Batagol v Commissioner of Taxation (Cth) [1963] HCA 51

High Court of Australia Kitto, Menzies and Owen JJ. Batagol v Commissioner of Taxation (Cth) [1963] HCA 51

ORDER Questions in the case stated answered as follows

1.

(a) No.

(b) No.

2.

(a) No.

(b) No.

(c) No.

3.

(a) Yes.

(b) Yes.

(c) Yes.

Order that the costs of the case stated be costs in the appeal.

Cur. adv. vult.

The following written judgments were delivered:

Nov. 19 Kitto J.

The appellant in June 1955 received from the respondent three notices of assessment, each stating an amount of taxable income and of tax payable in respect of income derived by the appellant in a year of income. The years were those which ended respectively on 30th June 1952, 30th June 1953 and 30th June 1954. In form the notices were notices of original, not amended, assessments; but the appellant says that in respect of each of the three years the Commissioner had made an earlier assessment which in the circumstances of the case he had no power to amend.

What had happened earlier was this. In respect of each of the relevant years of income the appellant duly made a return showing a taxable income. He made to the Commissioner a full and true disclosure of all material facts necessary for his assessment in respect of each of those years. In the Commissioner's office the normal procedure for assessing a taxpayer such as the appellant was pursued in respect of each year, but on each occasion the officers concerned made a mistake. The appellant had made in a previous year a loss which (the case stated assumes) would have entitled him under s. 80, if that section had not contained sub-s. (4), to treat as an allowable deduction in each of the three years now in question a sum equal to the amount shown in his return as his taxable income. The assessing officers overlooked sub-s. (4), notwithstanding that facts which are said to have made it applicable had been disclosed by the appellant. Accordingly, not by any error in calculation or any mistake of fact but by a mistake of law, on each occasion they reached the conclusion that the appellant had no taxable income, recorded the conclusion on the file in a manner conforming to the practice of the office, marked the file as having been finally dealt with, and had it put away. The appellant was not informed of the conclusion in respect of either of the first two years. In the third year, however, he had suffered deductions of tax from his wages, and a cheque by way of refund was sent to him together with a "refund advice" stating that no tax was payable.