Trend Finance (Pty) Ltd and Another v Commissioner for the South African Revenue Service and Another (8712/01) [2005] ZAWCHC 55; [2005] 4 All SA 657 (C); 2006 (2) BCLR 304 (C); 67 SATC 334 (8 August 2005)

Trend Finance (Pty) Ltd and Another v Commissioner for the South African Revenue Service and Another (8712/01) [2005] ZAWCHC 55; [2005] 4 All SA 657 (C); 2006 (2) BCLR 304 (C); 67 SATC 334 (8 August 2005)

The court found that the true transaction value of the imported footwear was higher than the amounts declared by the applicants, as evidenced by the dealings between Kedah and Pep Stores. The Controller's determination of underpayment was therefore justified and the appeal to set it aside was refused. However, the determination imposing a penalty in lieu of forfeiture was set aside on review under PAJA, as the applicants were not afforded procedural fairness: they were not notified of the intention to exercise discretion nor given an opportunity to make representations. The court further held that the provisional payments made for the release of the second and third consignments should be...

Citation
[2005] ZAWCHC 55
Parties
Applicant: Trend Finance (Pty) Limited; Applicant: Trend Gear Enterprises (Pty) Limited; Respondent: Commissioner for the South African Revenue Service; Respondent: Controller of Customs, Cape Town
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
8 August 2005
Case Number
8712/01
Procedural Posture
Review Application / Final Judgment After Oral and Affidavit Evidence
Outcome
The application to set aside the Controller's determination of underpayment was refused. The determination imposing a penalty in lieu of forfeiture was set aside on review. The first applicant's claim for repayment of provisional payments was refused, but the second applicant was awarded repayment of R900,000 plus...
Judges
Van Reenen
Legal Topics
Customs Duty Underpayment, Procedural Fairness, Promotion of Administrative Justice Act, Refund of Provisional Payments, Judicial Review, Import Permit Regulation
Tax Law Administrative Law Customs Duty Underpayment Procedural Fairness Promotion of Administrative Justice Act Refund of Provisional Payments Judicial Review Import Permit Regulation

Case Brief

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Parties

Trend Finance (Pty) Limited

Applicant

Trend Gear Enterprises (Pty) Limited

Applicant

Commissioner for the South African Revenue Service

Respondent

Controller of Customs, Cape Town

Respondent

Procedural Posture

Review Application / Final Judgment After Oral and Affidavit Evidence

Legal Issues

  1. 1 Whether the Controller's determination of underpayment of customs duty and VAT in respect of the first consignment should be set aside on appeal or review.
  2. 2 Whether the applicants are entitled to repayment of provisional payments made for the release of detained consignments.
  3. 3 Whether the determination imposing a penalty in lieu of forfeiture was procedurally fair under PAJA.

Ratio Decidendi

The court found that the true transaction value of the imported footwear was higher than the amounts declared by the applicants, as evidenced by the dealings between Kedah and Pep Stores. The Controller's determination of underpayment was therefore justified and the appeal to set it aside was refused. However, the determination imposing a penalty in lieu of forfeiture was set aside on review under PAJA, as the applicants were not afforded procedural fairness: they were not notified of the intention to exercise discretion nor given an opportunity to make representations. The court further held that the provisional payments made for the release of the second and third consignments should be...

Court Disposition

The application to set aside the Controller's determination of underpayment was refused. The determination imposing a penalty in lieu of forfeiture was set aside on review. The first applicant's claim for repayment of provisional payments was refused, but the second applicant was awarded repayment of R900,000 plus...

Orders

  • Prayer 1 of the Notice of Motion is refused.
  • The determination in the second respondent's letter of 29 March 2001 is reviewed and set aside only to the extent that it imposed a penalty in lieu of forfeiture.