Brown v Commissioner of Taxation [2001] FCA 596

FEDERAL COURT OF AUSTRALIA

Brown v Commissioner of Taxation [2001] FCA 596 TAXATION – assessable income – where Taxpayer failed to declare value of home unit and other benefits as part of income – where Taxpayer claimed benefits constituted a gift – where Commissioner claimed benefits were referable to services provided by Taxpayer – meaning of "income" for the purposes of s 25(1) Income Tax Assessment Act 1936 – meaning of "income from personal exertion" for the purposes of s 6 Income Tax Assessment Act 1936 – distinction between "product of an income producing activity" and "mere gift" TAXATION – discretionary power of Commissioner – where Commissioner found "deliberate evasion" – whether Commissioner's discretion should be re-exercised – whether Commissioner misconstrued facts – whether Commissioner took irrelevant considerations into account – whether Commissioner's decision capricious or arbitrary EVIDENCE – where Taxation Office investigated Taxpayer's claims – where Taxpayer's accounting and legal representatives initiated meeting with members of the Taxation Office – whether meeting and associated communications inadmissible under Evidence Act s131(1)(a) – whether operation of s131(1)(a) excluded by s131(2)(b) or (g) – whether evidence relevant

Taxation Administration Act 1953 (Cth) Part IVC Income Tax Assessment Act 1936 (Cth) ss 6, 25(1) Evidence Act 1995 (Cth) s131 Federal Commissioner of Taxation v Dixon 86 CLR 540 cited Hayes v the Federal Commissioner of Taxation (1956) 96 CLR 47 followed Scott v FCT (1996) 117 CLR 514 cited Squatting Investment Co. Ltd v Federal Commissioner of Taxation (1953) 86 CLR 570 cited Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 cited Dalgety Downs Pastoral Co. Pty Ltd v Federal Commissioner of Taxation (1952) 86 CLR 335 cited Duggan v Federal Commissioner of Taxation (1972) 129 CLR 365 cited Denver Chemical Manufacturing Co. v Commissioner of Taxation (NSW) (1949) 79 CLR 296 cited Rush & Thompkins v GLC [1989] 1 AC 1280 cited Unilever PLC v Proctor & Gamble Co [1999] 1 WLR 1630 cited Pitts v Adney (1961) 78 WN (NSW) 886 cited