oy CATCHWORDS ADMINISTRATIVE CAN - judiczal review - decision of Deputy Commissioner of Taxation - decision not to reinstate arrangements with tax agent for ledgment of income tax returns or raiiure to grant such reinstatement - objection to competency - whether decision made under an enactment. i ul Admy, McDonald Pty Ltd v. Hamence (1984) 53 ALR 136 Hawker Pacific Fty Lamited v. Freeiand (1983) 52 ALF 1285 Australian National University v. Burns (1982) 423 ALR 25 PETER JOHN BALNAVES v. DEPUTY COMMISSIONER OF TAXATION FORSTER J. TT. ADELATDE a -\ A] 31 MAY 198 IN_THE FEDERAL COURT OF AUS SOUTH AUSTRALIAN DISTRICT RE TRI GENERAL DIVISION MINUTE, JUDGE MAKING ORDER WHERE' MADE DATE OF ORDER THE COURT ORDERS THAT: No. G14 of 1985 BETWEEN: PETER_JCHN RALNAVES Applicant - and - DEPUTY COMMISSIONER OF TAXATION Respondent OF _ORDER FORSTER, d. ADELAIDE 21 MAY 1985 1. The application be dismissed. 2. The applicant pay to the respondent its costs of the application. 3. The injunction granted on the 28th day of March 1985 be discharged as from this day. Note: Settlement and entry of orders 1s dealt with in Order 36 of the Federal Court Rules. IN_THE FEDERAL COURT OF AUSTRALIA :] \ SQUTH AUSTRALIAN DISTRICT. REGISTRY! ' No. G14 of 1985 } GENERAL DIVISION BE TWEEN: PETER J OHN_BALNAVES Applicant - and - DEPUTY COMMIS In TONER OF TAXATION Respondent REASONS FOR JUDGMENT CORAM: Forster J. The applicant, a chartered accountant, registered as a tax agent for some twelve years, seeks a review pursuant to the Administrative Decisions (Judicial Review) Act of a decision of the Deputy Commissioner of Taxation communicated to the applicant by letter dated 7 February 1985 that no reinstatement of arrangements to lodge income tax returns beyond 31 December 1984 would be granted to him, or, in the alternative, the failure of the respondent to grant the said reinstatement. The review 15 sought on the grounds set out in s.5(1l)(a), 5(1)(e), S(1)(f), S¢(L)(h), 5(2)(a)d, S(2)(b), 5(2)(c), 52)(d), 5(2)(£), 5(2)(g) and 5(Z)(9) of the Administrative Decisions (Judicial Review) Act. Ze An objection to the competency of the application was lodged by the respondent on tne grounds - "1. The decisions referred to i1n the application were not decisions to which the Act applied within the meaning of the Act. 2. The decisions referred to in the application were not made under an enactment within the meaning of the Act". I heacd first the objection to competency and dismissed the application as being incompetent because the decisions complained ot were not made under an enactment, that is to say, the Income Tax Assessment Act 1936-1984. I said that I would give written reasons later which I now do. In order that the matter may be understood it is necessary to describe the arrangements made by the Commissioner of Taxation with tax agents. Section 161 of the Income Tax Assessment Act requires every person, 1f required Ky the Commissioner, by notice published in the Gazette, to furnish within the time specified in the notice an income tax return. It 21S common ground that the time specified in the notice with respect to the financial year 1983-1984 1s 31 August 1984 and has been the same in each year for quite a considerable time. In order to spread the burden of preparing income tax returns over a period longer than the two 3. months from 20 June to 31 August and also ta ease the administrative burden in the Taxation Office, the Commissioner Pach year enters into arrangements with tax agents for the lodging of returns, which arrangements have the effect of spreading the preparation of income tax returns and also of the cansequent assessments of tax, over a longer perirad. In June each year the Commissioner issues a circular to fax agents setting out the arrangements for the lodgment of ancome tax returns. In the circular issued in June 1984, a copy of which was tendered, 1t is said that lodgment of returns will be permitted under one of two alternative programmes —- the Standard Lodgment Programme or the Alternative Lodgment Progranme. It is common ground that the Standard Lodgment Programme was applicable to the applicant. The Standard Lodgment Programme requires that fifty per cent of the returns to be lodged by an agent must be lodged by 31 October 1984, sixty per cent by 30 November 1984 and 70 per cent by 31 December 1984, 80 per cent by 31 January 1985, 90 per cant by 28 February 1995 and 100 per cent by 31 March 1985. The agent 15 required by the circular ta netify the Commissioner of additions to and deletions from the list of clients whose income tax returns he will he lodging in order that the agent's lodgment performance in terms of percentages may be assessed. The Commissioner regards 31 December as a key date for the programme. The circular contains the following paragraph in bold type - 4. "(3) The key date for both programmes is 31 December and the continuation of arrangements beyond 21 December will depend on programme requirements being met at that date." Another passage in bold type is - "Where the 31 December programme requirements are not met continuation of arrangements will only be considered where the circumstances could not have been anticipated by the agent and are not circumstances which may reasonably be regarded as occurring in the normal course of business." At some time after 12 January 19585 the Commissioner wrote ta the applicant notifying him that because of dissatisfaction with his lodgment performance the extensien of time beyond 31 December 1984 would noc he granted. On 21 January 1985 the applicant requested reconsideration of the decision and on the same day had an interview with an officer of the Taxation Department. On 7 February 1985 the Acting Deputy Commissioner wrote to the applicant informing him that no reinstatement of arrangements to lodge returns beyond 31 December 19584 had been granted and that returns lodged after that date would be liable for additional tax for late lodgment. Application may he made under the Administrative Act for an order of a review of a decision to which the Act applies (sec.5). Decision to which the Act applies is relevantly defined as a decision of an administrative character made under an enactment other than a decision included in any of the classes of decisions set out in schedule 1. An enactment for present purposes means an act 5. other than the Commonwealth Places (Application of Laws) Act 1970 or The Northern Territory (Self Government) Act 1978; an Ordinance of a Terratory other than the Northern Territory; or an Instrument (including rules, regulations or by-laws) made under such an Act or under such an Ordinance. The only enactment under which it is argued that the impugned decisions were made is the Income Tax Assessment Act. If they were not made under that Act then they are not decisions to which the Administrative viewable HY Decisions (Jucicial Review) Act applies and are not ¢ under that Act. I do not find it necessary to decide whether or not the decisions are decisions included in any of the classes of decisions set out in schedule 1. If they are such decisions they are mot decisions to which the Administrative Decisions ¥ (Judicial Review) Act applies. Section 8 of the Income Tax Assessment Act provides that the Commissioner shall have the general administration of the Act. It 1s argued by the applicant that since the Commissioner exists only pursuant to the Income Tax Assessment Act and only acts officially because of that Act, then anything he does in an official capacity 15 done under the Act. I do not accept this argument. The Income Tax Assessment Act nowhere gives express or indeed implicit power to the Commissioner to enter into arrangements with tax agents to spread the lodging of income tax returns over a period longer than two months when he has caused to be published a notice in the Gazette effectively requiring all returns to be lodged by 31 August - "There are many activities in the ordinary course of administering the affairs of Government that may be carried on independently of any statutory power expressly or aumpliedly authorising the particular activity", McDonald Fty Ltd v. Hamence (1984) 52 A.L.R. 1365 per Neaves J. at 141. Tt 1s not suggested that the administrative arrangement made by the Commissioner with tax agents partly for their benefit and that of their clients and partly to aid the smooth running of the Taxation Department are in any sense beyond power even though there is no specific or implied power given by the Income Tax Assessment Act. It seems to me that the arrangements set out in the circular to which I have referred were mot made under the enactment but were made under an inherent power of the Commissioner to make administrative arrangements alluded ta by Neaves J. in McDonald Pty Ltd v. Hamence (supra) and by Fox J. in Hawker Pacific Pty Limited v. Freeland (1983) 52 A.L.R. 185 at 189. The Commissioner of Taxation exists and has his baing under the Income Tax Assessment Act but 1t does not follow that everything he does is done "under that enactment". The reasoning of the Full Court of this Court in Australian National University v. Burns (1982) 43 A.L.R. 25 1s of great assistance. 7. If, as I have found, the lodgment arrangements with tax agents were not maqde under an enactment, then 1t necessarily follows 1n my view, that the decision not to reinstate che arrangements with respect to the applicant and the failure to yeinstate the arrangements, were decisions not made under an enactment, Those e1siens were rather made under the administrative arrangements embodied in the circular cto tax agents of June 15984, For the above reasons I dismissed the application with nm "I ul tr 1) » I certify that this and the 6 preceding pages are a true copy of the Reasons for Judgment of Mr Justice Forster. Dated: 21 May 1985 Setkieamenc tne Federal The injuretion misenarjged as fir ane Pourt ui ur rt re Wy is) Ln ty LOMB Ee DT re tu ny ial ,] a a ct na Act cf a aevrztion of In m in Pa Ww 163) PR w uw - 1h on the qecunds set eun in in iN T—t mu tr ' i M1 J rt wu tt i So ameene tax raturns sver a verioc longer moerine From 70 June 3l Augsst and also t2 :158 cn? rerinm.strstive fuetan in the Yaxuatior ofiice, tha Cormniesianer each year anters "TG AYYAnNTEnents Witn tax ayenits Fer tne ist xt f the All, Ir jare year the loantistisoner A Tiycular ré7 TaN BGTntS settir¢g sat ine li 2NCIMe Ta.2 S2tTuURMS. 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