Decision Impact Statement
Panayi v Deputy Commissioner of Taxation
 HCASL 238
 NSWCA 93
2017 ATC 20-618
(2017) 319 FLR 228
Venue Reference No: S152 of 2017
Judge Name: Gageler and Keane JJ
Judgment date: 14 September 2017
Appeals on foot: No
Decision Outcome: Favourable to the Commissioner
This decision has no impact on any related advice or guidance.
Outlines the ATO's response to this case which concerns the application of the lockdown director penalties provisions as introduced by the Tax Laws Amendment Act 2012.
Brief summary of facts
The ATO commenced proceedings to recover liabilities due under the director penalty regime against the taxpayer in his capacity as director of a company. The taxpayer defended the proceedings on grounds inter alia that he was not a director of the company at the relevant time and that the liability had been remitted when members of the company resolved that it be wound up voluntarily. The success of this argument depended on the application of section 269-30 of Schedule 1 to the Taxation Administration Act 1953 (Cth) (TAA) in its unamended form as in force before 30 June 2012.
The primary judge applying the decision of the Western Australian Court of Appeal in Roche v. Deputy Commissioner of Taxation  WASCA 196 at  -, rejected the arguments and held that the amended form of section 269-30 of Schedule 1 to the TAA applied to the appellant's penalty because the appellant, as a director of the company, did not stop being under the relevant obligation under section 269-15 of Schedule 1 to the TAA until after 30 June 2012, the date of commencement of item 9 of the Tax Laws Amendment Act 2012. Applying that section as amended, subsection (1) did not apply to effect a remission of the appellant's penalty because the company did not give the Commissioner any notification under section 16-150 of Schedule 1 to the TAA within the period of three months after the due date for the payment of any of the withheld amounts.
Issues decided by the court
The issue in the appeal as relevant to the special leave application was limited to:
- whether the primary judge erred in applying the amended form of section 269-30 of Schedule 1 to the TAA.
The Court of Appeal held that an amendment that prospectively alters a person's unexercised opportunity to have a liability remitted does not engage the common law presumption that statutes do not have a retrospective operation.
The High Court refused to grant special leave and dismissed the application with costs.
ATO View of Decision
The decision accords with the ATO's view of the application of the lockdown director penalties provisions as introduced by the Tax Laws Amendment Act 2012.
We invite you to advise us if you feel this decision has consequences we have not identified. Please forward your comments to the contact officer.
| Date Issued:
||14 March 2018
| Due Date:
||11 April 2018
| Contact officer:
| Email address:
||02 9374 2281
Civil Procedure Act 2005 (NSW)
Corporations Act 2001
Evidence Act 1995 (NSW)
Taxation Administration Act 1953
Tax Laws Amendment (2012 Measures No 2) Act 2012
Items 8, 9
Uniform Civil Procedure Rules 2005 (NSW)
Abbott v. Minister for Lands
 AC 425
Alcan (NT) Alumina Pty Ltd v. Commissioner of Territory Revenue
(2009) 239 CLR 27
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Australian Securities Commission v. Marlborough Gold Mines Ltd
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(1993) 177 CLR 485
Colley v. Futurebrand FHA Pty Ltd
(2005) 63 NSWLR 291
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Deputy Commissioner of Taxation of the Commonwealth of Australia v. Woodhams
(2000) 199 CLR 370
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(2000) 43 ATR 757
2000 ATC 4141
Farah Constructions Pty Ltd v. Say-Dee Pty Ltd
(2007) 230 CLR 89
Federal Commissioner of Taxation v. SNF (Australia) Pty Ltd
(2011) 193 FCR 149
 FCAFC 74
2011 ATC 20-265
(2011) 82 ATR 680
Gray t/as Clarence Valley Plumbing Services v. Ware Building Pty Ltd
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Maxwell v. Murphy
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(1957) 96 CLR 261
Perish v. R
(2016) 92 NSWLR 161
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Roche v. Deputy Commissioner of Taxation
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Seltsam Pty Ltd v. McGuinness
(2000) 49 NSWLR 262
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