LOGAN J:
143 Mr Michael Shord once worked abroad (on offshore platforms, barges and other vessels) as a saturation diver, diving supervisor and diving superintendent. Between 1999 and August 2010, he worked overseas in one or the other of these capacities for various foreign companies. The Commissioner of Taxation (Commissioner) came to audit his taxation affairs. As a result, Mr Shord was requested to lodge income tax returns for the years ended 30 June 2006 to 30 June 2011 (the Relevant Period). The Commissioner thereafter made amended assessments for those income years. By these amended assessments, the Commissioner included in Mr Shord's assessable income payments received by him for his work overseas during the Relevant Period. The result, in total, was to increase the amount of his income tax liability for the Relevant Period by $149,967.75. Additional liabilities imposed by the Commissioner were shortfall interest charges and administrative penalties amounting to almost $134,000.
144 Mr Shord's objection against these amended assessments of income tax, the shortfall interest charges and the administrative penalties was disallowed by the Commissioner. He sought the review of that objection decision by the Administrative Appeals Tribunal. On 21 May 2015, the Tribunal (Senior Member CR Walsh) decided to affirm the Commissioner's objection decision: Shord and Commissioner of Taxation (2015) 101 ATR 392. Mr Shord then instituted in this Court's original jurisdiction a statutory appeal against the Tribunal's decision on a question of law as provided for by s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act). That appeal was dismissed on 29 June 2016: Shord v Commissioner of Taxation [2016] FCA 761; (2016) 103 ATR 576; (2016) 2016 ATC 20-577 (Gilmour J).
145 It is against that order of dismissal that Mr Shord has now appealed to this Court. As they have come to be amended and, by leave, further amended, the grounds of appeal are diffuse and prolix, each unnecessarily so. As it happens, it is not necessary to address each of them, having regard to a concession which the Commissioner came belatedly to make in the course of the hearing of the appeal.
146 To explain how that concession came about and, as a result, what remains for determination in this appeal it is necessary to delve into the history of this matter both before the Tribunal and in the original jurisdiction of this Court.
147 Broadly stated, the issues before the Tribunal were whether Mr Shord was a resident of Australia for taxation purposes during the Relevant Period and, if so, whether he was exempt from tax on foreign source income or, as the case may be, entitled to foreign tax offsets?
148 In accordance with the Tribunal's General Practice Direction, Mr Shord and the Commissioner exchanged "Statements of Issues, Facts and Contentions" (SIFC). In the context of the review of an objection decision such statements are not, and cannot be, a substitute for the obligation, found in s 14ZZK(b) of the Taxation Administration Act 1953 (Cth) (TAA), for an applicant to prove the assessment concerned to be excessive by reference to a specified ground of objection.
149 The role of a SIFC is to highlight and to narrow the issues of fact and law in a review and to ensure procedural fairness. In this the SIFC complements the notice of objection. The SIFC of each party fulfil a similar role in a review proceeding in the Tribunal to the appeal statements in a taxation appeal in the Court's original jurisdiction, for which provision is made by r 33.03 of the Federal Court Rules 2011 (Cth) and Practice Note Tax 1.
150 In light of the statutory obligation found in s 14ZZK of the TAA, it is important that, in relation to an applicant, the issues specified in that party's SIFC are consistent with the grounds of objection, be they as originally stated or as permissibly amended. Even so, those grounds of objection may prove not to be a complete foundation for the issues in a review. That is because the Commissioner may permissibly contend that his assessment is not excessive on a basis that did not commend itself to him when making that assessment or even on a basis in law upon which he has hitherto eschewed reliance: Federal Commissioner of Taxation v Wade (1951) 84 CLR 105 at 117 per Kitto J; Federal Commissioner of Taxation v Ryan (2000) 201 CLR 109 at 124, [22] per Gleeson CJ, Gummow and Hayne JJ. Requiring the Commissioner to furnish a SIFC is not subversive of this position. Instead, one end it serves is ensuring that no procedural unfairness to an applicant occurs if the Commissioner chooses to rely upon some other basis for defending the assessment: Pacific Exchange Corporation Pty Ltd v Federal Commissioner of Taxation (2009) 180 FCR 300.
151 Arising from the claim that if, which he denied, he was a resident of Australia, his income was exempt from tax, one of the issues identified by the Commissioner in his statement (at paragraph 4.10) was that, "at all material times, [Mr Shord] was not engaged in service as the holder of an office or in the capacity of an employee within the meaning of "foreign service" in subsection 23AG(7) of the ITAA 1936".
152 In the years ended 30 June 2006 to 30 June 2009, s 23AG of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936) provided, materially:
(1) Where a resident, being a natural person, has been engaged in foreign service for a continuous period of not less than 91 days, any foreign earnings derived by the person from that foreign service are exempt from tax.
........
(2) An amount of foreign earnings derived in a foreign country is not exempt from tax under this section if the amount is exempt from income tax in the foreign country only because of any of the following;
.........
(c) provisions of a law of the foreign country under which income covered by any of the following categories is generally exempt from income tax:
(i) income derived in the capacity of an employee;
(ii) income from personal services;
(iii) similar income;
(d) the law of the foreign country does not provide for the imposition of income tax on one or more of the categories of income mentioned in paragraph (c);
.........
(6) For the purposes of this section, a period during which a person is engaged in foreign service includes any period during which the person is, in accordance with the terms and conditions of that service:
(a) absent on recreation leave, other than:
(i) ......
(iii) leave without pay or on reduced pay; or
(b) absent from work because of accident or illness.
.........
(7) In this section: .........
foreign service means service in a foreign country as the holder of an office or in the capacity of an employee.
153 Having regard to the definition of "foreign service" in s 23AG(7) of the ITAA 1936, it was correct for the Commissioner to identify that one of the elements of that definition which needed to be satisfied was that Mr Shord's service in a foreign country was in the capacity of an employee. The Commissioner's SIFC put Mr Shord on notice that, as part of his obligation to prove the amended assessments for these years to be excessive, he would have to prove that his service abroad was in the capacity of an employee.
154 Section 33 of the AAT Act materially provides that the Tribunal is not bound by the rules of evidence. Thus, proof of the fact that Mr Shord's service had been in the capacity of an employee need not have been achieved by the adducing of evidence in a form admissible in a court, although that mode of proof might, permissibly, have been adopted. What was necessary was that some material logically probative of the factual element be placed before the Tribunal: Sullivan v Civil Aviation Safety Authority (2014) 226 FCR 555 at [85] to [97] per Flick and Perry JJ. Further, in light of s 14ZZK(b) of the TAA, it was necessary for the Tribunal to be persuaded by Mr Shord that it should act on this material.
155 When the matter came on for hearing before the Tribunal and at a time after Mr Shord's submissions had been prepared by his representative, an accountant, the following exchange occurred between Ms Vernon, counsel for the Commissioner, who also appeared for the Commissioner before Gilmour J and before us on the appeal (albeit disparately instructed - in the Tribunal and before Gilmour J directly by the Commissioner, (via "ATO Dispute Resolution", whatever that may be and not, as Gilmour J records, the Australian Government Solicitor in the original jurisdiction) on appeal, by Minter Ellison):
MS VERNON: And relying on the statement of facts, issues and contentions, although I should draw to your attention, Senior Member, that there is reference in the respondent's statement of facts, issues and contentions the matter that the respondent no longer pursues, Just find the paragraph. It's 4.10 … which refers to the question of whether or not the applicant was engaged in the capacity of an employee.
SENIOR MEMBER: So that's no longer an issue?
MS VERNON: That's no longer pursued by the respondent.
156 There was never any retraction before the Tribunal of the concession the Commissioner made by his counsel with respect to Mr Shord's status as an employee. In the context of the administrative decision-making task consigned to the Tribunal and in respect of the factual element of employment in the s 23AG(7) ITAA 1936 definition of "foreign service", the Commissioner's deliberate concession was material upon which the Tribunal was, in light of s 33 of the AAT Act, entitled to act. It had the status of an admission. Mr Shord was, in the absence of any withdrawal of this concession permitted by the Tribunal, entitled to assume that, as to this factual element, he had discharged his onus of proof and to cast the presentation of his case before the Tribunal accordingly.
157 Notwithstanding this concession by the Commissioner, one issue for determination subsequently identified by the Senior Member in her reasons (at [27]) was, "was Mr Shord's income derived from services in foreign countries (ie "foreign source income"), or any part thereof, exempt from income tax pursuant to s 23AG of the ITAA 1936, for the years ended 30 June 2006 to 30 June 2009?" As to this, the Tribunal found, at [94]:
Finally, Mr Shord 's description of the terms of his engagement by the relevant foreign companies indicates that, at all material times, he was not engaged in service as the holder of an office or in the capacity of an employee within the meaning of "foreign service" in s 23AG(7) of the ITAA 1936
158 In the circumstances, particularly having regard to the concession by the Commissioner, the Tribunal's finding that Mr Shord was not engaged in service in the capacity of an employee entailed, with all respect to the Senior Member, a patent jurisdictional error constituted by a denial of procedural fairness to him. The factual concession, never withdrawn, was logically probative of this particular factual element and should have been acted upon by the Tribunal.
159 Both as originally expressed and as it came further to be amended, the notice of appeal which engaged this Court's original jurisdiction under s 44 of the AAT Act was also prolix and diffuse in its specification of questions of law. Nonetheless, one of the questions of law it raised (question 3) was whether the Tribunal was entitled, in relation to s 23AG(7) of the ITAA 1936, to find that Mr Shord was not an employee?
160 The learned primary judge treated [94] of the Tribunal's reasons as including a finding of fact that Mr Shord was not an employee. His Honour concluded (at [18]) that it was open for the Tribunal to make this finding:
18 The question of whether or not the appellant was an employee was the subject of evidence and submissions. It cannot be said that the Tribunal's finding of fact at [94] was unreasonable: Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at [30] per French CJ. To the contrary, it was rationally open for the Tribunal to find, in circumstances where the ordinary incidents of an employer/employee relationship were absent, to conclude that such a relationship did not exist: Fletcher v Federal Commissioner of Taxation (1988) 19 FCR 442 at 451-452.
161 Having examined the transcript of proceedings before the primary judge, it appears to me that his Honour's apprehension of this particular question for determination on the appeal was the result of the way in which both Mr Fickling, counsel for Mr Shord (who had not appeared in the Tribunal) and Ms Vernon, counsel for the Commissioner, cast their submissions in the original jurisdiction. Those for Mr Shord were discursive and did not focus with particularity upon a denial of procedural fairness by the Tribunal. Perhaps reacting to that discursiveness, the Commissioner's submissions, while conceding that there was a finding at [94] of the Tribunal's reasons that Mr Shord was not an employee, sought to discount the relevance of that having regard to income from particular periods which were not in any event included in Mr Shord's assessable income in the making of the amended assessments. Further, though the concession was mentioned, the Commissioner's submissions nonetheless actively promoted the proposition that the Tribunal was entitled to conclude that Mr Shord was not an employee. That the ramifications of the concession did not loom in the reasons for judgment below appears to me, with respect, to be the result of a failure at the time to appreciate them both by those acting for Mr Shord and by those acting for the Commissioner. Against this background and that of a discursively expressed and argued notice of appeal it is, with respect, hardly surprising that the point was not raised by the learned primary judge. In short, the wood was lost for the trees.
162 It was not until, at the commencement of the appeal, Mr Shord sought leave further to amend his notice of appeal that the fact of an express concession by the Commissioner before the Tribunal and a resultant failure of procedural fairness by the Tribunal was raised with precision by him. Even so, the Commissioner initially opposed the amendment. It was only after a very pointed exchange between the bench and Ms Vernon and the standing down of the appeal so as to enable the Commissioner to reconsider his position that he came to concede that Mr Shord had been denied procedural fairness by the Tribunal in engaged in service as the holder of an office or in the capacity of an employee within the meaning of "foreign service" in subsection 23AG(7) of the ITAA 1936".
163 In light of this concession, what remained for consideration on the appeal was whether the primary judge erred in concluding that the Tribunal was entitled conclude that Mr Shord had not proved an entitlement to tax offsets for foreign income tax paid in the years ended 30 June 2006 to 30 June 2011.
164 Before turning to this remaining issue it is necessary to add the following.
165 The Commissioner is the chief revenue officer of the Crown in right of the Commonwealth. To him falls the high and important responsibility of the general administration of Federal taxation legislation, in particular the responsibility of collecting and recovering tax according to law.
166 In relation to proceedings to which the Commissioner, a Second Commissioner or a Deputy Commissioner is a party, he and these officers, or an officer authorised in writing by the Commissioner, are each entitled to appear personally or, alternatively, by a duly admitted legal practitioner: s 15, TAA. The Commissioner is not, however, ultimately responsible for the Commonwealth's legal business, even in revenue cases. His status is that of a party to litigation, suing not on his own behalf but as a representative of the Commonwealth. The ultimate, overall responsibility for the Commonwealth's legal business vests in the Attorney-General. That responsibility is derived from longstanding, Westminster system convention, arising from the nature of his office as the Commonwealth's First Law Officer and, expressly by statute, by virtue of the Attorney's ability to issue Legal Services Directions either generally or by reference to a particular matter: s 55ZF, Judiciary Act 1903 (Cth). Given the representative capacity in which the Commissioner is a party to proceedings, he and those who appear for him are subject to the duties in litigation which fall upon the Crown, Ministers and departments, agencies and other officers of the Commonwealth. The Commissioner's high office and important responsibilities mean that he has a special responsibility to lead by example in discharging these duties.
167 It is now more than a century ago that, in Melbourne Steamship Co Ltd v Moorehead (1912) 15 CLR 333, a case to which a subordinate of the Commonwealth's chief revenue officer of an earlier era, the Comptroller General of Customs, was a party, Griffith CJ felt obliged to state, at 342:
I am sometimes inclined to think that in some parts - not all - of the Commonwealth, the old-fashioned traditional, and almost instinctive, standard of fair play to be observed by the Crown in dealing with subjects, which I learned a very long time ago to regard as elementary, is either not known or thought out of date. I should be glad to think that I am mistaken.
The "standard of fair play to be observed by the Crown in dealing with subjects" to which Griffith CJ referred was not, in 1912, a new subject. Part of the constitutional history of the United Kingdom and, thus, derivatively, our own, was oppressive, unlawful behaviour by the Crown in the 17th century in the imposition, collection and recovery of taxes and a resultant and vicious civil war leading to regicide and not a republican ideal but military dictatorship. The later restoration of the monarchy was on terms that evolved into the constitutional separation of powers, legislative, judicial and executive and what we have come to know as the Westminster system of responsible government, each feature of which is to be found in the Australian Constitution. The standard of fair play expected of the Crown and its officers in litigation is a standard in keeping both with the avoidance of behaviours that, in an extreme form, led to the civil war and with the later constitutional settlement. Once this heritage is understood, the requirement for its observance is, or should be, as Griffith CJ stated, "elementary".
168 The standard expected of the Crown is not one diminished by the passage of time since the Restoration, much less since 1912, as this Court and others have, in the circumstances of particular later cases, felt obliged to highlight. Then, as now, there is a vital public interest in the maintenance of confidence in administrative government. This point was well made by Finn J in Kelson v Forward (1995) 60 FCR 39 at 66:
A shared concern both of courts and of public administrators within their particular spheres is with securing "good administration". While the respective emphases in, and understandings of, this may differ on occasion, the concern itself is a manifestly desirable and proper one. In the law, securing good administration can properly be said to be an organising idea for a group of principles which, in exacting procedural fairness, are designed to maintain public confidence in the integrity of administrative government: see e.g. Attorney-General of Hong Kong v Ng Yuen Shiu [1983] 2 AC 629; Consolidated Press Holding Ltd v Commissioner of Taxation (1995) 57 FCR 348 at 357-358.
In Commonwealth administration the concern has had a somewhat different focus. The reforms of the last decade and more - see generally The Australian Public Service Reformed (December 1992, AGPS) - have seen an accentuated emphasis on service delivery, performance and results. This emphasis has its own, acknowledged risks. As was said in Accountability in the Commonwealth Public Sector (June 1993, AGPS, p 15):
"In moving the public servant's attention to focusing more on results, care has been taken to balance this against the traditional concerns for probity and due process. Due process, fair dealing and the clear requirement to work within the law continue to be mandatory, but are not sufficient in themselves as a focal point for public servants."
For all these reasons, the importance of absolute integrity on the part of the Commissioner and those representing him in the collection and recovery of tax cannot be over-emphasised.
169 The "standard of fair play to be observed by the Crown in dealing with subjects" in litigious business, termed the duty to act as a model litigant, antedates and, if anything, is more onerous than the duty which all parties and their lawyers have in proceedings before this Court to assist in the achieving of the "overarching purpose" of facilitating the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible: s 37M and s 37N, Federal Court of Australia Act 1976 (Cth).
170 As I have observed, the Tribunal's denial of procedural fairness to Mr Shord in relation to the employment issue is patent. After the Tribunal made its decision and published its reasons, that jurisdictional error ought, ideally, upon a study of those reasons, to have been manifest to the Commissioner and to those advising him. Only the Commissioner had been legally represented before the Tribunal and it was via his lawyer that he expressly made the factual concession in question. Had the Tribunal's error been noticed, and it was not, there ought, given the concession, forthwith to have been a proactive acknowledgement of this error in dealings with the Tribunal and those acting for Mr Shord. That may or may not have obviated an appeal under s 44 of the AAT Act.
171 When a s 44 appeal did materialise, raising as a question of law whether the Tribunal was entitled, in relation to s 23AG(7) of the ITAA 1936, to find that Mr Shord was not an employee, another opportunity for the Commissioner to have conceded that, in the circumstances prevailing before the Tribunal, which materially included his factual concession, that the Tribunal's decision entailed this jurisdictional error was lost, apparently because the ramification of the Commissioner's concession was not appreciated. That not having occurred, when, finally, Mr Shord came to identify with precision the procedural fairness error in a proposed further amendment to the notice of appeal, the Commissioner should not just have not opposed the amendment but readily consented to it and actively promoted the upholding of that ground. That is how a model litigant ought to behave. It does not follow from that that the Commissioner was, in the particular circumstances, duty bound to concede the appeal. He was perfectly entitled to advance any reasonably arguable submission which was unaffected by the jurisdictional error he conceded.
172 An example of model litigant behaviour by the Commissioner in a s 44 appeal is offered by Palmer v Commissioner of Taxation (1999) 99 ATC 4514. In that case the Tribunal had, by oversight, failed to allow to Mr Palmer particular deductions which necessarily flowed from findings of fact which the Tribunal made. Mr Palmer challenged this failure by way of the statutory appeal to this Court's original jurisdiction but failed to appear on the hearing of the appeal. The Commissioner did not seek the dismissal of the appeal for want of prosecution, based on that non-appearance. Instead, as Dowsett J, at [1], acknowledged, the Commissioner "appropriately and helpfully" drew the Court's attention to the errors and promoted orders which ensured that there was a variation of the Tribunal's decision which resulted in Mr Palmer's being taxed according to law. An example of model litigant behaviour in the appellate jurisdiction is offered by SZLPO v Minister for Immigration and Citizenship (No 2) (2009) 177 FCR 29. The result, initially, in that case was a judgment in favour of the respondent Minister. After that judgment had been handed down, the Minister's solicitor drew to the attention of the Court an omission by the Court to deal with one of the grounds of appeal. The proceedings were reopened and, upon consideration of this other ground of appeal, the Court decided that its earlier judgment should be set aside and that the appeal ought to be allowed.
173 In making these observations, I do not under-estimate the difficulties presented to the Commissioner and his representatives by the unfocussed way in which Mr Shord came to challenge the Tribunal's decision and, for that matter, the judgment of the primary judge. If anything though, those difficulties made it all the more imperative that the Commissioner and those advising him proactively concede the patent jurisdictional error once it emerged with clarity. The fact that an express factual concession had been made before the Tribunal in relation to the fact of employment was not exclusively within the knowledge of the Commissioner and his representatives but it was within their knowledge. It is, to say the least, most regrettable that this patent jurisdictional error was not drawn to the Tribunal's attention by the Commissioner forthwith after the decision was published or, that not having occurred, that it was not appreciated and then conceded in the original jurisdiction or, that also not having occurred, that the absence of error in the Tribunal's conclusion with respect to the employment issue was maintained by the Commissioner until, in the very course of the hearing of the appeal, the exchange with the Commissioner's counsel mentioned earlier occurred. Even more so is this conduct regrettable in light of this Court's recent reminder to the Commissioner of his model litigant responsibilities in another appeal heard in Western Australia: LVR (WA) Pty Ltd v Administrative Appeals Tribunal (2012) 203 FCR 166.
174 It has been opined that, "Other than expressing their opinion, however, there are few tools available to the courts to hold government litigants accountable to the standards of conduct expected of model litigant.": Z Chami, "The Obligation to act as a Model Litigant", paper presented at the 2010 Australian Institute of Administrative Law National Administrative Law Forum, Sydney, 22 July 2010: (http://www.austlii.edu.au/au/journals/AIAdminLawF/ 2010/28.pdf - accessed 19 March 2017). That, with respect, is not so. Departures from model litigant behaviour can, in particular circumstances, constitute professional misconduct, a contempt of court or an attempt, contrary to s 43 of the Crimes Act 1914 (Cth), to pervert the course of justice. In the circumstances of the present case, given that the concession but not its ramification was mentioned to the primary judge by counsel for the Commissioner, it appears to me that the lack of a ready concession of the jurisdictional error was just the result of a lack of understanding, removed only by the direct exchange mentioned. Given that experience, and a patent absence of any bad faith, there the matter should rest, save perhaps in respect of costs.
175 I turn then to the remaining issue.
176 In respect of the years ended 30 June 2006 to 30 June 2011 there was a separate issue as to whether Mr Shord was entitled to tax offsets for foreign income tax paid pursuant to s 770-10(1) of the Income Tax Assessment Act 1997 (Cth) (ITAA 1997).
177 Also in respect of this issue, the Tribunal found that Mr Shord had failed to discharge the onus of proof which fell on him. Materially, the Tribunal stated (at [55] and [96]):
55. Apart from Brunei, the laws of all countries in which Mr Shord worked during the Relevant Period provided for the imposition of personal income tax. In his Witness Statement (at [21]: see para 49 above) Mr Shord states that his income tax for his overseas work in the Relevant Period was paid directly or on his behalf by his overseas employer. However, there is no evidence of this. Further, there is no evidence that Mr Shord himself paid personal income tax in any of the foreign countries in which he worked during the Relevant Period.
…
96. Mr Shord has not produced evidence to support an entitlement to any foreign income tax offset, or the quantum of any such offset, during the years ended 30 June 2006 to 30 June 2011. Specifically, there is no evidence that Mr Shord paid any foreign income tax on the foreign source income he derived whilst working overseas in the Relevant Period. Accordingly, Mr Shord has failed to positively establish what must be done to correct the Amended Assessments: Trautwein v FCT (1936) 56 CLR 63; [1936] ALR 425; FCT v Dalco (1990) 168 CLR 614; 20 ATR 1370; 64 ALJR 166; 90 ATC 4088; 90 ALR 341.
178 Before the learned primary judge, Mr Shord submitted that these conclusions were not reasonably open. This submission was rejected by his Honour. His Honour found that the material placed before the Tribunal by Mr Shord did not rise higher than assertions which were not even specific as to the nature of any tax paid either directly or on his behalf by the entity which had engaged him:
31 … It is correct that the appellant gave evidence that his income tax was paid directly or on his behalf by his employer. The Tribunal noted this at [55]. However, what is correctly concluded was that he did not prove, beyond mere assertion that such tax had been paid, or how much income tax, if any, had been paid. This conclusion was reiterated at [96] by the Tribunal. It was incumbent on the appellant to establish this fact in order to positively establish that the amended assessments were erroneous. Indeed, the appellant's objection to his amended assessments in July 2013, in which he claimed foreign tax credits, had been rejected for the very same reason. The objection decision of 18 December 2013 included the following:
You claimed you paid local taxes in source countries for your foreign source income. You made reference to an email from Craig Staggs of Technip stating Global Industries paid local taxes in source countries, including India and Thailand. However, you did not provide evidence to prove the amounts paid to each country and when the taxes were paid. Therefore we cannot allow the foreign tax credit or foreign income tax offset.
[See Mulherin v Commissioner of Taxation [2013] FCAFC 115].
32 The appellant's reliance upon Haritos v Commissioner of Taxation [2015] FCAFC 92 at [230]-[234] does not assist. Unlike the facts in that case, which involved "inexact evidence", here there was no evidence whatsoever upon which the Tribunal could make an estimate.
33 Neither the appellant's general statement that "local employment taxes" have been paid either directly or on his behalf, nor the two emails dated 1 August 2009 and 2012, respectively, alter this conclusion.
34 First, they do not establish that the taxes in question were or included income tax. Mr Stagg's email of 1 August 2012 asserts that Global Industries paid taxes in both India and Thailand for its offshore personnel. It is by no means clear that this was in respect of income tax. The explanation that the tax paid was calculated as a percentage based on the number of personnel, and the time they spent in the particular country, does not readily lead to the conclusion that it was income tax which was being paid.
35 Second, even if it were otherwise, this evidence does not establish that income tax in a particular amount was paid by or on behalf of the appellant in any particular income year. Nor was any evidence tendered of any means or formula by which such amounts might be calculated by the Tribunal. The Tribunal had no obligation to make enquiries overseas to ascertain what, if any, income tax was paid by or on behalf of the appellant.
179 On the appeal, Mr Shord seized upon his Honour's observation (at [35]) that, "The Tribunal had no obligation to make enquiries overseas to ascertain what, if any, income tax was paid by or on behalf of the appellant." He contended that not only that the Tribunal had such an obligation but also that the effect of s 33(1AA) of the AAT Act was that the Commissioner had a duty to assist the Tribunal to discharge that obligation. That subsection provides:
Decision-maker must assist Tribunal
(1AA) In a proceeding before the Tribunal for a review of a decision, the person who made the decision must use his or her best endeavours to assist the Tribunal to make its decision in relation to the proceeding.
180 Materially, s 43(1) of the AAT Act provides, "For the purpose of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision …". In the exercise of this power of review, the Tribunal is entitled, again by s 43(1) of the AAT Act, to affirm, to vary or to set aside the decision under review. This statutory provision for another officer of the executive government (the Tribunal as constituted by one or more members) to sit in place of an administrative decision-maker (the Commissioner) and to make a decision afresh follows a model the constitutional propriety of which was approved by the Judicial Committee in Shell Co. of Australia Ltd v Federal Commissioner of Taxation (1930) 44 CLR 530 (Shell v FCT). Like the Taxation Board of Review considered in Shell v FCT, the Tribunal is "in the nature of administrative machinery" and it "may act judicially, but still remain an administrative tribunal as distinguished from a Court, strictly so-called": Shell v FCT (1930) 44 CLR 530 at 544-545. The "core function" of the Tribunal is that of conducting the review for which s 43 of the AAT Act provides: Minister for Immigration and Citizenship v SZIAI (2009) 83 ALJR 1123 at 1127; [2009] HCA 39 at [18] (SZIAI).
181 In general, a proceeding before the Tribunal is not adversarial. However, a taxation review proceeding differs from others in the Tribunal in that, by virtue of s 14ZZK(b) of the TAA, there is an onus of proof and that onus falls on the applicant taxpayer. As in a taxation appeal in this Court's original jurisdiction, the taxpayer bears the onus of proving the assessment concerned to be excessive. The reference in this regard by the learned primary judge (citing with approval or reference by the Tribunal) to Trautwein v Federal Commissioner of Taxation (1936) 56 CLR 63; Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614 was, with respect, apt.
182 Even though the Tribunal's core function is one of review, there can be circumstances where it would be unreasonable for the Tribunal to decline a request by an applicant for an adjournment so as to make an inquiry so as to remedy a particular deficiency in adducing material to ground a necessary finding of fact: Minister for Immigration and Citizenship v Li [2013] HCA 18; (2013) 249 CLR 332. Further, as was observed of a similarly empowered administrative tribunal in SZIAI at [25]:
It may be that a failure to make an obvious inquiry about a critical fact, the existence of which is easily ascertained, could, in some circumstances, supply a sufficient link to the outcome to constitute a failure to review.
183 In the present case, any endeavour to remedy the deficiency in identifying with precision whether foreign income tax was paid on income derived abroad by Mr Shord and, if so, how much would have involved a wide ranging inquiry of the revenue authorities of multiple foreign jurisdictions. There was nothing before the Tribunal to indicate whether such an inquiry would be answered or, if so, when. Mr Shord, who, after all, was the person who claimed that foreign income tax had been paid on his earnings, had made no such inquiry. His own inquiries of those who had engaged him had yielded nothing more than the imprecision noted by the primary judge. There was nothing to indicate that any inquiry by the Tribunal via the Commissioner would have been any more fruitful.
184 The Commissioner may well have been able to initiate inquiries of foreign revenue authorities either informally or even perhaps formally, if there existed information sharing agreements between Australia and the foreign countries concerned, but he was not obliged to do this at either the assessing, objection decision or Tribunal review stages. This absence of obligation distinguishes the present case from Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22, a case relied upon by Mr Shord. In Wei, an administrative tribunal made findings of fact which were based on a failure by Macquarie University to comply with its imperative duty under the Education Services for Overseas Students Act 2000 (Cth) to upload onto a particular database information in relation to the enrolment of a student. Acting on the deficient database, the tribunal affirmed a student visa cancellation decision. That decision was held to be invalid. The only imperative obligation which the Commissioner had was to assess on the basis of the returns and other information in his possession: s 166 of the ITAA 1936. Subsection 33(1AA) of the AAT Act was not the source of any obligation on the part of the Commissioner to initiate any inquiry of any foreign revenue authority, or anyone else abroad for that matter, so as to ascertain what, if any income tax had been paid by or on behalf of Mr Shord abroad. Nor, in the circumstances, was the Tribunal obliged to initiate such an inquiry, seeking the Commissioner's assistance for that purpose.
185 The conclusion reached by the learned primary judge as to the s 770-10(1) ITAA 1997 foreign tax offsets issue in the case was correct. On this issue, the case was just an example of a failure by an applicant taxpayer to discharge the onus of proof that fell on him in a taxation review proceeding before the Tribunal.
186 The result then is that, given the conceded jurisdictional error on the part of the Tribunal, the s 23AG ITAA 1936 tax exemption issue will have to be reheard by the Tribunal. To this extent, the appeal must be allowed. Mr Shord has failed to demonstrate any error by the primary judge with respect to the s 770-10(1) ITAA 1997 foreign tax offsets issue. For these reasons, I agree with the orders proposed by Siopis and White JJ.
I certify that the preceding forty-four (44) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan.