Broken Hill Theatres Pty Ltd v Commissioner of Taxation (Cth) [1952] HCA 75

High Court of Australia Williams J. Dixon, C.J. McTiernan, Webb, Fullagar and Kitto JJ. Broken Hill Theatres Pty Ltd v Commissioner of Taxation (Cth)

ORDER Appeal dismissed with costs.

Cur. adv. vult.

July 6 Williams J . delivered the following written judgment:—

This is an appeal by Broken Hill Theatres Pty. Ltd. from its assessment for income tax under the provisions of the Income Tax Assessment Act 1936-1948 in respect of its income derived during the year ended 30th June 1948. The sole question at issue is whether the appellant is entitled under the provisions of s. 51 (1) of that Act to deduct from its assessable income for that year legal expenses amounting to £270 12s. 9d. In its income tax return the appellant in claiming the deduction stated that the legal expenses were for costs incurred in contesting in the District Court of Broken Hill the application of Mr. J. Boulus for an indorsement of the licence issued under the Theatres and Public Halls Act in respect of the Town Hall, Broken Hill, which, if granted, would have established in Broken Hill another motion picture theatre in opposition to the then existing motion picture exhibitors in that city. The appellant stated that the granting of this indorsement would have occasioned considerable loss to the company, both in the way of decreased income and increased expenditure.

The facts with respect to this litigation are set out in the report of the case Boulus v. Broken Hill Theatres Pty. Ltd. [1] . The parties have agreed to treat these facts as part of the evidence on this appeal so that they need not be recapitulated. The legal expenses in dispute were those incurred by the appellant in the litigation up to 30th June 1948. The proceedings in the Supreme Court of New South Wales and in this Court occurred after that date. As appears from these facts objections to the granting of Boulus' application were lodged by the appellant, Ozone Theatres (B.H.) Pty. Ltd., South Broken Hill Music Hall Co. Ltd. and Johnson's Theatres Pty. Ltd. on the grounds mentioned in the report [1] . It is not disputed that the sum of £270 12s. 9d. represents the share of the total costs incurred by the objectors up to 30th June 1948 attributable to the appellant.