Quarries Ltd v Commissioner of Taxation (Cth) [1961] HCA 69

High Court of Australia Taylor J. Quarries Ltd v Commissioner of Taxation (Cth) [1961] HCA 69

ORDER Appeal allowed. Amended assessment set aside. Respondent to pay the appellant's costs of the appeal.

Cur. adv. vult.

Taylor J. delivered the following written judgment:—

Nov. 14 Taylor J

In its return of income for the year which ended on 30th June 1957 the taxpayer included in the deductions which it claimed to make from its assessable income the sum of £3,720 which was said to be the cost of what were described as portable sleeping units. The claim for a deduction of this amount was disallowed and by an amended assessment the liability of the taxpayer was increased accordingly. Thereafter by notice of objection to the amended assessment the taxpayer contended, first of all, that the expenditure had been incurred in the production of assessable income or necessarily incurred in the carrying on of its business for that purpose and that the expenditure was not of a capital nature. Secondly it objected on the ground, in effect, that the units were property, being plant, or articles owned and used by it during the year of income for the purpose of producing assessable income within the meaning of s. 54 of the Income Tax and Social Services Contribution Assessment Act 1936-1957 Cth and in respect of which it was entitled to a deduction of an amount for depreciation in accordance with that section. The first of these grounds was abandoned at an early stage and the only material question before me was whether the taxpayer was entitled to a deduction for depreciation as was contended. The taxpayer appealed in the first instance to a Board of Review which resolved this question in favour of the Commissioner and an appeal is now brought to this Court pursuant to s. 196 of the Act.