The NSW Court of Appeal has unanimously dismissed a director’s appeal and held that a director’s penalty notice issued to him under s 269-25 of the Taxation Administration Act 1953 was valid despite his claim that as the notice did not state expressly that his liability to the Commissioner arose because he failed to satisfy an obligation he had under Div 269, as required by s 269-25(2)(b), then the notice was invalid. Instead, the Court agreed that while the notice failed to refer expressly to the fact that the obligation arose under Div 269, it clearly informed him that he was liable because of statutory provisions associated with s 269-25 and that the notice effectively called his attention to Div 269, and this was all that was required by the relevant words in s 269-25(2)(b). The director had appealed against the decision in DCT v Power  NSWSC 995 (Johnson J, 9 Nov 2012).
Accordingly, the Court found that the giving of the notice to the director fulfilled the legislative purpose of s 269-25 and that, insofar as s 269-25(1) precluded the commencement of the proceedings before a written notice under s 269-25 had been given, that prerequisite was satisfied in the present case. As a result, the Court found that the decision of the primary judge at first instance was not wrong in drawing the same conclusion and therefore dismissed the director’s appeal with costs.
(Power v DCT  NSWCA 428, NSW Court of Appeal, Barrett JA, Ward JA and Emmett JA, 12 December 2012.)
[LTN 234, 18/12/13]
Extract from Taxation Administration Act 1953, Schedule 1
269-25 Commissioner must give notice of penalty
(1) The Commissioner must not commence proceedings to recover from you a penalty payable under this Subdivision until the end of 21 days after the Commissioner gives you a written notice under this section.
Content of notice
(2) The notice must:
(c) explain the main circumstances in which the penalty will be remitted.
(3) To avoid doubt, a single notice may relate to 2 or more penalties, but must comply with subsection (2) in relation to each of them.
When notice is given
Note 2: Section 269-50 of this Act is also relevant to giving a notice under subsection (1). [Emphasis added]