The bottom line for review of an assessment - a case note on commissioner of taxation v Futuris Corporation Ltd

Abstract

Decisions of the Taxation Commissioner are prima facie reviewable, pursuant to s 75(v) of the Constitution and s 39B of the Judiciary Act 1903 (Cth), for jurisdictional error. However, the Income Tax Assessment Act 1936 (Cth) (‘ITAA 1936’) provides significant buffers to the ability of a court to review the Taxation Commissioner’s decisions. The tension between the general principle of the reviewability of the decisions of Commonwealth officers on the one hand, and the intention of Parliament to protect the Taxation Commissioner’s decisions from judicial review on the other hand, was addressed by the High Court in Commissioner of Taxation v Futuris Corporation Ltd (‘Futuris’). The context, scope and purposive approach to statutory construction, as refined by the Gleeson Court, is subtly underscored in Futuris by the policy consideration of protecting the public revenue. This is manifest in the Court’s construction of ss 175 and 177(1) of the ITAA 1936 which limits challenges to notices of assessment made under the Act. Despite refuting a privative clause construction on these provisions, the Court did not limit the protections that these provisions afford to assessments. Instead, the Court upheld the effectiveness of the provisions in both limiting and conditioning the exercise of a court’s jurisdiction to review taxation assessments. Challenging a court’s jurisdiction through the operation of a privative clause is fraught with difficulties; it is more effective to limit or condition the grounds of review.