SMITHFIELD PASTORAL COMPANY PTY. LIMITED V. THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

COURT:

PARTIES:

NATURE OF PROCS DINGS:

OF COURT:

DATE OF JUDG: 2

SONS FOR JUDG!

High Court of Australia

Smithfield Pastoral Company Pty. Limited v.

The Commissioner of 7 Commonwealth of Austr

Appeals % Court from decisions of the Commi, xr disallowing objections to assessments eh included in the assessable income of the taxpayer company for %r s of income ended 30th June, 1957, 1961, 1962 and 1963 pursuant to $.26(a) of the Income Tax a.d Social Services Contribution

Ass ment Act, the proceeds of sale of certain land.

Owen, J.

Assessments set as

iL Appeals allowed th costs.

26th April, 1966 at Sydney.

a

>

JUDGMENT

The appellant Company, which I shall call the Company, was formed in September 1955 to acquire certain land

in the neighbourhood of the small towz

ip of Smitnfield and carry on agricultural and pastoral pursuits thereon. Smithfield is 15 or 20 miles north of Adelaide on the aain North Road,

and about two miles north of what is now the town of Hlizabeth. The Company's Chairman and Managing Director was and still is Sir Ellerton Becker, then Mr. Becker, and for the sake of

brevity I will refer to him as Fecker. There were two other

directors, both of whom were close fricnds of his, Mr, Pickering, a well-known lawyer and Queen's Counsel of Adelaide and a

Mr. Haseldine, an accountent vractising in that city, Becker held the majority of the shares in the Company, the on'y other shoreholders being Pickering and Haseldine each of whom held a small varcel in trust for Becker. Between October 1955 and

June 1957 the Company purchasee from various vendors a number

of sections of land in the Smithfield neighbourhood at prices ranging from £102.10.0 to £156 per acre, the total cot of the purchases being something over £149,000. The lands purchased amounted in all to avout 1,200 acres and I will call them the Smithfield land. In June 1957 the Company sold one section