Waratah Gypsum Pty Ltd v Commissioner of Taxation (Cth) [1965] HCA 9

High Court of Australia McTiernan J. Waratah Gypsum Pty Ltd v Commissioner of Taxation (Cth) [1965] HCA 9

ORDER Appeals allowed with costs. Assessments remitted to the respondent for amendment by allowing the deductions claimed in the appeals computed in accordance with ss. 122 and 122A of the Income Tax and Social Services Contribution Assessment Acts 1936-1954 and 1936-1955.

Cur. adv. vult.

1965, March 5 McTiernan J. delivered the following written judgment:—

These are two appeals from assessments by the Commissioner of Taxation of the income of Waratah Gypsum Proprietary Limited, the taxpayer, for the years ending 30th June 1954 and 30th June 1955. The taxpayer claims deductions under ss. 122 and 122A of the Income Tax and Social Services Contribution Assessment Acts 1936-1954 and 1936-1955. Upon the Commissioner overruling the taxpayer's objection to the Commissioner's refusal to allow the deductions claimed in the tax returns, the taxpayer, pursuant to s. 187 of the Acts, requested the Commissioner to treat its objection as an appeal and forward it to this Court.

The taxpayer was in the years of income and still is engaged in the mining of gypsum by open cut excavation on two sites in South Australia, one at Lake Marion near the tip of York Peninsula and the other at Lake MacDonnel on the edge of the Nullabor Plain. Lake Marion is two and one-half miles from the port and settlement of Stenhouse Bay and three miles from Inneston township. Lake MacDonnel is nine miles from the town of Penong.

The taxpayer claims under s. 122 that it is entitled to deduct from its assessable income in the years of income in question a proportion of the following capital amounts expended in respect of its operations:

1. £3,173 on the purchase of three houses at Marion Bay in 1954.