THE COMMISSIONER OF INLAND REVENUE V WIKEEPA HC TAU CIV 2008-470-4

THE COMMISSIONER OF INLAND REVENUE V WIKEEPA HC TAU CIV 2008-470-4 28 April 2008IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY CIV 2008-470-4BETWEEN THE COMMISSIONER OF INLAND REVENUE Appellant AND FREDERICK WIKEEPA Respondent Hearing: 28 April 2008 Counsel: H A Wrigley for Appellant No appearance by or on behalf of Respondent Judgment: 28 April 2008(ORAL) JUDGMENT OF HEATH JSolicitors: Ronayne Hollister-Jones Lellman, PO Box 13063, Tauranga Copy to: F Wikeepa, 14 Waimapu Pa Road, TaurangaThe appeal[1] The Commissioner of Inland Revenue (the Commissioner), as informant, appeals by way of case stated against the dismissal of informations laid against Mr Wikeepa in the District Court. The informations alleged that Mr Wikeepa failed or refused to furnish an income tax return and several goods and services tax returns. [2] The questions posed in the case stated require me to consider the scope of s 150D of the Tax Administration Act 1994 (the Act). The central issue is the method by which it was necessary for the Commissioner to establish that the person who answered the summons was, in fact, the same person who had responsibility to furnish the returns and was prosecuted for failing or refusing to do so.Background[3] Mr Wikeepa lives at 14 Waimapu Pa Road, Tauranga. A person by that name, who gave that address, applied for registration under that name for GST purposes. That person did not file GST returns for the periods ended 30 November 2005, 31 January 2006, 31 March 2006, 31 May 2006 and 31 July 2006. Nor did he furnish an income tax return by 8 July 2006 for the tax year ended 31 March 2006. [4] On 4 October 2006 an officer with the Commissioner's office at New Plymouth wrote to Mr Wikeepa (at the address given) asking him to telephone or discuss any problems in furnishing the returns. The letter concluded by stating that if contact was not made by 16 October 2006, recovery action might be taken. [5] Another letter was sent on 17 November 2006, noting that no reply had been received to the earlier letter. Mr Wikeepa was advised that, by failing to furnish the returns, an offence had been committed under s 143 of the Act. Returns were requested by 1 December 2006. [6] Early the following year, correspondence was exchanged between the Commissioner and Mr Wikeepa. Mr Wikeepa contended that demands that hefurnish returns were unlawful on Mäori sovereignty grounds. For example, I refer to his letter of 28 March 2007 which he concluded with the words:God Save the Queen your boss my equitable partner.[7] Correspondence continued to be exchanged, but to no avail. In due course, Mr Wikeepa was advised that failure to furnish the returns would result in commencement of prosecution proceedings. [8] Informations were laid in the District Court on 15 May 2007. One alleged the commission of nine offences of failing to furnish GST returns. The other alleged failure to furnish a specified income tax return. No plea was entered, because Mr Wikeepa did not recognise the jurisdiction of the Court. His failure to enter pleas was taken as a denial of the charges. Not guilty pleas were entered on his behalf. [9] The charges were heard on 11 October 2007, in the District Court at Tauranga before Judge Bidois. Mr Wikeepa was present during the course of the hearing. However, he did not participate in it, save to make submissions protesting the jurisdiction of the Court, at the conclusion of the evidence. The Judge reserved his decision. All charges were dismissed in a judgment given on 21 November 2007. [10] Judge Bidois held against Mr Wikeepa on the jurisdictional issues. He was satisfied beyond reasonable doubt that a person by the name of Frederick Wikeepa, who lived at 14 Waimapu Pa Road, Tauranga, failed to furnish income and GST returns for the relevant periods. But, the Judge was not satisfied beyond reasonable doubt that the Commissioner had established that the person answering the summons was the person who had failed to furnish the returns. [11] Accordingly, the central question concerns the need to link the person who answers charges with the person whose obligation it was to furnish returns. In finding that identity had not been proved beyond reasonable doubt, Judge Bidois took the view that s 150D of the Act was to be taken as proving, without more, only that the returns were not furnished by the person against whom the proceeding was brought.[12] In determining that the Informant had failed to establish identity beyond reasonable doubt, the Judge observed that the GST application form did not include a date of birth against which the date of birth on the summons could be checked. He took judicial notice that many people are named after their fathers or grandfathers. He observed that there may be two or three Frederick Wikeepa's living at the address in Waimapu Pa Road. He considered that, in the particular geographic area, families (and generations of the same families) believe in the same philosophy of Mäori sovereignty and te tino rangatiratanga. The Judge took account of the fact that the District Court at Tauranga "had been inundated with prosecutions relating to fictitious GST applications and returns so the face value of such a document cannot be used itself to prove the truth of its contents without more". [13] The Judge found that there was no evidence to establish that the person before the Court had been employed at any time in any capacity. Further, the Judge held as a matter of law, that the s 150D certificate merely asserted that a man by the name of Frederick Wikeepa failed to furnish necessary returns.The case stated[14] Subsequently, on the application of the Commissioner, Judge Bidois agreed to state a case for this Court's opinion. The case poses the following questions:(a) Was I correct that the s 150D certificate proved that a person of the name given in the certificate failed to file tax returns and no more? (b) If not, what does a s 150D certificate prove and, in particular, does it prove that the person against whom the proceedings have been taken is the person who has failed to file the relevant documents. (c) Was I correct in not attaching significance to Mr Wikeepa's silence and failure to cross-examine on the issue of identity?Submissions of counsel for the Commissioner[15] Mrs Wrigley, in support of the appeal, submitted that the Judge had erred in failing to apply s 150D to establish that the person who answered the summons was the same person who had been charged with failing or refusing to furnish the returns. [16] I deal with specific submissions relating to the interpretation of s 150D shortly. Mrs Wrigley's submission was that orthodox principles of statutory construction suggested that s 150D was a provision imposing a reverse onus, such as to create a rebuttal presumption that the person with the obligation of furnishing the returns was the person against whom the prosecution had been brought. If, she submitted, the s 150D certificate provided such a rebuttable presumption, then the evidence had not rebutted it and the Judge ought to have found the charges proved.Analysis[17] Section 150D provides:150D Evidence in proceedings for failure to furnish returns or informationIn any proceedings against a person for refusing or failing to provide a tax return or written information or to produce for inspection any books or documents as and when required by any Act or by the Commissioner, a certificate signed by the Commissioner, that the tax return, information, books, or documents have not been received at the time required shall, in the absence of proof to the contrary, be sufficient evidence that the person has refused or failed to furnish the return, information, books, or documents, as the case may be. (my emphasis)[18] For the purpose of this particular case, the s 150D certificate was in the following terms:Pursuant to section 150D of the Tax Administration Act 1994, I Scott Duncan MacLean, Officer, Return and Debt Collection, Inland Revenue Department at New Plymouth certify that: 1. I am familiar with this matter and am authorised to sign this Certificate on behalf of the Commissioner of the Inland Revenue Department.2. The defendant, Frederick Wikeepa, was required under Sections 15B and 33(1) of the Tax Administration Act 1994 to furnish a return of his income for the year ended 31 March 2006. 3. The due dates for furnishing the return was 7 July 2006. 4. The return referred to in paragraph 2 has not been filed to date. 5. The defendant, Frederick Wikeepa was required by section 16 of the Goods and Services Tax Act 1985 to furnish a return for the periods ended 30 November 2005, 31 January 2006, 31 March 2006, 31 May 2006, 31 July 2006, 30 September 2006, 30 November 2006, 31 January 12007, 31 March 2007. 6. The due dates for furnishing the returns for the above periods were 15 January 2006, 28 February 2006, 28 April 2006, 30 June 2006, 31 August 2006, 31 October 2006, 15 January 2007, 28 February 2007, 7 May 2007 respectively. 7. The returns referred to in paragraph 5 have not been filed to date.[19] A s 150D certificate is designed to prove a link between the person who has been prosecuted ("a person", in the first line of the section) and the person who was required to furnish the return ("the person", in the sixth line). [20] The statute provides that in any proceedings against a person for refusing or failing to provide a tax return, a certificate under s 150D is sufficient evidence that the person has refused or failed to furnish the return in the absence of proof to the contrary. That does not create a presumption. What it does do is to indicate that there needs to be some evidential foundation for the proposition that the person who has answered the summons is not the person required to furnish the returns. In the absence of any evidential foundation to support an identity issue, the s 150D certificate operates to prove identity. [21] The problem with the way in which Judge Bidois addressed the question of identity is that he treated the need to prove identity as independent of the s 150D certificate. The Judge approached the question of identity as if, from all evidence available, it were necessary for the informant to prove identity beyond reasonabledoubt. That is clear from the way in which the Judge dealt with the Informant's submissions on identity. [22] Each of the points made by the Judge (see paras [12] and [13] above) was based on hypothesis that the Mr Wikeepa who answered the summons might not be the Mr Wikeepa whose obligation it was to furnish returns and who was being prosecuted. All rely on the assumption that there is a need to prove identity beyond reasonable doubt independently, of the s 150D certificate. As the Judge said:[22] The failure of the defendant to cross-examine does not affect the informant's obligation to prove identity to the required standard of beyond reasonable doubt. [23] The s. 150D certificate asserts that a man by the name of Frederick Wikeepa, without more, failed to file the necessary returns.[23] The Judge declined to put any weight on Mr Wikeepa's silence on the question of identity or any failure to cross-examine on that issue. That was appropriate because his silence merely left a balance of available evidence from which the Judge could consider whether identity had been proved. As to failure to cross-examine, in the absence of any witness who had seen Mr Wikeepa before or who could identify his signature there were no questions that could have been put by Mr Wikeepa relevant to the question of identity. [24] There was no evidence called at the hearing to suggest that the person who answered the summons was not the person who was being prosecuted for failing or refusing to furnish returns. In the absence of some evidence tending to put identity in issue, the s 150D certificate operated to that element.Result[25] I answer the questions posed in the case stated (set out at para [14] above), as follows: a) No.b) In the absence of some evidence that suggests that puts identity in issue, the s 150D certificate is sufficient evidence, of itself, to prove identity beyond reasonable doubt. c) Yes. [26] For those reasons, the appeal is allowed. [27] In exercising my discretion under s 112(d) of the Summary Proceedings Act 1957, I decline to interfere with dismissal of the informations in the District Court. The case stated has been brought, primarily, for the purpose of clarifying the legal effect of the s 150D certificate. Given that clarification has now occurred, I see no reason to require the charges to be retried. __________________________ P R Heath J