Taxpayer loses procedural point
2007 case note – calculation of statutory time frame begins on receipt of points of objection notice by Litigation Management Unit, not wider IR.
Tax Administration Act 1994, Taxation Review Authorities Regulations 1998
The calculation of the time frame for filing a case stated with the TRA commences when a points of objection notice is received by the Director Litigation Management Unit and not by its receipt by the wider Inland Revenue Department.
These proceedings were instituted by the Case Stated procedure on 20 May 2002.
In these proceedings the objector has claimed that the Commissioner failed to file a Case Stated within the statutory time period.
A points of notice ("PON") was posted by the Objector on 15 February 2002, addressed to "Senior Appeals Officer" Inland Revenue Dept, P O Box 2198, Wellington. The objector took it that items posted in the normal course of business deemed to have been delivered the day following posting. The Objector therefore took it that it would have been received on Monday 18 February 2002.
The Objector claimed that 63 days had elapsed between the date of receipt by the Inland Revenue Department ("IRD") on 18 February and the filing date on 21 May 2002 therefore, according to the objector the Case Stated was filed three days late. The Commissioner filed an application for an extension of time (to protect its position) for a further working day. The Objector opposed this application, on the grounds that the letter and PON were addressed in the manner required and therefore deemed to have been received by the Respondent on 18February 2002. The Objector also made reference to the Tax Administration Act ("TAA") and the need to treat an Objector fairly and impartially and to take account ss.4, 5 and 6 of the New Zealand Bill of Rights Act 1990.
The PON which was posted by the Objector on 15February 2002 was not received by the Litigation Management Unit until 1 March 2002. It appeared to have been received by another part of IRD (Processing Centre in Upper Hutt) on 20 February 2002. The Commissioner filed the Case Stated on 21 May 2002 which was well within the 60 day time frame. Counsel for the Commissioner argued that service of the PON must be on the Commissioner by personally delivering the document to the Director, Litigation Management, Freyberg Building, Aitken Street, Wellington.
Regulation 23(a) of the Taxation Review Authorities Regulations 1998 requires an objector to serve the Commissioner with the PON, by personally delivering the document to the Director, Litigation Management, P O Box 2198, Wellington. The Objector chose not to personally deliver or courier the PON but instead chose to post it. It did not reach Litigation Management until 1 March 2002 and at law, service of the PON was not achieved by the Objector until 1 March 2002 and therefore the 60-day period for the respondent to file a case stated commenced from that date and expired on 29May 2002. The Case Stated was filed on 21 May 2002 and so was well within the time.
Judge Barber relied on Regulation 23 in this ruling. He noted that s 6 of the Tax Administration Act 1994 and s 27 of the Bill of Rights Act 1990 could not help the Objector in any substantive way. Section 6 of the TAA requires the IRD to protect the integrity of the tax system, including, inter alia, to be fair, impartial and administer according to law.
The application for an order to allow the objection was refused on the above grounds.
The Judge stated that if receipt by the Processing Centre at Upper Hutt was determinative (in this case it's not), so that the Commissioner would have filed the case stated one day or so late, the application for an extension of time pursuant to reg.25 (2) of the Taxation Review Authorities Regulations 1998 on the basis that he was satisfied there were exceptional circumstances for the Commissioner's failure to file the case in time would have been granted.