The Federal Court has given judgment for the Deputy Commissioner seeking to recover unpaid income tax from Chemical Trustee together with the shortfall interest charge and the general interest charge, totalling over $28m. (The matter relates to the ongoing litigation arising under ongoing Wickenby investigation and litigation).
In giving judgment for the Commissioner, the Federal Court dismissed the taxpayer’s arguments that:
- the Deputy Commissioner’s causes of action in the relevant income years “did not merge in the first judgment” and there was an “issue estoppel” arising from the first judgment on the question of its liability to tax in those years or that otherwise there were inconsistent judgments as to its liability to tax in the relevant years and therefore the Deputy Commissioner’s action was an “abuse of process”;
- the relevant amended notices of assessment issued to the taxpayer for the income years 2001 to 2007 were “inconsistent”, and that the Deputy Commissioner could not issue multiple inconsistent notices of assessment; and
- the assessments issued for the 2005 and 2008 income years purported on their face to assess other income years (2004 and 2007) and that this was impermissible (where the Deputy Commissioner claimed that all that was involved was a typographical error).
At the same time, the Federal Court ordered the second respondent’s application for a stay be dismissed, and that the respondents pay the Commissioner’s cost of the application.
(DCT v Chemical Trustee Limited (No 8) & Ors [2013] FCA 494, Federal Court, Perram J, 23 May 2013.)
[LTN 99, 24/5/13]
Catchwords from [2013] FCA 494
INCOME TAX – Assessments – Notices of amended assessment – Whether notices of amended assessment regarding the same taxation period issued at different times were conflicting and inconsistent?
INCOME TAX – Assessments – Notices of amended assessment – Whether corresponding notices of amended assessment issued on the same day containing an error were impermissible in the particular circumstances?
ESTOPPEL – Res judicata – Whether notice of amended assessment of liability of income taxation merges with judgment – Interaction between the liability to taxation under Income Tax Act 1986 (Cth) s 5(1), notice of amended assessment under Income Tax Administration Act 1997 (Cth) s 5-5(2) and statutory debt created by Taxation Administration Act 1953 (Cth) s 255-5 causes of action – Whether the elements of those provisions create a different cause of action?
ESTOPPEL – Issue estoppel – Anshun estoppel – Whether judgment amounts obtained in prior proceedings for the same tax period gives rise to Anshun estoppel – Whether attempts to obtain judgment amounts relating to notices of amended assessments the subject of a previous judgment debt is abuse of process?