CRRC E-LOCO SUPPLY (Pty) Ltd v Comissioner for the South African Revenue Service (37766/2021) [2022] ZAGPPHC 527; 85 SATC 463 (18 July 2022)

CRRC E-LOCO SUPPLY (Pty) Ltd v Comissioner for the South African Revenue Service (37766/2021) [2022] ZAGPPHC 527; 85 SATC 463 (18 July 2022)

The court found that SARS was entitled to issue third party notices under section 179(6) of the Tax Administration Act without prior final demand, as the senior SARS official had reasonable grounds to believe that giving notice would prejudice the recovery of the tax debt. The applicant failed to provide guarantees as agreed, and the risk of expatriation of funds justified the urgency. The applicant was afforded sufficient procedural fairness through extensive prior correspondence. The allegations of dishonesty and tax fraud were largely uncontroverted, and the applicant's response was vague and unsupported by evidence. The court held that the decision was rational and not reviewable, and...

Citation
[2022] ZAGPPHC 527
Parties
Applicant: CRRC E-LOCO SUPPLY (Pty) Ltd; Respondent: Commissioner for the South African Revenue Service
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
18 July 2022
Case Number
37766/2021
Procedural Posture
Review Application / Judgment
Outcome
Application dismissed with costs, including costs of two counsel.
Judges
N Davis
Legal Topics
Tax Debt Collection, Third Party Notice, Tax Administration Act, Procedural Fairness, Audi Alteram Partem, State Capture Tax Investigation
Tax Law Administrative Law Tax Debt Collection Third Party Notice Tax Administration Act Procedural Fairness Audi Alteram Partem State Capture Tax Investigation

Case Brief

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Parties

CRRC E-LOCO SUPPLY (Pty) Ltd

Applicant

Commissioner for the South African Revenue Service

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether SARS was entitled to issue third party notices under section 179(6) of the Tax Administration Act without prior final demand.
  2. 2 Whether the senior SARS official had reasonable grounds to dispense with the final demand requirement.
  3. 3 Whether the applicant was afforded sufficient procedural fairness before the third party notices were issued.

Ratio Decidendi

The court found that SARS was entitled to issue third party notices under section 179(6) of the Tax Administration Act without prior final demand, as the senior SARS official had reasonable grounds to believe that giving notice would prejudice the recovery of the tax debt. The applicant failed to provide guarantees as agreed, and the risk of expatriation of funds justified the urgency. The applicant was afforded sufficient procedural fairness through extensive prior correspondence. The allegations of dishonesty and tax fraud were largely uncontroverted, and the applicant's response was vague and unsupported by evidence. The court held that the decision was rational and not reviewable, and...

Court Disposition

Application dismissed with costs, including costs of two counsel.

Orders

  • The application is dismissed with costs, including the costs of two counsel.