Roytrin Nominees Ltd et Al v The Board of Inland Revenue et Al
| Jurisdiction | Trinidad & Tobago |
| Judge | Kelsick, C. |
| Judgment Date | 10 March 1971 |
| Court | Tax Appeal Board (Trinidad and Tobago) |
| Docket Number | I 19-24/1968 |
| Date | 10 March 1971 |
Tax Appeal Board
Kelsick, C.
I 19-24/1968
Wells, Q.C. and Michael De La Bastide for the appellants.
Procope, Q.C. and Kong for the respondent.
Cases referred to:
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(1) Payne v. British Time Recording Co. Ltd. and Curtis Ltd. [1921] 2 K.B. 1.
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(2) Horwood v. Statesman Publishing Company Ltd. [1929] All E.R. Rep. 554; (1929) 98 L.J.K.B. 450; 141 L.J. 54.
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(3) Daws v. Daily Sketch [1960] 1 W.L.R. 126; [1960] All E.R. 397.
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(4) Market & Co. v. Knight Steamship Co. [1908–10] All E.R. Rep. 1031; [1910] 2 K.B. 1021; 19 L.J.K.B. 939.
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(5) City Center Properties (Overseas) Ltd v. B.I.R. (1967–77) 1 T.T.T.C. 371.
Application for consolidation of appeals.
Civil Practice and Procedure - Statement of Claim — Amendment — whether the Statement of Case should have been amended where there was insufficient information to answer a part of the claim — Onus to prove the assessment was excessive or wrong — Consideration of Norman v. Goulder (1945) 26 TC 293, X Ltd. v. B.I.R (No. I 88 of 1967) and Dixon v. Grant Ltd. (1944) 29 TC 289 — Finding that the onus of converting the factual assumptions on which an assessment was made on taxpayer — Finding that the Statement of Case should be sent back for amplification — Finding that the Statement of Case should be amended — Sections 43D (5) and 50(6) of the Income Tax Ordinance — Rule 28 and 29 of Appeal Board Rules — Order 18, rule 7 (E) — Section 34(1) of the Income Tax Ordinance
The revenue was the respondent in six appeals in which the appellants differ. The respondent is seeking to consolidate the appeal. The Board gave a ruling for amplification of the paragraph with respect to an alleged artificial transaction. In compliance with this order the respondent provided a more detailed statement of case. The decision on the application for consolidation of the appeals was postponed until the more detailed statement of case was given. No further evidence was adduced at the hearing.
The Notices of Appeal were filed in respect of the chargeable income about half of which purported to be additional income under the Income Tax Ordinance, s. 39(4). The chargeable income was to represent profits from the sale of land by Edrob Ltd. to Savannah Development Company. Each of the appellants was assessed as the agent and some as Attorney or manager of Edrob. The respondent in their statement of case alleged that the sale was artificial.
the main purpose of the rule is to avoid needless expenses where it can be done without doing injustice to anyone; it will be seen from the notices of appeal that there are common questions of law and fact to be decided in each case, a joint trial will therefore save time and expenses, further it does not appear that any of the appellants would suffer any unjust or unfair embarrassment at such a joint hearing.
Order made for consolidation of appeals.
On the 30th December, 1970 I gave a ruling on an application made by the appellants for amplification of several paragraphs of the Statements of the Case of the Respondent in these appeals. I acceded to this request in respect of paragraph 13 only, in which it was alleged in the alternative that the sale of the lands from Edrob Ltd. (hereafter called “Edrob) to Savannah Development Ltd. (hereafter called the “Savannah”), the alleged profit on which the Respondent is seeking to tax, was an artificial transaction.
Complying with the directive on 13th January, 1971, the Respondent alleged that the transaction is artificial in that —
A. Edrob and Savannah were not dealing with each other at arm's length.
B. The consideration agreed to be paid by Savannah could not be regarded as a true consideration having regard to the value of the land purchased and the consideration paid by Edrob and the price paid for the same land by Savannah without any improvement being made thereto.
C. On the same day the following series of transactions took place: — I. Savannah borrowed $650,000.00 from the Royal Bank of Canada.
2. Savannah paid Edrob $728,044.62
3. Edrob repaid Savannah $684,790.62
4. Savannah repaid the Royal Bank of Canada $650,000.00
Decision was postponed on a prior application (heard simultaneously) by the Board of Inland Revenue (hereafter called “the Revenue”) for consolidation of all the above-mentioned appeals until the order made on the appellants' application was complied with or otherwise. The application for consolidation came on for hearing again on 10th February, 1971.
Mr. Procope elected not to present any further arguments to those advanced by him at the previous hearing. Mr. Wells pointed out that if the contentions in paragraph 13 were to succeed there would be no profit and no tax. He contended that the particulars supplied took the matter no further and should be disregarded in arriving at a decision concerning consolidation. Mr. Procope concurred in this view.
The Court enquired of Mr. Procope whether paragraph 11 of the Statements of Case in which the “Bahamas Trust Company Ltd.” was referred to is the same entity as the “Trust Corporation of the Bahamas Ltd.” mentioned in paragraph 6 of the Notice of Appeal of Roytrin Nominees Ltd. (referred to hereafter as “Roytrin). He indicated that he may at a later stage ask for an amendment after he has checked on his instructions.
In reply to a question from the Court Mr. Procope stated that the “same day” referred to in paragraph C of the amplification was a date unknown in the year 1961.
I now turn my attention to the Revenue's application for consolidation. The relevant allegations of fact are set out in my ruling of 30th December, 1970 and will not be repeated in detail.
Rule 11 is in the following terms: –
Where two or more appeals are pending, then if it appears to the Court–
(a) that some common question of law or of fact arises in both or all of them; or
(b) that the rights to relief claimed therein are in respect of or arise out of the same transaction or series of transactions; or
(c) that for some other reason it is desirable to make an order under this rule,
the Court may, on the application of any party, order those appeals to be consolidated on such terms as it thinks just, or may order them to be tried at the same time, or one immediately after another, or may order any of them to be stayed until after the determination of any other of them.
The wording follows that of 0. 4, r. 10 of the English Rules of the Supreme Court, hereafter indicated as “(E)”. As pointed out in a note to this order (1970 Edn. of the “White Book” at p.26) the main purpose of consolidation is to save costs and time.
In deciding whether or not to order consolidation I am guided by the considerations propounded by Scrutton, L.J., in Payne v. British Time Recording Co. Ltd. and Curtis. Ltd. [1921], 2 K.B. 1, at page 16, which he repeated in Horwood v. Statesman Publishing Co. Ltd. [1929], All E.R. Rep. 554, at page 558. These were:–
The result of the later decisions is that you must look at the language of the rules and construe them liberally, and that where there are common questions of law or fact involved in different causes of actions you should include all parties in one action, subject to the discretion of the court, if such inclusion is embarrassing, to strike out one or more of the parties. It is impossible to lay down any rule as to how the discretion of the court ought to be exercised. Broadly speaking, where claims by or against different parties involve or may involve a common question of law or fact, bearing sufficient importance in proportion to the rest of the action to render it desirable that the whole of the matters should be disposed of at the same time, the court will allow the joinder of plaintiffs or defendants, subject to its discretion as to how the action should be tried.
This passage was cited by Wilmer, L.J., in Daws v. Daily Sketch [1960], 1 All E.R. 397, at page 399. In that case an application to consolidate two actions of libel by separate plaintiffs against the same defendants was refused because no summons had been served in one of the actions as required by the rules. Apart from this factor there were very distinctive differences in the issues and defences to both actions.
In Horwood's case two individuals sued the proprietors, publishers and printers of the New Statesman newspaper for damages for a libel in respect of the same words. The printers applied for consolidation of the actions under O. 49, r. 8(E), a rule which in its effect was similar to rule 11. The statements of claim in both actions were almost identical; both plaintiffs were represented by the same Counsel who were instructed by the same solicitor. The defence of the publishers and of the editor was fair comment and the printers pleaded an apology accompanied by a payment into Court. Concerning the causes or matters which could be consolidated, Sankey, L.J., thought that the rules should be interpreted widely, and at page 560 he expressed the opinion that–
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