Bilquip Pty Ltd v Chief Commissioner of State Revenue  NSWADT 151
|Date of judgement||2 August 2012||Proceeding No.||106089|
|Judge(s)||A Verick, Judicial Member|
|Court or Tribunal||Administrative Decisions Tribunal|
|Legislation cited||Administrative Decisions Tribunal Act 1997
Corporations Act 2001
Pay-roll Tax Act 1971
Payroll Tax Act 2007
Taxation Administration Act 1996
|Catchwords||Payroll Tax - Liability - Grouping provisions - Companies with common controlling interest - Whether accountant and wife assisting him de facto directors|
|Cases cited||Chameleon Mining NL v Murchison Metals Limited  FCA 1129
Coles Supermarkets Australia Pty Ltd v Tormey  NSWCA 135
Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389
DC of T v Austin (1998)16 ACLC 1555
Grimaldi v Chameleon Mining NL (N0 2)  FCAFC 6
Jones v Dunkel (1959) 101 CLR 298
Kocic v Deputy Commissioner of Taxation  NSWCA 322
Payne v Parker  1 NSWLR 200
Bilquip Pty Ltd, Ilmat Pty Ltd and Holibass Pty Ltd (“the Taxpayers”) sought a review of the Chief Commissioner’s assessments on 21 August 2009 which gave effect to the decision that:
Ilmat Pty Ltd Pty Ltd (“Ilmat”) and Bilquip Pty Ltd (“Bilquip”), for the period 1 July 2004 to 30 June 2008, were grouped through the common controlling interest of the directors of the two companies; and
Ilmat, Bilquip and Holibass Pty Ltd (“Holibass”), for the period 22 August 2005 to 30 June 2008, were grouped through the common controlling interest of the directors in the three companies.
Judicial Member Verick rejected the evidence of the taxpayers that ASIC records did not correctly record the actual or de facto directors of Bilquip during the relevant periods. Judicial Member Verick determined that the companies were grouped correctly by the Chief Commissioner and the assessments were correct.
The Chief Commissioner’s grouping decision was based on the conclusion that the common directors of Ilmat and Bilquip (from 1 July 2004 to 30 June 2008) and the common directors of Ilmat, Bilquip and Holibass (from 22 August 2005 to 30 June 2008) were the same 2 persons (Mr and Mrs Spychala).
The fact of the directorship of the taxpayer companies, and the payroll tax implications of grouping of companies, was the key issue in these proceedings. The taxpayers contended that Mr Florent had been a director of Bilquip since 28 June 1994 and that, from 13 July 2000, Mrs Florent became a director of Bilquip. Furthermore, it was asserted by the Applicants that from 13 October 2005, Mrs Florent became a director of Holibass.
The taxpayers’ case relied upon documents prepared and sent to ASIC. They contended that a document removing Mr Florent from his position as director of Bilquip in 2000 was sent by accident. They also contended that a further document appointing Mrs Florent as a director of Bilquip during 2000 was also not received/recorded by ASIC. The taxpayers’ case in respect of Holibass was that ASIC failed to receive/record a form that appointed Mrs Florent as a director of Holibass in 2005.
The critical issue to be determined in this case was therefore whether Mr and Mrs Florent could be considered as directors of Bilquip and Holibass, either because of an acceptance of the ASIC Register or because they were ‘de facto’ directors based on their roles in the companies.
Judicial Member Verick rejected the evidence of the taxpayers with respect to the documents sent to ASIC. Judicial Member Verick found that an adverse inference could be drawn from the taxpayers’ failure to call evidence from persons who would be expected to know (and who were independent of Mr and Mrs Florent) of the allegedly mistaken ASIC documents or the role in the company played by Mr and Mrs Florent (relying on the principle in Jones v Dunkel (1959) 101 CLR 298).
Accordingly, Judicial Member Verick held that the taxpayers were not directors of the companies at the relevant times and that the companies were grouped correctly by the Chief Commissioner and the assessments were correct.
The taxpayers’ application was, therefore, dismissed.