Lend Lease Custodian Pty Limited v Deputy Commissioner of Taxation [2006] FCA 1790

FEDERAL COURT OF AUSTRALIA

Lend Lease Custodian Pty Limited v Deputy Commissioner of Taxation [2006] FCA 1790

INCOME/CAPITAL GAINS TAX – purchase of parcel of shares of public banking company listed on Australian Stock Exchange Limited – history of that public company's regular payment of dividends envisaged to continue at future material times – purchase price payable on completion of contract of purchase nearly four years from time of entry into that contract of purchase at ultimate price significantly less than market value of shares of target company at time of that contract – vendor contractually entitled to dividends on shares of target company until time for payment of purchase price became due – negative operation of capital gains tax on sale of public company's shares referrable to that entitlement to dividends payable during that period of years between time of contract and time of completion – no Part IVA issue arising

Income Tax Assessment Act 1936 (Cth) (as amended) Part IIIA ss 160A, 160K(3), 160Z(1), 160ZC, 160ZD(1)(b) and (c), 160ZH and 160U(2)(3) and (4)

DKLR Holding Co (No 2) Pty Limited v The Commissioner of Stamp Duties (New South Wales) (1982) 149 CLR 431 referred to Kern Corporation Ltd v Walter Reid Trading Pty Ltd (1987) 163 CLR 164referred to Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 referred to Sydney Futures Exchange Limited v Australian Stock Exchange Limited and Another (1995) 56 FCR 236 cited Associated Alloys Pty Ltd v ACN 001 452 106 Pty Limited (in liquidation) and Another (2000) 202 CLR 588referred to Aberdeen Construction Group Ltd v Inland Revenue Commissioners [1978] AC 885cited Federal Commissioner of Taxation v Orica Ltd (1998) 194 CLR 500referred to Jazazievska v Secretary, Department of Family and Community Services (2002) 65 ALD 424 referred to Gresham Life Assurance Society Ltd v Bishop [1902] AC 287 cited Burrill v Commissioner of Taxation (1996) 67 FCR 519 cited Federal Commissioner of Taxation v Myer Emporium Ltd (1987) 163 CLR 199 cited Commissioner of Taxation v Citylink Melbourne Ltd (2006) 228 ALR 301referred to Prime Wheat Association Ltd v Chief Commissioner of Stamp Duties (1997) 42 NSWLR 505cited Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation (1932) 48 CLR 26 cited Cooper Brookes (Wollongong) Pty Ltd v Commissioner of Taxation (1981) 147 CLR 297 cited State Government Insurance Office (Qld) v Crittenden (1966) 117 CLR 412cited Moneywood Pty Limited v Salamon Nominees Pty Limited (2001) 202 CLR 351referred to Chief Commissioner of State Revenue v Dick Smith Electronics Holdings Pty Ltd (2005) 221 CLR 496cited and distinguished Archibald Howie Pty Ltd v Commissioner of Stamp Duties (NSW) (1948) 77 CLR 143 cited Shop and Store Developments Ltd v Commissioner of Inland Revenue [1967] 1 AC 472 cited Colonial Mutual Life Assurance Society Ltd v Federal Commissioner of Taxation (1953) 89 CLR 428 cited Integrated Insurance Planning Pty Ltd v Commissioner of Taxation (2004) 205 ATC 4054 cited Commissioner of Taxation (NSW) v Stevenson (1937) 59 CLR 80cited Commissioner of Taxation v Dulux Holdings Pty Ltd (2001) 113 FCR 436referred to Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 cited Hepples v Federal Commissioner of Taxation (1990) 22 FCR 1 cited LEND LEASE CUSTODIAN PTY LIMITED v DEPUTY COMMISSIONER OF TAXATION NSD 907 OF 2004