Case W72

Members:
JR Gibson SM

Tribunal:
Administrative Appeals Tribunal

Decision date: 14 April 1989.

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J.R. Gibson (Senior Member)

These are applications for review of decisions of the Commissioner of Taxation disallowing objections by the applicant to assessments to income tax for the years ended 30 June 1976, 1977 and 1978. The objections were to amended assessments dated 27 February 1980 and the adjustment sheets accompanying the notices of assessment indicated that the assessments had been made pursuant to sec. 167 of the Income Tax Assessment Act 1936, that is, that the Commissioner was not satisfied with the returns furnished for the relevant years and had made assessments of the amounts upon which in his judgment income tax ought to be levied. The effect of the amended assessments was that there were added to the taxable incomes as returned amounts of $8,863, $9,953 and $12,619 for the years ended 30 June 1976, 1977 and 1978 respectively.

2. Although the basis of the calculations of the amounts added by the Commissioner has not been disclosed by the evidence, it became clear at the hearing that the applicant had been assessed as having shared with two other persons the proceeds of a scheme whereby moneys received through the post for subscriptions to a business directory passed through bank accounts in the names of three companies, two of which had been incorporated for the purpose of receiving those moneys, and then through various other accounts in such a way as would make it difficult to trace the ultimate recipients. The applicant denies that he received any part of the moneys and says that, to the extent that he took part in the activities of the companies and the disposition of the moneys, he did so without being aware of being involved in a money-making scheme which involved concealing income.

3. At the hearing oral evidence was given by the applicant, his son, a former colleague (who will be referred to as Mr L) and, for the respondent, by a handwriting expert and by a senior officer of the Australian Taxation Office. There was also a great deal of documentary evidence including company records, documents relating to accounts in various banks and financial institutions, statements said to have been made by the applicant and Mr L and transcripts of evidence in other proceedings.

4. The applicant was an officer of the Taxation Department for some 25 years, and during his service became friendly with two colleagues, who will be referred to as Mr L and Mr S; all three eventually became income tax investigating officers. The applicant left the department in about 1973 but Messrs L and S continued in their employment until 1978. Since 1978 Mr L has been employed by the applicant in his business as a tax agent.

5. After his retirement from the department the applicant carried on business as a taxi driver and a tax agent. During 1975 he also commenced a business as a tipster, but it was unsuccessful. In April 1977 he purchased an employment agency, which was operating in leased office premises in the city of Sydney, and also carried on his tax agency business from that office. He gave up the taxi business in 1979.

6. According to evidence given by him in committal proceedings in Sydney in 1978, a person who will be called John Turner was a resident of New Zealand but between 1973 and 1975 was managing director of and a

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shareholder in a New South Wales company, which will be called Walter Drew Pty. Limited, which carried on business at least in the earlier part of that period and published a trade directory.

7. The directory was printed by the family company of a printer, who will be referred to as Mr Press, who had the key to the post office box of Walter Drew Pty. Limited and used to collect its mail. In the committal proceedings in 1978 Mr Turner said that he and his accountants attended at the Australian Taxation Office in Sydney in 1973 or 1974 and discussed the taxation liabilities of Walter Drew Pty. Limited and of Mr Turner with an investigating officer, Mr S. Subsequently, Mr Turner deposed, he abandoned the company's business and left Australia in 1974 or early 1975.

8. Mr Press, who has since died, also gave evidence in the committal proceedings. He deposed that Mr S, identifying himself as an investigating officer from the Australian Taxation Office, had called on him in about September 1974 and had asked him questions about Walter Drew Pty. Limited; six months later Mr S had obtained from him the key to the company's post office box. Thereafter, according to Mr Press, Mr S had introduced the applicant as a man who would collect the mail for Walter Drew Pty. Limited and pass on the information to the Taxation Department.

9. The applicant gave evidence at the hearing before the Tribunal that, in about July 1975, when he was operating the taxi business, his friend Mr S had asked him to assist in an undercover type of taxation investigation concerning Walter Drew Pty. Limited. In explaining what the word ``undercover'' conveyed to him the applicant's evidence was to the effect that if investigating officers exceeded the proper limits of their authority and thereby obtained a good result it was unlikely that their conduct would be officially noticed. The applicant said that the assistance that Mr S requested of him was that he should collect from the printer, Mr Press, invoices, contained in window-faced envelopes, and post them by bulk mail. Mr S also requested him to collect mail from the post office box of Walter Drew Pty. Limited and bank any cheques in the mail in a bank account with the Bank of New South Wales in the name of the company. The applicant said that he agreed to do so and did thereafter, according to him, over a period of 12 months or more, collect the envelopes from the printer from time to time and post them, and also collect the company mail and bank the cheques to its account. He used his own name as the depositor on the deposit slips. Commencing in August 1975 he was paid for his services by cheques drawn on the company. The first cheque which he received in payment for his services was banked in an account in his name; but cheques received subsequently were banked in an account under a fictitious name, John Arrow. That was an account which he had opened for the purposes of the tipping business which he had started under that name. The name was one which had been used as an alias by a taxpayer whose affairs he had investigated when he was employed in the Taxation Department and it had caught his fancy. When asked by his counsel why he had banked the cheques in the Arrow account he said that ``the person who was running the operation did not want his name mentioned and suggested that I do it under an alias''. The cheques were signed John Turner and bore dates from 25 September 1975 to 14 September 1976 and were for amounts ranging from $80 to $232. The applicant said that the moneys received by him from Walter Drew Pty. Limited were included in the income returned by him for the years of income ended 30 June 1976 and 30 June 1977.

10. On 9 February 1976 there was lodged in the office of the Corporate Affairs Commission of New South Wales the memorandum and articles of association of a company which will be called Waldrew Holdings Pty. Limited, the subscribers and signatories to which purported to be John David Arrow and John Benson, and the witness to the signatures purported to be John McGee of Cronulla. The applicant said that the signature of John McGee (the name being that of one of his clients) was written by him at the request of Mr S. He did not see the signatures of John David Arrow and John Benson being written and could not recognise the handwriting of the signatories. The handwriting expert later gave evidence that, in his opinion, the writing in the signature of John Arrow was that of Mr L.

11. In March 1976 an application was made on behalf of Waldrew Holdings Pty. Limited for a private post office box and the address of the company was given as one at Crows Nest, which was in fact the address of a company managed by a former colleague of the

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applicant, who was well known to the applicant, Mr L and Mr S. The applicant was the company's tax agent. At the hearing he identified some of the writing on the application for the private box as that of Mr L.

12. On 27 April 1977 a memorandum and articles of association of a company which will be called Lloyd Wall Pty. Limited was lodged with the Corporate Affairs Commission. The subscribers and signatories were Leslie Wall and Brian Edgar and the witness to the signatures was A. Hynes. The applicant gave evidence that Hynes was a fictitious name and that he had written the signature in a fictitious name at the request of Mr S. He had not seen the signing by Wall and Edgar. The evidence of the handwriting expert was that the signature of Brian Edgar was in the handwriting of Mr L.

13. As has been mentioned, the applicant acquired leased office premises in the city in April 1977. He gave evidence that, commencing in 1977, he agreed to allow Mr S the use of a room in that office and of a cupboard in the room. He said that on two or three occasions he had deposited cheques in a bank account of Waldrew Holdings Pty. Limited, which cheques, together with a deposit book had been left in the room with a note to him. He also deposited cheques in a bank account of Lloyd Wall Pty. Limited on the same basis. He had used a fictitious name as the name of the depositor and said that this was because Mr S had told him that ``they did not want anything to be traceable''.

14. According to the evidence of Mr L the business activities of Walter Drew Pty. Limited, Waldrew Holdings Pty. Limited and Lloyd Wall Pty. Limited consisted of sending out invoices which indicated that upon payment of the amount specified in the invoice the name, address and description of the business of the payer as set out in the invoice or as altered by the payer would be included in a classified business directory. In 1974 the invoices specified $84 as the annual fee but it was later made $87. The invoice forms were printed but the particulars of the entry were typed.

15. At the hearing cheques drawn on the bank account of Walter Drew Pty. Limited and deposit slips for deposits in it were admitted into evidence. In addition there were admitted documents relating to 14 other accounts in banks and buildings societies which, with one exception, were opened between 1975 and 1978, and all of which were in operation in all or part of that period. The documents included statements and transaction records, deposit slips, withdrawal forms, cheques and working papers relating to the accounts prepared by officers of the Taxation Department. Some relevant information from those documents is set out hereunder.

Waldrew Holdings Pty. Limited

16. Account with the Bank of New South Wales, total deposits to which in the relevant period were in the vicinity of $45,000, which included a taxation refund cheque for $10,620.99 payable to Walter Drew Pty. Limited. All the deposit slips in evidence have the signature J. Arrow as the person making the deposit and the cheques banked were for amounts of $84 or multiples thereof in the earlier part of the period, and for $87 or multiples thereof in the later part. Cheques drawn on the accounts prior to May 1976 were signed by J. Arrow and cheques drawn on the account thereafter were signed by J. Arrow and J. Benson.

Lloyd Wall Pty. Limited

17. This company had three accounts; one with the Bank of New South Wales, one with the Commonwealth Bank and one with the Commercial Banking Company of Sydney. The deposit slips were signed by B. Edgar and the cheques by L.A. Wall and B. Edgar. The deposits were of cheques for $87, or multiples thereof, and withdrawals were almost all by way of cash. The total of the deposits to the three accounts was roughly $38,000.

John Arrow

18. There are accounts in the name of John Arrow with the R.S.L., St. George and N.S.W. Permanent Building Societies and with the Commonwealth Savings Bank, and an account in the name of John David Arrow with the United Permanent Building Society. The total deposits and withdrawals to the building society accounts in the relevant period amounted roughly to $12,000. In all of those accounts there are some deposits of cheques for $84 or multiples of $84. Most of the moneys deposited to the savings bank account came from the building society accounts. All withdrawals from the savings bank account were by way of cash.

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Postal Sporting Club

19. Mr L said that the name for this account at the Commonwealth Bank was invented by him. The application to open the account and cheques on the account were signed by J. Arrow and J. Benson. Deposits, which totalled about $3,800, included cheques drawn on the building society account of Arrow and the account of Waldrew Holdings Pty. Limited. Withdrawals were mostly in cash, but cheques totalling $290 were drawn in favour of Waldrew Holdings Pty. Limited.

Sidney Jones

20. There are accounts in the name of Sidney Jones with the R.S.L. and the St. George Building Societies, the Commonwealth Savings Bank at Wynyard and the Commonwealth Savings Bank at Paddington. The latter account was opened in 1974 or earlier. Applications to open the building society accounts and requests for cheques on the accounts were signed S. Jones. Deposits to the building society accounts in the relevant period totalled roughly $10,000 and were mostly of cheques for $84 or multiples thereof. Moneys withdrawn went to the savings bank accounts. Most withdrawals from the savings bank accounts were of cash. Various documents relating to the Jones accounts which are in evidence were signed S. Jones or had Sidney Jones written or hand-printed on them.

21. A taxation refund cheque for $10,620.99 payable to the order of Walter Drew Pty. Limited was banked by Mr L in an account of Waldrew Holdings Pty. Limited on or about 12 May 1977. He had endorsed the cheque ``to Waldrew Holdings Pty. Limited by Walter Drew Pty. Limited per J. Turner''. Mr L gave evidence that he had made the endorsement and written the signature J. Turner, having been authorised to do so by Mr Turner. He said that the proceeds of the cheque were subsequently shared by him and Mr S.

22. Early in the morning of 15 March 1978 officers of the Commonwealth Police and the Taxation Department arrived at the applicant's home, searched the premises and took possession of documents; they then took him to the home of his estranged wife and to his city office and made searches and seized more documents there. The applicant was taken then to Commonwealth Police Headquarters at Redfern where he was interrogated at length. A typed record of interview was prepared, but he declined to sign it. On the same day police officers went to Mr L's home early in the morning, made a search and recovered documents and then took him to his office in the Taxation Department, where they also seized documents. Mr L was then taken to Federal Police Headquarters, interviewed by police officers and, eventually, signed a typed record of interview. In his evidence at the hearing Mr L said that he was told by the police officers that the applicant and Mr S were also in the building being interviewed.

23. Mr L and Mr S were charged with forging and uttering the taxation refund cheque and, after being committed for trial in late 1978, pleaded guilty to the charges.

24. As has been mentioned earlier evidence was given at the hearing by a handwriting expert, who will be referred to as Mr Wood. He was a highly qualified and experienced handwriting expert, and his evidence was not challenged. For the purpose of giving evidence he had been provided with documents called control documents said to contain the handwriting of the applicant, Mr L and Mr S, and other documents, called questioned documents, containing writing, and asked to express an opinion as to whether any of the writing in them was done by any of the persons whose writing was on the control documents. The applicant and Mr L agreed at the hearing that the control documents relating to them contained their handwriting. The control documents relating to Mr S came from the possession of the Taxation Department and included applications made and documents completed in the course of service in the department by an officer bearing that name, income tax returns and documents written for the Commonwealth Police on 15 March 1978. The applicant and Mr L were shown one of the documents and said that the signature in the name of Mr S appeared to be that of Mr S.

25. Mr Wood gave evidence that the writing of the person on the applicant's control documents appeared on a cheque payable to him drawn on Walter Drew Pty. Limited; in the signature in the applicant's name on a deposit slip to an account of that company with the Bank of New South Wales and (in a name other than his own) as depositor in two deposits of a number of cheques for $87 to an account of Lloyd Wall Pty. Limited with the Commercial

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Banking Company of Sydney. (The applicant agreed at the hearing he had made those deposits and had written the signatures.)

26. As to Mr L, the evidence of Mr Wood may be summarised as follows:

• (a) The signatures J. Arrow in the documents relating to an account of Waldrew Holdings Pty. Limited and other details on them were written by him;
• (b) The signatures in the name of Edgar on a number of documents, including cheques and deposit slips, relating to the bank accounts of Lloyd Wall Pty. Limited in the Commonwealth Trading Bank, Bank of New South Wales and Commercial Banking Company of Sydney and other details on some of those documents were written by him.

27. As to Mr S, Mr Wood expressed the opinion that the signature S. Jones on a number of documents relating to the accounts in the name of Sidney Jones with St. George and R.S.L. Permanent Building Societies; also that almost the whole of a withdrawal form on the Commonwealth Savings Bank account was written by him.

28. It seems clear that Walter Drew Pty. Limited, and later Waldrew Holdings Pty. Limited and Lloyd Wall Pty. Limited, were engaged in sending out invoices of the kind which has been described, as a result of which many remittances by cheque were received. The cheques were banked in one or other of the various accounts which have been mentioned. It seems most unlikely that the persons who sent the cheques were aware of the nature of the directory, for the 1978 copy which is in evidence and was said by the applicant to have been obtained by him from the printer is of such a limited nature and so poorly produced as to be almost worthless, and there is no evidence that any copies of it were circulated to the general public or to the business community. And, apart from the evidence of the applicant, Mr L and the late Mr Press as to what they were told by Mr S, there is no evidence that Mr S was instructed to investigate the operations of Walter Drew Pty. Limited, or that he was ever engaged in any form of investigation for the benefit of the Taxation Department. The evidence as to the incorporation of two companies by persons using false names, the creation of bank accounts in the names of those companies or other persons using false names and the way in which the proceeds were dealt with leads almost inevitably to the conclusion that there was a scheme to make money by way of what was very nearly a confidence trick and, by covering up the ultimate recipients, to enable them to avoid income tax on the proceeds. But the applicant's evidence was that he was not a participant in, or aware of, any such scheme. He said that he undertook to post invoices and to bank cheques partly to help Mr S in the ``undercover operation'' and partly to obtain extra income. He said that it was because it was an undercover operation that he had banked the earnings from his services in an account in a fictitious name, and that he had used the fictitious name when falsely purporting to witness signatures to the memorandum and articles of association of Waldrew Holdings Pty. Limited and Lloyd Wall Pty. Limited. For the same reasons he had rented office space to Mr S. The applicant said that he had not been curious about the nature of the operation and had never asked Mr S what it was. He had never wondered how the incorporation of the bogus companies could assist this or thought there was anything risky about it. He knew nothing of the negotiation of the tax refund cheque until the charges were brought against Mr L and Mr S, and his only discussion of it with them was when Mr L told him that he had negotiated the cheque on the advice of someone concerned with the operation. He had never received any moneys from the scheme except what he was paid for posting invoices, banking cheques and the use of his office. He did not know what had happened to the moneys banked and did not want to know. He was unaware of the existence of many of the bank accounts referred to in the evidence.

29. In his evidence in chief Mr L said that he had been requested by Mr S to assist him in an undercover investigation he was carrying out into the affairs of ``the people running Walter Drew Pty. Limited''. He assisted by signing documents in fictitious names on the incorporation of Waldrew Holdings Pty. Limited and Lloyd Wall Pty. Limited and by depositing cheques and withdrawing moneys from various bank accounts. Mr L said that he later became aware that the applicant was also assisting in the undercover operation by collecting and posting invoices and by allowing Mr S to have the use of the room in his office.

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Mr L said that the cheques which he banked were collected by him from a cabinet in that room, for which he, Mr S and a Mr Johnson had keys, and that the moneys which he withdrew from various accounts were left by him in that cabinet.

30. In cross-examination Mr L said that he had written the name John David Arrow and the signature John Arrow on the memorandum and articles of association of Waldrew Holdings Pty. Limited and said that the writing of the name John Benson on that document was similar to that of Mr S. Mr L said that John Arrow was the name of a friend of his and that he had previously used that name to get on the mailing list of a racehorse tipster whose taxation affairs he was then investigating. He had written the name Brian John Edgar on the memorandum and articles of association of Lloyd Wall Pty. Limited and thought that the name John Benson on that document was in the handwriting of Mr S. He had written the name John Arrow on deposits relating to accounts in that name with a building society and the Commonwealth Savings Bank, an account in the name of the Postal Sporting Club and accounts in the name of Waldrew Holdings Pty. Limited. He thought that the signatures of J. Benson on those documents were in the writing of Mr S. Mr L said that he had written the name B. Edgar on various documents relating to accounts in the name of Lloyd Wall Pty. Limited, but he could not identify the writing of the signatures Lloyd Wall on those documents.

31. Mr L stated that he became aware of various accounts in the name of Sidney Jones and that he knew that that name was an alias adopted by Mr S. He was not prepared to agree that the signature S. Jones on various documents relating to accounts in the name of Sidney Jones had been written by Mr S.

32. Mr L was cross-examined at length about a record of interview signed by him after his interrogation at Federal Police Headquarters on 15 March 1978. He said that the document was not a correct record and was produced at the end of a long day which had commenced when his home was raided at 6.25 a.m., when he had been refused an opportunity to speak to a solicitor and during which he had had nothing to eat or drink except a cup of coffee.

33. As to the taxation refund cheque for $10,620.99, Mr L said that he had endorsed it to Waldrew Holdings Pty. Limited and signed J. Turner on that cheque on the authority of Mr Turner. He had shared the proceeds of the cheque with Mr S. He had specifically instructed counsel appearing for him at the committal proceedings relating to the cheque to put that matter to Mr Turner but his counsel had not done so. Later he had told senior counsel about it and senior counsel had advised him to plead guilty because he had no written evidence of Turner's authorisation.

34. It was common ground at the hearing that in the subject assessments the applicant had been assessed as having derived a share of the income from the so-called undercover operation. During the course of the hearing counsel for the applicant sought to tender documents with a view to showing that in arriving at the amount of taxable income alleged to have been derived by the applicant the respondent had failed in the statutory requirement of allowing deductions for expenses incurred in obtaining the income and, accordingly, it was submitted, the assessments were invalid. The tenders, which were opposed, were rejected on the basis of sec. 177 of the Income Tax Assessment Act 1936, which provides, inter alia, that the production of a notice of assessment or a document purporting to be a copy of a notice of assessment under the hand of the Commissioner or a Deputy Commissioner shall be conclusive evidence of the due making of the assessment, and on the basis of the interpretation of the relevant statutory provisions by the High Court of Australia in
George v. F.C. of T. (1952) 86 C.L.R. 183 and later decisions in which it was followed. In George's case the Court said (at p. 204):

``The fact is that unless the taxpayer discharges the burden laid upon him by s. 190(b) of proving that this ascertainment or judgment is excessive, he cannot succeed and it can be no part of the duty of the Commissioner to establish affirmatively what judgment he formed, much less the grounds of it, and even less still the truth of the facts affording the grounds. Yet that is what is involved when the demand for particulars of the sources alleged of the appellant's income is justified by reference to s. 167.

It is an error to treat the formation by the Commissioner of a judgment as to the

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amount of the taxable income as if it were not the ascertainment of the taxable income which constitutes assessment or a necessary part of that process and as if it were but the fulfilment of a condition precedent to the power or authority to assess. If, however, it were a condition precedent the question would at once arise whether the fulfilment of the condition was not part of `the due making of the assessment' of which s. 177(1) makes the production of a notice of assessment conclusive evidence.''

35. In
Politis v. F.C. of T. 88 ATC 5029, Lockhart J. said, at p. 5032, ``the Act does not place any onus on the Commissioner to show that the assessment was correctly made, nor is there any statutory requirement that the assessment should be sustained or supported by evidence''.

36. However, in his submissions at the conclusion of the hearing, on the basis of a statement made by Mr L in the course of his evidence that no deductions for expenses, other than bank charges, had been allowed against the income split between the applicant, Mr L and Mr S, counsel submitted that the assessments were invalidly made and referred to the decision of the Privy Council in
Income Tax Commissioner v. Badridas Ramrai Shop, Akola (1937) L.R. 64 I.A. 102. The statement of Mr L referred to was objected to and was of no weight. But, putting that aside, sec. 167 of the Income Tax Assessment Act 1936 does not require the Commissioner to ascertain and deduct allowable deductions when making assessments under that provision;
Briggs v. D.F.C. of T. 87 ATC 4278. The decision of the Privy Council referred to by counsel for the applicant was concerned with Indian legislation in different terms from sec. 167 and, in any event, the observations of their Lordships seem to me to tend against the argument of counsel for the applicant.

37. For the applicant it was submitted that none of the moneys produced by the scheme had been traced to him, that his evidence that he had not participated in the scheme and had not received moneys from it should be accepted, with the consequence that the onus of proof imposed upon him by sec. 190 had been discharged. For the respondent it was submitted that on the totality of the evidence and the applicant's admissions of untruthfulness when interrogated by the police the evidence of the applicant could not be accepted.

38. It is convenient before assessing the evidence of the applicant to consider that of Mr L. He was not an impressive witness; he was vague about any conversations and dealings which he had had with the applicant and Mr S and appeared to be evasive at times. It may well be that the circumstances surrounding his interrogation by the police were as he described them and I would not place much weight on the contents of the record of interview which he signed. But he did admit at the hearing that he had told lies to the police on that occasion. It is difficult to accept his evidence that, having been given the taxation refund cheque by Mr Turner and having deposited it in the account of Waldrew Holdings Pty. Limited he, rather than Mr Turner, should have signed the endorsement John Turner. It is difficult also to accept his explanation as to why at the committal proceedings his counsel did not put to Mr Turner that he had authorised the endorsement of the refund cheque and his evidence as to the subsequent advice of senior counsel. It is of course relevant to his credit that he was prepared to be a party to the signing of company and bank documents in fictitious names and that he was prepared to share the proceeds of the taxation refund cheque to which on no basis did he have any entitlement. All in all the Tribunal would not be prepared to rely on the evidence of Mr L as corroborating that of the applicant on any material issue.

39. The evidence as to the incorporation of companies, the use of false names and addresses, false signatures and false statements as to witnessing signatures, the banking of a very substantial total sum of money in a number of bank accounts and its distribution in a manner which concealed the final recipients, the use by the applicant and his two former colleagues of the name John Arrow and the fact that no evidence was adduced to show that the activities of Mr S were in fact in aid of a bona fide investigation, give rise to a strong suspicion that the applicant was a party to a scheme to make money and to conceal the receipt of it. If he was, the fact that no moneys were traced to him could indicate that the scheme was to that extent successful.

40. The applicant sought to dispel that suspicion and to discharge the onus placed upon him by sec. 190(b) of the Income Tax

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Assessment Act 1936 by pointing to the fact that no proceeds had been traced to him and by asking that the Tribunal accept his evidence that he had not knowingly participated in anything other than an undercover operation and had not received any proceeds of the activities. The assessment of the credibility of the applicant is vital.

41. He gave his evidence well. He listened to the questions put to him and answered intelligently. He was quite firm in his denials of being involved in the scheme. His explanations as to the source of an amount of $4,000 banked by him in December 1977 and of the $2,000 received in cash in July 1976 were not inherently improbable, nor was his evidence as to a safe custody packet deposited by him in July 1977. He could not be described as evasive but he, like Mr L, seemed to be very vague as to any arrangements or conversations with Mr S.

42. The applicant admitted in cross-examination that when interrogated by the police on 15 March 1978 he had been quite untruthful about a number of matters. His explanation for that untruthfulness was that he was assisting in an undercover operation. The applicant also admitted in cross-examination that he had been untruthful about his association with the three companies when interviewed by an officer of the department in December 1979. Again his explanation was that it was ``undercover work'' but he amplified the explanation by adding that it was undercover work which he and ``they'' should not have been doing. The Tribunal finds it difficult to accept the explanation and, in any event, even if it explains his untruthfulness, the fact is that he was untruthful. Nor does it enhance the applicant's credit that he was prepared to sign documents using fictitious names and to purport to witness signatures which he had not witnessed.

43. More importantly, the Tribunal cannot accept that the applicant, who is not a simpleton and who was aware of the continuance of the so-called undercover operation for a period of about two and a half years, never questioned the reasons for the activities he was asked to undertake, had no curiosity about what the scheme was intended to accomplish and what was happening to the moneys received, never discussed it with his friends and former colleagues and never had any suspicions about it.

44. Although it is possible that the applicant did not receive a share of the proceeds of the scheme the Tribunal, having regard to all the evidence, is not satisfied by the applicant's evidence that he did not. He has therefore failed to discharge the onus of proving that the assessments were excessive. Accordingly the objection decisions the subject of the applications must be affirmed.