TaxTMI 
TaxTMI 
1930 (12) TMI 19
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.... is an administrative tribunal. Although it became unnecessary so to decide, the Judicial Committee desired to make it quite clear that, as at present advised, they were not prepared to assent to the view that it was competent, either with or without legislation of the Federal Parliament, to appoint justices of the High Court, or of the other Courts created under s. 71 of the Constitution, with other than a life tenure of their office, subject to the power of removal contained in s. 72. Judgment of the High Court of Australia, 38 C. L. R. 153, affirmed. APPEAL (No. 123 of 1929) by special leave from a judgment of the High Court of Australia, dated August 25, 1926, upon a special case stated by the Supreme Court of Victoria under s. 51A of the (Federal) Income Tax Assessment Act, 1922-1925, and from a judgment of the High Court, dated October 31, 1927, affirming a judgment of the Supreme Court of Victoria, dated September 16, 1927, the two last mentioned judgments being consequent upon that of August 25, 1926. The appellant company, whose registered name at the date of the assessments hereinafter referred to was the British Imperial Oil Company, Ld., was a company ....
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....ld, if dissatisfied with his decision, request him either to refer his decision to the Board of Review for review, or to treat their objections as an appeal and to forward it either to the High Court or the Supreme Court of the State. The appellants requested that their objection should be forwarded to the Supreme Court of Victoria. That Court stated a special case for the opinion of the High Court of Australia, which on August 25, 1926, delivered its judgment thereon. The Court (Isaacs, Higgins, Gavan Duffy, Rich and Starke JJ.; Knox C.J. dissenting) were of opinion that the Board of Review was not open to the same objections as had been successfully urged against the Board of Appeal. The questions raised by the special case were accordingly answered in favour of the validity of the assessment. The proceedings are reported at 38 C. L. R. 153. Consequent upon the decision the Supreme Court of Victoria dismissed the appellants, appeal under s. 50 of the Income Tax Assessment Act, 1922-1925, and that judgment was affirmed upon appeal to the High Court. The terms of the Income Tax Assessment Act, 1922-1924, relative to the Board of Appeal, and of the Act of 1925 relative to t....
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....sion is conclusive, subject to an appeal upon questions of law; (d) the jurisdiction is alternative to an appeal to the Court. A tribunal may be one exercising judicial power although it also exercises administrative power. If the Board acts administratively in deciding between taxpayers and the Commissioner, its decisions are open to debate in the Legislature, and that cannot have been intended. [Reference was made to Huddart, Parker & Co. v. Moorehead ; Rex v. Macfarlane ; Royal Aquarium, etc., Society v. Parkinson ; Boulter v. Kent Justices ; Rex v. Howard ; Rex v. Woodhouse ; Attwood v. Chapman ; Co-partnership Farms v. Harvey-Smith. ] The Constitution of Australia should be adhered to strictly, more especially because, as the preamble to the Act of 1900 shows, it embodied an agreement between the Commonwealth and the States; it carefully separates judicial, executive, and legislative functions. The provisions as to the Board of Review are so interwoven with the rest of the Act of 1922-1925 that they are not severable therefrom, so that if the Board of Review is a tribunal repugnant to the Co....
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....istrative and not judicial power. It is not disputed that the Commissioner acts administratively. The effect of s. 50 of the Act is that a taxpayer dissatisfied with the Commissioner's decision has the choice either to have the decision reviewed by another administrative body, or of appealing to the Courts. Cases referred to for the appellants show that a body may act administratively although it functions like a Court in many respects, e.g., hearing witnesses under oath, deciding between two or more contending parties. Further, a body may be administrative though it decides matters referred to it by another body, and its decision takes the place of that other body's decision: Rex v. Electricity Commissioners. The category of bodies against which a writ of certiorari can be issued is wider than that of Courts of justice: Reg. v. St. Mary Abbotts, Kensington (Assessment Committee). If it should appear that the functions assigned to the Board of Review may be regarded as either judicial or administrative, the provisions of the Act should be held to be valid rather than an infringement of the Constitution. A decision contrary to the respondent's cont....
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....C.J. in Waterside Workers' Federation case ; U. S. v. Ferreira ; U. S. v. Ritchie ; Prentis v. Atlantic Coast Line Co. ;and Story on the Constitution, 5th ed., vol. ii., para. 1574. Dec. 2. The judgment of their Lordships was delivered by LORD SANKEY L.C. This is an appeal by special leave granted by order of the King in Council dated January 29, 1929, from two judgments of the High Court of Australia, dated respectively August 25, 1926, and October 31, 1927. The judgment dated August 25, 1926, was given on a special case stated by the Supreme Court of Victoria arising out of an assessment on the appellants to Federal income tax for the financial year 1924-5. The judgment dated October 31, 1927 (following upon the decision of the case stated), dismissed an appeal of the appellants from a judgment of the Supreme Court dated September 16, 1927, which, following also upon the same decision, had dismissed outright the appeal against the assessment made by the appellants to that Court. In their appeal to His Majesty in Council against these judgments the appellants have disputed the validity of certain Federal Income Tax Assessm....
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....nd of the above questions, it was not contested in the High Court by the respondent for the reason that, so far as that Court was concerned, the matter was concluded by its own decision in the year 1918, in the case of Waterside Workers' Federation of Australia v. J. W. Alexander, Ld. , where it was held, to quote the words of Knox C.J. in British Imperial Oil Co. v. Federal Commissioner of Taxation : "that the judicial power of the Commonwealth can only be vested in 'Courts" that is, in Courts of law in the strict sense; and that, if any such Court be created by Parliament, the tenure of office of the Justices of such Court, by whatever name they may be called, shall be for life subject to the power of removal contained in s. 72 of the Constitution." The decision in the Waterside Workers' Federation case , however, not being a decision binding on their Lordships' Board, the respondent at the hearing, as a further answer to the appeal, contested its correctness and submitted that it should now be overruled. The appellants are a company duly incorporated in Great Britain and carry on in the Commonwealth of Australia the business of....
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....by the Commissioner to the Board as if these references were appeals. 50. - .... (5.) Objections which are treated as appeals to a Board of Appeal shall, if the taxpayer's written request is accompanied by a deposit of such amount as is prescribed for the particular class or case, be forwarded to the Board of Appeal by the Commissioner not later than thirty days after receipt by him of the written request. (6.) A taxpayer shall be limited on the hearing of his appeal to the grounds stated in his objection. (7.) If the assessment has been reduced by the Commissioner after considering the objection, the reduced assessment shall be the assessment appealed from. (8.) When the appeal is to the High Court or a Supreme Court, it shall be heard by a single Justice of the Court. 51. - (1.) On the hearing of the appeal, the Court or Board of Appeal may make such order as it thinks fit, and may either reduce or increase the assessment. (2.) An order of the Board on questions of fact shall be final and conclusive on all parties. (3.) An order by the Court shall be final and conclusive on all parties except as provided in this section. (4.) The costs of the appeal shall be in the disc....
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....ss receipts for such period, which gross receipts were 4,273,169l. The appellants on May 4, 1925, lodged with the respondent an objection in writing against the said assessment and in such objection challenged the validity of the assessment and of the legislation under which it purported to be made. The case which the appellants then proposed to put forward under their objections was that which they had already made with reference to the 1922-23 assessment, and it turned mainly upon the provisions above quoted of the Income Tax Assessment Act, 1922, with reference to the status of the Board of Appeal. That Board was, they objected, a "Court" exercising the judicial power of the Commonwealth, and was unconstitutional in that it was composed of members appointed only for a term of years. To their objection the Commissioner made no immediate answer, and by December 1, 1925, when for the first time he did respond, the situation as it stood at the date of the objections had greatly changed. In the first place, the objections taken by the appellants to the assessment of 1922-23 were during that interval disposed of by the High Court of Australia and in the sense contended for by....
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....dy referred to. Under this amending Act, the Board of Appeal disappeared and a Board of Review was constituted in its place, the sections of the 1922 Act already set forth being dealt with so far as is presently material in the following way. By s. 7 of the new Act - which by s. 24 thereof was to be deemed to have commenced upon the date of the commencement of the Act of 1922 - s. 28 of the Act of 1922 was amended by omitting sub-s. 3. By Ss. 9, 10, 11 and 12, Ss. 41, 44, 50 and 51 of the Act of 1922 were so dealt with as to produce the result following:- "9. Section forty-one of the principal Act is amended - (a) by omitting from sub-s. 1 thereof the word 'Appeal' and inserting in its stead the word 'Review'; and (b) by omitting sub-s. 3 thereof and inserting in its stead the following subsection: (3.) The persons who were, prior to the commencement of this section, appointed, in relation to income tax, to be members of a Board of Appeal, shall be deemed, as from the commencement of this Act, to have been appointed to be members of a Board of Review and shall continue to hold office as such members as if appointed under this Act." 10. Section fort....
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....on review, shall give a decision and may either confirm the assessment or reduce, increase or vary the assessment. (5.) The Board may, if it considers the reference to be frivolous or unreasonable, order the forfeiture of the whole or part of the amount deposited in accordance with sub-s. 1 of this section. (6.) The Commissioner or a taxpayer may appeal to the High Court from any decision of the Board under this section which, in the opinion of the High Court, involves a question of law. 51A. - (1.) Where a taxpayer has, in accordance with s. 50 of this Act, requested the Commissioner to treat his objection as an appeal and to forward it to the High Court or the Supreme Court of a State, the Commissioner shall forward it accordingly. (2.) The appeal shall be heard by a single justice of the Court. (3.) A taxpayer shall be limited, on the hearing of the appeal, to the grounds stated in his objection. (4.) If the assessment has been reduced by the Commissioner after considering the objection, the reduced assessment shall be the assessment appealed from. (5.) On the hearing of the appeal, the Court may make such order as it thinks fit, and may reduce, increase or vary the ass....
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....ndent and a submission in the contrary sense was put forward by him as a separate answer to the present appeal. The objections came before the Supreme Court of the State of Victoria (Macfarlan J.) on May 7, 1926, when His Honour, after discussion, stated a case in writing for the opinion of the High Court upon the following questions: "1. Did the assessment cease to be valid or operative upon the raising of the dissatisfaction of the appellants therewith? 2. Is the assessment appealed against good in law?" The case as so stated was argued before the High Court of Australia, judgment given upon August 25, 1926, and the answers given by the Court, Knox C.J. dissenting, were to (1.) "No," and to (2.) "Yes." The ground upon which the majority of the learned judges of the High Court proceeded when so answering these questions was that in their opinion, the Board of Review, if in the present case the objections of the appellants had been referred to it, would not in entertaining them have been a Court exercising the judicial power of the Commonwealth, but would have been merely a tribunal engaged in the administration of the statutes and one, therefore, quite prop....
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....making assessments, determinations and decisions under this Act.' Those are the only powers and functions conferred upon the Board for the purposes of decision. Other powers of formulation after decisions are given, but these are incidental only. (e) Sect. 44 then takes up the 'decisions' of the Board and says they are for all purposes (with certain exceptions) to be deemed those 'of the Commissioner.' (f) The first exception is patently immaterial here. It is merely to prevent the taxpayer having a double choice instead of an alternative choice of tribunal from the Commissioner. (g) The second exception, when carefully examined, is really to negative the notion of the Board being judicial. It allows an appeal to the Court from any decision which, in the opinion of the Court, is a question of law. .... The fact that the Commissioner may appeal as well as the taxpayer only indicates that the Crown as well as the subject may invoke the Court to correct a misconstruction of the law, which would, of course, affect not merely that taxpayer but all taxpayers in a similar position. (h) The Board's decision, when given, may, by s. 51, sub-s. 4, be formalized by conf....
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.... "judicial power" suggests to their Lordships a further material difference in the status of the two Boards not alluded to by Isaacs J. It will have been noticed that under the new s. 51A, the orders which the Court, under sub-s. 5, may make are by sub-s. 6 made final and conclusive on all parties except as provided by the section; and that by sub-s. 10, it is provided that the Commissioner or a taxpayer may appeal to the High Court in its appellate jurisdiction from any order made by the Court under sub-s. 5. But under the new s. 51, dealing with the orders of the Board of Review, there is no provision in any way corresponding to these sub-ss. 6 and 10 of s. 51A. The orders of the Board of Review are not there stated to be conclusive for any purpose whatsoever. On the other hand, under s. 51, sub-s. 2, of the Act of 1922, the orders of the Board of Appeal on questions of fact were expressly declared to be final and conclusive on all parties. The distinction is, their Lordships think, both striking and suggestive. The decisions of the Board of Review are under the amending Act made the equivalent of the decision of the Commissioner. No assessment of his, even when paid, is co....
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....pared with s. 51A, which regulates appeals to the Court. The differences between the two sections have already been referred to. The sections may again in this connection usefully be contrasted. Although superficially apparently minute, the contrast indicates that the status and function of the two tribunals are by no means the same. The Board of Review appears to be in the nature of administrative machinery to which the taxpayer can resort at his option in order to have his contentions reconsidered. An administrative tribunal may act judicially, but still remain an administrative tribunal as distinguished from a Court, strictly so-called. Mere externals do not make a direction to an administrative officer by an ad hoc tribunal an exercise by a Court of judicial power. Their Lordships find themselves in agreement with Isaacs J., where he says: "There are many functions which are either inconsistent with strict judicial action .... or are consistent with either strict judicial or executive action. .... If consistent with either strictly judicial or executive action, the matter must be examined further. .... The decisions of the Board of Review may very appropriately be designa....