The Commissioner of Taxation of the Commonwealth of Australia v. Avco Financial Services Ltd Avco Financial Services Ltd v. The Commissioner of Taxation of the Commonwealth of Australia [1980] FCA 187

CATCHWORDS

Income tax - Assessable income - Allowable deductions - Foreign currency borrowings - Exchange gains and losses on repayment - Whether gains capital or income - Gross income - Whether losses deductible outgoings - Outgoings of a capital nature.

Income Tax Assessment Act 1936, ss.25(1), 51(1).

The Commissioner of Taxation of the Commonwealth of

Australia v. Avco Financial Services Limited;

No. G68 of 1979,

Avco Financial Services v. The Commissioner of Taxation of the Commonwealth of Australia.

No. G69 - 72 of 1979,

Coram : Brennan, Deane and Fisher JJ.

Date : 16 December 1980,

Sydney.

IN THE FEDERAL COURT OF AUSTRALIA

No. G 68 of 1979

) ) NEW SOUTH WALES DISTRICT REGISTRY ) ) GENERAL DIVISION )

ON APPEAL from the Supreme Court of New South Wales Administrative Law Division

BETWEEN : THE COMMISSIONER OF TAXATION OT THE COMMONWEALTH OF AUSTRALIA

Appellant

AND : AVCO FINANCIAL SERVICES LIMITED

Respondent

No. G 69 - 72 of 1979

ON APPEAL from the Supreme Court of New South Wales Administrative Law Division

BETWEEN : AVCO FINANCIAL SERVICES LIMITED

Appellant AND : THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA Respondent ORDER

JUDGES MAKING ORDER : Brennan, Deane and Fisher JJ.

DATE OF ORDER : 16 December 1980.

WHERE MADE : Sydney.

THE COURT ORDERS THAT :

1. The appeals be allowed.

2. The orders of the Supreme Court of New South Wales be set

aside and in lieu thereof it be ordered that:

(a) In Appeal No. 632 of 1978: (1) the taxpayer's objection to the inclusion of exchange gains amounting to $175,084.00 as part of the taxpayer's assessable income for the year ended 30 November 1972