Notice of defence not necessary when filing an application to strike out
2015 case note – TRA finds notice of defence not necessary when filing an application to strike out.
This was a decision of the Taxation Review Authority ("TRA") dismissing the disputant's Notice of Appearance under Protest to Jurisdiction, finding the TRA had jurisdiction to hear the Commissioner of Inland Revenue's ("the Commissioner") strike-out application even though no Notice of Defence had been filed.
The judgment confirms that the TRA is comfortable with the practice of Notices of Defence not being filed where a strike-out application has already been made.
The disputant commenced a challenge in the TRA for his 2010 and 2011 income tax years. The Commissioner did not file a Notice of Defence but instead filed an Application to Strike out the Claim and sought an order deferring the date for filing her Notice of Defence until otherwise ordered to do so by the TRA. These matters were set down to be heard on 10 February 2015.
On the day of the hearing, the disputant filed a Notice of Appearance under Protest to Jurisdiction. The TRA asked for the Commissioner's written submission and the decision was made on the papers.
The disputant argued that the TRA regulations, being "an imperative statute", required the Commissioner to file a Notice of Defence by 24 November 2014. The Commissioner had not done so and as such, the TRA had no jurisdiction to hear the strike-out application.
The TRA dismissed the disputant's Notice of Appearance under Protest to Jurisdiction, finding that the TRA had jurisdiction to hear the Commissioner's strike-out application even though no Notice of Defence had been filed.
The TRA noted that it is well established under the High Court Rules that a party who seeks to strike out a pleading is not required to first file a Statement of Defence. The same approach is taken under the District Court Rules 2014. Although the TRA Regulations do not set out a procedure for an application to strike out a notice of claim, it is provided for under the District Court Rules 2014. The TRA found that it would not be inconsistent with the TRA Regulations if the approach prescribed by the High Court and District Court Rules was applied.
The TRA was also satisfied that it had the discretion to extend the time for filing a Notice of Defence, even when the application for the extension was not made until after the expiration of the time appointed.
Taxation Review Authorities Act 1994, Taxation Review Authorities Regulations 1998, High Court Rules 2008, District Court Rules 2014, Tax Administration Act 1994