory application and the appeal fails. For the same reason I do not find it necessary to resolve the notice of contention of the Commissioner to the effect that the primary judge should have concluded that the filing and service of the Revocation Affidavit in the Supreme Court proceeding was prohibited by s 198G(1) of the Corporations Act. 105 Counsel for the appellant submits that the "extraordinary powers" of the Commissioner to make a binding estimate, without reference to an established underlying liability, are tempered by a number of safeguards whereby a taxpayer may engage with the Commissioner to cause an estimate to be revoked or reduced. The filing of an affidavit by a director is one option consistent with the statutory purpose. If the primary judge is correct, that option is not available: an outcome not compelled by the statutory language. Reliance is placed on one of the objectives set out at s 268-1: a person "can ensure that the Commissioner does not require you to pay more than the relevant unpaid amounts." As was said in the Explanatory Memorandum to The Insolvency (Tax Priorities) Legislation Amendment Bill 1993 (Cth) at 20: As the Commissioner is only interested in collecting the actual unremitted amounts, a person will be given an opportunity to inform the Commissioner of the actual amounts deducted. (Original emphasis.) 106 From that purpose, the appellant submits that taxpayers are encouraged or compelled to engage with the Commissioner with the objective of ascertaining the true liability. Section 268-40 is an opportunity of that character by which a taxpayer may unilaterally reduce or revoke an estimate. The reference to "you" at item 2 of the table at s 268-40 operates independently of the reference at item 1, where "you" is the recipient of the notice and which controls the right to make a statutory declaration. In contrast all that is necessary to engage item 2 is that the person is a "party to proceedings before a Court that relate to the recovery of the unpaid amount of the estimate." The relational requirement is broadly expressed and is to be interpreted consistently with the obiter reasoning in Lee at [41] and the written submission of the Commissioner upon the application by the directors in that case for special leave to the High Court, which the primary judge in part reproduced at PJ [56]: ...if the plaintiffs had simply filed an appropriate affidavit shortly after the present proceedings to recover the penalty had been commenced that would have had the effect of revoking or reducing the estimate (s 268-40(1) - Item 2). Proceedings to recover a penalty that is parallel in quantum to, and exists to enforce an obligation to pay an estimate are aptly proceedings that "relate to" the recovery of the unpaid estimate. Those are words of wide import. No legislative purpose is identified in reading "relate to" as excluding a director from providing such an affidavit. The opportunity for a director to submit statutory declaration or affidavit consequent upon him or her becoming liable to a penalty for an estimate was also referred to in the Explanatory Memorandum to the legislation extending the director penalty regime to estimates of superannuation guarantee charge. (Footnotes omitted.) 107 Turning to the requirements for an affidavit at s 268-90(3), the appellant submits that "or" is disjunctive and the primary judge erred by adding additional words to demonstrate the construction. In proceeding in that way the submission is that the primary judge "gave a different emphasis than that warranted by the text of the provision" and overlooked that an affidavit could be filed by both a director or a liquidator depending upon who has direct personal knowledge of the actual liability (the director) or the person with access to the books and records of the Company (the liquidator), each of whom may give to the Commissioner the information required by the estimates regime. 108 Finally, the appellant submits that the primary judge was wrong to reject his construction submissions at PJ [109] as contrary to insolvency law principles, when it is "perfectly normal and acceptable" for a director to negotiate with a creditor of a company in liquidation and with the result that the creditor removes or reduces a proof of debt. It is not open to a liquidator to prevent a director from engaging with creditors in that way. 109 The Liquidator submits broadly that if a person is prohibited by s 198G of the Corporations Act from performing or exercising a function or power of a director when a company is under external administration, it follows that the director is also prohibited from acting as such for the purposes of and within the meaning of ss 268-40 and 268-90. This submission emphasises the disjunctive requirement that an affidavit "must" be made by a specified individual or "your" liquidator, receiver or trustee in bankruptcy at s 268-90(3). To construe the provision as submitted by the appellant leaves subparagraph (b) with no work to do. As a matter of ordinary construction, if a company is in external administration, any affidavit must be made (and only made) by its liquidator, administrator or receiver. That construction is entirely consistent with item 2 of the table at s 268-90(3) which is concerned with the person who is authorised to make the affidavit on behalf of the company, and not with one who is prohibited from doing so. 110 The Commissioner submits that the appellant could not make the affidavit conformably with ss 268-90(3)(b) and 268-100 because it concerned the Company's taxation liabilities. The appellant was prohibited from acting on behalf of the Company by force of s 198G of the Corporations Act. 111 The Commissioner does not dispute that before the primary judge it was conceded that the Supreme Court proceeding related to the recovery of unpaid amounts of the Estimate for the purpose of item 2 in the table at s 268-40(1), conformably with the concession made in Lee. However the Commissioner notes that Lee was not concerned with the application of s 198G of the Corporations Act, nor the meaning of "you" in the context of s 268-40(1). Counsel explained that the contrary interpretation of the primary judge differs from the Commissioner's previous interpretation and practice. In oral submissions, Counsel emphasised that the Commissioner adopts "a neutral position" on the question whether the primary judge was correct to conclude that an affidavit filed by a director in a director penalty proceeding cannot constitute an affidavit for the purposes of Item 2. 112 Despite the Commissioner's neutral position, two "observations" were made. First, that the word "you" was introduced in the ITAA 1997 as a result of the Tax Law Improvement Project commencing in 1993, intended to simplify the provisions of the ITAA 1936, and not to alter the underlying taxation policy. This principle was legislated into the ITAA 1997 at s 1-3(1): 1-3 Differences in style not to affect meaning (1) This Act contains provisions of the Income Tax Assessment Act 1936 in a rewritten form. (2) If: (a) that Act expressed an idea in a particular form of words; and (b) this Act appears to have expressed the same idea in a different form of words in order to use a clearer or simpler style; the ideas are not to be taken to be different just because different forms of words were used. 113 The reference to "this Act" includes the TAA by operation of the dictionary definition at s 995 of the ITAA 1997. 114 The predecessor regime was Div 8 of part VI of the ITAA 1936. The Commissioner submits: The subject of the former Div 8 was referred to as the "person liable" - a concept which performed the same function as the word "you" in Div 268. The "person liable" was defined as a person who has "become liable under a remittance provision to pay to the Commissioner": s 222AGA(1)(a) of the ITAA 36: cf, AS[12]. Under the former estimates regime, the Commissioner was obliged to send written notice of an estimate to the person liable (or to the person's trustee): s 222AGB(1) of the ITAA 36. As to revoking or reducing the estimate, s 222AHC provided only for a person liable (or their trustee) to file an affidavit. As to the contents of the affidavit, s 222AHE provided that it must be filed and served within 14 days after the first day on which the person liable (or their trustee) "takes a procedural step as a party to the proceedings". The "person liable" could be a company: s 222AHE(5)(a). It is plain that, under the former regime, the "person liable" was (i) the person who was the subject of the remittance obligations, (ii) the recipient of an estimate and (iii) the "party to the proceedings" that related to the recovery of the unpaid amount of the estimate. 115 Accepting that the rewriting of the provisions was not intended to enact any change in taxation policy, the reference to "you" at item 2 of the table at s 268-40 is a reference to the person liable, which is the Company and not the appellant. 116 Attention was drawn to the decision of Robertson J in Transtar Linehaul Pty Ltd v Deputy Commissioner of Taxation [2011] FCA 856; 196 FCR 271 where the applicant commenced a proceeding in the original jurisdiction of this Court pursuant to s 39B of the Judiciary Act 1903 (Cth) and sought declaratory relief to the effect that the estimates there relied on by the Commissioner were revoked by reason of the filing of affidavits in a proceeding commenced by the taxpayer for that relief. His Honour rejected that argument and held that despite the width of the statutory phrase at item 2 of s 268-40, the applicant was not a party to a proceeding before a court relating to recovery of an unpaid amount of an estimate. He gave three reasons for that conclusion at [49]-[51]: First, the statutory context suggests that recovery proceedings are those referred to in s 268-5, the object of Div 268 being to enable the Commissioner to take prompt and effective action to recover amounts not paid as required by Pt 2-5 (Pay as you go (PAYG) withholding). Secondly, in my view the scheme of the legislation is that the estimate is revoked in such recovery proceedings so that the court is then in a position to determine the underlying liability rather than the accuracy of the estimate. This is supported by Transtar Linehaul's contention that what the section requires for an affidavit is slight. Thirdly, paying close attention to the terms of item 2, it is the proceedings which must relate to the recovery of the unpaid amount of the estimate. Here, the proceedings are for a declaration that the estimate is revoked in proceedings brought for that purpose. Transtar Linehaul's contention was that whenever proceedings are commenced for a declaration that an estimate is revoked and a formal affidavit is filed and served within 14 days of commencing the action stating that no amounts were withheld, then the estimate is revoked. I do not attribute that intention to the legislature. (Original emphasis.) 117 The Commissioner's second observation is that ss 268-40 and 268-90 are to be read together, and in particular, s 268-90(2), require that the affidavit or statutory declaration must verify certain facts including "the sum of all amounts you withheld" and "the sum of all amounts you were required to pay" each of which must be a reference to the recipient of the notice of estimate, in this case the Company. 118 On the question whether a director may make an affidavit where a company is in liquidation, the Commissioner submits that Div 268 does not permit a director to take steps personally and separately from a company that is in liquidation and which is liable for an estimate, in an "attempt to deal with the personal parallel liability" of a director under Div 269. Section 268-90(3)(b) operates when a company is in liquidation and the word "or" which separates subparagraphs (a) and (b) does not expand the list of persons who may make the affidavit. The word "or" has a "substitutive character that changes, if and as applicable, who may make the affidavit or statutory declaration". The liquidator is the only person who is capable of doing so and the primary judge was correct to so conclude at PJ [109].

Resolution of the appeal 119 As I have indicated, my view is that the second issue resolved by the primary judge is determinative of the appeal. 120 It is trite that the provisions in question are to be construed harmoniously within the scheme of Div 268 to give effect to the provisions as a whole consistently with the statutory purpose: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at 381-382 (McHugh, Gummow, Kirby and Hayne JJ). Section 268-90(3) when read with s 268-95 is in my view clear in textual and contextual meaning. The verification requirements for a statutory declaration or affidavit at s 268-90(2) do not require the deponent to have direct knowledge of the facts. In the case of a corporation within the meaning of the Corporations Act that is a director or a company secretary, as the individuals specified at item 2 of the table at s 268-90(3). 121 In contrast, s 268-95 applies where there is a "supervising entity" which is "your" liquidator, receiver, trustee in bankruptcy or administrator, or the administrator of a deed of company arrangement that is executed by "you". In this case the supervising entity is the Liquidator and "you" is the Company. For the purposes of Div 268, a notice given by the Commissioner to a liquidator is taken to have been given to a company: s 268-95(3). The company must give to the liquidator a copy of any notice given to it by the Commissioner, as soon as practicable and in any event within seven days after, relevantly, control of the company passed to the liquidator: s 268-95(4). Any statutory declaration given to the Commissioner or affidavit filed by the liquidator "is taken" to have been given or filed by the company: s 268-95(6) and (7). Where there are multiple supervising entities, the provisions operate so that provisions for things to be done by or in relation to the supervising entity, may be done by or in relation to any of them: s 268-95(9). 122 An estimate may be reduced or revoked if the Commissioner lodges a proof of debt relating to the unpaid amount of the estimate and s 268-95 applies: s 268-45. If so, the supervising entity may give to the Commissioner a statutory declaration to the effect that the underlying liability has been discharged, is a specified lesser amount or never existed and may then reject the proof of debt on any ground made out in the declaration: s 268-45(2) and (3). The Commissioner may appeal or apply for review of any rejection and there is an adjustment mechanism that applies depending on the outcome: s 268-45(4) and (5). 123 These provisions work harmoniously with the requirements for a statutory declaration or affidavit at s 268-90 and in particular, with the mandatory provision at s 268-90(3) which is controlling and not permissive: the affidavit "must be" sworn or affirmed by "your" liquidator where "if and as applicable", is determinative. Where there is a supervising entity, the statutory declaration or the affidavit is for the entity to make and, where it is, is "taken" to have been given or filed by the person or entity the subject of the supervising entity appointment. 124 Understood in this way the statutory scheme is to the effect that Parliament has expressly made provision for engagement of the mechanism to unilaterally revoke or vary an estimate where there is a supervising entity at s 268-95 in conjunction with the statutory declaration and proof of debt rejection provisions at s 268-45. These express provisions in my view are not susceptible to erosion by the taking of separate steps by a director of a company that is in liquidation. 125 It should also be recalled that the effect of ss 268-45 and 268-95 is to expunge or reduce the liability of the Company under Div 268 and that the liability of a director to pay a penalty is: "equal to the unpaid amount of the company's liability under its obligation": s 269-20(5). In addition, Div 269 provides for defences that are peculiar to the circumstances of the individual director in receipt of a director penalty notice: s 269-35. The appellant does not rely on these defences. 126 I do not accept the appellant's submission that this construction is likely to lead to practical difficulty where, for example, a receiver and a liquidator are appointed or a receiver is appointed over limited assets and who may have no incentive to make a statutory declaration or file an affidavit. As noted, in the case of multiple concurrent appointments of a supervising entity, s 268-95(9) operates so that the necessary steps may be taken by any of the entities. As submitted by the Commissioner, the absence of a similar provision where there is both a director and a supervising entity is telling and unexplained by the appellant's submissions that despite appointment of a supervising entity, it is still open to the person or entity supervised to take the steps, and presumably to act inconsistently, even though the person is bound by action that is taken by the supervising entity: s 268-95(6), (7) and (8). 127 Where a receiver is appointed over limited assets, resolution of the question is likely to turn on the terms of the appointment and the scope and extent of the powers of the receiver. It may well be, as the Commissioner submits, that the concept of a supervising entity at s 268-95(1) is limited to one that has and may exercise control over, or in whom there is vested, all of the property of an individual or a company. As the Liquidator in this case has control over all of the property of the Company (Corporations Act, ss 474 and 477(1)), that question does not arise and there is a danger in seeking to resolve the present problem by reference to hypothetical analogies which may arise on different facts. 128 I turn to consider whether this construction of the statutory scheme is consistent with the predecessor provisions of the ITAA 1936 and the intent that the taxation laws were rewritten in clearer language without altering the underlying taxation policy. I also consider the legislative history which often assists in resolving constructional choices: Coverdale v West Coast Council [2016] HCA 15; 259 CLR 164 at [23] (French CJ, Kiefel, Keane, Nettle and Gordon JJ). The provisions were enacted as Div 8 to the ITAA 1936, commencing at s 222AFA. If the Commissioner had reason to suspect that "a person (the 'person liable') has become liable under a remittance provision" and if that liability remained undischarged, then the Commissioner was entitled to make an estimate of the unpaid amount of that liability: s 222AGA(1). Notice was then required to be given to "the person liable or to the person's trustee": s 222AGB(1). The reduction mechanism was provided for at s 222AGC which enabled "the person liable or the person's trustee" to make a statutory declaration conformably with s 222AGF which in part provided: (7) The declaration must be made by: (a) if the person is a company that has directors, a secretary or both - a director or secretary; or (b) if the person is an individual - the person; or (c) if the person is a government body - a prescribed person; or (d) if the person consists of 2 or more persons including one or more individuals and is neither a company nor a government body - that individual or one of those individuals; or (e) in any case - the person's trustee. 129 Similar provisions applied in recovery proceedings by the Commissioner pursuant to s 222AHA, where an affidavit could be filed by the person liable or the person's trustee: s 222AHC(2). The affidavit was required to comply with the requirements of s 222AHE which also specified as the deponent the person liable or the person's trustee (s 222AHE(2)), which included in the case of a company, a director or a secretary: s 222AHE(5). 130 Subdivision D dealt with insolvency proceedings. A statutory demand reduced to the extent of the reduction in an estimate (s 222AIA) and s 222AIB provided for a defence to a winding up proceeding where an affidavit filed under s 222AID could be relied upon to reduce or extinguish the debt relied on. An affidavit for this purpose was required to be made by a "director, secretary or trustee of the Company": s 222AID(5). Provision was made at s 222AIG(2) where, after lodgement of a proof of debt in bankruptcy or a winding up: The trustee of the person liable may reject the proof in whole on the ground that the underlying liability never existed or has been discharged in full, but may only do so if the trustee has given the Commissioner a statutory declaration that complies with section 222AIH and verifies facts sufficient to prove that ground. 131 It is to be noticed that this provision only referenced the trustee of the person liable. I also note that s 222AIH, where in stating the requirements for a statutory declaration under s 222AIG, provided in part at sub-s (4): (4) The declaration must be made by: (a) if the person liable is a company that has directors - a secretary or both a director or secretary; or (b) if the person liable is an individual - the person; or (c) if the person liable is a government body - a prescribed person; or (d) if the person liable consists of 2 or more persons including one or more individuals and is neither a company nor a government body - that individual or one of those individuals; or (e) in any case - the trustee of the person liable. 132 The answer to this apparent statutory anomaly was provided for at s 6 which, in the general definitions, extended the concept of a trustee to include a liquidator (amongst others): trustee in addition to every person appointed or constituted trustee by act of parties, by order, or declaration of a court, or by operation of law, includes: (a) an executor or administrator, guardian, committee, receiver, or liquidator; and (b) every person having or taking upon himself the administration or control of income affected by any express or implied trust, or acting in any fiduciary capacity, or having the possession, control or management of the income of a person under any legal or other disability. 133 The requirement that a proof of debt could only be revoked by the trustee of the person liable (in the case of a corporation, the liquidator) when read with the proviso "may only do so" if the trustee (liquidator) has given to the Commissioner a statutory declaration that is compliant with s 222AIH, although not entirely clear in its drafting, in my view logically confined the eligible deponent, in the case of a company in winding up, to the liquidator because it is the liquidator's function to receive, assess and accept or reject a proof of debt. At that point a director or secretary of a company has no relevant function to perform. However, this is not to say that a trustee or liquidator could not have made a declaration on information or belief from material provided or a statement made by a director or secretary. 134 Any lack of clarity in the drafting of that aspect of the predecessor provisions does not operate to control the meaning of the present provisions which, in my view and as I have demonstrated, are clear in textual and contextual meaning and purpose. The primary judge in my view was correct to resolve the second question adversely to the appellant. 135 Finally, I address the submission for the appellant that harsh consequences will be visited upon him if the construction of the primary judge is upheld. On his case, he faces a substantial liability claim in the Supreme Court proceeding which does not exist. The Estimate was issued on 2 April 2019 and was sent to the registered office of the Company, a firm of accountants. The appellant deposed that it was not received by him due to a disagreement with the former accountants, and "oversight" being the appellant's failure to take steps to change the address of the registered office. However, on 8 April 2019, the bank account of the Company was the subject of a garnishee in favour of the Commissioner and which resulted in a transfer of $373,704.18 from the Company to the Commissioner. The appellant did not explain how that occurred without his knowledge. On 9 May 2019, the Commissioner issued the Director Penalty Notice addressed to the appellant at an address in Earlwood. The appellant did not then reside there and for that reason did not receive the notice. Once again, he must accept responsibility in that he did not update the Company records to record his change of address. 136 On 6 June 2019, the Commissioner issued a statutory demand for debt addressed to the Company. It was sent to the registered office as then recorded by ASIC as the firm of accountants. That document did not in a timely manner come to the attention of the appellant because of his failure to notify ASIC of a change in the registered office of the Company. Those difficulties aside, the appellant admits receiving the originating process which sought a winding up of the Company (issued on 27 August 2019) on an unspecified date. He engaged a lawyer for the purpose of obtaining further information from the Commissioner as to the basis for the debt claim. He deposed that "extensions were granted" by the Commissioner for that to occur. Later, on an unspecified date, he engaged the services of a specialist taxation lawyer, but was unable to pay the anticipated fees "upfront" in order to resist the winding up application. In consequence, the Company was wound up on 13 November 2019. The Supreme Court proceeding was not commenced until 8 June 2021. 137 It is appropriate to observe that if the appellant had diligently complied with his obligations to notify a change in the registered office of the Company and/or the change in his residential address to ASIC then he would have had three opportunities to make the statutory declaration provided for at s 268-90 in his capacity as a director of the Company and before the service of the originating application to wind up the Company. Thereafter, he had the same opportunity to make the declaration between 27 August 2019 and 13 November 2019. 138 There are other steps that the appellant could have taken at any time between receipt of the originating application and the making of the winding up order. He could have requested that the Commissioner take action, by appealing to the general power at s 268-35 to reduce the amount of the Estimate. He could have engaged the general supervisory jurisdiction that is able to be exercised whereby an eligible court may inquire into the external administration of a company pursuant to cl 90-10 or 90-15 of the Insolvency Practice Schedule, being Schedule 2 to the Corporations Act if he had grounds to assert that the Liquidator had wrongly failed or refused to take a step to reduce the Estimate as provided for at s 268-95. 139 Accordingly, the appellant's claim that the construction of the primary judge results in a harsh or unjust outcome which must rest, if at all, on the general presumption that Parliament does not intend to enact laws which work harsh, unreasonable, unjust or like outcomes (Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; 147 CLR 297 at 304-305 (Gibbs J) and at 320-322 (Mason and Wilson JJ)) fails at the threshold of general rather than specific application to the circumstances of his case. The claimed harsh consequences are the result of inaction by the appellant rather than the general operation of the provisions.

Conclusion 140 As it has not been demonstrated that the primary judge erred in dismissing the interlocutory application, it is unnecessary to address the notice of contention. In my view the appeal must be dismissed and I would order as follows: (1) The appeal is dismissed. (2) Any application for costs is to be made in writing, limited to three pages and filed within seven days of the publication of these reasons and if made responded to within a further period of seven days. (3) Subject to any further order of the Court, the determination of any costs application will proceed on the papers. I certify that the preceding seventy-six (76) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice McElwaine.