JUDGMENT No. 77A76.1. IN_THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) NOS. G3294 TO 3297 of 1987 ) GENERAL DIVISION ) BETWEEN: PETER G. HENNESSY Appellant AND: THE COMMISSIONER OF TAXATION Respondent MINUTE OF ORDER JUDGE: FOX J. DATE OF ORDER: 16 DECEMBER 1987 WHERE MADE: Sydney. THE COURT ORDERS THAT: 1. The four appeals be dismissed and it confirms the assessments in each case. 2. The appellant pay the respondent's costs. Note: Settlement and entry or orders is dealt with in Order 36 of the Federal Court Rules. NOT FOR GENERAL DISTRIBUTION IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW _ SOUTH WALES DISTRICT REGISTRY ) Nos. G3294 to 3297 of 1987 ) ) GENERAL DIVISION CORAM: FOX J. DATE: 16 DECEMBER 1988 BETWEEN : PETER G. HENNESSY we Appellant AND: THE COMMISSIONER OF TAXATION Respondent REASONS FOR JUDGMENT FOX J. (EX TEMPORE) There are now before me four appeals from the refusal by the Commissioner of Taxation of objections to assessments to income tax made by hin. credits of amounts due to by him or on his behalf question which arises in has appeared before me in competently. The substantial Assessment Act 1936 ("the related to zone rebates. In each case, the assessments showed the taxpayer, taxation having been paid under the pay as you earn system. The each case is the same. The appellant person and has argued his own case very question centres around the Income Tax Act"), s.79A and the following sections The appellant is not himself in any of the zones and the assessments were prepared and have been sustained on the basis of the other provisions of the Act which have affected him. His argument is, however, to the effect that the Commissioner in calculating his assessment has acted contrary to two provisions of the Constitution, namely s.51(ii) and s.99. It is not necessary to set these out or deal separately with them. One in terms relates to not discriminating between States or parts of States and the other deals with preferences not being given to one. The appellant does not challenge the validity of 5.79A, but rather relied on it and related provisions, and claims that to accord with the Constitution the concessions for which it provides must be available more broadly. It is not said or argued that the Commissioner acted otherwise than in accordance with the Act as, in terms, it applies to the taxpayer. He does not seek an application of s.79A itself. Put another way, the challenge really is to the legislation under which he was assessed, and it is a challenge of a broad nature. The appellant has concentrated on the assessments and he submits that they are wrong because the Commissioner should have acted in away which, accepting the presence (and validity) of s.79A, would nevertheless lead to a situation in which there was no breach of the constitutional provisions to which I have referred. There can however be no basis on which the Commissioner - could do as the appellant has suggested namely, allow a rebate to the taxpayer as if he were in a zone. Whichever way the matter is looked at, 1t does seem to me that the appellant is in difficulties. He based himself largely on the Commissioner of Taxation v. Clyne (1958-59) 100 CLR 246. In that case, the Commissioner sued for income tax and demurrers were brought leading to the argument of questions before the full High Court. So far as concerns s.79A, the majority of the court in that case was prepared to assume for the purposes of argument, but certainly did not decide, that it was invalid. The taxpayer in that case, however, sought to use the argued invalidity of s.79A to bring down the rest of the Act, or at least all material parts of it. The majority of the High Court held that, even if s.79A were invalid, this would not bring down the rest of the Act and that being so, the taxpayer in that case (he had not been assessed under s.79A) would not have standing to argue anything about the section. Webb J. considered the validity of the section and held it to be valid. The taxpayer in Clyne's case was hoping for consequences to flow, just as the appellant in the present case is, but one was by challenge to validity, whereas the appellant here does not challenge validity, but, on an argued application of the Constitution, he claims a concession. This would not only lead in effect to wholesale amendments to the Act, but amendments which would be impossible to express or apply. It seems to me that the taxpayer, the appellant in these cases, does not have a sound case in law. I therefore dismiss the four appeals and confirm the assessments in each case. I will order that the costs of the appeals. Counsel for the Appellant: Solicitors for the Appellant: Counsel for the Respondent: Solicitors for the Respondent: Date of hearing: Date judgment delivered: appellant pay the respondent's I certify that this and the three (3) preceding pages are a true copy of the Reasons for Judgment herein of his Honour Mr. Justice Fox. Associate: Mare i Date: 16 December 1987 Mr G. Hennessy Mr G. Hennessy Mrs R. Sharp Australian Government Solicitor Sydney: 16 December 1987 Sydney: 16 December 1987