FEDERAL COURT OF AUSTRALIA In the matter of E Plus Holdings Pty Ltd ACN 084 534 878, Deputy Commissioner of Taxation v E Plus Holdings Pty Ltd ACN 084 534 878 [2006] FCA 799 DEPUTY COMMISSIONER OF TAXATION v E PLUS HOLDINGS PTY LTD ACN 084 534 878 QUD 548 OF 2005 DOWSETT J 16 MARCH 2006 BRISBANE IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY QUD 548 OF 2005 IN THE MATTER OF E PLUS HOLDINGS PTY LTD ACN 084 534 878 BETWEEN: DEPUTY COMMISSIONER OF TAXATION PLAINTIFF AND: E PLUS HOLDINGS PTY LTD ACN 084 534 878 DEFENDANT JUDGE: DOWSETT J DATE OF ORDER: 16 MARCH 2006 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The application for an adjournment be refused. 2. E Plus Holdings Pty Ltd ACN 084 534 878 be wound up in insolvency under the provisions of the Corporations Act 2001 (Cth). 3. Morgan Lane and Michael Peldan be appointed liquidators for the purposes of the said winding up. 4. The plaintiff's costs of the application fixed in the sum of $976.74 be reimbursed as a priority out of the funds in the liquidation. AND THE COURT DECLARES: That anything that is required or authorized by the Corporations Act 2001 (Cth) to be done by the liquidator may be done by one or both of them. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY QUD 548 OF 2005 IN THE MATTER OF E PLUS HOLDINGS PTY LTD ACN 084 534 878 BETWEEN: DEPUTY COMMISSIONER OF TAXATION ACN 084 534 878 PLAINTIFF AND: E PLUS HOLDINGS PTY LTD DEFENDANT JUDGE: DOWSETT J DATE: 16 MARCH 2006 PLACE: BRISBANE REASONS FOR JUDGMENT 1 This is an application for adjournment of a winding up petition based upon a statutory demand delivered on 6 September 2005 and not satisfied. It seems that Mr Holland, a director of the respondent company, has had a series of unfortunate personal crises in the period from September/October through until January of this year. The petition was filed and served on 16 December. It was returnable on 2 February this year. On that date, the company asserted that it was solvent. It had previously provided reports which may or may not have demonstrated that fact. However the plaintiff, after considering the matter during an adjournment, elected to proceed. 2 The statutory demand was originally for about $66,000, however, further amounts have fallen due since then, and the debt is now almost $306,000. The most recent statement of affairs of the company shows an alleged excess of current assets over current liabilities of $95,722. That figure does not take into account a loan from shareholders, obtained recently, in the amount of $280,000. It is likely that the amount of $66,063, shown as paid to the Australian Tax Office, was part of that amount. I should say that such amount has not actually been paid. It is apparently being held in a solicitor's trust account. 3 The Tax Office has indicated that it is not willing to accept it by way of part-payment. I accept that the moneys are available to pay the Commissioner, but the question is where the balance will come from. The only source appears to be the company's trade debtors, which owe in excess of $320,000, with an allowance of $30,000 for doubtful debts. However the company has said nothing about the status of those debts, how it might go about recovering them, or the likely timeframe for recovery. The statement of assets as at 14 March 2006 demonstrates other trade creditors at $217,412. Nothing has been said about how that amount might be paid. Nothing has been said about whether those creditors are pressing or not. 4 It also seems that there is a further amount outstanding by way of employee superannuation contributions. That, of course, is always a bad sign. 5 In the circumstances, I do not consider that the material placed before me is sufficient to rebut the presumption of insolvency based upon non-compliance with the statutory demand. The company has sought an adjournment in order to obtain an independent financial report. It suggests that this is necessary in order to demonstrate solvency. There is no suggestion that such a report would be based on figures other than those upon which the assets and liabilities statement to which I have referred is based. I have proceeded upon the basis that those figures are correct. In the circumstances, there is no reason to believe that an adjournment would produce further material of assistance to the company's case. The application for an adjournment will be refused. There will be an order in terms of the draft. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett. Associate: Dated: 4 July 2006 Solicitor for the Plaintiff: Australian Taxation Office Legal Services Branch Counsel for the Defendant: Mr A James Solicitor for the Defendant: Turnbull & Co Date of Hearing: 16 March 2006 Date of Judgment: 16 March 2006