CITATION: Larsson v Chief Commissioner of State Revenue [2008] NSWADT 208 DIVISION: Revenue Division APPLICANT: Matthew Paul Larrson PARTIES: RESPONDENT Chief Commissioner of State Revenue FILE NUMBER: 076103 HEARING DATES: 16 May 2008 SUBMISSIONS CLOSED: 16 May 2008 DATE OF DECISION: 29 July 2008 BEFORE: Perrignon R - Judicial Member MATTER FOR DECISION: Principal application First Home Owner Grant Act 2000 LEGISLATION CITED : Duties Act 1997 Taxation Administration Act 1996 Stamp Duties Act 1920 Snow v Chief Commissioner of State Revenue [2005] ADT NSW 278 Chief Commissioner of State Revenue v. Ferrington [2004] NSW ADT 41 Rauf v. Chief Commissioner of State Revenue [2005] NSW ADT 176 Abadier v. Chief Commissioner of State Revenue [2008] NSW ADT 16 CASES CITED: Knight and anor v. Chief Commissioner of State Revenue [2008] NSW ADT 83 Federal Commissioner of Taxation v. G. M. Swift and others 89 ATC 5101 Gomez-Martinez v. Chief Commissioner of State Revenue [2007] NSW ADT 251 Calcaro v. Chief Commissioner of State Revenue [2004] NSW AT 158 Philpot v. Chief Commissioner of State Revenue [2008] NSW ADTAP 18 Elskaf v. Chief Commissioner of State Revenue [2006] NSW ADTAP 10 Applicant: Mr Thomas REPRESENTATION: Respondent: Mr El Hage 1. The decision of the Chief Commissioner to reverse his previous decision to make a grant under the First Home Owner Grant Act 2000 in the sum of $7000 is affirmed. ORDERS: 2. The decision of the Chief Commissioner to assess stamp duty in respect of the transfer and mortgage is affirmed. 3. The decision of the Chief Commissioner to impose a penalty of $2,100 is varied by substituting a penalty of 20% in the sum of $1,400. REASONS FOR DECISION 1 On 7 July 2004, Mr. Larsson contracted to purchase a home unit at Penshurst in Sydney for $260,000. He was 23 years old, and lived with his parents in their home at Blakehurst. A licensed builder, he was working as a site supervisor for a building firm at the premises of the Australian Broadcasting Corporation at Artarmon. He applied to the Chief Commissioner of State Revenue for a First Home Owner Grant under the First Home Owner Grant Act 2000, and for the "First Home Plus" exemption from stamp duty under the Duties Act 1997. 2 On or about 17 August 2004, the Chief Commissioner paid to him the First Home Owner Grant in the sum of $7,000, and approved his application for stamp duty exemption. After settlement on 23 August 2004, Mr. Larsson's transfer and mortgage documents were stamped accordingly. 3 The Chief Commissioner authorised payment of the First Home Owner Grant, and approved the application for stamp duty exemption, in anticipation of Mr. Larsson complying with the residency requirements in section 12 of the First Home Owner Grant Act 2000 and section 76 of the Duties Act 1997. The Chief Commissioner was empowered to do this by section 20 and section 76A of the respective Acts. The residency requirements were that Mr. Larsson occupy the home unit as his principal place of residence for a continuous period of at least 6 months, and that this occupation should start within 12 months after completion of the contract to purchase, or such longer period as the Chief Commissioner may approve. 4 Mr. Larsson gave evidence that he moved in to the unit within a few days after 23 August 2004. On 8 December 2004, he engaged an agent to let and manage the property. He moved out on about 15 December 2004 and returned to live with his parents. He did not return to the unit. From 21 December 2004, the unit was let to a tenant. 5 It is common ground that Mr. Larsson failed to satisfy the residency requirement. 6 By operation of section 20(3) of the First Home Owner Grant Act 2000 and section 76A(2) of the Duties Act 1997, it was a condition of the grant, and of the stamp duty exemptions, that if Mr. Larsson should fail to satisfy the residency requirement, he would notify the Chief Commissioner of this, in writing, within fourteen days after the end of the period allowed for compliance, and pay to the Chief Commissioner: - the First Home Owner Grant in the sum of $7,000; and - the stamp duty from which he had been exempted – namely, $7,592 on the transfer and $877 on the mortgage. 7 By 24 August 2005, twelve months had passed since settlement. Time for compliance with the residency requirement had expired. In breach of the conditions of the grant and duty exemption, Mr. Larsson failed to notify the Commissioner, repay the grant, or pay the duty, within 14 days or at all. 8 On 19 September 2006, the Chief Commissioner sent Mr. Larsson a routine letter. It sought a statutory declaration as to when Mr. Larsson had begun to reside at the unit, and the period of time for which he lived there, plus supporting documentation. Mr. Larsson did not reply. 9 On 11 December 2006, the Chief Commissioner reversed his decision to authorise payment of the First Home Owner Grant, on the grounds that Mr. Larsson had failed to comply with the residency requirement. He required Mr. Larsson in writing to repay the grant in the sum of $7,000 pursuant to section 45(1) of the First Home Owner Grant Act 2000, and imposed a penalty of 30% in the sum of $2,100. The reason for imposing a penalty, and imposing one in that amount, was not specified in the letter. 10 Also on 11 December, the Chief Commissioner assessed Mr. Larsson's liability to stamp duty in the sums of $7,592 and $877, in respect of the transfer and mortgage respectively. In doing so, he exercised his powers of assessment under section 8 of the Taxation Administration Act 1996: Snow v Chief Commissioner of State Revenue [2005] ADT NSW 278. He imposed interest on the duty pursuant to section 15 of that Act. 11 On 9 February 2007, Mr. Larsson objected to the decisions of 11 December 2006. On 21 June 2007, the Chief Commissioner allowed his objections in part, by reversing the decision to impose interest. The objections were otherwise disallowed. 12 On 17 August 2007, Mr. Larsson commenced proceedings in the Tribunal for review of the Chief Commissioner's decisions of 11 December 2006. As the Chief Commissioner had already reversed his decision to impose interest, this part of the original decision was not agitated before the Tribunal, and the Applicant sought no order in respect of it. 13 The facts as set out above are not in dispute, although the Chief Commissioner denies that Mr. Larsson ever occupied the home unit as his principal place of residence, and puts him to proof of it. Jurisdiction 14 Jurisdiction to review these decisions of the Chief Commissioner is conferred on the Tribunal by section 28(1) of the First Home Owner Grant Act 2002, and section 96 of the Taxation Administration Act 1996. It is for the Applicant to prove his case. Issues for determination 15 The issues for determination by the Tribunal may be summarised as follows: a. Whether, and if so for what period, Mr. Larsson occupied the home unit as his principal place of residence. b. Whether it is appropriate to exercise the discretion under section 12(1A) of the First Home Owner Grant Act 2000 or section 76(2) of the Duties Act to exempt him from the residency requirement altogether, or to approve a shorter period. c. Whether in all the circumstances it is appropriate to impose a penalty, and if so in what amount. Residency 16 The Tribunal received affidavit evidence from Mr. Larsson and both his parents. Mr. Larsson and his father also gave oral evidence. All three gave evidence to the effect, in part, that Mr. Larsson moved out of his parents' home and into his new unit shortly after settlement in August 2004, and moved back in with his parents in December of that year. This was consistent with a declaration signed by the Applicant on 9 February 2007, and lodged with the Chief Commissioner in support of his initial objections to the Chief Commissioner's decisions. 17 Mr. Larsson gave oral evidence on the first and second days of trial. I observed his demeanour when giving evidence in chief, and during a detailed cross-examination. On each occasion, he impressed me as being a witness of truth. I formed a like impression of his father, who gave oral evidence and was cross-examined on the first day of trial. 18 Mr. Larsson's father agreed that his son had an open invitation to dine with his parents while living at the unit, and Mr. Larsson gave evidence that he regularly took advantage of that invitation. However, he said that he slept overnight in his parents' home on only one occasion. That was the night of 29 October 2004, when he had undergone a second operation to his hand – referred to below - and was unable to drive himself home. Otherwise, he lived at the unit as his home. 19 To corroborate his assertion that he had lived in the unit, the Applicant had provided documentary evidence to the Chief Commissioner that he had purchased furniture and had it delivered to the unit for his use, and that the furniture was not removed from the unit until after his occupation had ceased. This was tendered in evidence. 20 To rebut the Applicant's evidence that he had occupied the unit as his principal place of residence, the Chief Commissioner relied on the Applicant's admissions: § that he had not taken out contents insurance in respect of the unit, § that he had not connected a phone line, and § that he had not entered into a contract to supply electricity to the unit. 21 The Chief Commissioner also adduced documentary evidence to the following effect. a) During the period of his alleged occupation, the Applicant Mr. Larsson remained registered on the Electoral Roll as residing at his parents' address. b) During the same period, he did not notify the Roads and Traffic Authority of his change of address, but remained on their records as residing at his parents' address. c) From 18 August 2004 to 11 January 2005, 27 kwh of electricity was recorded by EnergyAustralia as having been consumed at the unit. d) An invoice from Sydney Water addressed to the Applicant at the unit for water service, sewerage service and stormwater drainage for the period 1 October to 31 December 2004 – previously supplied by the Applicant to the Chief Commissioner in support of his objections – did not include a separate charge for water use. e) Records of the NSW Office of Fair Trading disclosed that on 6 October 2004 a rental bond of $820 was lodged in respect of the unit, and refunded on 26 October 2004. Searches conducted by the Office of State Revenue revealed that the bond was lodged by Ray White Real Estate, Penshurst. 22 The applicant readily admitted that he had not taken out contents insurance, and had not even sought a quote for it. 23 He agreed that he had not connected a phone line, because he relied for his personal communications on a mobile phone supplied by his employer. 24 The Applicant accepted that he neglected to inform the Electoral Office and the RTA of his change of address. 25 He said he did not need to connect power to the unit, because the electricity was already connected and working when he took possession. That evidence was corroborated by an invoice from an electrical a contractor, for repairs made in September 2004 to a light in the lounge room and a power point in the laundry, at the Applicant's expense. It was consistent also with EnergyAustralia records showing that 27 kwh of electricity was consumed at the unit between 18 August 2004 and 11 January 2005. Those records showed that a previous occupant had ceased to occupy the unit on 24 February 2004, and that the person whose tenancy commenced on 21 December 2004 took up occupancy on 11 January 2005. 26 No evidence was called from EnergyAustralia as to the practical effect of a usage of 27 kwh. The evidence does not establish whether EnergyAustralia was the only supplier of electricity to the unit in the relevant period, or whether its records contained a complete record of electricity usage at the premises. The Tribunal is not in a position to draw any firm inference from the evidence of EnergyAustralia, save that it is consistent with the Applicant's evidence that electricity was supplied to the property, despite the lack of a supply contract. 27 The invoice from Sydney Water covered only part of the alleged period of occupation by the Applicant. No evidence was called from Sydney Water to establish whether, during that period, it charged separately for water usage, if so what volume of usage was needed before a charge was made, or whether it was its practice to include water usage charges in the same invoice as service and other charges. The Applicant accepted that his water usage would have been minimal, because he often took advantage of benefits conferred by his employer, including permission to take his showers at the workplace every day. He gave uncontested evidence that water usage was measured by a single meter for the entire block of units, and that the usage charge was divided up equally between all unit owners. From this, I infer that there were charges for water usage, that they may have been invoiced separately from other water charges, and that they would not necessarily have reflected the Applicant's personal usage in any event. In these circumstances, the lack of a separate charge for water usage on the Sydney Water invoice for water, sewerage and drainage services neither compels nor justifies a conclusion that no water was consumed by Mr. Larsson at the unit. 28 The issue of a rental bond remains something of a mystery. Tendered in evidence was a letter from Ray White Penshurst to the Chief Commissioner dated 19 March 2007, to the effect that they had searched their records, and had no record of the subject property at all. This suggests that either the records tendered by the Chief Commissioner are incorrect, or the records of Ray White are deficient. The Applicant denied ever having retained Ray White Penshurst or any other agent to let the property prior to 8 December 2004, or authorising its letting in October 2004, or the taking of a bond. So far as he knew, he thought his father had been involved in that without his knowledge. As the source of his understanding was not explored in evidence, its reliability cannot be assessed. 29 In his oral evidence, the Applicant's father explained that he had made an offer to purchase another unit in the same block of units as his son's unit for $250,000. The occupant was confined to a wheelchair, and about to leave the premises. The occupant's wife had suggested to the Applicant's father that he might buy it, when they met in the corridor. The Applicant's father approached Ray White Penshurst, who were handling the sale, and enquired what rental income he might expect if he purchased the unit. In the result, his offer was declined by the vendor. He neither purchased that unit, nor made any arrangements to let it. I accept his evidence. 30 It is possible that the agent misunderstood the queries of the Applicant's father, thought that he was seeking a tenant for his son's property, and that the rental bond was the result of this misunderstanding. However, in the state of the evidence, it is impossible to draw any firm conclusion. The evidence is not sufficient to satisfy the Tribunal that an agent was retained to let the Applicant's unit at all, let alone that the Applicant himself engaged an agent for that purpose, or authorised, acquiesced in, or even had knowledge of, any such engagement. 31 Having regard to all the evidence, I am not persuaded that the evidence adduced by the Commissioner, whether documentary or by way of admission, is sufficient to rebut the sworn evidence of the Applicant and his parents as to the Applicant's occupation of the unit. I am satisfied: § that the Applicant lived in the unit as his home from about 26 August 2004 to about 15 December 2004, and § that until he engaged agents to let it on 8 December 2004, his occupation had the requisite degree of permanence for being his principal place of residence, and otherwise satisfied the criteria for the same, as laid down by the Appeals Panel of this Tribunal in Chief Commissioner of State Revenue v. Ferrington [2004] NSW ADT 41. 32 I find that he occupied the unit as his principal place of residence from about 26 August 2004 to 8 December 2004 – that is, for a period of about three and a half months. Discretion 33 The Applicant requests the Tribunal to reduce the residency requirement to the period during which he occupied the unit, on medical grounds. 34 The Tribunal has determined a number of applications to modify the residency requirement on medical grounds, among others. Examples have included Rauf v. Chief Commissioner of State Revenue [2005] NSW ADT 176, Abadier v. Chief Commissioner of State Revenue [2008] NSW ADT 16, and Knight and anor v. Chief Commissioner of State Revenue [2008] NSW ADT 83. The facts in each of those cases differed materially from the facts in this case, though in Knight's case there were also significant similarities. 35 The discretion to modify the residency requirement must be exercised, if at all, having regard to the purpose of the Acts which authorise its exercise. It ought not be exercised in such a way as to defeat the primary purpose of the legislation: Federal Commissioner of Taxation v. G. M. Swift and others 89 ATC 5101; Gomez-Martinez v. Chief Commissioner of State Revenue [2007] NSW ADT 251; Abadier v. Chief Commissioner of State Revenue [2008] NSW ADT 16. 36 The purpose of the First Home Owner Grant Act 2000 is to be found in its long title: "An Act to encourage and assist home ownership, and to offset the effect of the Goods and Services Tax on the acquisition of a first home, by establishing a scheme for the payment of grants to first home owners; to amend the Stamp Duties Act 1920 to exempt such grants from financial institutions duty; and for other purposes." 37 The purpose of the First Home Plus Scheme is described in section 6 of the Duties Act 1996: "This scheme is intended to help people who are acquiring their first home." 38 When Mr. Larsson moved out of the unit, it became a rental property. He had intended that result as early as 8 December 2004, when he signed a management agreement. It is not the purpose of either Act to assist in the acquisition of properties for investment. That factor alone, however, would not necessarily preclude the exercise of the discretion in his favour, if good reason for its exercise were shown. To determine whether there is good reason for that exercise, regard must be had to the medical evidence. 39 The Applicant gave evidence that he injured his left hand on 7 May 2004, while driving a forklift truck at work. He was left-handed. On 14 May 2004, the hand was operated on by hand and wrist surgeon, Dr. Stuart Myers, who inserted a metal plate. A report from Dr. Myers dated 9 November 2007 was tendered in evidence. 40 The Applicant was certified unfit for work from 7 to 24 May 2004. From 25 May to 30 June 2004, he was on restricted duties involving no lifting with the left hand. From 5 July to 20 August 2004, he was placed on light duties, with a 5kg lifting restriction. 41 On review on 17 September 2004, Dr. Myers observed significant restrictions in finger movement. The Applicant was nevertheless assessed as being fit for full duties. 42 On 29 October 2004, the Applicant underwent a second procedure to remove the plate, and otherwise to improve his hand. From then until 14 November 2004, he was certified unfit for work. 43 On review on 1 November 2004, Dr. Myers observed: " …he was progressing well. There had already been significant improvement in finger range movement. He was referred to hand therapy." 44 The doctor assessed the Applicant as being fit for full duties from 15 November 2004. 45 On 9 May 2005, the doctor noted, "some residual aching in his hand around the 5th metacarpal neck region when he was working", but could discern no scar tenderness or signs of nerve entrapment. There was normal alignment of the little finger. He asked the Applicant to return for review after six months if he experienced residual ache, but the Applicant did not return. 46 The medical evidence was uncontested, and I make findings in accordance with it. I note in particular Dr Myer's observation that "the injury to the left hand had a profound effect on Matthew's ability to work and care for himself in the immediate post operative period." I find that Mr. Larsson experienced difficulty living on his own, due to the pain and inconvenience experienced by him in respect of his left hand. I accept his evidence that when he returned to work after the second procedure, his duties as a site manager were essentially clerical in nature – including typing at a computer keyboard - and that he did not perform extra manual work in which he had engaged prior to his injury, including driving a forklift and assisting labourers on site. 47 The medical evidence establishes that, when Mr. Larsson ceased to occupy the unit as his principal place of residence in early December 2004, he was fit for full duties as a site manager, and had been so since the middle of November. From the report of Dr. Myers, I infer that the worst was over, and that his medical condition was improving. It may well be that the injury to his hand, and the difficulties in caring for himself that they caused, contributed substantially to his decision to leave the unit and live with his parents again. The persuasive reasoning of his parents, and the convenience which living with them offered, was probably also a significant factor. 48 However, I find that Mr. Larsson could have continued to live on his own at the unit had he wished to do so, that the situation in that regard was by no means beyond his control, that his injuries did not compel him to leave the unit, and that any pain or inconvenience associated with his injury was not so great as to make his living there either impossible, dangerous or otherwise unreasonable in the circumstances. 49 Having regard to all the evidence, I am not persuaded that there are good reasons to modify the residency requirement of either Act, or to exempt Mr. Larsson from those requirements. Penalty 50 Section 45(3) of the First Home Owner Grant Act 2000 empowered the Chief Commissioner to impose a penalty not exceeding the amount of the grant for failure to make a repayment required under the conditions of grant. Having failed to satisfy the residency requirement, the Applicant failed to repay the grant within 14 days of expiry of the period allowed for compliance. It follows that he failed to make a repayment required under the conditions of grant, and that the Chief Commissioner was entitled to impose a penalty. 51 A penalty of 30% was imposed in the sum of $2,100. The following explanation was given in the Chief Commissioner's letter of 19 June 2007, dismissing the Applicant's objection: "It is reasonable that a penalty is imposed as you have had the benefit of the grant and monies for a period of over 30 months when you were not entitled to those funds. The penalty compensates the Government for the investment opportunities lost." 52 The matters to be taken into account when assessing penalties under section 45(3) were recently considered by the Appeals Panel of this Tribunal in Philpot v. Chief Commissioner of State Revenue [2008] NSW ADTAP 18. In that case, the Chief Commissioner had imposed a penalty of 20%. The Applicant had failed to satisfy the residency requirement in respect of a property purchased in Ulladullah. She did not reside in the property at all, as she was, among other things, unable to find employment in the area. 53 The Appeals Panel expressly preferred the approach to penalty enunciated by Judicial Member Verick in Knight and Anor v. Chief Commissioner of State Revenue [2008] NSW ADT 83 to that previously adopted in Calcaro v. Chief Commissioner of State Revenue [2004] NSW AT 158. The Panel quoted with approval the following passage from Knight: "28 It is important to note that a penalty under the FHOG Act is akin to a civil fine and is not another tax or an interest payment. ( Tilley v FC of T (1944) 3 AITR 76 and Sabiel v FC of T (1926) R & McG. 87) If it were to be a tax or an interest payment the FHOG Act would have prescribed a rate. The penalty allowed under section 45 is up to the amount of the grant. As a penalty is akin to a fine, in imposing a penalty it may not be appropriate to take into account any "opportunity cost". … 33 Another approach to determine the appropriate penalty under section 45 of the FHOG Act is to categorise cases, depending on the level of culpability, where it is relevant for the Commissioner to consider the imposition of penalties. Factors that need to be taken into account to determine the level of culpability would include: (1) the truthfulness of the original statements made by the applicant in his or her application for the grant; (2) the surrounding circumstance including the intention of the applicant in relation to the occupation and use of the property as his or her principal place of residence at the time when seeking the grant; (3) the reasons for failure to comply with conditions of the grant; (4) whether the applicant has occupied the property as his or her principal place of residence; (5) the candour of the applicant in his or her responses to compliance inquiries; and (6) whether the grant been refunded." 54 The Chief Commissioner's letter of 19 June 2007 demonstrates that the amount of penalty was not determined in accordance with the principles in Knight's case. It falls to this Tribunal to determine the appropriate level of penalty, applying those principles, and having regard to all the evidence before it. 55 In Mr. Larsson's case: a) no untruthfulness in his application for grant has been demonstrated; b) he intended to occupy the unit as his principal place of residence when seeking the grant, c) he occupied the unit as his principal place of residence for about three and half months, d) he failed to comply with the residency requirement in the circumstances that have been outlined, e) he did not respond to compliance inquiries; and f) he failed to repay the grant as required by the conditions of grant, or on demand. 56 Relying on Snow v Chief Commissioner of State Revenue (No 1) [2005] NSWADT 244, the Chief Commissioner submits that a penalty exceeding 20% is appropriate in any case where the applicant does not, at the first opportunity, admit that he or she did not occupy the property, because this failure will require the Chief Commissioner to undertake searches to corroborate the applicant's claims. The decision in Snow was based on the particular facts of that case. It is not authority for the general proposition advanced by the Chief Commissioner. Such an approach would be too rigid. Penalty should be assessed having regard to all the circumstances of the case. I respectfully adopt what fell from the Appeals Panel in Philpot: "While there is much to be said for consistency in administrative decision making, the need for consistency should not be allowed to trickle over into the realm of inflexibility." 57 The penalty of 30% imposed on Mr. Larsson is equal to that affirmed by the Appeals Panel in Elskaf v. Chief Commissioner of State Revenue [2006] NSW ADTAP 10. In that case, the Applicant failed to show that he had occupied the property at all, let alone occupied it as his principal place of residence, as he had asserted to the Tribunal. The outcome in this case has been different. 58 The quantum of penalty was also considered recently in Abadier v. Chief Commissioner of State Revenue [2008] NSW ADT 16 and in Agiostratis v. Chief Commissioner of State Revenue [2008] NSW ADT 23. In both cases, the Applicants were found to have made false statements to the Chief Commissioner, and a penalty of 20% - described in Abadier as "generous" – was affirmed. 59 In this case, no dishonesty has been established on the part of the Applicant. The facts were otherwise so distinct from those in Elskaf, Abadier and Agiostratis that little assistance can be drawn from those cases. 60 In Rauf v.Chief Commissioner of State Revenue [2005] NSW ADT 176, a penalty of 20% for failure to comply with a condition of the grant was reduced by the Tribunal to 15%. In that case as in this, the Applicants' ability to satisfy the residency requirement was hindered by medical issues. In Rauf, however, the Applicants had repaid the grant on demand, and responded forthrightly and candidly to the Chief Commissioner's routine inquiries. The facts in this case are not sufficiently similar to justify such a reduction in penalty. 61 The facts here bear a greater resemblance those in Knight. In both cases, the Applicants neither informed the Chief Commissioner of their failure to satisfy the residency requirement, nor repaid the grant within 14 days of expiry of the period for compliance. In both cases, the failure to satisfy the residency requirement was at least in part due to a medical condition – in Knight's case, unexpected pregnancy followed by complications at birth. 62 There are differences between the two cases. On the one hand, Mr. Larsson occupied the unit as his principal place of residence for a substantial period, whereas the applicants in Knight's case did not. On the other hand, the Knights had informed the Chief Commissioner of their change of circumstances before expiry of the period required for residency, responded candidly to the Commissioner's routine enquiries, and repaid the grant and penalty on demand. Mr. Larsson did not. The medical issues in Knight's case did not arise until after the application for grant – though the pregnancy itself occurred some months before the grant was received - whereas the injury to Mr. Larsson's hand occurred prior to his application. 63 Taking into account both similarities and differences, it is difficult to justify a greater penalty than that imposed in Knight's case. It is equally difficult to justify a lesser penalty, despite Mr. Larsson's partial compliance with the residency requirement. 64 In all the circumstances, a penalty of 20% is appropriate. Orders I make the following orders. 1) The decision of the Chief Commissioner to reverse his previous decision to make a grant under the First Home Owner Grant Act 2000 in the sum of $7000 is affirmed. 2) The decision of the Chief Commissioner to assess stamp duty in respect of the transfer and mortgage is affirmed. 3) The decision of the Chief Commissioner to impose a penalty of $2,100 is varied by substituting a penalty of 20% in the sum of $1,400. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.