Federal Commissioner of Taxation v Hipsleys Limited [1926] HCA 34

ie

38 C.L.R.] OF AUSTRALIA 219

[HIGH COURT OF AUSTRALIA.

THE FEDERAL COMMISSIONER OF ) = , MaxATION. >. OC; 5 ae? AGAINST HIPSLEYS LIMITED . f 3 $ 5 . Derenpant.

War-time Profits Tax—Transfer of business—Tax on profits made before transfer— H. 0. or A.

Assessment of transferor after transfer—Liability of transferee—Validity of 1926. law—Law dealing with different subjects of taxation—The Constitution (63 & 64 =~ Vict, c, 12), sec, 55—War-time Profits Tax Assessment Act 1917-1924 (No. 33 of |SyDNEY, 1917—No. 58 of 1924), secs. 14, 25, 30, 32, 34. Aug.

A business, to which the War-time Profits Tax Assessment Act 1917-1918 MeLuourne, applied, was transferred after the commencement of that Act. Subsequently ¢t. 11. to the transfer the transferor was assessed for war-time profits tax under Knox o.J., that Act in respect of the profits of the business during several years preceding Tacs, Hagins, the transfer, Neither the transferor nor the transferee secured the payment 0d Rich JJ.

of the tax so assessed to the Commissioner.

Held, by the whole Court, that sub-secs, 2 and 5 of sec. 14 of the Act authorized the making of the assessment, and that sub-sec. 5 imposed upon the transferee a personal liability to pay the tax so imposed; but, by Knox G.I. Higgins and Gavan Duffy JJ. (Isaacs and Rich JJ. dissenting), that the liability so imposed upon the transferee by sub-see. 5 did not include a liability to pay the 10 per cent additional tax imposed by sec, 34 of the Act.

Boase Spinning Oo, v. Commissioners of Inland Revenue, (1926) Sc.L.T. 307 ; 135 L.T. 211, applied.

Wankie Colliery Co, v. Commissioners of Inland Revenue, (1922) 2 A.C. 51, distinguished,

Held, also, by the whole Court, that sec. 14 (5) does not deal with a subject of taxation other than war-time profits, and therefore is not obnoxious to sec. 55 of the Constitution.