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High Court of Fiji |
IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION
Judicial Review No. 17 of 2006
BETWEEN :
THE STATE
AND :
Fiji Bank and Finance Sector Employees Union
Respondent
EX PARTE :
Commissioner of Inland Revenue
Applicant
Appearances: Mr D. Solanki for the applicant
Mr V.Kapadia for the respondent
Date of hearing: 7 August, 2012
JUDGMENT
1.1 This is an application by the Commissioner of Inland Revenue to judicially review a decision of the Court of Review established under the Income Tax Act(cap 201). On 24th November,2005, the Court of Review had granted the Fiji Bank and Finance Sector Employees Union, a stay order as follows:
The decision and all recovery proceedings there under including all garnishee proceedings is stayed until the hearing and determination of the Appeal.
1.2 On 21st November,2011, I granted leave to the applicant, to apply for judicial review.
1.3 The relief sought is an order of certiorari to quash the decision and a declaration that the Court of Review has acted ultra vires, by granting a stay of the decision of the Commissioner . The grounds, upon which the applicant seeks relief, are as follows:
- (a) The Court of Review acted outside of its jurisdiction in granting the order.
- (b) The Court of Review made an error in law in holding that it had jurisdiction in
granting the order.
2.1 The applicant's case
At the hearing, Mr Solanki, counsel for the Commissioner advanced four contentions.
Firstly, he submitted that that the Court of Review is a creation of statute. The Income Tax Act does not grant the Court of Review, jurisdiction to grant a stay order against the recovery of taxes and penalties. It does not have inherent jurisdiction to stay the recovery of tax. Its powers are limited to the hearing and determination of appeals, as provided in sections 63 of the Act.
Secondly, it was argued that in terms of the mandatory provisions of 62(7) of the Act under review, the Court of Review may direct the Commissioner to refund any amounts paid in excess by the taxpayer, but does not enable the Court of Review to direct the Commissioner to suspend the recovery of taxes, in an appeal
Thirdly, it was contended that the decision challenged by the respondent in the Court of Review, was a garnishee order made in terms of section 75. Mr Solanki submitted that section 63 confers jurisdiction on the Court of Review, only for the purpose of hearing and determining appeals from the Commissioner, as regards assessments. There is no right of appeal against the invocation of collection mechanisms.
Finally, Mr Solanki drew an analogy with section 70(9) of the Act and the powers conferred in contrast, with the Discretions Review Board.
2.2 The respondent's case
Mr Kapadia, counsel for the respondent accepted that the Court of Review is a statutory court and has no inherent jurisdiction like the High Court. He submitted that its powers are derived from section 63 .
Mr Kapadia advanced three arguments in riposte.
The first argument was that the power to suspend the collection of tax pending an appeal, is an ancillary power conferred on the Court of Review .
The second contention was that section 62(7) does not lead to an assumption that the Court of Review does not have jurisdiction to grant a stay order pending an appeal, particularly when it is vested with powers similar to the High Court.
Finally, Mr Kapadia submitted that the principle that tax legislation must be interpreted strictly is "for the protection of the tax payer, not for the Commissioner".
3.1 Both counsel are not at variance that the Court of Review is a creature of statute and its powers are derived from section 63 of the Income Tax Act. Mr Kapadia agrees that the Court of Review does not have inherent jurisdiction, like the High Court. From that point on, the arguments of counsel diverged.
3.2 Section 63 is in these terms:
"..........the said Court of Review shall, for the purpose of hearing and determining the Appeals referred under this Act referred to it have powers and authority similar to those vested in the High Court as if Appeal were an action between the taxpayer and the Commissioner".(emphasis added)
3.2.1 In my view, section 63 confers on the Court of Review, powers and authority "similar" to those vested in the High Court, for the purpose of determining appeals as regards assessments, as provided in section 62. The word "similar" connotes very much alike, but certainly does not mean the same. I would refer to the following dictum of Lord Parker CJ in Regina v Leicester Licensing Justices Ex-parte Bisson,(1968)1 WLR 729 at page 723 as cited by Byrne J in Gurdial Singh Brothers Limited,(Civil Appeal No.ABU0091 of 2006):
"It seems to me that it would be perfectly right to give a wide meaning to the word "similar" a word which anyhow does not mean identical...."
3.3 I would now turn to the crucial question for determination in this application, namely whether the Court of Review possesses ancillary powers to stay a decision of the Commissioner.
- 3.3.1 Mr Solanki founded his argument on sub-section 62(7). He asserted that in terms of this mandatory provision of law, only the Commissioner is empowered to suspend the recovery of any tax.
- 3.3.2 Mr Kapadia's contended that the power to suspend the collection of tax is an ancillary power conferred on the Court of Review, by implication.He relied on section 41 of the Interpretation Act. This provides that where "any written law confers powers upon any person to do or to enforce the doing of any act or thing, all such powers shall be deemed to be also conferred as are necessary to enable the person to do or enforce the doing of the act or thing".
- 3.3.3 Section 62(7) is in these terms:
"the obligation to pay and the right to receive and recover any tax chargeable under the Act (including interests, costs and penalties) shall not, unless the Commissioner so directs, be suspended by an objection or appeal or pending the decision of the Court of Review under Section 63, 69 or 70 but, if any assessment is altered on objection or appeal or in conformity with any such decision, a due adjustment shall be made, amounts paid in excess being refunded and amounts short paid being recoverable".(emphasis added)
3.3.4 In my view, it is clear that the right to suspend the recover of any tax is statutorily vested in the Commissioner. In my judgment, the conclusive words of the sub-section overrides section 41 of the Interpretation Act and the words "powers and authority similar to those vested in the High Court " in section 63.
3.3.5 In contrast, section 70(9) of the Act, as pointed out by Mr Solanki, gives the Discretions Review Board "all the powers which the Commission has in making assessments, determinations and decisions, including decisions on objections, under this Act".
3.3.6 In interpreting a section in pari materia in the VAT decree, Coventry J in Commissioner of Inland Revenue v Gurdial Singh Brothers Limited, (Civil Appeal No. 15 of 2005), stated that the subsection " clearly places the decision concerning the suspension of the payment of any assessed taxes during the currency of any appeal with the Commissioner" (emphasis added). He concluded:
"These words must necessarily take precedence over the ancillary jurisdictions given to the tribunal by sections 51[4] and its words "shall have the powers and authority similar to those vested in the Judge of the High Court..." (emphasis added)
This conclusion was preceded by the observation that:
"In the circumstances of other statutory bodies, where procedures and the Tribunal's jurisdiction is linked to that of the High Court, there might be argument for stating that those powers necessarily include the ability to stay orders, directions or requirements of the subordinate tribunal or authority pending the outcome of the appeal. However the taxation regime is regarded as sui generis". (emphasis added)
3.3.7 The decision of the High Court was affirmed by the Fiji Court of Appeal in Gurdial Singh Brothers Limited v Commissioner of Inland Revenue, (supra).
3.3.8 In Suncourt (Wholesalers)Ltd V FIRCA, (HBJ no 26 of 2004) as also referred to by both counsel in their written submissions, it was held that albeit the Court of Review has wide powers to consider objections to assessments made by the Commissioner, it does not have powers to stay.
3.4 Mr Kapadia, in his written submissions, has placed great reliance on the case of Pacific Transport Limited v Land Transport Authority & Sunbeam Transport Ltd, (High Court Civil Action No. 126 of 2004). This case, as relied on by the Court of Review, in the impugned decision, held that the Land Transport Appeal Tribunal had power to stay a decision of the authority, in terms of the Land Transport Act.
- 3.4.1 The reasoning in Pacific Transport Limited v Land Transport Authority & Sunbeam Transport Ltd, was distinguished by Byrne J in Gurdial Singh Brothers Limited v Commissioner of Inland Revenue, (supra) on the basis that the Land Transport Appeal Tribunal is statutorily vested with "equitable power..to make orders such as it thinks just and reasonable".
- 3.4.2 Byrne J cited the following passage from the "Judicial Authority on Revenue Law", Rowlatt J in Cape Brandy Syndicate v IRC, [192] 1KB 64 at p 71:
"In a Taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used."
3.5 Mr Kapadia has cited several authorities in support of the proposition of law that the intention to impose or increase a tax must be shown by clear and unambiguous terms. In my judgment, this principle has no relevance to the matter before me.
A.L.B. Brito- Mutunayagam
21st May, 2013
Judge
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