Commissioner of Inland Revenue v Fiji Bank and Finance Sector Employees Union [2012] FJHC 1058; Judicial Review 17.2006 (2 May 2012)

IN THE HIGH COURT OF FIJI AT SUVA
CIVIL JURISDICTION

JUDICIAL REVIEW NO. 17 OF 2006

In the matter of
an application by the Commissioner of Inland Revenue for leave to apply for Judicial Review in the form of an Order of Certiorari.:

and

In the matter
of Order of the Court of Review dated 24th November 2005.

BETWEEN:

COMMISSIONER OF INLAND REVENUE
APPLICANT

AND:

FIJI BANK AND FINANCE SECTOR EMPLOYEES UNION
RESPONDENT

Appearances: Mr D. Solanki for the applicant
Mr V.Kapadia for the respondent
Date of hearing: 21 November, 2011

JUDGMENT

1. This is an application by the Commissioner of Inland Revenue (Commissioner) to judicially review a decision dated 24th November,2005, made by the Court of Review established under the Income Tax Act(cap 201).The decision granted the Fiji Bank and Finance Sector Employees Union(Union), a stay order on the recovery of taxes against the Commissioner's demand. The relief sought is an order of certiorari to quash the decision and a declaration that the Court of Review has acted ultra vires.
   

The application is supported by an affidavit filed on behalf of the Fiji Island Revenue & Customs Authority(FIRCA).

2. The respondent, in its notice of opposition, states that the grounds set out in the application deal with the merits of the decision rather than the decision making process and that the Court of Review has not made any errors of law .
   
3. The determination

The Union, in its written submissions, has opposed the grant of leave on two grounds. The first is the delay in bringing this application, in terms of Or 53 rule 4 (2) of the High Court Rules. The second is that the Court of Review has jurisdiction to grant a stay of proceedings on the recovery of taxes.

At the hearing, Mr Kapadia, counsel for the Union argued that the decision to stay was made by the Court of Review on 6th September,2005, and hence the delay was 8 months.

I find that argument to be a misreading of that decision .The Court of Review held generally that it has jurisdiction to hear a stay application. The penultimate paragraph of that decision, provides that the "grant of stay in any proceedings will of course depend on the merits of each case". The order to stay the recovery proceedings on the Union's tax and penalties was subsequently made on 24th November,2005, upon the Union filing application for stay with a supporting affidavit on 17 October,2005.

The reasons given by the Commissioner for the delay was that, in the first instance, he filed notice of appeal against the impugned decision on 21st December,2005, following the procedure adopted in an identical appeal in the case of Commissioner of Inland Revenue and Gurdial Singh Brothers Limited, (Civil Appeal No. 15 of 2005). In that case, Justice Coventry, in a judgment delivered on 16th December, 2005, had held that the VAT Tribunal does not have powers to issue orders for stay, pending the final determination of appeal. The Legal Division of the FIRCA, upon reading the Respondent's written submissions filed on 25 April, 2006, had come to the conclusion that the appeal was misconceived and on 28 April, 2006, had withdrawn its appeal. Justice Coventry had then, dismissed the notice of appeal and awarded costs of $1,500 to the Union. Thereafter, the Commissioner had filed these proceedings on 12 May,2006, within a period of 14 days from the date of the dismissal of the notice of action.

The Court of Appeal in Harikisun v Singh, (1996) FJCA 15 declared:

"Undue" means, "excessive, extreme, unjustifiable or going beyond what is appropriate".

I am satisfied that a justifiable explanation had been provided for the delay . I do not consider that the delay has caused hardship to the Union. The Union was aware that the impugned decision was being challenged from the outset.

Mr Kapadia placed, at the forefront of his case the decisions in State v PSC, ex parte Nasalasala,[1997] FJHC 141 and Waqaitanoa v Commissioner of Prisons,[1997] FJHC 141. In the first case, the court had dismissed the application for judicial review, since the applicant had not explained his delay in applying for relief.

In Waqaitanoa v Commissioner of Prisons, the solicitors for the applicant had inadvertently failed to file a motion within 14 days as required by Or 53, r 5, after leave had been granted to move for judicial review, resulting in a delay of seven months. The court held that no satisfactory explanation had been provided for the delay.

The differentiating feature in the present case, is that steps had had taken to challenge the decision of the Court of Review within a month, albeit the wrong procedure was adopted. Thereafter, this application was promptly filed.

I pass now to the second question to be considered namely, whether the Commissioner has made out a prima facie case for the grant of leave to apply for judicial review.

This is said by both counsel to turn on the meaning to be attributed to Section 63 of the Income Tax Act,1974( Cap. 201), which is in these terms:

"..........the said Court of Review shall, for the purpose of hearing and determining the Appeals referred under this Act referred to it have powers and authority similar to those vested in the High Court as if Appeal were an action between the taxpayer and the Commissioner".

Mr Solanki, counsel for the Commissioner submitted the Court of Review has limited powers and does not have inherent jurisdiction to stay the recovery of tax.

The written submissions filed on behalf of the Union asserted that although the Court of Review was a statutory court, it has wide powers similar to those vested in the High Court. In support, reference was made to the case of Pacific Transport Limited v Land Transport Authority& Sunbeam Transport Ltd,(High Court Civil Action No. 126 of 2004) which held that the Land Transport Appeal Tribunal had power to stay a decision of the authority in terms of the Land Transport Act. This case was also relied on in support by the Court of Review. The answer to this contention was that the relevant provision in the Income Tax Act is differently worded .

All this being said, the contentions of counsel raise the question whether the Court of Review was acting within its powers. I am of the view that given the Commissioner has sufficient interest in this matter, there is an arguable case. Accordingly, in the exercise of my judicial discretion, I grant the Commissioner leave to apply for judicial review.

4. Orders
   

1. The application for leave to apply for judicial review is allowed.
2. I make no order as to costs.
   

A.L.B. Brito – Mutunayagam
Judge
2nd May, 2012