Risby Forest Industries Pty Ltd v Commissioner of Taxation [1988] FCA 474

JUDGMENT No. .4.1.47..38..

CATCHWORDS

INCOME TAX — Grounds for review of Commissioner's exercise of discretion under s. 109 of the Income Tax Assessment Act - whether payment to retiring managing director was deductible to company pursuant to s. 78(1)(c) of the Act - whether receipt by taxpayer was deemed dividend within the scope of para. 44(1)(a) of the Act - powers of Court on review of Commissioner's exercise of discretion ~ interaction between para. 78(1)(c) and s. 109 of the Act - determination that payment is otherwise deductible under para. 78(1)(c) as prerequisite to exercise of Commissioner's discretion pursuant to s. 109 - effect of failure of Commissioner to reach fresh determination as to whether payment was reasonable under s. 109 after abandoning contention that payment was not in good faith for the purposes of para. 78(1)(c) - Court's power to reach conclusion as to whether Commissioner ought to have been satisfied that payment was reasonable in amount - whether receipt by retiring managing director was of capital or revenue nature.

Income Tax Assessment Act 1938: sub-s. 44(1), sub-s. 78(1),

s. 109, s. 187, sub-s. 189(3), s. 199.

RISBY FOREST INDUSTRIES PTY. LTD. v THE COMMISSIONER OF

TAXATION

TG 2006 of 1987

CHARLES ARTHUR RISBY v THE COMMISSIONER OF TAXATION

TG 2007 of 1987

LOCKHART J. 29 AUGUST 1988 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

TASMANIAN DISTRICT REGISTRY

GENERAL DIVISION

BETWEEN:

AND:

No. TG 2006 of 1987

RISBY FOREST INDUSTRIES PTY. LTD.

Applicant

THE COMMISSIONER OF TAXATION

IN THE FEDERAL COURT OF AUSTRALIA

TASMANIAN DISTRICT REGISTRY

GENERAL DIVISION

BETWEEN:

JUDGE MAKING ORDER: DATE OF ORDER: WHERE ORDER MADE:

Respondent

No. TG 2007 of 1987

deed

CHARLES ARTHUR RISBY Applicant

THE COMMISSIONER OF TAXATION

Respondent

LOCKHART J. 29 AUGUST 1988 SYDNEY

MINUTE OF ORDERS

THE COURT ORDERS THAT: