BETWEEN:	RUDRA PRASAD
-	First Plaintiff 

	PRATITA PRASAD
-	Second Plaintiff 

AND:			MINISTER OF REVENUE AND CUSTOMS

-	Defendant 

BEFORE LORD CHIEF JUSTICE PAULSEN 

Counsel:		Mr. William Edwards for plaintiffs/respondents
		
			Mr. ‘A. Kefu SC for the defendant/applicant

Date of Hearing:	20 April 2016

Date of Ruling:		16 May 2016

RULING
The issues
[1]	The plaintiffshave sought judicial review to quash notices issued under sections 15 and 29 of the Revenue Services Administration Act 2002 (the Act).  The Minister has applied to set aside the writ and contends that the issues raised are within the exclusive jurisdiction of the Tax Tribunal and that as the plaintiffs failed to use the statutory procedures under sections 6 and 9 of the Act to challenge the notices within time they are now beyond challenge.  
[2]	The plaintiffs argue that the existence of statutory procedures to challenge taxation decisions do not preclude judicial review involving jurisdictional error and that, in the alternative, section 6 and 9 are invalid as being inconsistent with the Act of Constitution in so far as it confers jurisdiction on the Supreme Court and protects property rights.
[3]	The principalissue relates to the proper interpretation that is to be put on sections 6 and 9 of the Act in their statutory context.  Fundamentally what the court must decide is whether, and if so, in what circumstances, sections 6 and 9 of the Act preclude challenges being made to taxation decisions by way of judicial review.  
Facts
[4]	For the purposes of this application I record the facts as follows.
[5]	Moapa Enterprises Limited (Moapa) was registered under the Companies Act 1995 on 28 October 2002.  At that time, Mr.Rudra Prasad (Mr. Prasad) and Mrs.Pratita Prasad (Mrs. Prasad) (the first and second plaintiffs and respondents respectively) were directors and shareholders of Moapa.  Mr.EtilunaMafi (Mr.Mafi) and another local businessman were also shareholders of Moapa.  Mr.Mafi was also a director and shareholder of Luna’eva Enterprises Limited (Luna’eva).
[6]	Moapa operated under a business licence under the Business Licence Act 2002 as a supermarket business, importing and selling supermarket and grocery products from its registration until 10 April 2015.
[7]	In correspondence dated 9 April 2015, the Ministry of Commerce, Tourism and Labour advised Mr. Prasad that Moapa’s business licence had been cancelled.  
[8]	As a result of the cancellation of Moapa’s business licence, the business was left with a large quantity of perishable goods which it was unable to sell through its supermarket business.
[9]	In order to mitigate Moapa’s loss, on 14 April 2015 Mr. Prasad entered into an arrangement with Mr.Mafi whereby Moapa sold its business, assets and stock to Luna’eva for TOP$750,000.  A Sale and Purchase Agreement (the Agreement) was signed on behalf of Moapa and Luna’eva.Moapa was in possession of stock that had been supplied to the business by Rampra Investments Limited for which Moapa had not made payment.  A provision was included in the agreement to the effect that Luna’eva would assume possession of the stock, sell it and repay the outstanding debts to Rampra directly.
[10]	On the same day, Mr. Prasad sent an email toMr. Michael O’Shannassy (Mr.O’Shannassy) of the Ministry of Revenue and Customs (the Ministry)advising him of the sale.
[11]	Between 14 April and 15 April 2015 the Ministry sent four emails to Mr. Prasad enclosing five amended tax assessments for Moapa (amended income tax assessments for the periods from July 2011 to June 2014 and amended consumption tax assessment for the period from September 2007 to August 2010).  The total outstanding, not including penalties, was TOP$2,359,827.99.
[12]	On 15 April 2015, Mr. Bloomfield, the Chief Executive Officer of the Ministry (the CEO) issued notices to the Westpac Bank of Tonga (Westpac), ANZ Bank (ANZ) and Luna’eva, pursuant to sections 15, 16 and 17 of the Act(section 15 notices).The effect of the section 15 notices was to direct Westpac and ANZto hold all deposits, up to the outstanding tax amount, made into bank accounts in the name of Moapa or Mr. Prasad and Mrs. Prasad.  In the case of Luna’eva, it was directed to hold any payments to Moapa up to the outstanding tax amount.  The section 15 notices were said to be effective from 15 April 2015 until 30 June 2015, on which date the recipients were required to make payment of the funds held to the Commissioner of Revenue.
[13]	On the same day, Mr. Prasad was served with a hard and soft copy of the section 15 notices.  Although they also applied to the individual or jointly held bank accounts of Mrs. Prasad, she was never served with a copy of the section 15 notices.
[14]	On 15 April 2015, Mr. Prasad’s legal counsel, Mr.KalevCrossland (Mr.Crossland) sent an email to Mr.O’Shannassyrequesting an explanation of the evidentiary and legal basis upon which the Ministry claimedMr. and Mrs. Prasad had a personal liability for Moapa’s alleged tax debt.  His email stated that:
“…Mr. and Mrs. Prasad are not legally liable for the alleged tax debt of Moapa (which is to be challenged).  There appears to us to be no legal basis for this action that we can discern.  However, we wish to offer the Revenue a short opportunity to explain the position over this draconian step.”
[15]	In an email that same day, Mr.O’Shannassy informed Mr.Crosslandof the Ministry’s position that Mr. and Mrs. Prasad’s personal liability for Moapa’s tax debt arose from the application of section 29 of the Act.  He advised that:
“…the garnishee notices issued over your client’s personal accounts was as a result of the information provided to us by Mr. Prasad by way email yesterday afternoon.  In that email he advised that the assets of Moapa including trading stock had been sold.
Accordingly, acting on this information and exercising an abundance of caution, we applied section 29 of the Revenue Services Administration Act 2002, which applies where a company has been left with insufficient assets to cover current or future tax obligations.  As you will note in subsection 29(3) a director or controlling shareholder of a company at the time an arrangement was entered into shall be jointly and severally liable for the tax liability of the company.”
[16]	There is a dispute as to whether Mr.O’Shannassy formed the view that section 29 of the Act applied before or after the section 15 notices were issued.  Mr. and Mrs. Prasad contend that it is not clear, on Mr.O’Shannassy’s affidavit, that the Ministry issued the section 15 notices on the basis of Mr.O’Shannassy’s position.  In any event, the section 15 notices did not refer to section 29 of the Act and it was not until Mr.Crossland’s request that any reference to the section, as the purported legal basis on which Mr. and Mrs.Prasads’ personal liability was founded, was made on behalf of the Ministry.
[17]	On 20 April 2015, Mr. Prasad, Mr.Mafi and Mrs.Mafi (the latter two individualsas shareholders of Luna’eva) signed undertakings to the effect that neither Mr. Prasad nor Mrs. Prasad were to collect any benefit, dividend or profit made by Luna’eva as a result of the purchase, or to be involved in any decision-making of Moapa. Mr. Prasad has stated that these were signed in response to advice from the Ministry of Commerce, Tourism and Labour that the appropriate business licence would not be issued to Luna’eva until such assurances were provided.
[18]	Between 20 April 2015 and 18 May 2015, Mr.Crossland and Mr.O’Shannassyexchanged a number of emails disputing, in general terms, the process employed by the Ministry in producing Moapa’s amended tax assessments, the consequent integrity of those reassessments and the proposed legal basis forMr. and Mrs. Prasad’s personal liability to pay Moapa’s alleged tax debt.  A discussion of the salient aspects of the correspondence sheds some light on the parties’ positions.
[19]	On 20 April 2015, Mr.Crosslandwrote to the Ministry advising of Moapa’s position that “the process leading to the amended tax assessments was arbitrary and also did not take into consideration the very matters the Revenue itself considered to be relevant”.  For this reason, Mr.Crossland contended that the Ministry’s decision to issue the section 15 notices was not one that a “reasonable decision maker in the Revenue’s shoes could make”.  Mr.Crosslandsought further particulars of the reassessment process the Ministry undertook and advised that his clients would take steps to bring judicial review proceedings if these were not provided.  Mr.Crossland did not present an argument in relation to Mr. and Mrs.Prasads’ alleged personal liability, except to state that the sale of the Moapa business was effected because Mr. Prasad was advised that he could not operate a business in Tonga as a non-Tongan and that the Ministry’s decision to claim personal liability was “unacceptable”.
[20]	A letter was sent by the Ministry on 27 April 2015 in response to Mr.Crossland’s request for further particulars, in which the Ministry set out the basis upon which it had reassessed Moapa’s tax liability which included an outline of the history of Moapa’s tax activities and correspondence with the Ministry for the relevant periods.  The Ministry did not accept the assertion that its decision had been made arbitrarily, providing itsanalysis of the law as support.  It concluded that the section 15 notices, as taxation decisions, were issued in accordance with the Act, including to the extent that they applied to Mr. and Mrs. Prasad individually, and that section 6 of the Act prevented Mr. and Mrs. Prasadfrom applying for judicial review.  The letter directed attention to the statutory procedures for objecting to taxation decisions.
[21]	On 29 April 2015, Mr.Crossland responded to the two substantive issues – the availability of judicial review and the assessments themselves – raised in the Ministry’s letter.  In answer to the matter of whether judicial review was available, Mr.Crossland acknowledged thatthe statutory objection process appeared to be the “pragmatic course” for dealing with the dispute.  In relation to the assessments, it is sufficient to state that Mr.Crossland again requested further particulars in order to adequately object to the decision in the manner provided by statute, while urging the Ministry to reconsider the assessments in light of the further information he had provided regarding Moapa’s taxation history.
[22]	The Ministry confirmed, in its letter to Mr.Crossland of 1 May 2015, that once it received the further information it had requested from his clients, it would review its calculations of Moapa’s assessments and notify him of any changes.  Mr.Crossland was advised that all other issues and actions would be dealt with once this occurred, and thatif necessary, an extension of time for his clients to lodge any objections under the Act would be granted until these calculations were made.
[23]	In his affidavit, Mr.O’Shannassy states that the Ministry and Mr.Crossland engaged in other email exchanges regarding the taxation assessments until 8 May 2015 when Mr. and Mrs. Prasad lodged their objections to the income tax assessments for the 2013 and 2014 financial years, and the consumption tax assessment for the period September 2007 to August 2011.  However, the plaintiffs did not lodge an objection, or request an extension of time to do so, in relation to the section 15 notices.
[24]	Between 13 May 2015 and 18 May 2015, the Ministry and Mr.Crossland engaged in further discussions as to the plaintiffs’ income tax and consumption tax objections.
[25]	At some stage after 15 May 2015, although it is not clear when, the Ministry issued a request for information to Luna’eva under section 22 of the Act, requesting copies of any contracts between Luna’eva and Moapa.  The Ministry issued the notice after this date as it marked the last day of the 30 day period provided by section 8(1) for an objection to be lodged to the Ministry’s decision to issue the section 15 notices.
[26]	The Ministry again wrote to Luna’eva on 9 June 2015 informing it of the obligation under the section 15 notice to hold any payments due to be made to Moapa and/or Mr. and Mrs. Prasad.  Luna’eva responded with a request for an explanation of the legal basis on which the Ministry demanded payment.  This explanation was provided by way of letter on 22 June 2015, a copy of which was circulated to Mr. Prasad.
[27]	On 24 June 2015 Luna’eva responded, accepting the Ministry’s explanation and enclosing a cheque in the amount of the first instalment of the purchase price under the Agreement.  The Ministry confirmed receipt of the cheque on 10 July 2015 by way of letter which was again copied to Mr. Prasad.
[28]	On 30 June 2015, the CEO issued further section 15 notices to Westpac, ANZ and Luna’eva, extending the date for payment to the Chief Commissioner of Revenue from 30 June 2015 to 31 December 2015.
[29]	The Ministry did not receive a response from Mr. Prasad in relation to either the two letters circulated to him or the further section 15 notice issued on 30 June 2015.
[30]	In his affidavit, Mr. Prasad produced receipts for two payments made pursuant to the section 15 notice by Luna’eva to the Chief Commissioner of Revenue on 29 June 2015 and 7 September 2015 totalling TOP$325,000.00.
[31]	On 30 September 2015, the Ministry issued a further section 15 notice to the Bank of South Pacific (Tonga) Limited (BSP) (who had purchased Westpac’s accounts in the intervening period) instructing that it make payment of all funds held in specified bank accounts of Mr. Prasad and Moapaby 5 October 2015.
[32]	On the same day, a letter was sent to Mr. Prasad by the Ministry headed “Notice under section 29 of Revenue Services Administration Act 2002 (as amended)” (the section 29 notice).  The letter read:
		“Dear Rudra, 
		Re:  Notice under section 29 of Revenue Services Administration 		       Act 2002 (as amended) 
1.	This is to advise that we intend to recover tax payable by Moapa Enterprises Limited from you under section 29 of the RSAA (copy attached).
2.	As you will see this section applies where an arrangement has been entered into with the intention or effect of rendering a company unable to satisfy a current or future tax liability under any Revenue law.  Its purpose is to provide a mechanism for the collection of tax whereby a company has been left with insufficient assets to meet its tax liability. 
3.	We contend that the contract you entered into with Luna’eva on 14th April 2015 whereby you agreed to sell the stock, fixtures and fittings and all motor vehicles and other equipment rendered the company unable to pay its then current tax debts and future tax debts.  You should note that a purpose of the arrangement is to have the effect that the company is unable to pay the tax liability.  It only has to be one of the purposes of the arrangement it does not have to be the main purpose. 
4.	As you occupied the position of director at the time the arrangement was entered into you are jointly and severally liable for the tax debt of the company. 
5.	We do not believe that subsection 29(4) applies as you and your wife were the owners of the company and as such you derived a financial or other benefit from the arrangement being the sale price.  You did not notify us of your dissent as required in paragraph (a) of subsection 29(4) and you had knowledge of the arrangement as you were a signatory to the contract. 
6.	Accordingly we will be advising the BSP (Tonga) to pay over to us the sum outstanding in the account in your name in the sum of $918,166.43AUD as at 25th September 2015 in part payment of recent income tax amended assessments issued on the 1st September 2015 for the 2009 and 2010 income tax years for $785,821.88 in tax and penalties and income tax amended assessment issued on the 25thSeptember 2015 for the 2011 income tax year for $700,647.79 in tax and penalties. 
7.	Monies held in BSP in the name of Moapa Enterprises will also be used to contribute to paying off the balance of the debt. 
If you have any queries concerning this matter do not hesitate to contact myself on 23444. 
Yours sincerely, 
Mrs.LepaolaVaea
Deputy Chief Executive Officer, Ministry of Revenue & Customs
cc  Mrs. Petunia TupouFungateiki Law Firm, P.O. Box 2217, Laifone Avenue, Kolofo’ou, Nuku’alofa, Kingdom of Tonga.” 
[33]	On 1 October 2015, Mr. Prasad’s local lawyer, Mr. William Edwards (Mr. Edwards), wrote to the Ministry contesting the legal basis of their 30 September letter.  He argued that the Ministry employed misconceived reasoning in its application of section 29 of the Act to Mr. and Mrs. Prasad as it failed to consider whether the arrangement, being the Agreement, was entered into with the intention or effect of rendering Moapa unable to satisfy a current or future tax liability, as required by section 29(1) of the Act.  It was his position that it was the cancellation of Moapa’s business licence, and not the sale of the Moapa business, which had the true effect of rendering Moapa unable to satisfy its current or future tax liability.  He further claimed that Mr. and Mrs. Prasad were not persons who either owed or held money on behalf of Moapa and were therefore not subject to the initial section 15 notice.  Indeed, in his email of 15 April 2015, Mr.O’Shannassy had advised Mr.Crossland that the Ministry relied on section 29, and not section 15, of the Act in imposing personal liability on the plaintiffs.  Consequently, Mr. Edwards placed the Ministry on notice of an intention to commence proceedings seeking injunctive relief and damages from the Ministry if any funds were removed from Mr and Mrs Prasad’s personal accounts.
[34]	By letter dated 2 October 2015, the Ministry maintained its position in relation to the validity of the section 29 notice by first setting out the relevant statutory provisions, being sections 15 and 29 of the Act, together with a brief analysis of the application of each element to Mr. and Mrs. Prasad.  The Ministry concluded that the plaintiffs’ personal liability arose from their own status as taxpayers pursuant to section 29 of the Act and that the prerequisite condition to the application of that section contained in subsection (1) had been satisfied as the effect of the Agreement was to leave Moapa with insufficient assets to pay its tax debts.  In response to Mr. Edwards’ stated intention to commence proceedings, the Ministry referred to section 6 of the Act, which effect was to prevent those proceedings which disputed taxation decisions or assessments being brought in a manner outside the procedures contained in Part IV of the Act.  It was further advised as follows:
“…your client had the opportunity to object to the garnishee on the private accounts of Mr. and Mrs. Prasad.  This is provided in the RSAA in subsection 8(1) which provides that a taxpayer dissatisfied with a taxation decision (defined in section 2 to include a decision by the Minister of Revenue & Customs under subsection 15(3) or 16(3)).  Thus your client could have objection within 30 days of receiving the Notice under subsection 15(3).  He did not do so and is now statute barred from doing so.  There are no objections rights against the application of section 29 as this would form the basis of an objection under subsection 15(3) which was not done.”
[35]	On the same date, that is 2 October 2015, Mr. Edwards forwarded an email to Mr.O’Shannassy in reply, addressing the matters raised by the Ministry’s correspondence by forthrightly statingthat he disagreed with the Ministry’s interpretation and subsequent application of the relevant provisions of the Act and would take steps to file proceedings.  This is what Mr. and Mrs. Prasad did on 19 October 2015 when they filed this action.
[36]	However on 29 October 2015, after instituting proceedings,Mr. Edwards also objectedon Mr. and Mrs. Prasad’s behalf to the section 15 and 29 notices by lodging a Form 2 Notice of Objection to a Taxation Decision which is part of the statutory objection procedures contained in section 8 of the Act.  He also requested a stay of the statutory objection procedures to allow for a determination of the judicial review proceedings.  Mr. Edwards provided the following reason for lodging these documents:
“…I have filed the Objection as a matter of prudence and in compliance with section 8 of the Act which is merely to preserve Mr and Mrs Prasad’s right to challenge the decision dated 30 September 2015.  Although I have filed the Objection, it is not to be treated as a waiver of the right to seek judicial review in the present circumstances.”
[37]	On 12 November 2015, the Ministry responded, again rejecting the objections and refusing to grant a stay of the proceedings on the basis that the objections lodged were not in accordance with the Act.  In respect to the objection against the section 29 notice, the Ministry stated that there is no decision made under section 29 and accordingly it is not a taxation decision and it is unable to be objected againstunder the statutory procedures.  In respect to the objection against the section 15 notices, the Ministry’s position was that the objection had been lodged out of time and was therefore invalid.
[38]	The Ministry filed itsnotice of application to set aside the writ on 1 December 2015.  Mr. and Mrs. Prasad filed a notice of opposition to the application to set aside the writ on 29 January 2016.
The causes of action
[39]	The statement of claim contains four causes of action.  They can be summarised as follows:
[39.1]	The first cause of action pleads that the issue of the section 15 notices on 15 April 2015 and 30 June 2015 was invalid because the Ministry had not issued a determination under section 29 assessing Mr. and Mrs. Prasad’s personal liability for Moapa’s tax debt, and has never issued to them assessments of their personal liability insofar as it relates to Moapa’s tax debts.  A declaration is sought that the section 15 notices are void and of no effect.
[39.2]	The second cause of action pleads that such amounts as were held by Westpac and the BSPfor Mr.and Mrs. Prasad are “payable upon demand or after a fixed period or after notice” and thataccordingly,the banks did not owe Mr.andMrs. Prasad money under section 15 of the Act,and the issuing of the section 15 notices was in excess of the powers conferred under the Act.  A declaration is sought that the issuing or acting upon the section 15 notices was, or will be,ultra vires.
[39.3]	The third cause of action alleges that the decision to issue the section 15 and section 29 notices was made in breach of the rules of natural justice.  An order is sought quashing thesection 15 and section 29 notices.
[39.4]	Finally,Mr. and Mrs. Prasad plead in their fourth cause of action that in deciding that they were personally liable for the tax liability of Moapa, the Ministry failed to take into account relevant considerations and took into account irrelevant considerations, such that the decision was one that no reasonable decision maker would have made.  An order is sought quashing the section 15 and section 29 notices. 
	The statutory provisions
[40]	Clause 90 of the Act of Constitution sets out the jurisdiction of the Supreme Court as follows: 
	“The Supreme Court shall have jurisdiction in all cases in Law and Equity arising under the Constitution and Laws of the Kingdom (except cases concerning titles to land which shall be determined by a Land Court subject to an appeal to the Privy Council in matters relating to hereditary estates and titles or to the Court of Appeal in other land matters) and in all matters concerning Treaties with Foreign States and Ministries and Consuls and in all cases affecting Public Ministries and Consuls an all Maritime Cases.” 
[41]	The Minister relies on section 4(1) of the Supreme Court Act which provides that the Supreme Court shall have jurisdiction to hear any proceedings other than proceedings excluded from the jurisdiction of the Court by the Act of Constitution or that by law are in the exclusive jurisdiction of another Court or Tribunal.  
[42]	The Act sets out statutory procedures for challenging taxation decisions and objection decisions.  I set out sections 6 – 10 (inclusive) in full as follows:
PART III - TAXATION DECISIONS
6	Taxation decisions
Except in proceedings under part IV of this Act —
(a)	no taxation decision shall be disputed in the Tax Tribunal, in any Court, or in any other proceedings on any ground whatsoever; and
(b)	the amount and particulars of every taxation assessment shall be treated as correct and the liability of the taxpayer shall be determined accordingly.

7	Defect does not affect validity
The validity of a taxation decision or a notice of a taxation decision or any other document purporting to be made, or executed under any revenue law shall not be —
(a)	quashed or deemed to be void or voidable for want of form; or
(b)	affected by reason of any mistake, defect, or omission therein,
if it is, in substance and effect, in conformity with the revenue law under which it has been made, issued, or executed and the person assessed, or intended to be assessed or affected by the decision or document, is designated in it according to common understanding.

PART IV - TAXATION OBJECTIONS AND APPEALS
8	Objection
(1)	A taxpayer dissatisfied with a taxation decision may lodge an objection to the decision with the Chief Commissioner of Revenue within thirty days of service of the notice of the decision.
(2)	An objection to a taxation decision shall be in the prescribed form.
(3)	A taxpayer dissatisfied with a taxation decision may apply, in writing, to the Chief Commissioner of Revenue for an extension of time and such an application shall be made within thirty days of service of the notice of the decision.
(4)	The Chief Commissioner of Revenue may if satisfied there is reasonable cause, grant an application under this section and shall serve notice of the decision on the applicant.
(5)	An extension of time under this section shall not exceed fifteen days provided that the Chief Commissioner of Revenue may grant an extension beyond fifteen days in exceptional circumstances.
(6)	The Chief Commissioner of Revenue shall after consideration of the objection, allow the objection in whole or in part or disallow the objection and his decision shall be referred to as an “objection decision”.
(7)	The Chief Commissioner of Revenue shall serve notice of the objection decision on the taxpayer within thirty days.
(8)	Where the Chief Commissioner of Revenue has not made an objection decision within 60 days of the objection being lodged, the taxpayer may elect, by notice in writing to the Chief Commissioner of Revenue, to treat the Chief Commissioner of Revenue as having made a decision to disallow the objection.
(9)	Where a taxpayer has made an election under subsection (8), the taxpayer shall be treated as having been served with notice of the objection decision on the day his notice was lodged.

9	Review of objection decision
(1)	A taxpayer dissatisfied with an objection decision may apply to the Tax Tribunal for review of the decision in accordance with section 60.
(2)	The Tax Tribunal may in reviewing an objection decision exercise all the powers of the Chief Commissioner of Revenue under the revenue law relating to that objection.
(3)	Where an application for review relates to a taxation assessment, the Tax Tribunal make may an order to – 
(a)	affirm, reduce or increase the taxation assessment to which the objection decision relates; or
(b)	remit the taxation assessment to the Chief Commissioner of Revenue for reconsideration in accordance with the directions of the Tribunal.
(4)	Where an application for review relates to a taxation decision other than a taxation assessment, the Tax Tribunal may make an order to affirm, vary or set aside the decision.

10	Appeal to Supreme Court
Any party to a proceeding before the Tax Tribunal has a right of appeal on a question of law to the Supreme Court, within 30 days after being notified of the decision.
	Discussion of statutory provisions
[43]	Under section 6no taxation decision may be disputed in any Court or on any grounds whatsoever except in proceedings under Part IV of the Act.  Section 2 of the Act defines the term ‘taxation decision’ which includes a taxation assessment and a decision by the Chief Commissioner of Revenue to issue a notice under sections 15 (3) or (16)(3) of the Act.  The definition makes no reference to section 29 of the Act.  
[44]	Section 7 of the Act protects a taxation decision from challenge on the grounds of any want of form, mistake, or omission if it is in substance and effect in conformity with the revenue law under which it was made. Section 8(1) provides that a taxpayer dissatisfied with a taxation decision may lodge an objection to the decision with the Chief Commissioner of Revenue within thirty days of service of the notice of the decision. Section 8(2) provides that an objection to a taxation decision shall be in the prescribed form.  There is provision in section 8(3) for a taxpayer to apply for an extension of time to lodge an objection.  Section 8(6) provides that the Chief Commissioner of Revenue shall, after consideration of the objection, either allow the objection in whole or in part or disallow the objection, and his decision shall be referred to as an objection decision.  
[45]	Under Section 9, a taxpayer who is not satisfied with an objection decision may apply to the Tax Tribunal for review of the decisionin accordance with section 60.  It will be observed that the Tax Tribunal has very wide powers.  Section 9(2) provides that in reviewing an objection decision, the Tax Tribunal may exercise all of the powers of Chief Commissioner of Revenue relating to that objection and under section 9(3), when an application for review relates to a taxation assessment, the Tax Tribunal may affirm,reduce or increase the taxation assessment or remit the taxation assessment to the Chief Commissioner of Revenue for reconsideration in accordance with the directions of the Tribunal.  Under section 9(4), where an application for review relates toa taxation decision other than a taxation assessment, the Tax Tribunal may make an order to affirm or set aside the decision.  
[46]	Section 10 of the Act provides a right of appeal from the Tax Tribunal on a question of law to the Supreme Court.
	Proper interpretation of sections 6 and 9 of the Act
[47]	As far as section 6 is concerned I note in particular the use of the words “on any ground whatsoever”.The Supreme Court of New Zealand in TannadyceInvestments Ltd v Commissioner of Inland Revenue [2012] 2 NZLR 153 was concerned with whether default tax assessments could be challenged by way of judicial review on the grounds that the default assessments were an abuse of power and made in breach of natural justice, or whether the taxpayer could only initiate statutory disputes procedures.  Relevantly, section 109 of the legislation with which the Court was concerned provided:
“..no disputable decision may be disputed in a court or in any proceedings on any ground whatsoever…” 
[48]	The majority of the Supreme Court took the view that these words highlighted Parliament’s intention that disputes or challenges capable of being brought under the statutory procedures were in fact brought in that way.  In delivering the majority decision, Tipping J at [54] and [55] said: 
The words “on any ground whatsoever” must have been designed to emphasise the comprehensive nature of the embargo on bringing proceedings outside the statutory framework.  Conversely, Parliament must have contemplated, by the use of those words, that disputable decisions could and should be contested and challenged under the statutory procedures on any ground whatsoever, including the ground that what the Commissioner claimed to be a decision or assessment was not a decision or assessment at all.  If that could be established, the hearing authority’s power to cancel on any ground whatsoever would appropriately be invoked. 

The advantage Parliament saw in this approach must have been that, whatever the claimed ground of error, illegality or invalidity, a hearing authority, which will be the High Court if the taxpayer so elects, is empowered to adjudicate upon it.  Furthermore, the hearing authority can go on in the same proceeding, as far as necessary or appropriate, to determine whether the Commissioner’s assessment is correct and, if not, what the correct assessment ought to be.  There is thereby no potential for separation of matters of legality from matters of correctness.  This leads to a much more efficient and satisfactory process overall, particularly when regard is had to the various time limits that apply throughout the tax administration processes.” 
[49]	In my view the same considerations apply to the interpretation of section 6 of the Act in this case.  The Legislative Assembly’s intention was clearly that all challenges to taxation decisions be made using the statutory procedures in Part IV of the Act.  
[50]	This is plain as a matter of construction having regard to the words of section 6, and in particular the phrase “on any ground whatsoever”, the very wide powers of the Commissioner and the Tax Tribunal on conducting a review of a taxation decision and the protective provisions of section 7.  
[51]	I turn now to consider the issue of whether and if so, in what circumstances the Act excludes the availability of judicial review.
Judicial review 
[52]	Mr. and Mrs. Prasad’s case is that privative clauses, such as section 6 of the Act, do not preclude judicial review of jurisdictional error and bad faith (R v Medical Appeal Tribunal; Ex parte Gilmore [1957] 1 QB 574, 583; Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147 and Plaintiff S157/2002 v Commonwealth [2003] HCA 2 and see JRS Forbes ‘Justice in Tribunals’ 4th Ed at 16.37).  The Ministry’s position is that pursuant to section 6 of the Act, the Tax Tribunal has exclusive jurisdiction to review all taxation and objection decisions.
[53]	The courts should be “slow to conclude that a statutory provision ousting or limiting access to the courts was intended to preclude applications to the High Court for judicial review alleging unlawfulness of any kind” (Tannadyce (supra) at [56] citing Bulk Gas Users Group v Attorney-General [1983] NZLR 129 (CA) at 133).
[54]	However,the majority in Tannadyce (supra)recognised that despite the important constitutional role of judicial review, the terms in which Parliament enacts legislation must also be respected and that in the context of the New Zealand tax legislation there was no need to “strain to reconcile” the tax legislation, which precludeschallenges to disputable decisions other than by way of the statutory procedures,with the general availability of judicial review.  This was because, as the Court noted at [57], the statutory procedures in issue in that case allowed the taxpayer to take the matter to the High Court (the equivalent of our Supreme Court) if that was thought desirable or necessary.  The Court noted:
“There cannot therefore be any question of s109 preventing access by taxpayers to the High Court.  Giving effect to its terms does not have that consequence.  It cannot matter whether the taxpayer seeks relief from the High Court pursuant to an application for judicial review or pursuant to a challenge under Part 8A.  As we have seen, the statutory procedures are framed so as to give hearing authorities power to consider a challenge made to an assessment on any ground whatsoever and to cancel, vary or confirm the assessment as may be appropriate.”
[55]	The majority did, however, recognise the possibility of “rare cases” where it was not “practically possible”for a taxpayer to challenge a disputable decision using the statutory procedures, in which case proceedings for judicial review could not be precluded, and stated at [61]:
“In summary therefore we would hold that disputable decisions (which include assessments) may not be challenged by way of judicial review unless the taxpayer cannot practically invoke the relevant statutory procedure.  Cases of that kind are likely to be extremely rare.”
[56]	The Supreme Court also relevantly noted at [74], [75] and [76]
“In order to demonstrate practical inability to comply with the stipulated procedures, it will not necessarily be sufficient to show that literal compliance with an apparently mandatory requirement was not possible.  The courts no longer attempt to classify procedural requirements as strictly mandatory or only directory.  No longer does failure to comply with an apparently mandatory requirement lead automatically to the process miscarrying, or to a statutory body such as the Inland Revenue Department having to decline to accept a proffered document ...”
	and
“…thecrucial question was whether the legislature intended a failure to comply with a procedural provision to vitiate all that followed.”
	and
“… it will be a rare case indeed in which it will be appropriate to hold that compliance with the statutory requirements was not possible, with the result that the matter in issue was never capable of being resolved under the processes prescribed in the Tax Administration Act.” 
[57]	Although I accept that under Part IV a dissatisfied taxpayer cannot (as is the case in New Zealand) elect to file their challenge proceedings directly with the Supreme Court, section 10 of the Act does provide that after an objection decision has been made and then been considered by the Tax Tribunal, there is a right of appeal to the Supreme Court of Tonga.  The circumstances are similar to those in Ramsay v Wellington District Court [2006] NZAR 136 (CA).  
[58]	Ramsay concerned the New Zealand Accident Compensation scheme.  It was an appeal from an order made striking out the appellant’s challenge by way of judicial review of a decision of the District Court that the appellant had the capacity to work.  The statutory procedureprovided that if a person had a right to apply for a review or appeal under the relevant Act, that person had no other remedy in relation to the matter.  The appellant had rights of appeal with leave from the District Court decision on questions of law to the High Court and to the Court of Appeal.  The Court of Appeal dismissed the appeal and at paragraphs [32] and [33] said as follows:
“At times, however, a challenge to the lawfulness of the decision of statutory authority or tribunal will not be amenable to a statutory appellate process and can only be effectively addressed through that of judicial review by the High Court. That will often be the case where it is alleged that there has been a breach of natural justice duties going to the validity of the decision.  In such cases, if a privative provision is read as excluding judicial review there may be no basis for a challenge to the lawfulness of the particular decision making process at all. The Courts will then approach the interpretation of the privative provision on the basis that, in the absence of clear language from Parliament, it was not intended to exclude judicial review of particular decisions that did not fall within the scope of the statutory appellate process.

In the case of s 134(4) the drafter has been careful to confine the scope of the statutory exclusion of the courts to matters where the person has a right to invoke the statutory process of review and appeal. Accordingly, if the perceived error or invalidity cannot be fitted within that procedure, then the exclusion of other remedies will not apply. This is clear on the language of s 134 and the presumption of interpretation does not arise for consideration. It will accordingly be sufficient, in the present case, for the appellant to maintain its judicial review proceeding if he can show that the grounds on which he relies in seeking judicial review remedies could not be determined under the statutory process. But if they are amenable to decision under the statutory scheme, the effect of s 134(4) is that the Court is barred from granting relief in the separate judicial review proceedings.”
[59]	In Ramsay, as all the pleaded grounds of review were of a kind which the statute required should be raised using the statutory process, it was not open to the High Court to grant any remedies in judicial review proceedings. 
[60]	Section 6 of the Act is sufficiently comprehensive, in my view,to require that all challenges to a taxation decision should be brought under the statutory procedure set out in Part IV and not by judicial review.  As in Tannadyce(supra),the Legislature’s intention was to create a statutory challenge process that would capture all possible challenges to taxation decisions. This would prima facie include challenges made on the basis of jurisdictional error or breach of natural justice.
[61]	However, I accept that exceptions should apply in cases where a particular ground under challenge does not fall within the scope of the statutory appellate process (Tannadyce at [59]), or for some other reason the statutory procedure cannot practically be invoked.  
[62]	The Legislative Assembly intended to create a hierarchical system for challenging taxation decisions, with access to the Supreme Court once other avenues have been exhausted.  In my view, there is therefore no merit, as was argued for Mr. and Mrs. Prasad, that section 6is unconstitutional as preventing access to the Supreme Court.  A taxpayer’s right to have its case heard by the Supreme Court is protected by section 10 of the Act.  Challenges to taxations decisions may eventually proceed to the Supreme Court if they are not first resolved by one of the other dispute resolution procedures.  There is nothing in that, in my view, which is inconsistent or infringes the Constitution.
[63]	It was also argued for Mr. and Mrs. Prasad that section 6 of the Act infringestheconstitutional safeguards in clauses 1 and 14 of the Constitution protecting an individual’s right to “use their own property as they will” and preventing property being taken away “except according to law”.  However, as has already been observed, this is not the effect of section 6 of the Act.  Section 6 does not remove Mr. and Mrs. Prasad’s right to challenge any action taken to deprive them of their property and they have had every opportunity to do so under the statutory objection procedures and, if necessary to take the matter to the Supreme Court.  
	Application to this case 
[64]	There is no dispute that the issue of a section 15 notice is a taxation decision as defined in section 2 of the Act.  The decisions to issue section 15 notices in this case were in my view practically able to be challenged using the statutory procedures.  
[65]	The facts as I have recounted them earlier in this ruling show that Mr. and Mrs. Prasad, through their lawyers, were clearly able to engage in discussions regarding the basis on which the section 15 notices were issued.  There was substantial correspondence between their lawyers and the Ministry regarding the matter.  The first of these emails was sent on the same day that the first section 15 notices were issued, with Mr.Crosslandenquiring as to the basis on which personal liability purportedly arose and the Ministry responding by email referring to section 29(3).In their email of 27 April 2015, the Ministry clearly directed Mr. and Mrs. Prasad to section 8(2) of the Act for the action they could take if they wished to object to the Ministry’s decision.  Indeed, Mr.Crossland responded to this email on 29 April 2015, 16 days before the 30 day timeframe for raising objections was to expire, noting that the statutory procedures were the most pragmatic approach to resolving the dispute and that Moapa did “not wish to fund an expensive legal action concerned with ouster provisions”.  Therefore, if Mr. and Mrs. Prasad wished to challenge the noticesthey clearly could have (and were aware that they could have) done so by setting out the grounds in the prescribed form, which is what they in fact eventually did, albeit well out of time.  
[66]	In my view Mr. and Mrs. Prasad cannot show that it was not practically possible for them to bring their challenge to the section 15 notices under the statutory procedure for challenging taxation decisions.  Each of the grounds on which Mr. and Mrs. Prasad challenge the section 15 notices falls within the wide scope of the section 6 requirement that proceedings “on any ground whatsoever” are brought pursuant to the statutory procedures.  It follows thatMr. and Mrs. Prasadcannot challenge the decisions to issue those notices by way of judicial review.
[67]	The position is different in my view in relation to section 29.  The position that has been adopted by the Ministry and by the Minister is that the liability of a director or controlling shareholder to pay the tax of a company arises if the requirements of section 29(1) are met and not as a result of any decision or assessment.  It follows that there is no taxation decision and liability under section 29(1) cannot be subject to objection using the Part IV procedures.  In a letter to Mr. Edwards of 12 November 2015,Mrs.LepaolaVaea, the Deputy Chief Executive Officer (Technical Services) at the Ministry wrote:
	“Taxations decision is defined in section 2 to mean amongst other decisions (a) a taxation assessment and (e) a decision by the Chief Commissioner to issue a notice under section 15(3) or 16(3).  There is no decision under section 29.  Accordingly, as it is not a taxation decision it cannot be objected against and the objection is not valid”
[68]	Mr. Kefu described section 29 as a “deeming provision” by which I understood him to mean that the liability of a director or controlling shareholder for tax arises automatically and as a matter of law should the circumstances in section 29(1) exist.  I do not accept that section 29 is a deeming provision as that term is usually understood (MN Kandev&J Lennard, “Interpreting and Applying Deeming Provisions of the Income Tax Act” (2012) 60:2 Can Tax J 275)nor do I accept that there is no decision made under section 29.  Whilst 29 sets out the circumstances under which a director or controlling shareholder will be liable to answer for the tax of a company it is ultimately the Chief Commissionerwho must decide whether those circumstances exist and to what extent.  Only having made that decision may steps be taken to recover the tax.  That this is the case is supported by the fact that a director shall not be liable for the tax of a company where “the Chief Commissioner is satisfied” that the circumstances in section 29(4) exist.  In this case a decision was made that Mr. and Mrs Prasad were to pay the tax of Moapa and this was notified to them in the Ministry’s letter of 30 September 2015 when Mrs.Vaea wrote “This is to advise that we intend to recover tax payable by Moapa Enterprises Limited from you under section 29 of the RSAA (copy attached)”. 
[69]	The position initially taken by Mr. and Mrs. Prasad was that liability for tax under section 29 involves a taxation assessment and is therefore a taxation decision under section 2.  However, having heard the exchange between the court and Mr. Kefu, Mr. Edwards resiled from the position.  For the purposes of the present application then, both parties take the position that the imposition of liability (or the issue of a notice to recover tax) under section 29 of the Act is not a taxation decision and therefore not subject to the statutory regime by which taxation decisions are challenged under Part IV of the Act.
[70]	I accept this position for the reason that, as already stated, there is no reference to section 29 of the Act in the section 2 definition of taxation decision and there is no other statutory procedure contained within the Act to challenge decisions made under section 29.  I note also that the definition of taxation decision does not include any reference to section 28 of the Act by which tax may be recoverable from a representative.  Furthermore, in my view, the only means by which the imposition of liability under section 29 could possibly fall within the definition of ‘taxation decision’ is if it is considered to be a taxation assessment.  However taxation assessment is defined in section 2 of the Act, for present purposes, to mean “any assessment of income tax, consumption tax or penalty”.  Assessments of income tax and consumption tax are made under the Income Tax Act 2007 and the Consumption Tax Act 2003.  The liability that we are concerned with here does not arise under either of those Acts but under the Revenue Services Administration Act.There was no relevant assessment of Mr. and Mrs. Prasad for tax under either the Income Tax Act 2007 or the Consumption Tax Act 2003.  The liability they are said to have arises only under section 29 and is to answer for the tax debt of Moapa irrespective of any personal assessment.
[71]	Therefore, the test of whether it was practically possible for Mr. and Mrs. Prasad to invoke the Part IV procedures is not engaged.  As they have no statutory method of challenging the basis upon which the Commissioner seeks to hold them liable under section 29 for the tax debt of Moapa, judicial review must be available to them. 
[72]	Mr. Kefu argued that Mr. and Mrs. Prasad did have an effective means of challenging their liability under section 29, asserting that if they were to use the statutory procedures to challenge the issue of notices under section 15 then incidentally, they could also challenge the basis of those notices, being their purported personal liability under section 29, under the same statutory process.  He said that this was a ‘gateway’ into the use of the Part IV procedures.  I reject that submission.  Sections 15 and 29 are distinct provisions with wholly different objects and effects.  Section 15 provides the Commissioner with a non-exclusive means of recovering tax, but does not create any tax liability.  On the other hand section 29 imposes personal liability on the directors or controlling shareholders of a company in certain circumstances but says nothing about how the tax will be collected.  The fact that the Ministry purported to issue the section 15 notices cannot mean that the imposition of liability for tax under section 29 took on the status of a taxation decision.  That would mean that Mr.and Mrs. Prasad couldchallenge their liability under section 29 ifthe Commissioner had first taken some step bringing the Part IV procedures into play but not otherwise.  That would be an absurd position.
[73]	It follows that as there is no statutory procedure available to Mr. and Mrs Prasad to challenge their liability under section 29 of the Act (holding them personally liable for Moapa’s tax debt)that matter is amenable to judicial review.
Result
[74]	The conclusions I have reached are as follows:
[74.1]	The decisions of the CEO to issue the section 15 notices are not amenable to judicial review.  
[74.2]	Thedecision to hold Mr. and Mrs Prasad personally liable under section 29 of the Act for the tax debt of Moapa is amenable to judicial review.  
[74.3]	I decline to set aside the writ but require Mr. and Mrs Prasad to file an amended statement of claim with 21 days reflecting the Court’s findings in this ruling.  
[75]	I invite the parties to agree on costs but in the event they cannot do so they may file memoranda within 21 days. 

								        O.G. Paulsen
NUKU’ALOFA:  16 May 2016 		          LORD CHIEF JUSTICE