Professional Administration Service Centres Pty Limited v Deputy Commissioner of Taxation

REASONS FOR JUDGMENT 1 This proceeding was commenced on 28 April 2010. By the proceeding, the applicant (the Taxpayer) appeals against what is said to be an appealable objection decision made by the respondent, the Deputy Commissioner of Taxation (the Commissioner), relating to assessments for the periods 1 July 2004 to 30 September 2006 and 1 October 2006 to 31 December 2006 involving goods and services tax liability. There has been significant default on the part of the Taxpayer in the past concerning compliance with Court directions. Specifically, there has been a failure to comply with orders made by the District Registrar on 14 November 2011. By reason of that failure, the Commissioner has now applied, by interlocutory application of 19 January 2012, for an order under rule 5.23 of the Federal Court Rules 2011 (the Rules) that the application be dismissed, and an order that the Taxpayer pay the Commissioner's costs of the proceeding. In the alternative, the Commissioner seeks further orders for compliance with the orders made on 14 November 2011. 2 On 12 October 2011, the Commissioner filed and served on the Taxpayer a notice to produce various documents. The notice required production to the Court, on 2 November 2011, of the original copy of documents described in a schedule to the notice, together with any other copy of those documents that differed from the copy of the documents exhibited to an affidavit of John Lamont sworn on 14 July 2011. There are some 34 documents described in the schedule. The Taxpayer did not comply with the notice to produce. 3 On 2 November 2011, the Commissioner filed and served an interlocutory application seeking an order for discovery of certain documents, including any agreement or retainer for the matters the subject of invoices set out in a schedule to the interlocutory application, documents recording communications with the providers of those invoices in relation to any such agreement or retainer, and invoices for the matters the subject of those invoices. On 14 November 2011, the District Registrar made an order for discovery on or before 9 December 2011, in accordance with rules 20.16 and 20.17, of the documents that were the subject of the interlocutory application. On the same day, the District Registrar made orders pursuant to rule 20.31(3) of the Rules that the Taxpayer produce for inspection at the offices of the Commissioner's solicitors in Pitt Street, Sydney, on 15 November 2011, the documents described in the notice to produce of 12 October 2011. The Registrar also directed that a copy of the orders be provided to Mr Ian Daley, the director of the Taxpayer. 4 The orders made on 14 November 2012 have not been complied with, although there has been desultory correspondence between solicitors for the Taxpayer and the solicitors for the Commissioner, which does not go anywhere near offering any satisfactory explanation for the failure to comply with the orders of 14 November 2011. Ultimately, therefore, the Commissioner filed its interlocutory application of 19 January 2012 seeking summary dismissal, or, alternatively, an order for compliance with the earlier orders. 5 Having heard the solicitor for the Taxpayer, I have some reservation as to whether or not there has been a full comprehension of the obligations arising from those orders. That, however, is not a matter for which the Commissioner can be held responsible. It is clear from the material before me that the Commissioner has taken active steps to endeavour to ensure compliance, and has done so to no avail. 6 I therefore propose to make what are in effect conditional orders. I propose to order that the proceeding be dismissed. However, I will stay that order up to and including 9 March 2012. If, no later than 6 March 2012, the Taxpayer has complied with the orders for discovery and for production of documents that were made on 14 November 2011, and has filed an affidavit in proper form explaining why the orders have not hitherto been complied with, I shall entertain an application on 9 March for the order for dismissal to be rescinded. I also propose to direct that a copy of my orders of today be provided to Mr Ian Daley, the director of the Taxpayer, at 29 Baileys Road, Tallai, Queensland, no later than 12 noon on Monday, 5 March 2012. I propose to order the Taxpayer to pay the Commissioner's costs to date of the motion seeking summary dismissal, including the costs of today. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett.