Kelton (Deputy Federal Commissioner of Taxation) v. Goodes.

Judges:
DF Wilson SSM

Court:
Adelaide Magistrates Court

Judgment date: Decision handed down 25 October 1978.

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Wilson S.S.M.: The complaint of the Deputy Commissioner of Taxation for the State of South Australia alleges that the defendant, on being required by the complainant by notice in writing dated 7 June 1978, which was on that day duly posted by pre-paid letter post addressed to the defendant at his address for service 9 Duncan Crescent, Highbury, to furnish to the complainant at his Office in Adelaide, within fourteen days of the date of the notice, for the purposes of the Income Tax Assessment Act, 1936, a return in writing in the prescribed form of income derived by the defendant from all sources in Australia or elsewhere, during the year 1 July 1976 to 30 June 1977, failed to duly furnish such return as and when required: contrary to sec. 223 of the Income Tax Assessment Act, 1936 (hereinafter referred to as ``the Act'').

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It will be convenient to set out sec. 223 at once. It is in the following terms:

``223. (1) Any person who fails to duly furnish any return or information or comply with any requirement of the Commissioner as and when required by this Act or the regulations or by the Commissioner shall be guilty of an offence.

Penalty: Not less than Four dollars or more than Two hundred dollars.

(2) A prosecution for an offence against this section may be commenced at any time.''

The defendant appeared and pleaded not guilty to the charge. The complainant's case consisted of documentary evidence, namely a copy of the notice referred to in the complaint (Exhibit P1) and a certificate by the Deputy Commissioner of Taxation (Exhibit P2) to the effect that the return in question had not been received. This certificate was tendered pursuant to reg. 55 of the Income Tax Regulations. The complainant also relied on sec. 243(1) of the Act which provides as follows:

``243. (1) In any taxation prosecution, every averment of the prosecutor or plaintiff contained in the information, complaint, declaration or claim shall be prima facie evidence of the matter averred.''

The complaint contains no ``averments'' separately pleaded as such, but in my opinion this is not necessary to enable the complainant to invoke sec. 243. The word ``averment'' is not a term of art - it simply means a statement, assertion or allegation: see Co. Litt. 362b; and the statement of the charge itself, insofar as it consists of allegations of fact, is an averment or series of averments for the purposes of sec. 243:
Brady v. Thornton (1947) 75 C.L.R. 140.

The defendant gave evidence on oath. He did not deny that he had failed to lodge his return in accordance with the requirement in the notice, but swore that he had never received the notice. In the absence of any other evidence, I accept the defendant's testimony as to this and find accordingly. I also find that the notice was on 7 June 1978 duly posted by pre-paid letter post addressed to the defendant at his address for service, which was his residential address at the time and also his address at the time of giving evidence.

Thus the sole issue in the case is whether the non-receipt of a notice of a requirement by the Commissioner duly posted to a defendant, affords him with a defence to a charge under sec. 223. The power of the Commissioner (or a Deputy Commissioner, by virtue of sec. 13) to issue the notice is conferred by sec. 162, which provides:

``162. (1) Every person shall, if required by the Commissioner, whether before or after the expiration of the year of income, furnish to the Commissioner, in the manner and within the time required by him, a return, or a further or fuller return, of the income or any part of the income derived by him in any year, whether on his own behalf or as agent or trustee, and whether a return has or has not previously been furnished by him for the same period.

(2) If no income has been so derived by the person so required to furnish a return, he shall nevertheless furnish a return stating that fact.''

(In passing I draw the defendant's attention to subsec. (2) as he seems to be under a misapprehension about this, according to his evidence.)

The question is whether a person may be said to have been ``required'' by the Commissioner to do anything if such requirement was posted to him but did not in fact come to his notice. Both sec. 162 and sec. 223 are silent on the question. Mr. Martin, who appeared for the complainant, has referred me to reg. 59 which provides as follows:

``59. Any notice or other communication by or on behalf of the Commissioner may be served upon any person -

• (a) by causing it to be personally served on him; or
• (b) by leaving it at his address for service; or
• (c) by posting it by pre-paid letter post, addressed to him at his address for service;

and in any case to which paragraph (c) of this regulation applies, unless the contrary

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is proved, service thereof shall be deemed to have been effected at the time when it would, in the ordinary course of post, have arrived at the place to which it was addressed.''

In view of my acceptance of the defendant's evidence, this Regulation does not assist the prosecution case since, in terms of the Regulation, ``the contrary is proved''. In any event this Regulation begs the very questions whether the Commissioner's requirement must be served on, or come to the notice of, the person concerned before proceedings under sec. 223 can succeed. In the absence of any specific legislative provision, this question becomes one of construction of the word ``requirement''. Surprisingly enough there do not appear to have been any authoritative decisions on the construction of the expression in this particular context. The Prosecutor referred me to a judgment of the Chief Justice of the Supreme Court of South Australia in
Buchanan v. Kahl 72 ATC 4107, 23 May 1972. In that case the defendant received a notice under sec. 162, but not (as the Court found) until after the time specified therein for compliance. There were other grounds of appeal. The appeal against conviction was dismissed, but somewhat surprisingly the Chief Justice does not deal in his judgment with the question of the non-receipt of the notice. If he had thought that non-receipt of the notice (until compliance was impossible) would afford the defendant with a defence, it is hard to imagine that he would not have said so and allowed the appeal on that ground. Since his Honour made no reference to the question, the case cannot be regarded as a binding authority either way, but by its very silence on the point the judgment suggests that the non-receipt of the notice until too late made no difference - from which it would seem to follow that the question, whether notice of a requirement under sec. 162 is received at all by the person to whom it is addressed, is immaterial. No other authorities were cited to me, and for the reason I have indicated, the one here discussed is not conclusive.

As was pointed out by Hallett J. in
Nuthall Ltd. v. Entertainments Etc. Ltd. & Ors. (1947) 2 All E.R. 384 at p. 392 B: ``The word `required' by itself is certainly ambiguous''. His Honour goes on to say: ``It may mean in some context no more than `desired'.'' Certainly more than that is required in some contexts. For example, in sec. 75 of the South Australian Police Offences Act 1953 as amended, which authorises members of the Police Force to require certain persons to state their full name and address, I have no doubt that it is essential for the prosecution to prove communication of the requirement to establish the offence of failing to comply with such requirement, created by subsec. (3).

On the other hand, in
Reg. v. Nicholls (1972) 2 All E.R. 186, in which a motorist was asked by a Police Sergeant to give a specimen of his breath, but (apparently due to the effects of liquor) he did not comprehend what was being requested, it was held that he had nevertheless been ``required'' to give such a specimen within the meaning of a provision in the English Road Safety Act, which made it an offence for a person who had been required to provide a specimen of breath for a breath test, to fail to do so. Delivering the judgment of the Court of Appeal, Megaw L.J. said at p. 188 e-g: ``Can a person properly be said to have been `required' to do something if in fact he has not heard or has not understood the words spoken to him by another person, although the other person has spoken the words in the honest and reasonable belief that they would be, and were being, heard and understood by the person to whom they were addressed? In our judgment, the answer is Yes. The person concerned has been `required'. The fact that his brain has not absorbed the sound of the words spoken, or has not processed them into full understanding, does not prevent that which would otherwise be a requirement from being a requirement. Of course, if there were bad faith, the position would be wholly different; but not because of the meaning of the word `required'.''

In principle I can see no difference between the case where a defendant's brain is incapable of understanding a verbal requirement (as in Nicholls' case) and one where a written requirement has been duly made and posted to him, but not communicated to him personally for some other reason, such as an error in the Post Office or the negligence or worse of some other person into whose hands it comes.

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However the expression must be construed in the context in which it occurs, and it is therefore necessary to look at the Income Tax Assessment Act as a whole, and in particular Part IV, headed ``Returns and Assessments'', to determine whether the word ``requirement'' should be construed as in Nicholls'case or in some other way. ``As a general rule a word is to be construed as used throughout an Act of Parliament in the same sense, and therefore we may look through the other sections to see in what sense the word is there used'':
Spencer v. Metropolitan Board of Works (1882) 22 Ch. D. 142 per Jessel M.R. at p. 162.

It is to be observed that the Act contains no general requirement of persons in receipt of income to lodge an annual return thereof with the Commissioner of Taxation. That requirement springs from the periodic implementation of sec. 161 which, so far as material provides as follows:

``161. (1) Every person shall, if required by the Commissioner by notice published in the Gazette, furnish to the Commissioner in the prescribed manner, within the time specified in the notice, or such extended time as the Commissioner may allow, a return signed by him setting forth a full and complete statement of the total income (other than income upon which withholding tax is payable) derived by him during the year of income, and of any deductions claimed by him...

...''

Now it is perfectly obvious that a notice in the Gazette, requiring a particular person to furnish to the Commissioner a return of his income, may not in fact come to his notice; indeed in most cases the probabilities are that it will not. Yet it is manifest that the intention of Parliament was that the mere publication of such a notice in the Gazette will constitute a requirement in terms of sec. 161, sufficient to found a successful prosecution under sec. 223 of someone who fails to comply with it, irrespective of whether it actually came to his notice. Moreover, I see no reason why a requirement under sec. 161 may not be made in general terms, without specifying individuals by name. A requirement had been made in that form in
Frazer v. Barclay (1920) S.A.L.R. 157. The defendant's appeal against conviction succeeded because of defective pleading by the complainant, who had simply alleged a failure to lodge an income tax return, whereas he should have alleged a failure to comply with the Commissioner's requirement. But there was no challenge to the form or effectiveness of the requirement itself. It is indeed common knowledge that sec. 161 is implemented annually in this general way: see for example the notice in the Government Gazette numbered G25 of 28 June 1977 at pp. 12-13, giving notice of the Commissioner's requirement pursuant to that section for the year ended 30 June 1977, which requirement is directed to several groups of persons and companies, specified by reference to residence, total income, and other criteria without naming any individuals. That notice clearly constitutes a requirement in terms of sec. 161; it is the only notice which most persons receive to lodge returns, and anyone who did not comply with it could be successfully prosecuted under sec. 223 without more ado; it would be quite idle to suggest that any such person had a defence to the charge simply because he had not read the Government Gazette. In point of fact it seems to be the practice to issue a further requirement under sec. 162 directed to an individual before prosecuting him, but there is nothing in the Act to suggest that this is essential. Parliament has indicated a plain intention that a requirement of the Commissioner in terms of sec. 161, even though it may never come to the notice of persons to whom it applies, is nevertheless a requirement in respect of that person for the purposes of sec. 161.

Now ``it is a sound rule of construction to give the same meaning to the same words occurring in different parts of an Act of Parliament'':
Courtauld v. Legh L.R. 4 Ex. 126 per Cleasby B. at p. 130; compare
R. v. Poor Law Commissioners (1837) 6 A. & E. 56, per Lord Denman C.J. at pp. 68-69. It seems to me that this principle applies with added force where, as here, the two sections in question (sec. 161 and 162 of the Act) are contiguous and their subject matter and content are very similar. Indeed I think it would be utterly capricious to adopt a different interpretation of the word ``requirement'' in the two sections. There is a clear indication of an intention by Parliament that a purported requirement by

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the Commissioner under either section is none the less a requirement because it does not come to the notice of the person concerned. By the same token sec. 223 relates to requirements under either sec. 161 or sec. 162.

This conclusion is neither to be regretted nor wondered at. The obligation to lodge Income Tax returns is common knowledge - even though many people may not be aware that it depends on the annual implementation of sec. 161. Moreover an allegation that a notice has not been received through the post is very easy to make and virtually impossible to disprove. In these circumstances it is not surprising that Parliament should regard the non-receipt of notice of the Commissioner's formal requirement under sec. 162 as irrelevant to a prosecution under sec. 223.

I hold that where the Commissioner (or a Deputy) has posted a notice pursuant to sec. 162 of the Act to the last known address of any person, such person has then and thereby been required in terms of that section to do whatever was specified by the Commissioner in the notice, and that proof by the person so required, that the requirement did not come to his notice, is no defence to a charge under sec. 223. For these reasons, in the absence of any other defence to the charge, I find it proved.