The Federal Court has refused an application by 4 related companies for the adjournment of winding-up applications brought by the Commissioner. The matter related to an earlier finding of the AAT in AAT Case [2013] AATA 40, Re Bayconnection Property Developments Pty Ltd and Ors and FCT that the companies were not carrying on an enterprise and were therefore not entitled to input tax credits claims (ITC) for tax periods from February 2005 to January 2009. The companies at the time of the application were indebted to the Commissioner for some $720,000 (including interest and penalties).
In arriving at its decision, the Court found that even though appeals had been lodged against the earlier AAT decision, the relevant legislative scheme enacted by the Parliament gave priority to the recovery of taxation revenue notwithstanding that the appeals were on foot and that this was where the public interest lay in the case. This was primarily in view of the Court’s finding that the companies’ grounds of appeal were not “reasonably arguable” in relation to their claim that they were “carrying on an enterprise” and that they had made “relevant acquisitions”. It also noted that their grounds of argument were more in the nature of “form than substance”.
(DCT v Bayconnection Property Developments Pty Limited (No 2) & Ors [2013] FCA 208, Federal Court, Robertson J, 11 March 2013.)
[LTN 48, 12/3/13]