MUC v DEPUTY COMMISSIONER OF TAXATION

CATCHWORDS: CONSTITUTIONAL LAW - The non-judicial organs of government - the Crown -proceedings by and against the Crown - limitation of actions - LIMITATION OF ACTIONS - Contracts, torts and personal actions - the period of limitation - actions to recover money recoverable by virtue of an enactment - STATUTES - Acts of Parliament - interpretation - expressio unius est exclusio alterius - STATUTES - Acts of Parliament - interpretation - consideration of extrinsic matters - other matters - explanatory intrinsic material - TAXES AND DUTIES - Income tax and related legislation - collection and recovery of tax - proceedings for recovery - PAYE - PAYG

A New Tax System (Pay As You Go) Act 1999 A New Tax System (Tax Administration) Act 1999 Income Assessment Act 1936 LEGISLATION CITED: Income Assessment Act 1997 Judiciary Act 1903 Limitation of Actions Act 1974 (Qld) Taxation Administration Act 1953 Limitation Act 1969 (NSW)

Barry R Liggins Pty Ltd v Comptroller-General of Customs (1991) 32 FCR 112 Deputy Commissioner of Taxation v DTR Securities Pty Ltd (1988) 165 CLR 56 CASES CITED: Deputy Commissioner of Taxation v Jonrich Pty Ltd (1986) 86 FLR 25 Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55 Maguire v Simpson (1977) 139 CLR 362 Moss v Deputy Commissioner of Taxation [2003] NSWCA 341, 54 ATR 517

TEXTS CITED: 2000 Australian Master Tax Guide, Sydney, CCH Australia Ltd, 2000

PARTIES: Katarina MUC DEPUTY COMMISSIONER OF TAXATION

COUNSEL: Appellant: J O Hmelnitsky, D F C Thomas Respondent: S Gageler SC, R Quinn

SOLICITORS: Appellant: G H Healey & Co Respondent: Australian Government Solicitor

DC 3816 of 2004 LOWER COURT FILE NUMBER(S): DC 3817 of 2004 DC 3818 of 2004

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40843/06

MASON P BEAZLEY JA GILES JA

The PAYE (pay as you earn) system of income tax required employers to deduct tax from their employees' salary and remit the tax to the Commonwealth. The employees were then issued with a group certificate enabling them to file their own returns. The system of collection and recovery of unpaid tax was authorised by Part VI, Division 2 of the Income Tax Assessment Act 1936 .

The appellant was an employer who failed to remit deductions by the due date to the respondent during the period 1 July 1995 to 20 June 1998. The respondent commenced proceedings on 6 August 2003 to recover the unpaid tax.

The appellant argued that recovery of the unpaid tax was statute barred by s14(1)(d) the Limitation Act 1969 (NSW) which stipulates a six year period within which a cause of action to recover money under an enactment, other than a penalty or forfeiture, is to be brought. This argument was rejected by the trial judge.

On 1 July 2000 (being between the date that the deductions became due and payable and the commencement of proceedings) the PAYE system was discontinued and a new scheme, PAYG (pay as you go), was introduced. There were also changes introduced at that date to the collection and recovery scheme for unpaid tax located in the Taxation Administration Act 1953 (Cth). The respondent argued that this scheme extended to the recovery of the PAYE debts in question because the debts remained payable as at 1 July 2000 and by virtue of the operation of the transitional provisions.

Johnstone DCJ held that there was a federal scheme in relation to the collection and recovery of debts that excluded the operation of the limitation in the State Act. The trial judge applied the principles in Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55.

The appellant appealed from the trial judge's decision.

Held (Per Mason P, Beazley JA and Giles JA agreeing)

(1) The collection and recovery rules introduced in 2000 apply to a claim like the present. (at [38] and [58])

(2) The regime effectively covers the field and is incompatible with the operation of s 14(1)(d) of the Limitation Act 1969 (NSW). (at [58]) Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55; discussed and applied. Maguire v Simpson (1977) 139 CLR 362; Deputy Commission or Taxation v DTR Securities (1988) 165 CLR 56; referred to. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40843/06

MASON P BEAZLEY JA GILES JA

Katarina MUC v DEPUTY COMMISSIONER OF TAXATION JUDGMENT 1 MASON P: For many years until 2000 the system of income tax collection for employees was known as PAYE (pay as you earn). In brief, the employer deducted tax and remitted it to the Commonwealth. Employees would be issued with a group certificate enabling them to file their own returns. 2 This system of collection was authorised by Part VI, Division 2 (ss221A-221Y) of the Income Assessment Act 1936 (ITAA36). Unless indicated, sections reproduced below are from that legislation as it stood on 1 January 1997. (On and from 1 July 1998, the PAYE provisions were relocated from Division 2 of Part VI to Division 1AAA of that Part. There was no other material change at that stage and so, for ease of reference, I shall continue to refer to Part VI, Division 2 as the location of the PAYE liabilities engaged in this case.) 3 An employer who deducted tax and failed to remit it to the Commissioner was exposed to criminal and civil sanctions. 4 The employer was required to pay to the Commissioner the amount of any deductions, no later than the 7th day after the end of the month in which the deductions were made (ITAA36, s221F(5)). 5 This requirement could be varied at the discretion of the Commissioner in relation to a "group employer" (ITAA36, s221F(7)). 6 Where the amount remained unpaid after the time by which it was required to be paid, the sum (termed the "principal amount") continued to be payable by the employer to the Commissioner and the employer was liable to pay a penalty to the Commissioner calculated at a stipulated interest rate (ITAA36, s221F(12)). Penalties were capable of remission by the Commissioner (s221N(2)) and persons dissatisfied with the Commissioner's decision in that regard could object in the manner set out in Part IVC of the Taxation Administration Act 1953 (TAA) (ITAA36, s221N(4)). 7 Section 221R(1) of the ITAA36 relevantly provided: [Debt due to Commonwealth] An amount payable to the Commissioner under the provisions of this Division shall be a debt due to the Commonwealth and payable to the Commissioner, and may be sued for and recovered in any court of competent jurisdiction by the Commissioner or a Deputy Commissioner suing in his official name. 8 Section 221R(2) of the ITAA36 also provided: [Evidence] In an action against a person for the recovery of an amount payable to the Commissioner under the provisions of this Division, a certificate in writing signed by the Commissioner, a Second Commissioner, a Deputy Commissioner or a prescribed delegate of the Commissioner, certifying that: (a) the person named in the certificate is, or was, on the date specified in the certificate, a group employer, or an employer other than a group employer, as the case may be; and (b) the sum specified in the certificate was, at the date of the certificate, due by that person to the Commonwealth in respect of amounts payable to the Commissioner under the provisions of this Division; shall be prima facie evidence of the matters stated in the certificate. 9 Section 222ALA of the ITAA36 is not in Part VI, Division 2, but it permitted the Commissioner to make an agreement under which an employer (see definition of "person" in s222AFB) agreed to pay a liability under a remittance provision by instalments under a deferred payment arrangement. "Remittance provision" was defined in s222AFB at the relevant time to include s221F (subsection (12) excepted) in Part VI, Division 2 of the ITAA36. The effect of a s222ALA agreement was to substitute, as the due date for various payments, the dates specified in the agreement in place of the dates on which the amounts were previously made due and payable (Moss v Deputy Commissioner of Taxation [2003] NSWCA 341, 54 ATR 517). 10 Employees of the law firm in which the appellant was a partner had PAYE deductions taken from their wages during the period 1 July 1995 to 30 June 1998. The appellant failed to remit these amounts by the due dates as required by s221F(5). 11 The Deputy Commissioner of Taxation commenced recovery proceedings against the appellant in the District Court on 6 August 2003. In its amended form, the Statement of Claim identified the sums claimed as PAYE deductions made under Division 2 of Part VI of the ITAA36 for various periods (the latest being 1 January 1998 to 30 June 1998) plus "the general interest charge payable pursuant to Item 93 of Schedule 2 of the ANTS(PAYG)A 1999 [referred to below] and Division 1 of Part IIA of the TAA 1953" calculated from various dates (Red 31). There was also a continuing claim to a "further general interest charge" pursuant to the said Item 93 to date of payment or judgment (Red 31). 12 The claim was established by evidence that included a certificate under s221R(2). Judgment was entered on 5 December 2006 in the sum of $645,639.05 with costs. 13 This appeal relates to the limitation defence that was raised in the District Court and rejected. The limitation defence is only applicable to matter 3818/04 which related to the tax period 1 July 1995 to 30 June 1998. The appellant had invoked s14(1)(d) of the Limitation Act 1969 (NSW) which stipulates a six year period within which a cause of action to recover money under an enactment, other than a penalty or forfeiture, is to be brought. In rejecting that Johnstone DCJ held that the principles in Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55 ("Moorebank") applied. The Judge awarded the respondent $241,409.06. 14 Section 64 of the Judiciary Act 1903 (Cth) provides: In any suit to which the Commonwealth or a State is a party, the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject. 15 Maguire v Simpson (1977) 139 CLR 362 established that s64 made s14(1)(a) of the Limitation Act applicable to common law debt recovery proceedings in a New South Wales court by the Commonwealth Trading Bank of Australasia, an emanation of the Commonwealth. 16 Since, however, the direction in s64 operates as a Commonwealth law, it will not apply where another Commonwealth Act dealing with specific matters manifests an intention that the State law and/or common law applicable to suits between private persons are not to apply to those in which the Commonwealth is a party. The leading case is Moorebank. 17 Moorebank involved proceedings in the Supreme Court of Queensland in which the Commonwealth sought to recover income tax and additional tax. Applying the reasoning in Maguire, the Full Court of the Supreme Court had held (by majority) that s64 incorporated the Limitation of Actions Act 1974 (Qld), arming the taxpayer with limitation defences to stale claims to recover both the tax and the additional tax (Deputy Commissioner of Taxation v Jonrich Pty Ltd (1986) 86 FLR 25). 18 This decision was overturned by the High Court. The High Court assumed the correctness of the Full Court's decision that an action to recover unpaid income tax would, in a suit between subject and subject, be "an action to recover a sum recoverable by virtue of [an] enactment" (ie the Queensland equivalent of s14(1)(d) of the Limitation Act 1969 (NSW)). 19 The High Court held, nevertheless, that the provisions of the ITAA36 precluded any operation of s64 which would have had the effect of applying the Queensland legislation on limitations. Provisions of the ITAA36 were found to have "effectively covered the field and left no room for the direct or indirect intrusion of State Limitation Acts to limit the time an action can be brought on behalf of the Commissioner of Taxation for unpaid income tax or additional tax" (at 64). 20 The possibility of an implication deriving from the prohibition upon discrimination between States found in s51(ii) of the Constitution was noted, but did not form the basis of the Court's decision (see at 64-5). Rather, the case turned upon a detailed analysis (at 65-8) of the relevant provisions of the ITAA36. 21 The High Court was not persuaded of any "direct inconsistency" between s209 of the ITAA36 which provided that unpaid tax was recoverable in any court of competent jurisdiction (cf ITAA36, s221R(1)) and a Limitation Act provision limiting the period in which such a right of action and recovery might be pursued (see at 66). However, the "general scheme" of the provisions for collection and recovery of tax was found relevantly to cover the field and, by virtue of being inconsistent federal legislation, to preclude the generality of s64 of the Judiciary Act from picking up the State limitation provision in the Queensland proceedings. It was held that the intrusion of State limitation Acts provisions would significantly undermine that scheme. Examples were given (at 66-8) in a passage that should be set out (citations omitted): Thus, eg, s206 of the Assessment Act authorizes the Commissioner "in any case [to] grant such extension of time for payment ... as he considers the circumstances warrant" and provides that "in such case the tax shall be due and payable accordingly". That power to grant an extension of time "in any case" plainly extends to the case where tax has already become due and payable with the result that the right of action to recover the tax has already arisen or accrued. The intrusion of a State Limitation Act provision which, according to its terms, barred recovery after the expiry of a specified time from the date on which the cause of action "arose" or "accrued": see, e.g, the Queensland Act, s10(1)(d) and (5) or "first accrues": see, eg, Limitation Act 1969 (NSW), ss14(1) and 18 would be incompatible with the existence of such a broad discretionary power. If, in such a case, the Commissioner granted an extension of time until after the expiry of the relevant limitation period from the date on which the right of action for recovery of the tax "arose" or "accrued" or "first accrues", the application of a State Limitation Act provision to bar recovery in accordance with the extension of time would be inconsistent with the provisions of the Assessment Act to the effect that the tax should be then due and payable (s206) and that any tax unpaid may be sued for and recovered in any court of competent jurisdiction: s209. If the application of the State limitation provision was not excluded, the result would be that the general discretion conferred upon the Commissioner was effectively confined to preclude the grant of any extension of time beyond the limitation of action period since, if an extension of time beyond that period were granted, the tax would be irrecoverable at the time when it became due and payable in accordance with the extension.

The intrusion of State Limitation Acts provisions would undermine other aspects of the coherent scheme which the Assessment Act embodies. The intrusion of such provisions would, e.g, lie ill indeed with the Assessment Act provisions pursuant to which income tax and additional tax become and remain due and payable notwithstanding that an objection to payment of the tax has been lodged and the appellate procedures for challenging an assessment have been invoked: s201. There will inevitably be cases in which it would be oppressive for the Commissioner to seek to enforce payment of the full amount due under a notice of assessment or by way of additional tax before the final resolution of a genuine dispute about the correctness of the assessment: cf Deputy Federal Commissioner of Taxation v Australian Machinery and Investment Co Pty Ltd; Marina Estates Pty Ltd v Deputy Commissioner of Taxation. A case in which the Commissioner issues a number of assessments on an alternative basis to different taxpayers in respect of the same income provides an obvious example. Viewed as a whole, the provisions of the Assessment Act relating to the procedures for challenging the correctness of an assessment leave no room for the applicability of a State law which would produce the consequence that, in a case where a genuine dispute about the correctness of the assessment remained unresolved against the particular taxpayer at the expiry of the relevant limitation period, the Commissioner would be barred from recovering income tax or additional tax if he had refrained from instituting separate proceedings for recovery of the tax.

Another example of potential conflict which would be involved in the application of State limitation provisions is to be found in the provisions of the Assessment Act dealing with the amendment of assessments. Those provisions contain their own carefully structured time restrictions upon the power of the Commissioner to issue an amended assessment: see, in particular, s170. In some circumstances, the Commissioner is expressly empowered to issue an amended assessment at any time: see, e.g, s170(1) and (6). It would scarcely be consistent with the general scheme to be discerned in the Assessment Act for a limitation provision to intrude to bar an action for, or to extinguish the underlying right or title to, the income tax payable in respect of particular income in circumstances where, under the express provisions of the Act, the Commissioner remained free to issue an amended assessment in respect of the whole or part of that very income. 22 In a related case, Deputy Commissioner of Taxation v DTR Securities Pty Ltd (1988) 165 CLR 56, the High Court applied the reasoning in Moorebank to preclude s18 of the Limitation Act 1969 (NSW) from application to an action to recover additional tax payable in respect of unpaid income tax, cf ITAA36, s221F(12)(b). 23 The High Court's reasoning demonstrates that a taxpayer does not escape the impact of the federal "scheme" by showing that particular powers that might have been applied were not applied in the particular case. 24 The appellant submitted that the principles in Maguire applied. She pointed to s221R(1) of the ITAA36 whereby a sum payable under an enactment is declared to be "a debt due to [the Crown] and may be sued for and recovered in any court of competent jurisdiction". And she submitted that there was no federal "scheme" like that considered in Moorebank in relation to the collection and recovery of the debts sued upon such as to exclude the operation of the State limitation enactment. 25 The respondent's arguments sought to align the legislation referable to the recovery of the unremitted deductions with statutory scheme considered in Moorebank. 26 The issues were addressed by the parties, in effect, at two points of time. 27 The respondent's primary submission focussed upon changes to the system of tax collection embodied in additions to Schedule 1 of the TAA that came into effect on 1 July 2000. These were said to be applicable to the statutory debts in question in these proceedings notwithstanding that they related to PAYE liabilities that had accrued before that date. 28 The PAYE system was discontinued on 30 June 2000 consequent upon the introduction as and from 1 July 2000 of a different and more expansive scheme for the collection and payment of taxes known as Pay As You Go (PAYG). Under the new PAYG system, tax payments were to be made throughout the year of income. The PAYG system operated generally from 1 July 2000 and replaced the PAYE and several other income tax collection systems (see generally CCH 2000 Australian Master Tax Guide, Sydney, CCH Australia Ltd, 2000 ¶¶27-000, 27-300). 29 PAYG was introduced by A New Tax System (Pay As You Go) Act 1999, No 178, 1999 (ANTS(PAYG) Act). One provision of that Act imposed the general interest charge calculated in accordance with the TAA on amounts (including amounts of penalty and interest) owing to the Commonwealth directly under a taxation law (including a law that has been repealed or amended) and that became payable at any time before 1 July 1999, if the unpaid debt remained unpaid at the beginning of 1 July 1999 (Sch 2, item 93). This was the statutory basis of the imposition of the general interest charge in the instant claim. 30 Other changes were made to the TAA by A New Tax System (Tax Administration) Act 1999, No 179, 1999 (ANTS(TA) Act). Schedule 2, Part 1 inserted into Schedule 1 of the TAA, as and from 1 July 2000, a new Part 4-15 - Collection and recovery of tax-related liabilities and other amounts. Part 4-15 had four Divisions: Division 250 - Introduction; Division 255 - General rules about collection and recovery; Division 260 - Special rules about collection and recovery; and Division 265 - Other matters. 31 The Explanatory Memorandum to the Bill relevantly stated: Collection and recovery rules Amends the TAA 1953, ITAA 1936 and other Acts to introduce standardised rules which will enable the Commissioner to collect and recover tax-related liabilities which: • arise under the various taxation laws for which the Commissioner has general administration; and • remain unpaid after they become due and payable. The amendments also include a number of consequential amendments to enable a smooth transition from the different rules which exist throughout the different taxation laws to the standardised rules. 32 Chapter 2 of that Explanatory Memorandum explained the collection and recovery rules in greater detail. Of present relevance were the following: 2.2 The standardised rules, together with amendments to ensure their application from 1 July 2000, are contained in Part 1 of Schedule 2 to this Bill. Parts 2 and 3 of Schedule 2 to this Bill contain the consequential and savings provisions which are necessary to either cease or modify the application of existing collection and recovery rules so that there will be a smooth transition to the new standardised rules from 1 July 2000. … 2.7 The standardised collection and recovery rules will generally apply from 1 July 2000 to all tax-related liabilities which exist on 1 July 2000, whether or not those liabilities have arisen before, on, or after that day. [Item 2 of Part 1 of Schedule 2] … 2.9 Currently, each taxation law contains its own collection and recovery provisions. The ITAA 1936 has several sets of collection and recovery rules which have evolved as new tax obligations have been introduced. For example, Part VI of the ITAA 1936 contains separate Divisions to provide for the collection and recovery of income tax debts and other debts arising under different withholding systems such as the PAYE, PPS and RPS systems. 2.10 Many of the recovery provisions in Divisions in Part VI of the ITAA 1936 are identical or similar in effect and result in a significant amount of duplication. In addition, there are also different provisions to achieve the same outcome but which vary, in various degrees, in structure and content. 2.11 The standardised collection and recovery rules will generally apply when tax-related liabilities remain unpaid after their due date for payment. Existing provisions in the different taxation laws which specify when a tax debt is due and payable are not affected by these amendments. 33 The collection and recovery rules introduced as from 1 July 2000 were described in argument (and since 2006 in the heading to the relevant Chapter of the Act) as "generic collection and recovery rules". The respondent submits that they extend to the recovery of liabilities such as those at issue in these proceedings, ie PAYE liabilities that accrued before 1 July 2000 and remained outstanding as at that date. This proposition about the transitional operation of the new collection and recovery rules is disputed by the appellant. 34 If the respondent is correct in her submission that these provisions have the effect of applying key parts of the "generic collection and recovery rules" introduced in 2000 to the instant claim, then the respondent's case for applying Moorebank becomes an overwhelming one. That is because Subdivision 255-B of the 2000 generic collection and recovery rules confers express powers on the Commissioner to defer (s255-10) or bring forward (s255-20) the time at which an amount of a tax-related liability is, or would become, due and payable (whether or not the liability has already arisen) (Cf ITAA36, s206 and Moorebank at 66-7). 35 These powers apply alongside a continuing power in the Commissioner to vary statutory time limits (ITAA36, s221F(7). Cf ITAA36, s207 and Moorebank at 65). Section 222ALA (which provides for agreements to vary the due date for payments of remittance provisions) replicated in s255-15 of the TAA which is found in Subdivision 255-B.

36 Alternatively, the respondent focussed upon Part VI, Division 2 of the ITAA36 as it stood at the various dates between 1 July 1996 and 30 June 1998 when deductions were made that ought to have been remitted to the Commissioner. This approach correctly recognised that the liabilities sued upon arose on the several dates when instalments of tax deducted from wages ought to have been paid to the Commissioner (see ITAA36, s221F(5)(c)). If those liabilities had been discharged by 1 July 2000 then the new generic collection and recovery rules commencing on that date would not have engaged with them. 37 The respondent's alternative submission, in short, was that the legislation as it stood in 1996-98 was relevantly indistinguishable from that considered in Moorebank. The appellant disputed this, contending that there was really no more than the creation of a statutory debt coupled with a right to sue and recover in a court of competent jurisdiction, the very situation that the High Court held in Moorebank to be insufficient in itself to create a "direct inconsistency" sufficient to exclude the incorporation of a State limitation provision (see Moorebank at 66).

The applicability of the new generic collection and recovery rules to the instant debts 38 The respondent submitted that the new rules apply to the instant debts because those debts remained payable as at 1 July 2000 and because of the terms of the transitional provision referred to below. I accept that submission for the reasons that follow. 39 The money claimed is a tax related liability within Part 4-15 of Schedule 1 of the TAA. Not all tax-related liabilities depend upon an assessment (see s250-5). Section 255-1 defines tax-related liability to mean: "a pecuniary liability to the Commonwealth arising directly under a taxation law (including a liability the amount of which is not yet due and payable)". The ITAA36 is such a law (see Income Tax Assessment Act 1997 (ITAA97), s995-1(1) "taxation law"). 40 The appellant disputed this interpretation of s255-1, relying upon Note 1 to that section which directed attention to s250-10 for an index of tax-related liabilities. That "index" cites 12 provisions of the ITAA36 but makes no reference to liabilities arising under the sections of Part VI Division 2 under which the appellant's liability accrued. 41 The appellant also submitted that the new rules have no application because the instant debts all arose before 1 July 2000. 42 Section 250-10 (entitled Summary of tax-related liabilities) relevantly states: (1) The following table is an index of each tax-related liability under the Income Tax Assessment Act 1936. The key provision for the liability, as set out in the table, specifies when the liability become due and payable.

43 Then follows a Table with three columns: Item, Topic and Provision. The first item (numbered 5 to permit easy insertion of earlier items) is 5 trustee beneficiary non-disclosure tax 102UO

Several items follow, but there is no reference to s221F or any other section in Part VI, Division 2 of the ITAA36 . There is, however, reference to s222ALA (see item 70). As indicated, that provision is not found within Part VI, Division 2 of the ITAA36 although it applies to liabilities arising under that Division, among others. 44 Section 250-10(2) includes a similar table in the form of an index of tax-related liabilities under Acts other than the ITAA36. 45 Invoking the maxim expressio unius est exclusio alterius, the appellant submitted that the absence of any reference to sections from Part VI, Division 2 of the ITAA36 confirmed that outstanding debts arising under that Division were not made subject to the new generic collection and recovery rules even if they remained outstanding as at 1 July 2000. 46 There is a difficulty with the argument based upon the silences in the tables. It was touched on by the respondent during the hearing and more specifically drawn to the attention of the parties in a memorandum from the Court after judgment was reserved. Further submissions were invited and received. 47 Subdivision 250-A of the TAA, within which s250-10 is located, is a Guide, a term described in s950-150(1) of the ITAA97 as "sections under a heading indicating that what follows is a Guide to a particular Subdivision". (Section 950 of the ITAA97 applies to the TAA: see TAA, s3AA(3).) 48 Section 950-100(1) of the ITAA97 states that Guides "form part" of the Act. They are, however, "kept separate from the operative provisions" (ITAA97, s950-150(2)). Section 950-150(2) further states that: ... In interpreting an operative provision, a Guide may only be considered: (a) in determining the purpose or object underlying the provision; or (b) to confirm that the provision's meaning is the ordinary meaning conveyed by its text, taking into account its context in the Act and the purpose or object underlying the provision; or (c) in determining the provision's meaning if the provision is ambiguous or obscure; or (d) in determining the provision's meaning if the ordinary meaning conveyed by its text, taking into account its context in the Act and the purpose or object underlying the provision, leads to a result that is manifestly absurd or is unreasonable.

49 The consequence is that the Guides in Subdivision 250-A of Schedule 1 to the TAA do not confine the operative provisions of Pt 4-15 or any applicable transitional provision. As the respondent submitted, they are in the nature of explanatory intrinsic material. As with explanatory extrinsic material, they cannot be used to contradict the meaning of the language of the operative text (Barry R Liggins Pty Ltd v Comptroller-General of Customs (1991) 32 FCR 112 at 120). 50 There is, in fact, a transitional provision touching the application of Pt 4-15 that gives express effect to the statements in the Explanatory Memorandum. 51 Item 2 of Schedule 2 Part 1 of ANTS(TA) Act provides: 2 Application of Part 4-15 in Schedule 1 to the Taxation Administration Act 1953 (1) Section 255-5 in Schedule 1 to the Taxation Administration Act 1953 applies in relation to an amount of a tax-related liability that becomes due and payable on or after 1 July 2000. (2) Subdivision 255-B in Schedule 1 to the Taxation Administration Act 1953 applies in relation to any tax-related liability (whether arising before, on or after 1 July 2000). (3) Subdivision 255-C in Schedule 1 to the Taxation Administration Act 1953 applies in relation to: (a) a proceeding commenced on or after 1 July 2000 under section 255-5 in that Schedule; and (b) a proceeding to recover an amount of a tax-related liability if it commenced before 1 July 2000 and is continuing on or after that day, as if it were a proceeding commenced under that section. (4) Subdivision 260-A in Schedule 1 to the Taxation Administration Act 1953 applies in relation to any debt (whether payable before, on or after 1 July 2000). (5) Subdivision 260-B in Schedule 1 to the Taxation Administration Act 1953 applies in relation to a person who becomes a liquidator on or after 1 July 2000 (whether the outstanding tax-related liabilities concerned arise before, on or after that day). (6) Subdivision 260-C in Schedule 1 to the Taxation Administration Act 1953 applies in relation to a receiver, or receiver and manager, who takes possession of a company's assets on or after 1 July 2000 (whether the outstanding tax-related liabilities concerned arise before, on or after that day). (7) Subdivision 260-D in Schedule 1 to the Taxation Administration Act 1953 applies in relation to an agent who is instructed, on or after 1 July 2000, to wind-up the principal's business in Australia (whether the outstanding tax-related liabilities concerned arise before, on or after that day). (8) Subdivision 260-E in Schedule 1 to the Taxation Administration Act 1953 applies in relation to a person who dies on or after 1 July 2000 (whether the outstanding tax-related liabilities concerned arise before, on or after that day). (9) Section 265-40 in Schedule 1 to the Taxation Administration Act 1953 applies in relation to an amount of a tax-related liability that is paid on or after 1 July 2000 (whether the liability concerned arises before, on or after that day). (10) Section 265-45 in Schedule 1 to the Taxation Administration Act 1953 applies in relation to any tax-related liability arising on or after 1 July 2000. 52 It can be seen at once that this transitional provision seeks to deal exhaustively with its subject matter and that it applies the rules introduced on 1 July 2000 to tax-related liabilities arising before that date in several instances. The presently critical provision is 2(2) given that Subdivision 255-B contains the Commissioner's powers to vary payment times (cf Moorebank at 66-7). It stipulates in the clearest of terms that the Subdivision extends to tax-related liabilities that arose before 1 July 2000. 53 Schedule 2, Part 2 of the ANTS(TA) Act also contains consequential amendments of Acts including the ITAA36. Item 37 inserts after s221R(1) the following subsection and Note: Application (1A) Subsection (1) does not apply in relation to an amount that becomes due and payable on or after 1 July 2000. Note: For provisions about collection and recovery of amounts payable under this Division and other amounts on or after 1 July 2000, see Part 4-15 in Schedule 1 to the Taxation Administration Act 1953 . 54 Subsection (1A) does not speak directly to the present case because the moneys sued for became due and payable before 1 July 2000, including the general interest charge (see ANTS(PAYG) Act, Schedule 2, Part 2, Item 93(2)). 55 It is the Note to the new s221R(1A) that is presently critical. Although it does not form part of the ITAA36 it is a clear statement to the effect that Pt 4-15 governs collection and recovery of amounts payable under Part VI Division 2 on or after 1 July 2000. It therefore supports the respondent's primary case, because although the debts sued upon were due before 1 July 2000, they remained payable after that date.

56 The appellant submitted, in effect, that the information provided in the Note to the newly inserted s221R(1A) was inaccurate. In her submission, none of Part 4-15 addressed the collection and recovery of outstanding PAYE deductions. She submitted that Part 4-15 is relevantly confined to the "tax-related liabilities" referred to in s250-10. I have already explained why these submissions should be rejected. 57 The expressio unius maxim must always be used with caution. To use it, as the appellant seeks to do, in relation to the Guide found within s250-10 of the TAA, involves taking two steps too far, especially in view of the weight of indications pointing the opposite way. I include the plain meaning of the expression "tax-related liability" in s255-1; the clear terms of the transitional provision set out above; the paragraphs of the Explanatory Memorandum to which attention has already been drawn; and the Notes to s221R(1A). 58 I therefore conclude that the generic collection and recovery rules introduced in 2000 apply to a claim like the present; and that they are relevantly indistinguishable from the regime discussed in Moorebank. The regime effectively covers the field and is incompatible with the intrusion of s14(1)(d) of the Limitation Act 1969 (NSW). 59 It therefore becomes inappropriate and unnecessary to decide whether the applicable provisions of the ITAA36 as they stood before 1 July 2000 had a similar operation. 60 The appeal should be dismissed with costs. 61 BEAZLEY JA: I agree with Mason P. 62 GILES JA: I agree with Mason P. **********

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