Wu v Commissioner of Taxation

Federal Court of Australia|2018-08-30|Before: Steward J

The application for an extension of time be granted.
The appeal be dismissed.
The applicant pay the respondent's costs, as agreed or as assessed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 This is an appeal from a decision of Deputy President Hack, S.C. of the Administrative Appeals Tribunal (the "Tribunal"), given on 13 February 2015. The learned Deputy President decided to dismiss applications for review arising in the Tribunal pursuant to Pt IVC of the Taxation Administration Act 1953 (Cth) (the "TAA") for the years of income ending 30 June 2009, 2010, 2011 and 2012. The applicant did not file an appeal from that decision to this Court within the 28 days prescribed by s 44(2A) of the Administrative Appeals Tribunal Act 1975 (Cth) (the "AAT Act") and, accordingly, he made an application for an extension of time. Before me, at the hearing the respondent (the "Commissioner") consented to that extension, and leave to file the appeal late was duly granted and the appeal was heard by me. 2 The proceedings before the learned Deputy President concerned, relevantly, the assessability, for the purposes of the Income Tax Assessment Act 1997 (Cth) (the "1997 Act"), of certain deposits made into the applicant's bank accounts. The funds had been paid into those accounts from overseas in the years in dispute. The applicant contended, and the learned Deputy President did not accept, that the funds so deposited represented savings he had accumulated previously in China as well as his share of certain profits he had earned in 2003 and 2004 with a Mr Tang. 3 Before the learned Deputy President, the applicant was represented by Mr McCafferty of counsel. Before me the applicant represented himself. Mr Musikanth of counsel represented the Commissioner.

The Tribunal Proceedings 4 The applicant is an Australian businessman. Upon his arrival from China in 2005, he established a company, called B W Minerals Pty Ltd, which purchases heavy mineral sands in Western Australia and sells those sands to a Chinese company. In February 2009, the applicant was issued a permanent visa. It is not disputed that he has always returned, and paid income tax on, his Australian earnings. 5 There were three disputed categories of income before the Tribunal. The first, in respect of which the applicant was successful, is no longer in issue. The second and third concerned the series of deposits already referred to. They may be categorised into two groups. 6 The first group was paid in the 2009 income year. It was described by the learned Deputy President in these terms at [12]: It seems likely that the report by AUSTRAC concerned two deposits made to Mr Wu's USD account xxxxxx-389 at HSBC: one of USD $300,000 on 9 October 2008, the other of USD $59,975 on 15 June 2009. It is common ground that these amounts were equivalent to AUD $433,025 and AUD $72,812 respectively. On 10 October 2008 Mr Wu transferred USD $300,000 from his USD account to the account of the Australian company. On 25 September 2009 USD $20,000 was transferred from Mr Wu's account to the account of the Australian company. (Footnotes omitted) 7 As already mentioned, the applicant contended that these funds represented savings he had previously accumulated in China. The Tribunal did not accept this explanation. The learned Deputy President found at [42]: Finally, there is the question of the deposits of $505,837 in October 2008 and June 2009. Again, I regret to say that I am unable to accept Mr Wu's explanation for these deposits. The complete absence of documents evidencing these claimed savings in China and the complete absence of any reference to them in visa application in particular, have me dissatisfied with Mr Wu's explanation. 8 The second group comprised deposits made between October 2011 and March 2012. The applicant's explanation for these deposits was described at [27] below in the following terms: The funds deposited to Mr Wu's cash management account, he says, represented his share of profits from the venture with Mr Tang in 2003 and 2004. At the conclusion of the venture, Mr Wu was entitled to RMB 4,150,000 as his share of the profit. This sum, he said, was not then paid to him. Instead it was lent to Mr Tang interest-free and eventually repaid, but deposited into eight of Mr Wu's bank accounts in China, and then withdrawn by him and deposited into his Australian bank accounts together with other funds withdrawn on trips to China and also deposited on his return. 9 Once again, the learned Deputy President did not accept this explanation. At [38]-[41] the Tribunal reasoned as follows: Ultimately, the issue comes down to whether I accept Mr Wu's account of his dealings with Mr Tang. After anxious consideration I have concluded that I am not able to do so. I accept that there may be difficulties in obtaining contemporaneous documents from China but I am concerned that there is not a single document that evidences what must have been a considerable business, nor any concerning a relationship that seems, in substance, to have been a partnership, nor even any that document a very large loan. Mr Wu says that the business relationship with Mr Tang came to an end in 2004 when he moved to Australia and that he did not retain any written records of the business. He explained this on the basis that, ... we no longer needed those records and in China, it can be dangerous if personal or financial information such as this gets into the wrong hands. That assertion, with respect, defies logic. It may be accepted that there are cultural differences in the way business is carried on in China however I am unable to accept that documents evidencing a business relationship would not be retained against the possibility of some authority, whether in China or Australia, requiring some proof or detail of the relationship. Additionally any danger from the documents getting into the wrong hands could be abated by Mr Wu keeping them in Australia where he has resided since early 2005. Mr Wu was able to obtain from Mr Tang a document, said to have been executed by Mr Tang on 8 December 2011, which lends some support to Mr Wu's account of events but, as well, raises questions of its own. First, it is dated 8 December 2011, some months prior to the commencement of the Commissioner's audit. There is no explanation proffered for its production in December 2011. Moreover, if Mr Tang was able to be prevailed upon to provide that document it may be wondered why he could not have been prevailed upon to provide a witness statement or even some documents evidencing the earlier relationship. This is a man who, on Mr Wu's account, was a "trusted friend" who had had the benefit of an interest free loan over a number of years. His absence was not explained. Additionally, and as the Commissioner points out, reference to these dealings with Mr Tang (and indeed to the Chinese company) was absent from Mr Wu's answer to the question on his visa application that asked him to provide a list of all businesses he had been involved in. I am, then, not satisfied that Mr Wu has discharged the onus of showing that the amended assessments are excessive so far as these deposits are concerned. On the contrary, I am satisfied that the assessments are too generous to Mr Wu given the incorrect calculation of the total of the deposits. The correct decision, on the material before me, is that all of the $720,750 be treated as Mr Wu's assessable income. It should be apportioned between the 2010 and 2011 income years in the manner earlier undertaken by the Commissioner. It will be apparent from the foregoing that the key findings made by the Tribunal were factual in nature and did not raise any obvious question of law for the purposes of s 44 of the AAT Act. They turned on the quality and sufficiency of the evidence before the Tribunal.

The Notice of Appeal 10 The applicant's notice of appeal raised several grounds of review but only one of these was pressed in written submissions and before me. That was the applicant's claim concerning s 768-910 of the 1997 Act. The applicant contended that he was a temporary resident until February 2009 and that the Tribunal had failed to consider whether s 768-910 of the 1997 Act applied to render the disputed deposits non-assessable non-exempt income. The provision is in these terms: (1) The following are non-assessable non-exempt income: (a) the ordinary income you derive directly or indirectly from a source other than an Australian source if you are a temporary resident when you derive it; (b) your statutory income (other than a net capital gain) from a source other than an Australian source if you are a temporary resident when you derive it. (2) For the purposes of paragraph (1)(b): (a) if you have statutory income because a particular circumstance occurs, you derive the statutory income at the time when the circumstance occurs; and (b) if you have statutory income because a number of circumstances occur, you derive the statutory income at the time when the last of those circumstances occurs. (3) However, the following are not non-assessable non-exempt income under subsection (1): (a) the ordinary income you derive directly or indirectly from a source other than an Australian source to the extent that it is remuneration, for employment undertaken, or services provided, while you are a temporary resident; (b) your statutory income (other than a net capital gain) from a source other than an Australian source to the extent that it relates to employment undertaken, or services provided, while you are a temporary resident; … 11 Section 995-1 relevantly provides: temporary resident: you are a temporary resident if: (a) you hold a temporary visa granted under the Migration Act 1958; and (b) you are not an Australian resident within the meaning of the Social Security Act 1991; and (c) your spouse is not an Australian resident within the meaning of the Social Security Act 1991. However, you are not a temporary resident if you have been an Australian resident (within the meaning of this Act), and any of paragraphs (a), (b) and (c) are not satisfied, at any time after the commencement of this definition. Note: The tests in paragraphs (b) and (c) are applied to ensure that holders of temporary visas who nonetheless have a significant connection with Australia are not treated as temporary residents for the purposes of this Act. It would appear that the potential application of this provision was overlooked by the parties below, and the Tribunal, as a result, was not aware of its possible relevance. 12 The argument was expressed in the following way in the applicant's notice of appeal (as amended): 1. Problem with decision: Temporary Residence for Tax Purposes Summary of issue 1. Based on the analysis below, I have concluded that Mr. Wu qualified as a temporary resident under the Income Tax Assessment Act (1997) up until he was issued with his permanent visa in February 2009. 2. To avoid confusion, this 'temporary resident' status is an Income Tax law classification and not a direct reference to Mr Wu's migration law status (although his visa status is relevant to the tax status). 3. As a temporary resident for tax purposes, he would generally not have been assessable on most amounts of foreign source income. 4. At law, he would not be assessable on foreign source business income while qualifying as a temporary resident. 5. This would certainly include all amounts actually deposited prior to his permanent residence if they were found to be business profits. 6. This may include later deposits if they can be shown to represent income derived from business transactions in China prior to Mr. Wu's permanent residence in February 2009. This may be particularly relevant to the cash deposits from 2009 that was at issue before the tribunal. The Commissioner conceded before me that the application of s 768-910 to the deposits arising in the 2009 year should have been considered below. In his submission, the Tribunal had accordingly erred in law. In that respect, it did not appear to be in dispute that the applicant was not a permanent resident when the first disputed deposit of USD$300,000 was made. Whether these funds were derived from a foreign source, and whether the other integers of s 768-910 were otherwise capable of being satisfied, remained unclear. The Commissioner therefore proposed that the 2009 income year should be remitted back for a re-hearing. However, he submitted that the later years should not be remitted back. That was because it was not disputed that throughout those later years the applicant was a permanent resident. Moreover, it was said, the applicant's contentions concerning his alleged arrangement with Mr Tang had been entirely rejected by the Tribunal. Those contentions should not be re-litigated. 13 The applicant submitted that all of the years in dispute should be remitted. In relation to the later years, he repeated his contentions concerning the alleged arrangement with Mr Tang, and submitted that when he became entitled to his share of the profits he had earned with that man, he was only a temporary resident for the purposes of s 768-910. It was unclear to me when this alleged entitlement arose; when pressed, the applicant said he obtained the funds in 2010 and 2011. When I pointed out to him that he himself contended that he was by then a permanent resident, the applicant claimed that he became entitled to the funds in 2004. Whether this was the moment of derivation for an individual, who is probably required to account for income tax on a cash basis, was not clear to me. 14 I should also record that the applicant further submitted that the funds repatriated to Australia would have been taxed in China. Other than arguably giving rise to an entitlement to a foreign tax credit under Div 770 of the 1997 Act, the relevance of this claim to a determination of the origins of the deposits, and as to whether the constituted Australian assessable income, was not apparent. 15 For the reasons set out below, I need not resolve these issues.

Disposition 16 Two issues arose for preliminary consideration. 17 The first was that the notices of objection for the 2009 to 2012 income years did not contain grounds which expressly invoked s 768-910 of the 1997 Act. The provision, it would appear, had been overlooked from inception. On appeal from the Tribunal, this Court does not generally have the power to give an applicant leave to rely on new grounds of objection. Its power to do so is confined to proceedings brought to this Court pursuant to s 14ZZO of the TAA, which relevantly provides as follows: In proceedings on an appeal under section 14ZZ to a court against an objection decision: (a) the appellant is, unless the court orders otherwise, limited to the grounds stated in the taxation objection to which the decision relates; … 18 Here, however, there were no appeals "under section 14ZZ to a court", but, rather, applications for review in the Tribunal. Where such an application is made, the Tribunal, but not this Court, has the power to give an applicant leave to rely on new grounds of objection. Section 14ZZK of the TAA provides: On an application for review of a reviewable objection decision: (a) the applicant is, unless the Tribunal orders otherwise, limited to the grounds stated in the taxation objection to which the decision relates; (b) the applicant has the burden of proving: (i) if the taxation decision concerned is an assessment--that the assessment is excessive or otherwise incorrect and what the assessment should have been; or (ii) in any other case--that the taxation decision concerned should not have been made or should have been made differently. It follows that were I to remit this matter to the Tribunal, the first issue it would need to consider is whether the applicant's notices of objection in their present state validly raised the new ground concerning the application of s 768-910, and if they did not, whether the applicant should now be given leave to rely on that ground. Consideration of this issue would include the extent to which highly generalised grounds (pleaded in the context of more specific grounds) can encompass a new argument of the kind raised here. 19 The second preliminary issue is that, generally speaking, the Tribunal does not err in law when it fails to deal with a point of law which the parties themselves did not address. In Commissioner of Taxation v Glennan (1999) 90 FCR 538, the Full Court of this Court was confronted with the same issue, which Hill, Sackville and Hely JJ described in these terms at [77]: The issue which we have to decide is whether the [Tribunal] made an error of law in failing to find that the assessment was excessive on the grounds now advanced by the taxpayer, notwithstanding that these grounds were not exposed to the [Tribunal] for its consideration. This raises the question of whether, in the context of a statute which places the burden of proof on the taxpayer of proving that an assessment is excessive, the [Tribunal] is bound to consider for itself and to make findings of fact based on a contention which may be open on the evidence before it, albeit that a contention to that effect is neither formulated nor advanced by the taxpayer. 20 The Court reviewed a number of authorities which supported the proposition that the Tribunal does not err in law in failing to address an issue which was not before it. These included a decision of Gummow J in Federal Commissioner of Taxation v Raptis (1989) 19 ALD 726; 20 ATR 1262 and a decision of Davies J (senior) in Federal Commissioner of Taxation v Perkins (1993) 26 ATR 8. At [80] the Court said: In Commissioner of Taxation (Cth) v Raptis (1989) 20 ATR 1262 at 1267; 89 ATC 4994 at 4999, Gummow J observed that: "[t]here must be some difficulty...in finding an 'error of law' in the failure in the Tribunal to make a finding first urged in this Court." Raptis was cited with approval by the Full Court in Department of Social Security v Cooper (1990) 26 FCR 13, at 18. In Commissioner of Taxation (Cth) v Perkins (1993) 26 ATR 8; 93 ATC 4524, the issue on which the Commissioner sought to rely on appeal had not been brought to the attention of the [Tribunal] as a matter for its decision. Davies J, with whom the other members of the Court concurred, said (at 10; 4526): I am of the view that no error of law has been demonstrated in the manner in which the Tribunal dealt with the matter. It was the role of the Tribunal to decide questions of fact and, before the Tribunal, counsel for the Commissioner identified one fact alone as the crucial fact which had not been disclosed. No other fact was so identified or relied upon. The Tribunal did not err in law in failing to regard as a material fact a fact which counsel for the Commissioner failed in his submissions to the Tribunal to contend was material. 21 At [82] the Court endorsed the proposition that, as a general rule, no error of law occurs if the Tribunal in a tax appeal fails to address issues of fact and law not the subject of argument by the taxpayer. The Court said: As a matter of general administrative law, it has long been accepted that it is no part of the duty of the decision-maker to make out a case for the applicant: Prasad v Minister for Immigration and Ethnic Affairs (1985) 6 FCR 155 at 170, per Wilcox J. In a statutory context in which a taxpayer seeking to challenge an assessment is required to specify the grounds of his objection, and bears the burden of proving that it is excessive, as a general rule it cannot be said that the [Tribunal] is bound to make findings of fact and rulings on issues not relied upon by the taxpayer in the proceedings before it. It follows that, as a general rule, there is no error of law if the [Tribunal] fails to address issues of fact and law not the subject of argument by the taxpayer. See also Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/2002 (2003) 211 CLR 441 at [31]-[32]. 22 The foregoing proposition was expressed as a "general rule". There are exceptions where a claim is apparent on the face of the material before the Tribunal and the issue is otherwise sufficiently raised. This was expressed by Hill J in SZBZJ v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCA 771 in the following terms at [21] after his Honour's consideration of NABE v Minister for Immigration and Multicultural and Indigenous Affairs (No 2) (2004) 144 FCR 1: NABE v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 263 was a decision of the Full Court decided after Applicants S134/2002 [(2003) 211 CLR 441]. There is a discussion in the judgment of Black CJ, French and Selway JJ of the question whether there will be a constructive failure to exercise jurisdiction if the Tribunal does not address a claim not in fact advanced: see paras [58]-[63]. While the Full Court accepted that there is no obligation on the Tribunal to deal with a claim not advanced, the view is taken that there will be a review obligation on the part of the Tribunal when it is apparent on the face of the material before the Tribunal that an applicant to it has sufficiently raised the relevant issue. No doubt, in reaching this conclusion the Full Court was conscious of the fact that many applicants before the Tribunal are unrepresented and indeed that lawyers, not being also migration agents, have no right, without leave, to make submissions to the Tribunal. There is no system of pleadings in the Tribunal which define the issues which the Tribunal - an inquisitorial Tribunal - must decide. The conclusion reached by their Honours that there will be a constructive failure on the part of the Tribunal to exercise jurisdiction, in a case where an applicant's claim is apparent on the face of the material before the Tribunal, even if the claim is not expressly or distinctly raised by the applicant for decision would seem consistent with the requirement that the Tribunal give justice to those who apply to it. It is not necessarily inconsistent with Applicants S134/2002. Whether a claim is, or is not, sufficiently raised on the face of the material before the Tribunal may involve questions of degree. At the very least, as the Full Court said in NABE at [60]: It is not obliged to deal with claims which are not articulated and which do not clearly arise from the materials before it. 23 In SZBZJ, Hill J was of the view that the proposition expressed in Glennan, supra, had been established by the High Court's decision in Applicants S134/2002. At [16] his Honour explained: There is much to be said for the view submitted for the Minister that there can be no jurisdictional error in the Tribunal failing to consider a claim that is not raised by the applicant before it. Indeed, this would seem to be established by the joint judgment of Gleeson CJ, McHugh, Gummow, Hayne and Callinan JJ in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/2002 [2003] HCA 1, in that part of their Honours' decision as relates to what was said to be a constructive failure by the Tribunal to exercise jurisdiction by not determining that the first prosecutor's spouse had held a temporary protection visa and was an applicant for a permanent protection visa. If that matter was found favourably to the prosecutors, their application for a protection visa would have been successful. Their Honours said at [31]-[32]: None of the prosecutors relied upon the position of their husband and father as the main applicant to found a claim that they fell within the second category [ie a matter that they were a family unit of which one person was owed protection obligations and had been granted a protection visa]. The reasons why they did not do so are apparent, at the least, from their then state of knowledge respecting his whereabouts. The Tribunal was required to review the decision of the delegate who, in turn, had been required (by s 47) to consider the application and the criteria which that application had to meet, not the criteria for an application, never made, which might have been put on another basis... There is no obligation imposed by s 65(1) to reach a state of satisfaction (or otherwise) representing criteria which the prosecutors did not advance. There was no misapplication of the relevant criteria by the Tribunal and no jurisdictional error. 24 In written submissions filed after the hearing with leave, the Commissioner properly brought to my attention the decision of Beazley J in Thomas v Repatriation Commission (1994) 50 FCR 112. In that case the Tribunal had been led erroneously by the applicant to a belief that a certain approved "Guide" applied. It did not. The error was raised before Beazley J who remitted the matter for reconsideration. Her Honour said at 119: As I said in Tefonu v Superannuation and Insurance Commissioner (1993) 44 FCR 361, there is no absolute principle that a new issue may not be raised in this court in appeals under s 44(1) of the Administrative Appeals Tribunal Act. It depends upon the issues which are sought to be raised. The stance taken by the parties in the Tribunal may also be relevant, although the court may permit a new issue to be raised, even though that issue had been conceded by the party before the Tribunal: Kuswardana v Minister for Immigration and Ethnic Affairs (1981) 54 FLR 334. In that case the Full Court held that the failure of the Tribunal to consider the legal question in dispute was itself an error of law, as the relevant immigrant status of the applicant was a statutory precondition for the application of the provisions of the migration legislation which were under consideration. As Bowen CJ stated (at 343): ... a party is not necessarily precluded by the conduct of his case before the Tribunal from arguing on 'appeal' matters conceded below. If he is successful then the decision of the Tribunal may be overturned - found in some way to be wrong in law, even though that error may have been substantially contributed to by the conduct of the case by the party in question. In other words, the conduct of the party's case before the Tribunal goes to this court's discretion as to what course it will take given that there has been an error rather than to the question as to whether the Tribunal really made an error. 25 Beazley J was of the view that where both parties had been under a misapprehension of the correct law before the Tribunal, they were not thereafter bound by that mistake. At 120, her Honour then said: It seems to me, in circumstances where the legal representatives for both parties were acting upon the wrong assumption as to the correct law, and either permitted, or encouraged the Tribunal to apply the wrong statutory provisions, it lies ill in the mouth of the party who urged the wrong course upon the Tribunal to complain that the other party had every opportunity to raise the correct position in the course of the Tribunal hearing. Thus, in circumstances such as occurred here, where the applicant's case was determined upon the wrong application of the legislation and both parties seemed to have been under a misapprehension of the correct law, the applicant ought to be permitted to raise the issue before this court. 26 Subsequently in Repatriation Commission v Warren (2008) 167 FCR 511, Thomas was cited with approval and Lindgren and Bennett JJ said at [78]: The following principles, which we take to be established, must be understood against the background that the tribunal under consideration, like the Tribunal here, is required to "review" a primary decision, is given all the powers and discretions that were conferred on the original decision-maker, is not bound by the rules of evidence, is required to proceed with little formality and technicality, and is, of course, bound to apply the provisions of the relevant statute, even if there is no challenge by the parties: • The general rule that a litigant is bound by, and accordingly is entitled to act on, admissions and concessions does not automatically apply, although cases concerned with the exercise of judicial power may be of assistance (Kuswardana 54 FLR at 343; 35 ALR at 195 per Bowen CJ). • A party to the proceeding is not necessarily precluded from arguing on "appeal" matters that were conceded before the tribunal. Whether the party is so precluded depends on the nature of the matter conceded, its conduct of its case, whether the concession represented an agreement by the parties as to the facts to be decided and other relevant circumstances (Kuswardana 54 FLR at 343; 35 ALR at 195 per Bowen CJ and at 348; 199 per Fox J). • Where a concession is made, there must be some difficulty in finding an "error of law" when the contrary of the concession is raised for the first time in this Court (Federal Commissioner of Taxation v Raptis (1989) 20 ATR 1262 at 1267 per Gummow J). • A tribunal does not err in law in failing to regard as material a fact which counsel failed in submissions to contend was material (Federal Commissioner of Taxation v Perkins (1993) 26 ATR 8 at 10 per Davies J). • There is a difference between factual matters not canvassed before the tribunal and a new issue relating to the validity of a regulation (Tefonu Pty Ltd v Insurance and Superannuation Commissioner (1993) 44 FCR 361 at 367 per Beazley J). • Even though the parties may be "able, in practical terms, to narrow the issues by concession ... even a concession does not permit the [t]ribunal to avoid its duty as an administrative decision-maker to make the correct or preferable decision ... on all relevant aspects of the matter before it" (Peacock v Repatriation Commission (2007) 161 FCR 256 at [23]); • A concession "does, however, permit the decision-maker to reach the correct or preferable decision by reference to the concession as well as to its findings on disputed questions" (Peacock 161 FCR 256 at [23]; and see Comcare v Fiedler (2001) 115 FCR 328 at 337-338). • The Court will more readily permit a matter to be raised for the first time in this Court on an appeal from a tribunal where: (a) the matter is a pure question of law, such as a question as to the validity of a regulation (Kuswardana 54 FLR at 343; 35 ALR at 195; Tefonu 44 FCR at 367) or a question as to whether the tribunal had applied the correct standard of proof on the true construction and application of legislation (Ferriday 69 FCR at 527-528 per Lee J); (b) the matter goes to a misapprehension that was shared by the parties before the tribunal and therefore by the tribunal itself (Perpetual Trustee Co (Canberra) Ltd v Commissioner for Revenue (ACT) (1994) 50 FCR 405 at 418-419 per Wilcox J) such as a shared misapprehension as to the applicable law (cf Thomas 50 FCR at 120 per Beazley J); or (c) the matter goes to a condition precedent to the availability of a power, the exercise of which will have a serious impact on the individual (Kuswardana 54 FLR 334; 35 ALR 186) . 27 Neither of these decisions was an appeal from the Tribunal reviewing an objection decision pursuant to 14ZZK of the TAA. However, Thomas was also cited with apparent approval in Haritos v Federal Commissioner of Taxation (2015) 233 FCR 315, which was a tax case and where the Full Court of this Court said at [80]-[82]: An analogous approach informs the decision of the Court in its original jurisdiction as to whether or not, in a s 44 appeal, it will entertain an issue that was not previously raised in the Tribunal. See, for example, Tefonu Pty Ltd v Insurance & Superannuation Commissioner (1993) 44 FCR 361 where, in an appeal under s 44 of the AAT Act, in the Court's original jurisdiction, Beazley J, as her Honour then was, rejected the submission that there was an absolute principle that a new issue may not be raised before the Federal Court on an appeal from the Tribunal. See also Repatriation Commission v Warren (2008) 167 FCR 511 where Lindgren and Bennett JJ observed, at [78], that the Court in its original jurisdiction will more readily permit a matter to be raised for the first time on an appeal from the Tribunal where: (a) the matter is a pure question of law, such as a question as to the validity of a regulation: see Kuswardana v Minister for Immigration and Ethnic Affairs (1981) 54 FLR 334 at 343-344; 35 ALR 186 at 195; Tefonu at 367, or a question as to whether the Tribunal had applied the correct standard of proof on the true construction and application of legislation: Ferriday v Repatriation Commission (1996) 69 FCR 521 at 527-528 per Lee J; (b) the matter goes to a misapprehension that was shared by the parties before the Tribunal and therefore by the Tribunal itself: see Perpetual Trustee Co (Canberra) Ltd v Commissioner for Australian Capital Territory Revenue (1994) 50 FCR 405 at 418-419 per Wilcox J, such as a shared misapprehension as to the applicable law: cf Thomas v Repatriation Commission (1994) 50 FCR 112 at 120 per Beazley J; or (c) the matter goes to a condition precedent to the availability of a power, the exercise of which will have a serious impact on the individual: see Kuswardana. These observations by Lindgren and Bennett JJ were approved by a subsequent Full Court in Hussain [(2008) 169 FCR 241] at [40]. The matter was also considered, and Hussain followed, in Culley v Australian Securities and Investments Commission (2010) 183 FCR 279 at [16], where the Full Court (in its appellate jurisdiction but speaking of the exercise of original jurisdiction by the primary judge) said that where no submission on a factual issue had been made to the Tribunal, and where the fact to be found was not a precondition of jurisdiction, this Court's power to entertain a question of law not previously raised in the Tribunal was discretionary, citing Water Board v Moustakas (1988) 180 CLR 491. The dictum of Gummow J in Raptis [(1989) 20 ATR 1262] at 1266-1267, to the effect that there must be some difficulty in finding an "error of law" in the failure in the Tribunal to make a finding first urged in this Court, was cited at [15] and applied at [16]. We would add a reference to Minister for Immigration and Ethnic Affairs v Teo (1995) 57 FCR 194 where, in relation to its exercise of appellate jurisdiction, a Full Court (Black CJ, Gummow and Beazley JJ) said, at 197: As we have indicated, the proceeding before the primary judge was on the narrow footing provided by s 138 of the [Migration] Act, namely an appeal on a question of law. If, for example, the further point involved an allegation by the respondent of the exercise of statutory power otherwise than bona fide, there might have been some substance in the complaint against consideration of the matter at this stage. That is not the case. The further point, as will appear, is a complaint directed to error of law on a question of construction. Accordingly, there is no reason why the ordinary principles considered in decisions such as Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 and Coulton v Holcombe (1986) 162 CLR 1, do not apply and operate in favour of the respondent. 28 Whilst Haritos was a tax case, the foregoing observations do not appear to be concerned with the Tribunal's modified functions when reviewing objection decisions of the Commissioner. 29 Relying on Thomas, the Commissioner conceded that s 769-910 had been overlooked by the parties and submitted that the point relied upon by the applicant could now nonetheless be raised for the first time, justifying at least a limited remittal to the Tribunal. 30 With respect, I do not think that Thomas, and the passages from it I have set out above, apply here. That is because s 14ZZK of the TAA modifies the Tribunal's usual function and powers. As has been observed elsewhere, the Tribunal may be restrained in a review of a taxation objection decision from making its own enquiries: Warren v Repatriation Commission (2015) 238 FCR 124 at [13]-[14]. That is because of the presence of the onus of proof imposed by s 14ZZK. This perhaps explains the express reference in Glennan (at [82]) of the statutory context which comprised: "a taxpayer seeking to challenge an assessment is required to specify the grounds of his objection, and bears the burden of proving that it is excessive…". The Court in Glennan went on to state at [83]: It follows from what we have said that we do not see the problem facing the taxpayer as simply being that he has sought in this Court to raise fresh arguments not put to the [Tribunal]. It is not simply a matter of whether the [Tribunal] would have found in favour of the taxpayer had the arguments been put and whether raising those arguments before the Court creates "prejudice" to the Commissioner. The issue in the present case is, in the context of the relevant provisions of the TAA, whether the [Tribunal] erred in law by not addressing the arguments now sought to be raised: cf Australian Fisheries Management Authority v PW Adams Pty Ltd (No. 2) (1996) 66 FCR 349 (FC). In our view, it did not. 31 Because this is an appeal from a decision of the Tribunal reviewing an objection decision pursuant to Pt IVC of the TAA, in my view I am bound to apply Glennan, bearing in mind that it only establishes a "general rule". That rule is "discretionary" in nature and may, for practical purposes, not be any, or greatly different, from the "discretionary power" described in Haritos to allow a new point to be heard. The difference is that the discretion must be exercised in the particular statutory context, which here includes s 14ZZK. 32 Nothing said in Batchelor v Federal Commissioner of Taxation (2014) 219 FCR 453 compels any different approach, even though in that case Wigney J described Glennan as a case with "particular and somewhat unusual circumstances" (at [94]). Edmonds and Pagone JJ, however, said at [8]: …tax proceedings, even before the Tribunal, are generally conducted as adversarial with the parties deciding what and how the dispute is to be resolved. Indeed, there are substantial practical and legal limitations upon the Tribunal conducting proceedings other than as the interested parties elect to proceed. A consequence is that the parties, through their legal advisers, make forensic judgments in the conduct of proceedings by which they will be bound on appeal. Here, it will be recalled, the taxpayer was represented by counsel below. 33 It follows that the "general rule" of the Full Court of this Court in Glennan, supra, applies to the circumstances of this appeal. In that respect I am not satisfied that this matter merits exceptional treatment in the sense described in SZBZJ and NABE. This is not a case where the new point sought to be enlivened under s 768-910 was apparent on the face of the materials before the Tribunal. It did not "clearly arise" from those materials. Rather, this is a case where a potentially relevant provision was missed by the parties, a happenstance not unknown in tax cases. I asked the applicant about this oversight. He blamed his legal representatives. Regrettably, in this context, that is no excuse. It follows that I am not satisfied that the Tribunal erred in law in failing to consider the application of s 768-910, even though both the Commissioner and the applicant had thought that it had (at least in part). 34 The following considerations also support an application of the general rule in Glennan: (1) First, it is not open for me to consider the new point as it does not appear to constitute a ground of objection, and for the reasons already given, I have no power to give leave to rely on this new ground. The statutory limitations on what a taxpayer may argue pursuant to s 14ZZK are part of the statutory context in exercising my discretion. (2) Secondly, I am not, in any event, persuaded that the new point raises a pure question of law: c.f. Haritos at [80], supra. The issue as to whether the applicant was a "temporary resident", in the sense that that term is used is 768-910 and as defined by s 995-1, raises a question of mixed fact and law. No finding was made below concerning the applicant's precise status for the purposes of the Migration Act 1958 (Cth) in the 2009 year other than a reference to him initially obtaining a State/Territory Sponsored Business Owner (Provisional) (Subclass 163) visa and then a permanent visa from February 2009. Whether this rendered the applicant the holder of a "temporary visa" who is not otherwise an "Australian resident" within the meaning of the Social Security Act 1991 (Cth) would need to be determined. It might require the production of further evidence. 35 If I am wrong in reaching this conclusion, I should record that I would have otherwise remitted this matter on the limited basis suggested by the Commissioner. There is no doubt in my mind that the applicant was seeking to re-litigate his claims concerning his arrangement with Mr Tang. Those claims have been rejected already by the Tribunal based upon the evidence before it. The claim should not be re-litigated. 36 The appeal is dismissed with costs. I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Steward.

Income Tax Assessment Act 1997(Cth)ss 768-910, 995-1

Taxation Administration Act 1953(Cth)ss 14ZZ, 14ZZK, 14ZZO

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