Epov v Commissioner of Taxation [2007] FCA 34

FEDERAL COURT OF AUSTRALIA

Epov v Commissioner of Taxation [2007] FCA 34

INCOME TAX – power to issue amended assessments when appeals on objections against original assessments before the Court – whether payments by a company are dividends paid out of profits and assessable income under ss 108/109C and 44(1) of the Income Tax Assessment Act 1936 (Cth) – burden of proof – alternatively whether Part IVA applies Taxation Administration Act 1953 (Cth) Income Tax Assessment Act 1936 (Cth) St George Leagues Club Ltd v Commissioner of Land Tax (NSW) [1983] 2 NSWLR 399 PETER EPOV v COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA NSD 170 OF 2005 NSD 171 OF 2005 NSD 173 OF 2005

EDMONDS J

31 JANUARY 2007

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD 170 OF 2005

NSD 171 OF 2005

NSD 173 OF 2005

BETWEEN: PETER EPOV

Applicant

AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

Respondent

JUDGE: EDMONDS J DATE OF ORDER: 31 JANUARY 2007

WHERE MADE: SYDNEY

THE COURT ORDERS THAT:

1. The applicant is hereby granted leave pursuant to s 14ZZO(a) of the Taxation Administration Act 1953 (Cth) to amend the notices of objection to the amended assessments in respect of each of the years of income ended 30 June 1996, 1997 and 1998 by the inclusion of the following ground: The amended assessment is excessive it having no legal consequence in that the Commissioner was not in the circumstances permitted to amend the original assessment so as to increase the applicant's liability once an application from an appealable objection decision in respect of the original assessment had been filed in the Federal Court of Australia. 2. The objection decision in respect of the year of income ended 30 June 1996 be set aside and the appeal in respect of that year be allowed. 3. The objection decision in respect of the year of income ended 30 June 1997 be set aside and remitted to the Commissioner to be decided in accordance with the reasons for judgment. Otherwise, the appeal in respect of the year of income ended 30 June 1997 be dismissed. 4. The objection decision in respect of the year of income ended 30 June 1998 be set aside and remitted to the Commissioner to be decided in accordance with the reasons for judgment. Otherwise the appeal in respect of the year of income ended 30 June 1998 be dismissed. 5. The applicant pay two-thirds of the respondent's costs and the respondent pay one-third of the applicant's costs as agreed or taxed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.