The NSW Supreme Court has dismissed proceedings by a taxpayer who sought to argue that his conviction for 7 counts of tax fraud related to non-declaration of income in relation to transactions with Vanuatu institutions as part of a “Project Wickenby” investigation were invalid in various ways. As a result, the taxpayer sought to argue that his sentencing for these convictions should not proceed. Among other things, the taxpayer sought to challenge the jurisdiction of the Supreme Court under s 39B of the Judiciary Act 1903 over the matter and that the relevant income tax assessments should be declared void. Furthermore, he sought an application for mandamus against the Commonwealth Director of Public Prosecutions (DPP), the Commissioner of Taxation (FCT) and the Commissioner of the Australian Federal Police (AFP) in respect of their actions leading up to the judgment to invalidate income tax returns that lead to the judgment, and to restrain the DPP and the FCT from relying on the assessments.
- However, the Court concluded that it did not have the jurisdiction to quash the relevant amended assessments.
- Furthermore, the Court found that the issuing of the relevant s 264 notices under the ITAA 1936 that gave rise to the amended assessment was not unlawful.
- Likewise, it found that in neither case was mala fides on the part of the relevant Commonwealth officers disclosed or evident.
- As a result, the Court held that the decision to prosecute the taxpayer for fraud was not made in error and that any of the charges of bad faith in relation to any of the conduct of the ATO or DPP should not be vitiated for illegality.
- The Court also found that it had jurisdiction over the matter, arising from a valid trial and the return of a guilty verdict by the taxpayer.
- It also found there was no undermining of s80 of the Constitution or merging of administrative and judicial functions in finding that the taxpayer had obtained a requisite “financial advantage”.
Accordingly, the Court concluded that the sentencing of the taxpayer must proceed.
(Taxpayer v DPP [2013] NSWSC 594, Supreme Court of NSW, Rothman J, 21 May 2013.)
[Earlier the prosecutor said that this case was nearly in the worst category, warranting a custodial sentence about the same as that given to a chief organizer of these Vanuatu ‘false invoicing’ arrangements: Robert Agius, who was sentenced to 9 Years (with non-parole of 7.5 years) out of a maximum of 10 years. He also said Tim Taxpayer had shown no contrition or remorse, and was willing to tell “direct and repeated lies in furtherance of the fraud.”]
[s80 of the Constitution relates to Trial by Jury, and provides: “he trial on indictment of any offence against a law of the Commonwealth shall be by jury and every such trial shall be held in the State where the offence was committed, and if the offence was not committed within any State the trial shall be held at such place or places as the Parliament prescribes.”]
[LTN 98, 23/5/13]