20 Jun 13 Summary judgment for Deputy Commissioner despite pending review – Robertson
The Supreme Court of New South Wales has granted summary judgment in favour of a Deputy Commissioner against two partners in respect of tax debts arising from their alleged failure to meet their tax liabilities in respect of the partnership. The court held that the taxpayers’ defences challenging the relevant tax assessments were properly the subject of procedures under Pt IVC of the Taxation Administration Act 1953 (Cth) (TAA) and were not justiciable in the Supreme Court. Section 14ZZM TAA enables the Deputy Commissioner to recover outstanding tax despite the fact that a review is pending in relation to a taxation decision. The Deputy Commissioner was therefore entitled to summary judgment: DCT v Robertson  NSWSC 795 (Hidden J, 18 June 2013).
The Deputy Commissioner had served notices of assessment of net amount, based on revised BASs, which gave rise to an RBA deficit debt in the amount of $2,072,222.34.
The taxpayers raised three matters in their defence:
- 74 objections were lodged to the assessments. One was rejected and was to be the subject of an application for review. The remaining objections had yet to be determined
- the amounts claimed by the Deputy Commissioner under the various notices of assessment were challenged
- part of that challenge related to credits said to have been wrongly withheld, and this was also the subject of a cross-claim by the taxpayers.
The court referred to s 14ZZM TAA, which enables the Deputy Commissioner to recover outstanding tax despite the fact that a review is pending in relation to a taxation decision. In this case, objections by the taxpayers yet to be decided remained to be dealt with under Pt IVC TAA, and the fact that a review was pending in relation to one of them was no defence to the present recovery proceedings. As to the notices of assessment, a challenge to them might be made for the procedures under Pt IVC but was not a defence to the present proceedings.
The court was satisfied that all the matters raised by the taxpayers in the defence and cross-claim were properly the subject of the procedures under Pt IVC TAA, and were not justiciable in the Supreme Court. Accordingly, the Deputy Commissioner was entitled to summary judgment.