Brian Hatch Timber Co (Sales) Pty Ltd v Commissioner of Taxation (Cth) [1972] HCA 73

High Court of Australia Walsh J. Barwick C.J. Menzies, Windeyer and Owen JJ. Brian Hatch Timber Co (Sales) Pty Ltd v Commissioner of Taxation (Cth) [1972] HCA 73

ORDER Appeals allowed with costs. Appeals allowed with costs. Orders of Walsh J. set aside and in lieu thereof order that the appeals against the assessments be dismissed with costs.

Cur. adv. vult.

1971, May 21 Walsh J

. delivered the following written judgment:—

The appellant company (herein called the company) made a return of income for the year ending 30th June 1967 in which it showed a net profit of $67,836 but it claimed to deduct earlier losses were "not allowed in terms of s. 80A (1) of the Income $330". The respondent disallowed the claim, stating that the losses were "not allowed in terms of Section 80A (1) of the Income Tax Assessment Act ". It is not disputed that the losses were incurred. But it appears that the respondent was not satisfied of the matters set out in pars. (c), (d) and (e) of s. 80A (1). In addition to assessing tax on the full amount of the net profit, the respondent made an assessment of additional tax on undistributed profits under Div. 7 of Pt III of the Act. He disallowed objections to both assessments. The principal question in these appeals is whether or not the company has shown that this Court should interfere with the decision of the respondent concerning the matters to which s. 80A (1) refers. There is a subsidiary question as to the application of s. 80B (5).

The question is not whether I think that upon the facts placed before me the conditions of s. 80A (1) were satisfied, but whether the respondent's decision should be reviewed on the ground that it can be seen that he has failed to discharge properly his statutory function, according to law. I accept the statement of Dixon J. in Avon Downs Pty. Ltd. v. Federal Commissioner of Taxation [10] as being an accurate exposition of the principles to be applied in dealing with the question which I have to decide. The examination of that question is complicated by the circumstance that very little evidence has been placed before me to show what was the material before the respondent when he made his decision. The company, through its counsel, has claimed that it was not practicable for it to produce that evidence. The respondent has chosen not to provide it. His contention is that there is no material before me upon which I can interfere with the respondent's decision and that, therefore, the company must fail.