Queensland Television Ltd v Commissioner of Taxation (Cth) [1969] HCA 41

High Court of Australia Kitto J. Queensland Television Ltd v Commissioner of Taxation (Cth) [1969] HCA 41

ORDER Each of these appeals is dismissed with costs. Usual order with respect to exhibits.

Cur. adv. vult.

Sept. 5 Kitto J. delivered the following written judgment:—

By consent of the parties I have heard together six appeals, under ss. 187 (b) and 197 of the Income Tax and Social Services Contribution Assessment Act 1936 Cth as amended, against assessments of income tax payable by the appellant. They relate to the years of income ended on 30th June of the years 1961, 1962, 1963, 1964, 1965 and 1966 respectively. The first three appeals may be considered together and the last three together, as I shall proceed to explain.

The assessments appealed against in respect of the first three years were all amended assessments, each of which was made within six years from the date upon which the tax became due and payable under the original assessment. The amendments increased the appellant's liability, and were made otherwise than to correct any error in calculation or any mistake of fact. The appeal in each of the three cases therefore involves two questions: (1) whether the amended assessment, if valid, properly increased the appellant's liability, and (2) if so, whether the original assessment was made after a full and true disclosure to the Commissioner of all the material facts necessary for the assessment: s. 170 (3).

The original assessment in respect of income derived in the year ended 30th June 1961 was made in 1962. In making it the Commissioner allowed as a deduction under s. 80 an amount of $15,648 as a loss incurred by the appellant in the year ended 30th June 1960. The figure had been arrived at by treating as an allowable deduction under s. 88 (2) in respect of the 1960 year an amount of $21,391 as being a proportionate part of expenditure incurred in making, with the written consent of the lessor, improvements not subject to tenant rights on land of which the appellant claimed to have been in that year a lessee and which it had used in that year for the purpose of producing assessable income. The Commissioner also allowed as a deduction under s. 88 (2) an amount of $34,696 in respect of similar expenditure in the 1961 year itself. The two amounts so allowed were, of course, not allowable deductions if, in the respective years, the appellant in fact held no lease of the land on which the improvements had been made. The amended assessment, made in 1967, was made on the basis that there was no such lease, and for that reason the abovementioned deductions were disallowed. The amended assessments in respect of the 1962 and 1963 years disallowed for the same reason deductions that had been allowed under s. 88 (2) in the original assessments for those years.