Sibai v Commissioner of Taxation

The statutory provisions 21 Under s 25(1)(a) of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act), an enactment may provide that applications may be made to the Tribunal for review of decisions made in the exercise of powers conferred by that enactment. 22 By s 43(1) of the AAT Act, 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 and shall make a decision in writing either (a) affirming the decision under review, (b) varying the decision under review, or (c) setting aside the decision under review and making a decision in substitution for the decision so set aside, or remitting the matter for reconsideration in accordance with any directions or recommendations of the Tribunal. 23 Section 6(1) of the ITAA provides that an "assessment" means, relevantly, the ascertainment of the amount of taxable income (or that there is no taxable income), of the tax payable on that taxable income (or that no tax is payable), and of the total of a taxpayer's tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income). 24 Under s 166 of the ITAA, from the returns, and from any other information in the Commissioner's possession, or from any one or more of these sources, the Commissioner must make an assessment of the amount of the taxable income (or that there is no taxable income) of any taxpayer, the amount of the tax payable thereon (or that no tax is payable) and the total of the taxpayer's tax offset refunds (or that the taxpayer can get no such refunds). 25 Under s 167 of the ITAA, if any person makes default in furnishing a return, or if the Commissioner is not satisfied with the return furnished by any person, or if the Commissioner has reason to believe that any person who has not furnished a return has derived taxable income, the Commissioner may make an assessment of the amount upon which in his or her judgment income tax ought to be levied, and that amount shall be the taxable income of that person for the purpose of s 166. 26 Under s 168 of the ITAA, the Commissioner may at any time during any year, or after its expiration, make an assessment of (a) the taxable income derived (or that there is no taxable income) in that year or any part of it by any taxpayer, (b) the tax payable thereon (or that no tax is payable), and (c) the total of the taxpayer's tax offset refunds for that year or that part of it (or that the taxpayer can get no such refunds). 27 Section 170(1) of the ITAA prescribes time periods within which the Commissioner may amend an assessment. 28 Section 175A(1) of the ITAA provides that a taxpayer who is dissatisfied with an assessment made in relation to the taxpayer may object against it in the manner set out in Part IVC of the TAA. 29 Part IVC of the TAA applies to taxation objections. 30 By s 14ZL(1) of the TAA, a person who is dissatisfied with an assessment, determination, notice or decision, or with a failure to make a private ruling, may object against it if a provision of an Act or a legislative instrument so provides. This is a taxation objection: s 14ZL(2). 31 Section 14ZU of the TAA provides that a taxation objection must state in it, fully and in detail, the grounds that the person relies on. 32 As noted, s 14ZV of the TAA provides that if the taxation objection is made against a taxation decision, being an assessment or determination that has been amended in any particular, then a person's right to object against the amended assessment or amended determination is limited to a right to object against alterations or additions in respect of, or matters relating to, that particular. 33 By s 14ZY(1) of the TAA, if a taxation objection has been lodged with the Commissioner within the required period, the Commissioner must decide whether to allow it, wholly or in part, or disallow it. 34 Section 14ZZ(1)(a) of the TAA provides that if a person is dissatisfied with the Commissioner's objection decision, the person may, if the decision is a reviewable objection decision, apply to the Tribunal for review of the decision or appeal to the Federal Court against the decision. 35 A reviewable objection decision means an objection decision that is not an ineligible income tax remission decision: s 14ZQ of the TAA. 36 Division 4 of Pt IVC of the TAA applies to the Tribunal's review of objection decisions, and included s 14ZZK which, as noted, provides that: (a) the applicant is, unless the Tribunal orders otherwise, limited to the grounds stated in the taxation objection to which the decision relates, and (b) if the taxation decision concerned is an assessment - that the assessment is excessive or otherwise incorrect and what the assessment should have been. 37 The equivalent provision to s 14ZZK, which applies in an appeal to the Federal Court, is s 14ZZO.

Facts 38 The applicant had lodged returns for the years 2012 and 2013 showing nil or modest taxable income. Notices of assessment were issued by the Commissioner as follows: (a) 2012 - nil taxable income as per the return, and (b) 2013 - $85,271 taxable income as per the return. 39 The Commissioner conducted an audit of the applicant in 2015. On 13 May 2015, the Commissioner issued amended assessments for 2012 and 2013 (s 167 of the ITAA) and a special assessment for 2014 (s 168 of the ITAA). Notices of shortfall penalty assessments were also subsequently issued. 40 On 28 June 2016, the applicant lodged an objection against the 13 May 2015 assessments. 41 On 12 May 2017, the Commissioner allowed the objections in part and otherwise disallowed the objections and then issued amended assessments for 2012, 2013, and 2014.

Applicant's contentions 42 The applicant contends that the amended assessments for 2012 and 2013, his objections, and the Commissioner's objection review decisions were confined to altering the original assessments by, in each case, the addition of a discrete amount of assessable income which left all other particulars of the 2012 and 2013 tax returns and the original assessments unaltered. 43 The applicant's contention (referred to as the "s 14ZV jurisdictional issue") is that, by operation of s 14ZV of the TAA and associated provisions of the statutory scheme identified above, the Tribunal has no jurisdiction as part of the review to consider any particular of the amended assessments for 2012 and 2013 other than the Commissioner's additions of the discrete amounts of assessable income for each year. 44 Explained in the terms of the applicable statutory context, the applicant contends that: (1) the objections were confined to the discrete amounts of additional assessable income as required by s 14ZV of the TAA; (2) the Commissioner's objection decisions were confined to allowing and disallowing parts of those objection decisions as provided for in s 14ZY of the TAA; (3) under s 14ZZ of the TAA, the application for review before the Tribunal is confined to a review of the entirety of the discrete amounts of additional assessable income (and not just the parts disallowed by the Commissioner about which the applicant is dissatisfied), because this is the scope of the Commissioner's objection decision under s 14ZY of the TAA; and (4) construing s 14ZZK in this context, and having regard to s 14ZZK(a), s 14ZZK(b) must mean that the applicant's burden is to prove that the discrete amounts of additional assessable income were not assessable income either in whole or in part and, if the applicant does so, it follows that the assessments are excessive or otherwise incorrect, and that the assessment should have been the resulting lesser amount (excluding the whole or part of the discrete amounts of additional assessable income for each year as determined by the Tribunal). 45 The same arguments underlie the applicant's contention that the Tribunal, in fairness, had to permit him to rely on his applications under s 14ZZK(a) of the TAA and proposed second further amended statement of facts, issues and contentions. So far as I can understand this argument, it is to this effect (as senior counsel explained in the hearing before the Tribunal on 26 October 2020): (1) once the Commissioner disclosed on 19 September 2019 that he was putting the applicant to proof in respect of all facts on which the applicant relied to discharge his burden of proving that the notices of amended assessment are excessive, the applicant filed further evidence to meet that case, and the amended statement of facts, issues and contentions; (2) the applicant then considered that he would also have to seek to amend his grounds of objection under s 14ZZK(a) because he had not objected about anything other than the addition of the discrete amounts of assessable income in each year; and (3) the applicant also considered that his amended statement of facts, issues and contentions had to be further amended to enable him to put both cases - being the confined case he asserted, dealing only with the addition of the discrete amounts of assessable income in each year, and the expanded case to deal with the Commissioner's position that the applicant had the burden of proving all facts on which the applicant relied to establish that the notices of amended assessment are excessive. 46 One reason I struggle to understand this latter aspect of the applicant's argument is that the applicant knew the Commissioner's position from (at the latest) 19 September 2019 and had already filed the further amended statement of facts, issues and contentions in that regard on 17 April 2020. If the applicant wanted to put two alternative cases, one confined and the other more expansive, the applicant could have done so on 17 April 2020. The applicant could also have applied at that time to amend his grounds of objection. He did neither. Instead he filed the 17 April 2020 statement of facts, issues and contentions, which responded to the Commissioner's position as put in the Commissioner's statement of facts, issues and contentions (that is, the applicant had the burden of proving all facts on which he relied to prove that the amended were excessive). 47 It is not apparent why the applicant waited until September and October 2020 to file the applications under s 14ZZK(a) of the TAA and the proposed second further amended statement of facts, issues and contentions respectively. It is also not apparent why the applicant, having always maintained that the Tribunal's review was confined to the addition of the discrete amounts of assessable income in each year, only identified his (purportedly) complete contentions in that regard in September and October 2020. These facts are relevant because it is apparent that he Tribunal's decisions about the applications under s 14ZZK(a) of the TAA and the proposed second further amended statement of facts, issues and contentions were a result of case management considerations, and not any issue of principle.

The "jurisdictional" issue 48 There is no "jurisdictional" issue. 49 The "jurisdictional" issue is nothing more than a dispute about the proper scope of the review before the Tribunal or, to be precise, what the applicant must prove to succeed before the Tribunal. The Tribunal had jurisdiction to determine that issue. 50 The applicant may be correct that it is possible to trace through the process leading up to the amended assessments for 2012 and 2013 and infer from this that the Commissioner increased the applicant's taxable income by adding amounts of assessable income, but otherwise assumed that the information in the applicant's returns was correct. If so, this does not mean that in issuing the amended assessments the Commissioner merely altered the particulars of the assessment by the addition of the discrete amounts of assessable income. Rather, the amended assessments disclose the amendment of one particular only, in each case being the change from the previous taxable income to the amended taxable income. This conclusion is consistent with the reasoning in Federal Commissioner of Taxation v Australia & New Zealand Savings Bank Ltd (1994) 181 CLR 466 (ANZ) at 483 where McHugh J said that a default assessment under s 167 involves one component only, being the final amount. 51 Neither Briggs v Commissioner of Taxation (WA); Ex parte Briggs (No 2) (1987) 14 FCR 249 nor Madden v Madden (1996) 65 FCR 354 are to the contrary. In Briggs at 265, to the extent relevant, Sheppard J merely accepted that under s 167 the Commissioner might (but need not) endeavour to ascertain the assessable income and the allowable deductions which the taxpayer has. In Madden, to the extent relevant, Foster J at 394 accepted this aspect of the reasoning in Briggs. 52 On this basis, s 14ZV of the TAA would have permitted the applicant to object to matters relating to that particular, being any aspect of the change from the previous taxable income to the amended taxable income. 53 The applicant, however, asserts that he did not take this view and confined his objections to the addition of the discrete amounts of assessable income as required by s 14ZV of the TAA. Whether this is so or not is immaterial, because the applicant's arguments about the "jurisdictional" issue confuse the provisions which regulate a taxpayer's taxation objection before the Commissioner and the provisions which regulate the Tribunal's review of the Commissioner's taxation objection decision. 54 Assume (contrary to my view and to ANZ at 483) the applicant is right that the Commissioner amended the assessments in respect of the particular additions of discrete amounts of assessable income in each year. Section 14ZV of the TAA then operated to limit the applicant's right of objection to those additions. By s 14ZY(1) of the TAA, the Commissioner had to decide whether to allow or disallow, in whole or part, those objections. The Commissioner did so. Under s 14ZZ(1)(a) of the TAA the applicant was dissatisfied with that objection decision and could apply to the Tribunal for review of that reviewable objection decision. 55 So far, so good from the applicant's perspective. Everything is confined to the particular additions of discrete amounts of assessable income in each year. Section 14ZZK then operates. From the applicant's perspective the question is, how can he be limited in the Tribunal to the grounds stated in the taxation objection to which the decision relates under s 14ZZK(a) and yet have the burden of proving that the assessments are excessive or otherwise incorrect and what the assessments should have been under s 14ZZK(b), if this means that the applicant has to prove his true taxable income and thus tax liability in each year? Rather, according to the applicant, he proves the assessments are excessive or otherwise incorrect, and what the assessments should have been under s 14ZZK(b), if he proves that any of the particular additions of discrete amounts of assessable income in each year are excessive or incorrect. 56 The problem is that s 14ZZK(b)(i) does not say what the applicant wants it to. It says the applicant has the burden of proving that the assessment is excessive or otherwise incorrect and what the assessment should have been. The "assessment" is the ascertained amount of taxable income, tax payable on that taxable income, and total of a taxpayer's tax offset refunds for a year of income. Given the notices of assessment in issue in this case, the applicant had the burden of proving that these ascertained amounts were excessive or otherwise incorrect, and what amounts should have been ascertained. On no view are these ascertained amounts confined to the particular additions of discrete amounts of assessable income in each year. 57 It is not to the point that in any given case an applicant's objection may be confined under s 14ZV to a particular of an assessment that has been altered, or that the Commissioner's objection review decision may be confined to alteration or some or other particular of an assessment the subject of an objection. It is also not to the point that the decision of which the Tribunal is seized is a decision confined to alteration or some or other particular of an assessment the subject of an objection. For an applicant to succeed in a review of that decision (however the decision is characterised or whatever its scope), the applicant must prove that the assessment is excessive or otherwise incorrect, and prove what the assessment should have been. Section 14ZZK(b) is about what an applicant must prove to succeed before the Tribunal, irrespective of the character of or process which led to the Commissioner making the reviewable objection decision. 58 In exercising its jurisdiction to review a reviewable objection decision, the Tribunal is bound to apply s 14ZZK(b) in accordance with its terms. The ways in which the Tribunal may satisfy itself that an applicant has discharged its burden depends on the forensic decisions of the parties including, in particular, the extent to which the Commissioner decides to put an applicant to proof. That extent is a matter for the Commissioner alone to decide, in each case, once an application for review to the Tribunal is made. 59 This makes perfect sense. It ensures that once an application for review is filed in the Tribunal: (1) an applicant cannot expand the case beyond the grounds of objection unless the Tribunal otherwise orders; and (2) the Commissioner can require an applicant to prove every or any fact relevant to establishing that the assessment is excessive or otherwise incorrect, and what the assessment should have been. 60 The relevant forensic choice before the Tribunal is that of the Commissioner, not the applicant. The Commissioner is constrained in that forensic choice only by considerations of procedural fairness and case management, both of which are regulated by the Tribunal. Before the Tribunal, the Commissioner can choose to put an applicant to proof of every fact relevant to establishing that the assessment is excessive or otherwise incorrect, and what the assessment should have been. The ordinary process of administrative decision-making by the Commissioner cannot give rise to any "implied agreement", estoppel or waiver by the Commissioner of the right under s 14ZZK(b) to make whatever forensic choice the Commissioner sees fit about what the applicant must prove before the Tribunal. 61 There is no necessary inconsistency between this construction of s 14ZZK(b), which gives the words of the section their ordinary and natural meaning, and the other provisions of the statutory scheme including ss 14ZZK(a) and 14ZV. 62 A first answer to the applicant's posited inconsistency is that s 14ZZK(a) operates "unless the Tribunal orders otherwise". That is, if the Commissioner makes a forensic decision in the Tribunal to put an applicant to proof of a wider range of matters than the matters dealt with in an applicant's grounds of objection, the Tribunal can order, under s 14ZZK(a), that the applicant is not limited to the grounds of objection and may rely on grounds about the wider range of matters. In the present case, this possibility was plainly contemplated by the Tribunal when it ordered the applicant, on 10 March 2020, to file a further amended statement of facts, issues and contentions, and to set out the contentions for which leave under s 14ZZK(a) is required. 63 A second answer is that, although the capacity of the Tribunal to "otherwise order" in accordance with s 14ZZK(a) is discretionary, the Tribunal remains subject to a duty to ensure that the review is conducted in a manner consistent with the requirements of procedural fairness. If the Commissioner decides in the Tribunal that an applicant must prove all facts relevant to the applicant's taxable income then, in the ordinary course, the requirements of procedural fairness would include that an applicant be given a reasonable (but not an unlimited or absolute) opportunity to file evidence and make a case in support of all aspects of the applicant's asserted taxable income and tax liability. 64 A third answer is that s 14ZZK(a) simply does not operate as the applicant believes. For example, in the present case, the Commissioner has put the applicant to proof of all facts necessary to establish that the assessments were excessive or otherwise incorrect. In my view, s 14ZZK(a) does not mean that the applicant is unable to adduce evidence to prove, or try to prove, that the items which constitute his taxable income not altered by the Commissioner are as identified in his returns and that, in accordance with his grounds of objection, the Commissioner should not have added the discrete amounts of additional assessable income. This would not offend s 14ZZK(a) because, in so doing, the applicant is not contending that the amended assessments are excessive or incorrect outside of the grounds of objection. The applicant is merely proving that the Commissioner was right to accept certain items in issuing the amended assessments and in the taxation objection decisions to the extent the Commissioner allowed those objections in part and wrong insofar as the Commissioner disallowed the applicant's objections. 65 To explain further, an applicant contending in the Tribunal that the Commissioner was wrong in part or whole because of a rejected ground of objection is one thing, as is an applicant contending in the Tribunal that the Commissioner was right in part or whole to have assumed or not disputed the correctness of other information put forward by an applicant in the taxation assessment and objection process before the Commissioner. Neither class of contention requires the Tribunal to "otherwise order" under s 14ZZK(a). The former involves nothing more than an applicant making contentions in the Tribunal in accordance with the grounds of objection. The latter involves nothing more than an applicant, if and as required by the Commissioner in the Tribunal, adducing evidence to prove that the Commissioner was right to not dispute certain information provided by the applicant to the Commissioner in the assessment and objection process. No order under s 14ZZK(a) for the latter is required because there is no need for the applicant to put anything to the Tribunal other than that: (a) the grounds of objection should be upheld, and (b) the Commissioner was otherwise right to not dispute or to accept other aspects of the information put forward by the applicant in the assessment and objection process. 66 However, an applicant contending in the Tribunal that the Commissioner was wrong in part or whole to have assumed or not disputed the correctness of other information put forward by an applicant in the taxation assessment and objection process before the Commissioner is another thing altogether. If an applicant wishes to do this and to adduce evidence to support such a contention, then the applicant will need an order otherwise from the Tribunal under s 14ZZK(a). 67 I recognise that this third (and my preferred) view about how s 14ZZK(a) affects the scope of the permissible evidence from an applicant may be thought to be in conflict with obiter dicta in Bosanac v Commissioner of Taxation [2019] FCAFC 116; (2019) 267 FCR 169 at [47] where the Full Court said: The grounds that may be relied upon are confined to those raised before the Commissioner in the objection, unless the court otherwise orders. So, the evidence that may be led to discharge the onus is likewise confined. (Emphasis added). 68 However, in Bosanac, the Full Court was not called upon to consider the operation of s 14ZZK(a) in circumstances analogous to the present case. The observation of the Full Court is made in passing only. If the Commissioner's forensic decision before the Tribunal is to confine the issues in dispute to those that are the subject of the objection, the Full Court's observation would be accurate. If, however, the Commissioner makes a forensic decision in the Tribunal to put the applicant to proof of all facts relevant to the applicant's taxable income then (leaving aside case management considerations), I cannot see how s 14ZZK(a) could operate to prevent a taxpayer from seeking to prove that the Commissioner was right to accept any particular underlying the assessment which it may be inferred that, up to the filing of the application for review in the Tribunal, the Commissioner did not dispute. 69 This approach to s 14ZZK(a) is also consistent with the observations of White J in Commissioner of Taxation v Moignard [2015] FCA 143; (2015) 228 FCR 456 at [101]-[104] set out below. 70 It is also necessary to recognise that in all cases, procedural fairness requires only that a party be given a reasonable opportunity to put the party's case. It does not require that the party be given every possible opportunity to do so at any time of the party's choosing and irrespective of case management directions of the Tribunal. 71 Further, and contrary to the applicant's apparent assumption, all that s 14ZZK(a) contemplates is that an applicant will be limited to the grounds of objection unless the Tribunal otherwise orders. The Tribunal, thereby, can order that the applicant not be limited to the applicant's grounds of objection, and be permitted to contend that the assessment is excessive or otherwise incorrect, and what the assessment should have been on grounds other than those in the grounds of objection. While those additional grounds need to be identified, they need not be identified by the making of an order amending the existing grounds of objection. Presumably, this is why the Tribunal's orders of 10 March 2020 contemplated that the applicant would identify the terms of any order the applicant sought under s 14ZZK(a) in a further amended statement of facts, issues and contentions. As noted, on 17 April 2020, the applicant filed a statement of facts, issues and contentions which sought no order under s 14ZZK(a) and the applicant did not provide any version that sought such an order until 16 October 2020, 10 days before the hearing and about four months after the Commissioner had filed his evidence. Given the history of the matter in the Tribunal, the applicant is not well-placed to make any complaint of a denial of procedural fairness. 72 Given the ordinary and natural meaning of s 14ZZK(a) and (b), it is not surprising that the cases are consistent with my principal conclusion that the Commissioner is free in the Tribunal to put the applicant to proof of any or all facts relevant to the issue of the assessment being excessive or otherwise inaccurate. The applicant's attempts to distinguish these cases are unsustainable. Relevant statements include the following (with emphasis added of the critical parts, exposing why the cases are not distinguishable from the present): (1) Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614 A taxpayer, who seeks to discharge the burden of proving that the amount shown in the notice of assessment is excessive, is limited by s. 190(a) to the grounds stated in an objection against the assessment. An objection must state "fully and in detail" the grounds on which a taxpayer relies (s. 185) and the Commissioner is required, after consideration of the objection, to "disallow it, or allow it either wholly or in part": s. 186. But an objection and a Commissioner's notice of decision on the objection are not pleadings which so confine the issues as to preclude the Commissioner from putting the taxpayer to proof of the true amount of his taxable income. After all, the purpose of the procedure of assessment, objection and appeal or review is to ascertain the true tax liability of the taxpayer under the substantive provisions of the Act. Oftentimes, the grounds of an objection and the Commissioner's notice of decision thereon will define the issues for determination by a court entertaining an appeal against the assessment; but not necessarily so (p 621). … The manner in which a taxpayer can discharge that burden varies with the circumstances. If the Commissioner and a taxpayer agree to confine an appeal to a specific point of law or fact on which the amount of the assessment depends, it will suffice for the taxpayer to show that he is entitled to succeed on that point. Absent such a confining of the issues for determination, the Commissioner is entitled to rely upon any deficiency in proof of the excessiveness of the amount assessed to uphold the assessment, though the taxpayer is limited to the grounds of his objection (p 624). … I agree with Wilcox J. in the Federal Court that "the task for the taxpayer, upon an appeal or a review under Pt V of the Act, is to show that the amount of money for which tax is levied by a particular notice of assessment exceeds the actual substantive liability of the taxpayer". As his Honour points out, a taxpayer will generally discharge that onus by satisfying the court or tribunal that his or her true taxable income is less than that appearing in the assessment (p 631). (2) Federal Commissioner of Taxation v Australia & New Zealand Savings Bank Ltd (1994) 181 CLR 466 While s.187 speaks of a request to refer "the decision" to the Tribunal or a request to refer it to the Federal Court, it is apparent that in the former case the reference is for the purposes of administrative review while in the latter case it is for the purposes of appeal. But what is referred, in either case, is the Commissioner's decision under s.186 of the Act which is a decision, after considering an objection, to disallow it, or allow it either wholly or in part. Obviously, there will be no reference if the objection has been wholly allowed. Section 189 makes abundantly clear that what is referred to the Tribunal or to a court is "a decision on an objection" and that the referral constitutes either the making of an application to the Tribunal for a review of "the decision" or the institution of an appeal against "the decision". When the decision comes before the Tribunal for review or the Federal Court on appeal the burden of proving that the assessment is excessive lies upon the taxpayer… (p 475). … The flaw in the approach taken by the majority in the Federal Court was to give the notion of particulars a significance which it does not have in the present case. The terms "particular" and "particulars" have a role to play in the operation of the Act but they are not determinative of the jurisdiction of the Federal Court to entertain a contention by the Commissioner that, if the basis on which he has determined the assessable income of a taxpayer is shown to be in error by reason of the inclusion of a particular amount, the basis on which the Commissioner determined deductions to be made from that income in order to arrive at the taxable income of the taxpayer should also be reviewed (p 477). … The question for the Court hearing an appeal is not whether the grounds of objection have been made out but whether the taxpayer has satisfied the burden cast by s.190(b) of proving that the assessment is excessive. Although Dalco was concerned with a default assessment made pursuant to s.167 of the Act, the point applies equally to an assessment made pursuant to s.166. Each section is concerned with the taxable income of a taxpayer. In several decisions it has been held that the Commissioner may support the amount of the assessment on a ground not taken into account at the time the assessment was made … The Commissioner will be required to give proper notice to the taxpayer and, where appropriate, will be directed to furnish particulars. But, as Kitto J observed in Federal Commissioner of Taxation v. Wade ((21) (1951) 84 CLR at 117.): "No conduct on the part of the commissioner could operate as an estoppel against the operation of the Act." In the present case the Commissioner does not seek to support the assessments on a ground not previously taken into account. The Commissioner seeks to support the assessments, if not in their entirety, by reference to what he claims to be reductions in the amount of the deductions properly allowable to the taxpayer under s.51(1) of the Act as a consequence of the Federal Court's decision as to the basis on which the assessable income of the taxpayer should be determined. Since the Court is concerned to determine whether the amounts assessed as taxable income are excessive, the Commissioner must be able to raise for the Court's determination the deductions properly to be allowed in the light of the Court's decision as to assessable income (p 479). (3) Commissioner of Taxation v Rigoli [2013] FCA 784 [15] There will, no doubt, be many cases where proceedings to challenge an assessment under s 167 may effectively be limited to some aspect of the total calculation undertaken by the Commissioner in forming a judgment about the amount upon which tax is to be levied. Agreement between the Commissioner and the taxpayer may be one example. Another may, conceivably, be where a taxpayer gives evidence from which a Tribunal may properly determine that amounts included in the Commissioner's calculations were sufficiently proven by evidence upon the balance of probabilities. It is, for example, conceivable that a taxpayer may give probative evidence to the effect that amounts found in computations by the Commissioner were, in the taxpayer's testimony, likely to be correct… (4) Commissioner of Taxation v Moignard [2015] FCA 143; (2015) 228 FCR 456 [101]… in principle the limitation of the grounds upon which a taxpayer may object to an amended assessment should not affect a taxpayer's burden of establishing his or her true tax liability. The obligation on a taxpayer imposed by s 14ZZK(b)(i) to reveal any taxable income not previously disclosed to the Commissioner cannot reasonably be understood as being qualified by the limitation on the grounds of objection to the assessment in fact issued by the Commissioner, nor can the taxpayer's obligation to show that no portion of a total amount included by the Commissioner in the assessable income is properly assessable be so regarded. A contrary construction would be inconsistent with the object of s 14ZV. … [103] The notion that s 14ZV modifies the onus of proof imposed by s 14ZZK on a taxpayer is also inconsistent with the decision of the High Court in Federal Commissioner of Taxation v Australia and New Zealand Savings Bank Limited (1994) 181 CLR 466 in which it was held that it is open to the Commissioner on an appeal against the disallowance of an objection to raise for the Court's determination the appropriateness of deductions allowed to the taxpayer in the Commissioner's assessment. It is not readily to be supposed that s 14ZV would preclude a taxpayer from objecting to something raised by the Commissioner. [104] Although by virtue of s 14ZZK(b)(i), a taxpayer has the burden in the AAT of showing his or her correct taxable income, it is possible for the parties to "agree to confine an appeal to a specific point of law or fact on which the amount of the assessment depends": Dalco at 624 (Brennan J) and 626‑7 (Deane J). When that occurs, success by the taxpayer on the identified issue may be sufficient to indicate that the assessment is excessive. (5) Zappia v Commissioner of Taxation [2017] FCAFC 185; (2017) 106 ATR 875 [2] It was submitted by the appellant that she was able to discharge her statutory burden of proof by relying upon what was described as "facts found by the Commissioner in his objection decision" and that the Commissioner was bound by those facts in proceedings under Part IVC of the 1953 Act…. [3] The appellant's submissions cannot be accepted and proceed from an erroneous premise. The question for a court hearing a tax appeal is whether a taxpayer has satisfied the burden cast by s 14ZZO: Federal Commissioner of Taxation v Australia & New Zealand Savings Bank Ltd (1994) 181 CLR 466 at 479. The burden imposed upon the appellant by s 14ZZO to prove that the assessment was excessive required her to establish the amount upon which tax was to be levied: Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614 at 625, 634; Gashi v Commissioner of Taxation [2013] FCAFC 30; 209 FCR 301 at [66]-[67], Rigoli v Commissioner of Taxation [2014] FCAFC 29; 96 ATR 19 at [26]. The statutory amendments relied on by the appellant do not affect this requirement of s 14ZZO. Proof of the amount upon which tax was to be levied is not established by showing error by the Commissioner in the evidentiary, factual or legal basis of assessment: Dalco, Rigoli. Statements made by the Commissioner in an objection decision do not establish the facts upon which tax was to be levied and do not bind the Commissioner, or the operation of the taxing provisions, except (perhaps) where the parties in proceedings have agreed to the facts for the purposes of the proceedings. The recital of facts found in an objection decision are not themselves the facts they purport to recite and their recitation does not bind the Commissioner, or the operation of the taxing statute, where a taxpayer is required to discharge the burden imposed by s 14ZZO to prove that an assessment is excessive. That can be done only by establishing the facts upon which the liability depends. The reasons in the joint judgment in Australia & New Zealand Savings Bank Ltd at 479 do not stand for a contrary proposition. (6) Bosanac v Commissioner of Taxation [2018] FCA 946 [81] … Generally speaking, the onus imposed on a taxpayer to demonstrate excessiveness is practically the same, if not legally the same, regardless of whether the assessment in dispute was issued pursuant to s 166 or s 167. These two sources of power are very different, but that is so from the perspective of the Commissioner, not the taxpayer: Gashi v Federal Commissioner of Taxation (2013) 209 FCR 301 at [52]-[56]. From the taxpayer's perspective, the task is to prove excessiveness, and this includes proving, or otherwise demonstrating, the correct taxable income. The source of that obligation is not s 167 or s 166, but s 14ZZO of the Taxation Administration Act 1953 (Cth). (7) Bosanac v Commissioner of Taxation [2019] FCAFC 116; (2019) 267 FCR 169 [47] Having regard to the issues raised in the present appeal, we would summarise the nature of an appeal under s 14ZZ in the following terms. Although s 14ZZ provides for an 'appeal', it confers an original jurisdiction to determine a review claim 'against the decision' by the Commissioner on an objection. The Court is to determine the claim on the evidence presented to it in accordance with its usual practice and procedure for applications in its original jurisdiction. The onus is on the appellant to prove that the assessment the subject of the objection decision was excessive or otherwise incorrect and what the assessment should have been. As stated by Dowsett J in Weyers v Commissioner of Taxation [2006] FCA 818 at [146], '[t]he Commissioner need not justify the decision, save in response to an appropriate attack upon it'. The grounds that may be relied upon are confined to those raised before the Commissioner in the objection, unless the court otherwise orders. So, the evidence that may be led to discharge the onus is likewise confined. It is a matter for the parties whether they stipulate the correctness of factual matters before the Commissioner. However, in the absence of such matters being agreed or such matters being presented as evidence of the truth of those matters without objection, it is for the appellant to provide the necessary evidence on the hearing before the court on the 'appeal'. The court does not simply receive the record before the Commissioner on the objection and make its decision on that basis. Nor does it consider whether there has been error demonstrated in the decision by the Commissioner. Even less so does it consider whether an amended assessment issued after the objection decision is correct. Therefore, as noted by Greenwood J in Aurora Developments Pty Ltd v Federal Commissioner of Taxation (No 2) [2011] FCA 1090; (2011) 196 FCR 457 at [32], 'an appeal under s 14ZZ(c) bears some of the characteristics of an appeal by way of a hearing de novo in that the taxpayer has an extensive, though not unqualified, right to put additional evidence before the Court'. 73 The applicant's reliance on these and other cases in an attempt to demonstrate to the contrary is unpersuasive and involves fundamental misconceptions about the principles for which those cases stand. In respect of the other cases: (1) Trautwein v Federal Commissioner of Taxation [1936] HCA 77; (1936) 56 CLR 63 considered a provision (s 37(1) of the then ITAA) which confined a taxpayer's capacity to object to any alteration or addition to an assessment to one which had the effect of imposing a fresh liability or increasing an existing liability. It is the equivalent, in different terms, of s 14ZV of the TAA. The fact that the decision in Trautwein discloses that it is permissible to go behind the assessment to determine if the alteration or addition to an assessment had the effect of imposing a fresh liability or increasing an existing liability does not mean, as the applicant appears to assume, that in the present case: (a) the Commissioner is to be taken to have agreed in perpetuity with all particulars underlying the assessments not the subject of disallowance in the Commissioner's taxation objection decisions, or (b) the Commissioner is somehow estopped for putting the applicant to proof in the Tribunal of all particulars underlying the assessments not the subject of disallowance in the Commissioner's taxation objection decisions; (2) Commissioner of Taxation v Swan Brewery Co Ltd [1991] FCA 463; (1991) 30 FCR 553 confirmed that, under ss 170(1) and 185 (as amended) of the ITAA, a taxpayer did not obtain a general right of objection as a result of an alteration or addition to an assessment. Again, neither Trautwein nor Swan Brewery support any notion that the Commissioner is taken to have agreed in perpetuity to or is estopped from putting an applicant in a Tribunal to proof of all facts relevant to the applicant's taxable income and tax liability as a result of the operation of s 14ZV or s 14ZZK(a); (3) Commissioner of Taxation of the Commonwealth of Australia v Jackson [1990] FCA 604; (1990) 27 FCR 1 concerned s 177F of the ITAA, which permits the Commissioner to deem amounts to be included in assessable income. The Commissioner made a determination under s 177F. The outcome in Jackson was that the determination did not itself operate as an amended assessment. As a result, the Commissioner could not rely on the determination in the Tribunal without amending the assessment to reflect the determination. Jackson says nothing supporting the applicant's propositions in the present case; (4) Liedig v Commissioner of Taxation (Cth) (1994) 50 FCR 461 does not support the applicant's contentions. The case does not consider the operation of s 14ZZK(b); it is concerned with s 14ZZK(a). Insofar as Hill J referred to Mobil Oil Australia Pty Ltd v Commissioner of Taxation (Cth) (1963) 113 CLR 475 at 502 and the relevant obligation, being to "merely to do over again (within the limits of the taxpayer's objection) what the Commissioner did in making the assessment", it must be understood that this is so if and only if the Commissioner, in the Tribunal, does not make a forensic decision to put the applicant to proof of all facts relevant to the assessment. No doubt the applicant can point to innumerable cases where the Commissioner has not chosen to put an applicant to proof of anything more than the matters the subject of the objection decision, to the extent it was disallowed. That does not change the fact that this is a choice the Commissioner is free to make in every case before the Tribunal. Equally, however, the Commissioner can choose to put an applicant to proof of every fact relevant to the assessment. Properly understood, neither Liedig nor Mobil Oil suggest to the contrary; and (5) Epov v The Commissioner of Taxation [2007] FCAFC 139 confirmed that s 14ZV operates in accordance with its terms. It too says nothing supporting the applicant's propositions in the present case. 74 The submissions for the applicant are also unsustainable. 75 As noted, it may be true that, in the present case, it can be inferred that in making the taxation objection decisions the Commissioner, in effect, altered the assessable income of the applicant but otherwise did not dispute aspects of the returns and information provided by the applicant. That does not mean that the Commissioner impliedly agreed not to put the applicant to proof of all relevant facts before the Tribunal as provided for in s 14ZZK(b). Nor does it mean that the Commissioner is somehow estopped from putting the applicant to proof of all relevant facts before the Tribunal or waived the right or capacity to do so given the terms of s 14ZZK(b). 76 Nor, for the reasons given, is there any unfairness to the applicant resulting from the operation of s 14ZV (which the applicant, wrongly in my view, believed confined the scope of his objection to the alterations in the case of the 2012 and 2013 amended assessments) or s 14ZZK(a) (which confines the applicant before the Tribunal to the grounds of objection). This is so whether the applicant was (or is) wrong or right about s 14ZV. As explained this is because of: (1) the power of the Tribunal to otherwise order under s 14ZZK(a) of the TAA; (2) the duty of the Tribunal to act in accordance with the requirements of procedural fairness, which includes a reasonable (but not an absolute or unlimited) opportunity for a party to present its case; and/or (3) my view that s 14ZZK(a) does not operate to prevent an applicant before the Tribunal seeking to prove nothing more than that the Commissioner was right about any aspect of an assessment not the subject of objection. To make contentions and adduce evidence to the effect that the Commissioner was right about any aspect of an assessment not the subject of objection does not require the making of any order under s 14ZZK(a). 77 The applicant's submission that "one size does not fit all" under s 167 is beside the point. It is true that, in some default assessments, it may not be possible to identify what items the Commissioner did and did not accept in the Commissioner's decision-making processes and that in other default assessments it may be possible to identify these items. Even putting ANZ at 483 to one side, this does not matter one way or another to the operation of s 14ZZK. The Commissioner is always free to put an applicant before the Tribunal to proof of any and every fact relevant to the assessment. The mere fact (if it be the fact) that, in the present case, it is possible to infer what the Commissioner accepted or assumed to be correct in the decision-making process culminating in the taxation objection decisions does not come close to establishing some form of agreement (implied or otherwise) or estoppel or waiver or any other unknown cause of action preventing the Commissioner from putting the applicant to proof of all relevant facts in the Tribunal. 78 This case does not call up for consideration any of the multiplicity of issues the applicant seeks to raise. It does not call up any issue about the operation of ss 166 or 167. It is simply irrelevant that, according to the applicant, the 2012 and 2013 assessments did not dispute the deductions the applicant had claimed. That is all well and good for the process of the Commissioner's decision making up to and including the taxation objection decisions. Once the applicant applied for review in the Tribunal, however, s 14ZZK(b) operates in accordance with its terms. 79 The applicant has been unable to identify a single authority that provides any support for his arguments to the contrary. 80 For these reasons, the errors of law the applicant attributes to the Tribunal in respect of the so-called "jurisdictional issue" are without foundation. 81 First and foremost, any error by the Tribunal is immaterial given that it reached the correct conclusion that, as a result of the forensic position of the Commissioner in the Tribunal, the applicant is "required to establish his taxable income and is to do more than lead evidence addressed to changes of his assessable income". 82 Otherwise, my conclusions are that: (1) contrary to ground 1, the Tribunal did not have to refer to every case the applicant mentioned in submissions. The Tribunal understood the argument being put and gave adequate reasons for rejecting it; (2) ground 2 is another version of ground 1; (3) ground 3 is a complaint about the Tribunal's conclusion, which was correct for the reasons given; (4) ground 4 is another version of ground 3; (5) contrary to ground 5, the Tribunal was right to apply the reasoning in Dalco, which is not distinguishable merely because of the nature of the Commissioner's decision in that case; (6) contrary to ground 6, nothing in Dalco supports the applicant's propositions in this case. Dalco does contemplate that, before the Tribunal, the Commissioner may (not must) agree to limit the scope of the facts in dispute. This is a forensic decision the Commissioner is free to make in each and every proceeding before the Tribunal; and (7) to the extent ground 7 concerns the so-called "jurisdictional decision", the alleged error is founded on the applicant's incorrect view of the law rejected above.

The other applications 83 The grounds of the application relating to alleged errors by the Tribunal in refusing to order that the applicant be permitted to amend the grounds of objection and to rely on the proposed second further amended statement of facts, issues and contentions expose the same fundamental misconceptions on the part of the applicant about the operation of the statutory scheme. They also expose a fundamental misconception by the applicant about what the Tribunal decided. The Tribunal did not reject the applications to amend the grounds of objection and for the applicant to rely on the proposed second further amended statement of facts, issues and contentions in a vacuum. It did so in a context. The context is important. 84 First, the Tribunal had vacated the hearing of the substantive review application in order to deal with the so-called "jurisdictional issue". 85 Second, the Tribunal explained at [29] of its reasons that the provision of the new documents was the result of delay which had not been satisfactorily explained, apparent dilatoriness and discourtesy by the applicant, a disregard of the Tribunal's directions, and conduct that undermined orderly case management. This is hardly surprising given that, on 10 March 2020, the applicant was ordered to identify any orders sought under s 14ZZK(a) and did not do so in the amended statement of facts, issues and contentions filed on 20 April 2020 and, indeed, did not finalise his applications until 16 October 2020 when the matter was listed for a substantive hearing starting on 26 October 2020. 86 Third, the Tribunal explained at [30]-[31] that at least some of the new proposed grounds lacked particularity. That was a matter for the Tribunal to decide in the exercise of its jurisdiction. The amendments sought are by no means clear. 87 Fourth, the Tribunal accepted at [32] that its case management function did not include any form of punishment of the applicant. This is correct. The Tribunal's decisions did not involve any form of punishment of the applicant. They were case management decisions well within the scope of reasonable case management in the circumstances. 88 Fifth, in the circumstances identified at [35] ("the lengthy history of this matter - which includes the vacation of the hearing on two occasions; the non-compliance with case management directions and the absence of satisfactory explanation for the delay; the costs thrown away by the Commissioner; and the shortcomings the Commissioner has identified in some of the proposed extended grounds") the Tribunal was not prepared to permit the applicant to rely on the amended grounds or the proposed second further amended statement of facts, issues and contentions, but said that: It may be that the applicant can provide additional particulars to the Commissioner between now and the time of the resumed hearing [in February 2021] that will assist the Commissioner to properly understand the applicant's case, but which will not occasion further delay. In that event the Commissioner, as a model litigant, will consider whether he can conveniently consent to better-articulated grounds of objection at the outset of the hearing. 89 In other words, the Tribunal did not prevent the applicant from making a further application to identify, with precision, amended grounds of objection and to rely on a second further amended statement of facts, issues and contentions, provided the applicant could do so without occasioning unfairness to the Commissioner and further delay. Instead of taking that opportunity, the applicant filed the judicial review application in this Court. 90 The grounds of judicial review of the Tribunal's decisions about the amended grounds of objection and second further amended statement of facts, issues and contentions are devoid of merit. 91 Contrary to grounds 7 and 8, the applicant has no right to review "on all grounds of objection that are reasonably open to him". By s 14ZZK(a) the applicant is confined to his grounds of objection unless the Tribunal otherwise orders. 92 The feared prejudice to the applicant in ground 8 is illusory unless and until the Tribunal does something irrevocable. Other than to correctly rule that the applicant is required to establish his taxable income, and is to do more than lead evidence addressed to changes of his assessable income, the Tribunal has done nothing irrevocable. If and when the Tribunal does something irrevocable, it would still be orthodox to await a final decision on the merits from the Tribunal so that any application for review or appeal on a question of law could be determined in light of the Tribunal's substantive reasons rather than, as in this case, based on the applicant's apparent fear of a prejudice, which has not yet crystallised. 93 Ground 9 fails as the Tribunal clearly did weigh up the relevant considerations to the exercise of its discretion. 94 As a result, ground 10 is also misconceived as even if it is the case that all of the amended grounds and new facts, issues and contentions were disclosed in, and referable to, the applicant's evidence filed in January 2020, the applicant evidently did not explain on a satisfactory basis why it waited from January 2020 until September and October 2020 to seek orders about the amended grounds, and new facts, issues and contentions. 95 Ground 11 is unsustainable as it is apparent that the Tribunal did consider the merits of the applications. 96 Contrary to ground 12, in making its decision the Tribunal did not deny the applicant natural justice, particularly because the Tribunal effectively invited the applicant to formulate amended grounds and new facts, issues and contentions which were sufficiently precise to put the Commissioner on proper notice of the applicant's case in advance of the hearing, and did not involve further delay. If the applicant is not capable of doing so, that is not a result of any denial of natural justice to the applicant. In any event, as I have said, if the January 2020 evidence is truly doing nothing more than seeking to prove that the Commissioner was right not to alter certain components of the assessments then, in my view, given that the Commissioner has put the applicant to proof of all facts relevant to the assessment, the applicant must be able to adduce that evidence irrespective of s 14ZZK(a) and without amending the grounds of the objections or amending the facts, issues and contentions (but, importantly, subject to any other proper ground of objection). If, however, the evidence seeks to do something else, then it may well be objectionable as a result of s 14ZZK(a). Either way, there is no unfairness to the applicant. 97 Contrary to ground 13, there was material supporting the Tribunal's decision, as explained by the Tribunal at [28]-[36] of its reasons. 98 Contrary to ground 14, the Tribunal's decision is well within the grounds of reasonableness. 99 Contrary to ground 15, the Tribunal did not abrogate its decision-making function or delegate it to the Commissioner. The Tribunal meant nothing more than that it would be expected that if the applicant formulated new grounds which enabled the Commissioner to understand the applicant's case and would not result in any further delays, the Commissioner as a model litigant may consent to the new grounds. The Tribunal did not suggest that it would not consider any further application by the applicant for itself.

Conclusion 100 For these reasons, the application is misconceived and must be rejected, with costs. 101 Further, applications for judicial review of interlocutory decisions of the Tribunal of this kind (not involving any true jurisdictional issue) should not be encouraged as they may result in a multiplicity of appeals/review applications and an inability to assess the materiality of any alleged error by the Tribunal. I certify that the preceding one hundred and one (101) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jagot.