Cape Flattery Silica Mines Pty Ltd v Commissioner of Taxation [1997] FCA 706

CATCHWORDS No QG 121 of 1995 TAXATION - appealable objection decisions - whether payments made by mining company to trustee company for an aboriginal community are deductible under s 51 Income Tax Assessment Act 1936 (Cth) - characterisation of payments made pursuant to two deeds of compensation - whether on capital or revenue account No QG 122 of 1995 TAXATION - appealable objection decisions - characterisation of payments made pursuant to two deeds of compensation - whether on capital or revenue account - whether payment in the nature of a rent or royalty - recurrent payments in lieu of compensation for deprivation of possession of land which is the subject of mining lease on revenue account - whether annual bursary for the purpose of training a recipient in areas relevant to mining deductible No QG 123 of 1995 TAXATION - appealable objection decisions - whether legal expenses incurred in negotiations with aboriginal community and in relation to the application for renewal of mining lease, discussions in respect of the validity of that application and advice relating to defending the validity of the application in the Mining Warden's Court deductible Income Tax Assessment Act 1936 s 51 Mineral Resources Act 1989 (Qld) John Fairfax & Sons Proprietary Limited v Federal Commissioner of Taxation (1959) 101 CLR 30 Federal Commissioner of Taxation v Sherritt Gordon Mines Limited (1977) 137 CLR 612 Hallstroms Pty Ltd v The Federal Commissioner of Taxation (1946) 72 CLR 634 Cliffs International Inc v Federal Commissioner of Taxation (1979) 142 CLR 140 Barrett v Federal Commissioner of Taxation (1968) 118 CLR 666 CAPE FLATTERY SILICA MINES PTY LTD (ACN 000 586 096) v COMMISSIONER OF TAXATION Nos QG 121, QG 122 and QG 123 of 1995 SPENDER J BRISBANE 28 July 1997

IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY No QG 121 of 1995 GENERAL DIVISION BETWEEN: CAPE FLATTERY SILICA MINES PTY LIMITED (ACN 000 586 096) Applicant AND: COMMISSIONER OF TAXATION FOR THE COMMONWEALTH OF AUSTRALIA Respondent CORAM: Spender J PLACE: Brisbane DATE: 28 July 1997 MINUTES OF ORDER THE COURT ORDERS THAT: 1. The objection decision of the respondent made on or about 27 July 1995 to disallow in full the taxpayer's objection dated 10 April 1995 against the Commissioner's Amended Assessment issued 22 February 1995 in respect of the applicant's income year ended 30 June 1994 or substituted accounting period be set aside; 2. The applicant's objection dated 10 April 1995 be allowed in full; 3. The applicant be allowed a deduction in the sum of $652,998.00 for the income year ended 30 June 1994 or substituted accounting period; 4. The respondent pay the applicant's costs of this application on a party and party basis to be taxed or agreed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.