Gluck v Federal Commissioner of Taxation [2005] FCA 1634

FEDERAL COURT OF AUSTRALIA

Gluck v Federal Commissioner of Taxation [2005] FCA 1634 JEFFREY GLUCK v FEDERAL COMMISSIONER OF TAXATION ACD 38 OF 2004 EMMETT J 11 OCTOBER 2005 CANBERRA

IN THE FEDERAL COURT OF AUSTRALIA

AUSTRALIA CAPITAL TERRITORY DISTRICT REGISTRY ACD38 OF 2004

BETWEEN: JEFFREY GLUCK

APPLICANT

AND: FEDERAL COMMISSIONER OF TAXATION

RESPONDENT

JUDGE: EMMETT J

DATE OF ORDER: 11 OCTOBER 2005

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. The applicant pay the respondent's costs of the appeal. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

AUSTRALIA CAPITAL TERRITORY DISTRICT REGISTRY ACD38 OF 2004

BETWEEN: JEFFREY GLUCK

APPLICANT

AND: FEDERAL COMMISSIONER OF TAXATION

RESPONDENT

JUDGE: EMMETT J

DATE: 11 OCTOBER 2005

PLACE: SYDNEY

REASONS FOR JUDGMENT 1 Before the Court is an appeal pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth). Under s 44, an appeal lies on a question of law from a decision of the Administrative Appeals Tribunal ('the Tribunal'). This appeal is from a decision of the Tribunal affirming a decision on review, of the respondent, the Federal Commissioner of Taxation ('the Commissioner'), in relation to an objection to an assessment issued by the Commissioner to the applicant Mr Jeffrey Gluck ('the Taxpayer'). 2 On 10 October 1998, the Taxpayer lodged an income tax return for the year ended 30 June 1998. That return disclosed income that resulted in a refund of tax. However, following investigations on behalf of the Commissioner, the Commissioner concluded that the Taxpayer had not disclosed the whole of his assessable income for the year in question. 3 A notice of assessment was issued, dated 23 May 2000. By that notice of assessment, the Commissioner indicated that the taxable income of the Taxpayer was $45,027, and that there had been an understatement of taxable income, as a consequence of which penalties and interest were included in the notice of assessment. The notice of assessment showed that net business income of $42,350 had been added to the income disclosed by the Taxpayer. The assessment arose out of renovation work carried out by a Mr Humphries on his own house, in connection with which the Taxpayer provided assistance as a building supervisor. 4 By notice of objection dated 7 August 2000, the Taxpayer objected to the assessment. The Commissioner made an objection decision on 20 July 2001 in respect of that objection. On 8 August 2001, the Taxpayer applied to the Tribunal for review of the Commissioner's objection decision. 5 The basis of the assessment was that the Taxpayer had received assessable income in the sum of $108,885.25, and had incurred expenditure in deriving that assessable income in the sum of approximately $50,000. As a result of an arithmetical error on the part of the Commissioner, or his officers, the amount of taxable income did not actually reflect the figures found by the Commissioner. However, the error was in favour of the Taxpayer. 6 The notice of appeal to this Court describes seven questions of law as follows: '(a) Whether there was any evidence or other material sufficient to justify the making of the decision;