Struck-off company has no legal capacity
2010 case note - struck-off company has no legal status and cannot appear before the Taxation Review Authority; regardless of this there was no issue to address.
A struck-off company has no legal status and cannot appear before the Taxation Review Authority (TRA); regardless of this, on the facts as found by the TRA there was no issue to address.
Impact of decision
This case is a re-statement of the law relating to the status of struck-off companies.
The TRA had previously made an order by consent that the Commissioner refund $7,819.12 to the taxpayer company. The taxpayer alleged the refund had not been made and sought an order from the TRA for the refund and also costs or "a penalty" of either $10,000 or $100,000. It also sought a further goods and services tax (GST) refund which was not the subject of any proceedings before the TRA.
The Commissioner denied the allegation and adduced affidavit evidence showing the refunds had been made (and use of money interest also paid). In addition the taxpayer company was struck off the Companies Register and had not been reinstated.
The TRA accepted the Commissioner's submission that a struck-off company was incapable of beginning proceedings; paragraphs [13-22]:
- It is settled law that the objector has no legal existence. The objector lacks any capacity to bring or proceed with this application. (paragraph )
... the so-called company currently has no status before this Authority because it is a struck off company. (paragraph )
Regardless of this, the TRA accepted the Commissioner's evidence that the refunds had been made to the taxpayer and therefore there was nothing for the TRA to address (paragraphs [9-12]):
- It seems to me that, on the balance of probabilities, there has been full compliance by the respondent Commissioner with my Order ... (paragraph )
The Authority accepted it lacked any jurisdiction to award costs or "a penalty" against the Commissioner (paragraph ).
It rejected a complaint by the taxpayer's agent that the Commissioner had the "wrong" witness confirming that:
- ... it is not for an opposing litigant (here the objector) to decide who should be called as witnesses by the defendant ... (paragraph )
The Authority accepted that the further GST refund issue was not within its jurisdiction (paragraph ).
Tax Administration Act 1994, Taxation Review Authorities Act 1994, Companies Act 1993