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You are here: BAILII >> Databases >> Irish Court of Appeal >> J.S.S. & Ors v Tax Appeal Commission & Anor [2020] IECA 73 (13 March 2020)
URL: http://www.bailii.org/ie/cases/IECA/2020/2020IECA73.html
Cite as: [2020] IECA 73
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THE COURT OF APPEAL
Neutral Citation Number: [2020] IECA 73
Record Number: 2019/222
Donnelly J.
Ní Raifeartaigh J.
Power J.
BETWEEN
J.S.S., J.S.J., T.S., D.S. AND P.S.
APPELLANTS
- AND –
TAX APPEAL COMMISSION
RESPONDENT
- AND –
CRIMINAL ASSETS BUREAU
NOTICE PARTY
JUDGMENT of Ms. Justice Power delivered on the 13th day of March 2020
1. This is an appeal against the judgment of the High Court delivered on 5 April 2019
wherein the trial judge refused to grant an order of certiorari in respect of a series of
decisions made by an Appeal Commissioner of the Tax Appeal Commission (‘the
Commissioner’) following a preliminary hearing on whether certain tax appeals sought by
the appellants should be admitted. The hearing before the Commissioner was held on 21
June 2017 and his decision issued on 26 April 2018. Essentially, the Commissioner
admitted appeals in respect of years wherein the appellants had delivered tax returns and
he refused to admit appeals in respect of years in which either no tax returns had been
delivered and/or no self-assessed tax liabilities had been paid. It was in respect of the
decision to refuse to admit certain appeals that judicial review proceedings were
instituted. The central complaint in the judicial review proceedings concerned the alleged
failure of the Commissioner to provide reasons for his decision not to admit the aforesaid
appeals.
Background
2. The appellants—a father and his four sons—are members of the Irish Travelling
community and have addresses in Rathkeale, County Limerick. Living a nomadic lifestyle,
they stay in their caravans and work as tarmacadam contractors in various locations
abroad for several months each year. Their primary claim before the Commissioner was
that as members of the travelling community they were non-resident or not ordinarily
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resident for tax purposes in Ireland. That being so, they claimed, that the relevant
provisions of the Taxes Consolidation Act 1997 (‘the 1997 Act’), which required the
delivery of tax returns and/or the payment of self-assessed tax liabilities as a pre-
condition to the admission of an appeal, did not apply to them as non-residents.
3. On 31 March 2016, the notice party—the Criminal Assets Bureau (‘CAB’)—issued to the
appellants or to a number thereof, various income tax assessments or amended income
tax assessments in respect of years ranging from 2004 to 2014 inclusive. The appellants
disputed these assessments and by letter dated 26 April 2016 asked to have appeals
admitted to the Tax Appeal Commission in relation thereto. CAB claimed that the
appellants’ income tax compliance history had varied over the years in question. It had no
objection to appeals being admitted in respect of years in which tax returns had been
delivered and/or self-assessed tax liabilities had been paid. However, it did object to the
admission of appeals in respect of years where either no tax returns had been delivered
and/or where self-assessed tax liabilities had not been paid. Its objection in this regard
was based on its contention that the appellants had failed to fulfil the statutory conditions
required for the admission of an appeal.
4. The respondent arranged for a preliminary hearing pursuant to s. 949E(2) of the 1997 Act
to decide whether the appeals, to which CAB objected, ought to be admitted.
The Tax Appeal Commission Hearing
5. At the hearing, counsel for the appellants made the following submissions. As members of
the travelling community, they spend very little time—approximately two months per
year—in Ireland. The rest of the year they travel throughout Europe. As non-residents
they are not ‘chargeable persons’. Not being ‘chargeable persons’, they are not obliged to
file returns in Ireland. As non-residents they are obliged to have an agent acting on their
behalf in Ireland and they do—an accountant, Mr. Loughran, from Tralee. The reasons
they were given for the non-admission of their appeals were outstanding taxes and the
failure to file returns. They denied that there were any outstanding taxes. They are not
obliged to file returns because, as stated, they are not chargeable persons. Where a
person is resident in Ireland, income returns are made in that person’s name. Where a
person is not resident in Ireland, that person does not make returns. Returns are made
by that person’s agent. In the case of a non-resident, it is the agent who is responsible,
that is, ‘assessable’ and ‘chargeable’ for tax purposes. The appellants do not spend 183
days in the country in any year or 280 days in any two years. Consequently, they are
clearly non-resident. No issue had ever been taken with this and CAB had certainly not
exercised its right to dispute the question of residence in the manner prescribed.
6. A number of provisions of the 1997 Act were then opened in support of the appellants’
claim that as non-residents they are not ‘chargeable persons’ and thus are not
themselves obliged to file income returns. The first provision to which the Commissioner
was referred was s.18(1)(a) of the 1997 Act. It provides:
“Tax under this Schedule shall be charged in respect of-
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(a) the annual profits or gains arising or accruing to-
(i) any person residing in the State from any kind of property whatever,
whether situate in the State or elsewhere,
(ii) any person residing in the State from any trade, profession, or
employment, whether carried on in the State or elsewhere,
(iii) any person, whether a citizen of Ireland or not, although not
resident in the State, from any property whatever in the State, or
from any trade, profession or employment exercised in the State,
and
(iv) any person, whether a citizen of Ireland or not, although not resident
in the State, from the sale of any goods, wares or merchandise
manufactured or partly manufactured by such person in the State.”
(Emphasis added.)
Counsel submitted that this section establishes that the scope of Schedule D (which
covers taxable business income) is such that whereas a non-resident may certainly be
chargeable within the State, such charge is only in respect of activities that are actually
carried on in the State.
7. The Commissioner was then referred to s. 1034 of the 1997 Act, the relevant part of
which provides:
“A person not resident in the State, whether a citizen of Ireland or not, shall be
assessable and chargeable to income tax in the name of any trustee, guardian,
or committee of such person, or of any factor, agent, receiver, branch or manager,
whether such factor, agent, receiver, branch or manager has the receipt of the
profits or gains or not, in the like manner and to the like amount as such non-
resident person would be assessed and charged if such person were resident in the
State and in the actual receipt of such profits or gains; . . . .” (Emphasis added.)
It was submitted that this section establishes, clearly, that where a person is non-resident
such a person is not assessable in his or her own name but rather in the name of a
trustee or guardian or agent. The Commissioner’s attention was drawn to the fact that the
section is drafted in mandatory terms. A person not resident in the State shall be
assessable and chargeable in the name of a trustee, guardian or agent. Pursuant to this
section, it was argued, the appellants, as non-resident persons, are not chargeable. They
are obliged to have an agent in Ireland and they do, a Mr. Loughran, based in Tralee.
Their counsel stressed that the key words in the section were ‘assessable’ and
‘chargeable’.
8. The appellants, through their counsel, then referred the Commissioner to s. 950 and to
the definition of the term ‘chargeable person’ contained therein. The definition reads as
follows:
“...‘chargeable person’ means, as respects a chargeable period, a person who
is chargeable to tax for that period, whether on that person's own account or on
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account of some other person but, as respects income tax, does not include a
person…” (emphasis added).
It was submitted that the reference to a person chargeable to tax ‘on account of some
other person’ was deliberately inserted into the definition to encompass agents who,
pursuant to s. 1034 are responsible for accounting for tax on behalf of another (non-
resident) person. Counsel for the appellants stressed that as non-residents the appellants
are neither assessable nor chargeable. It is their agent who is assessable or chargeable.
9. Counsel for the appellants then addressed the Commissioner on the preconditions
imposed on persons seeking the admission of an appeal under Part 41 which are set out
in s. 957(2) and of s. 959AH (1) of the 1997 Act (hereinafter ‘the impugned provisions.’)
The sections are almost identical with the former applying in respect of years of
assessments up to and including 2012 and the latter in respect of assessments for the
year of 2013 et seq. It is sufficient to recite only one of the impugned provisions and
where reference is made hereafter to one, it includes the other. Section 959AH (1)
provides:
“Where a Revenue officer makes a Revenue assessment, no appeal lies against the
assessment until such time as-
(a) Where the assessment was made in default of the delivery of a return, the
chargeable person delivers the return, and
(b) In all cases, the chargeable person pays or has paid an amount of tax on
foot of the assessment which is not less than the tax which –
(i) is payable by reference to any self-assessment included in the
chargeable person’s return, or
(ii) where no self-assessment is included, would be payable on foot of a
self-assessment if the assessment were made in all respects by
reference to the statements and particulars contained in the return
delivered by the chargeable person.” (Emphasis added.)
The appellants submitted that the tax payer referred to in the above section and in s.
957(2) is clearly the ‘chargeable person’. Essentially, such a chargeable person is
prohibited from bringing an appeal against an assessment unless he or she has delivered
a return and/or has paid an amount of taxes on foot of the assessment. Those specific
pre-conditions apply only to chargeable persons. Counsel submitted that he had
demonstrated, clearly, that the appellants are not ‘chargeable persons’ having regard to
the provisions of s. 1034 and s. 950 of the 1997 Act. Consequently, the appellants were
not caught by the pre-conditions set out in the impugned provisions. Such pre-conditions
do not apply to them and, therefore, do not present obstacles to the admission of their
appeals.
10. That being so, it was submitted that in circumstances where the appellants sought to
appeal an assessment, their application for the admission of such appeal falls to be
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determined pursuant to the terms of s. 933. That section deals with appeals, generally. It
provides:
“(1) (a) A person aggrieved by any assessment to income tax or corporation tax made on
that person by the inspector or such other officer as the Revenue Commissioners
shall appoint in that behalf (in this section referred to as “other officer”) shall be
entitled to appeal to the Appeal Commissioners on giving, within 30 days after the
date of the notice of assessment, notice in writing to the inspector or other officer.
(b) Where on an application under paragraph (a) the inspector or other officer is of the
opinion that the person who has given the notice of appeal is not entitled to make
such an appeal, the inspector or other officer shall refuse the application and notify
the person in writing accordingly, specifying the grounds for such refusal.
(c) A person who has had an application under paragraph (a) refused by the inspector
or other officer shall be entitled to appeal against such refusal by notice in writing
to the Appeal Commissioners within 15 days of the date of issue by the inspector or
other officer of the notice of refusal.”
That section contains no restrictions or pre-conditions such as those contained in the
impugned provisions. The appellants submitted that to refuse to admit their appeal based
on unfulfilled pre-conditions that did not and do not apply to them as non-residents was
‘completely unjust’ in circumstances where ‘everybody knows’ that the appellants are
non-resident. The balance of fairness and justice lay with admitting their appeals. If one
is not obliged to make a return because one is non-resident, then one’s failure to make
such a return cannot be used as a reason for refusing the admission of an appeal. That
was the central point made by the appellants at the preliminary hearing before the Appeal
Commission.
11. All the appellants had travelled from abroad to attend the hearing. However, as it was a
preliminary matter and not itself an appeal under s. 933 or s. 824 (which deals with the
right to have the question of residence heard and determined) their counsel was reluctant
to put them into evidence. If the hearing were, in fact, an appeal then their evidence
would be relevant. The fact that they had filed returns for certain years did not change
the fact that they remained non-resident and, as such, had no obligation to file returns.
The fact that their agent had inserted ‘not normally resident in Ireland’ on returns that he
had filed on their behalf did not affect the factual situation which is that all the appellants
were non-resident.
12. Counsel for CAB responded by identifying the matters that appeared not to be in issue
between the parties, including, that there were no returns for certain periods and that
certain monies which appeared due and owing had not been paid. He then made the
following points. There had been no submission made, no factual reason offered as to why
a return should not be required at this stage. No reason had been given for not filing a
return. Returns can be filed on a without prejudice basis. Nothing had been advanced by
way of evidence or submission demonstrating any difficulty in complying with the
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legislation. The Commissioner is bound to operate on the explicit words of the legislation.
It is difficult to see how the interests of justice could be engaged where no reason was
given for not filing a return. The legislation operates to deprive the appellants of an
appeal because of a choice that they have made. The Revenue Officers approached their
tasks seriously and carefully. The appellants did not point to any place of residence. All
they were saying is that wherever it is, it is not Ireland. It is difficult to understand how
that statement could be made in circumstances where there was no ‘global picture’. From
certain references made at the hearing it was established that ‘economic activity’ is being
carried on. There was a whole range of factors to occupy the Commissioner at this stage.
The 1997 Act and the requirements of the Act are clear. No reason other than a
determination not to comply with the relevant section had been offered. An affidavit had
been submitted late in the day, but it did not appear to contain anything to which violent
objection could be taken.
13. The Commissioner clarified that it was his understanding that the appellants were not
making any admission in relation to alleged outstanding liabilities. He questioned whether
he was obliged to take evidence in relation to the factual basis for an assertion by the
Bureau to the effect that ‘These are not valid appeals because these two statutory pre-
conditions are not met’. Counsel for CAB answered ‘If you wish’ but he thought that this
would tend to turn matters around and he did not want to ‘set a hare running in terms of
examining and cross-examining’. He was anxious to preserve ‘the mechanism of the
forum and the mechanism of the legislation’.
14. The Commissioner then asked to be addressed on the argument that the appellants are
not chargeable persons and that, therefore, s. 957(2) and/or s. 959AH simply do not
apply. Counsel for CAB stated that there was no basis being laid for the proposition that
the appellants are not chargeable persons. He pointed to factors, including, the presence
of economic activity, the appellants’ presence in the State for ‘a period of time’ and the
possession of substantial assets there – as matters of fact and matters of evidence in the
hearing. He also pointed to the fact that for a number of years the appellants did file
returns of the type they now seek to step away from. He then cited the provisions of s.
957 of the 1997 Act. He said a chargeable person means no more than is evident from
the definition section as a person who is capable of being charged.
15. The Commissioner than asked to be addressed on the arguments in relation to s. 1034 to
the effect that their non-residence meant that it was their agent and not the appellants,
personally, against whom an assessment ought to have been raised. Counsel for CAB
presumed that this would be an argument to be raised in relation to the appeals that are
pending. Claiming ‘You have got the wrong person. You should have raised it in the name
of somebody else’ was an argument that can be made. He had yet to hear what ‘the
pattern of business’ and ‘the factual position’ was in relation to the appellants. The
appellants’ position was based on suppositions for which the ground work had not been
respondent argued, unsuccessfully, for the same distinctions between ‘a charge to tax’
and whether ‘a person was a chargeable person’. Counsel hoped he was not treating the
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issue of the agent too lightly. He then moved to the question of s. 824. He found it
difficult to see how that sat with the overarching argument being made by the appellants.
He found it difficult to see how the arguments ‘found purchase’ when the legislation is
clear about what should happen and clear about the consequences of not doing it.
16. Counsel for the appellants, in reply, queried how assessments could have been raised by
the respondent if it did not know ‘the factual position’ of the appellants. He rejected the
contention that he was ignoring the legislation. On the contrary and for the avoidance of
doubt, he had sought precisely the opposite, namely, to rely upon the legislation. He
asked that CAB would do the same as legislation cuts both ways. Everything revolves
around whether the appellants are chargeable persons or not. The impugned provisions,
relied upon by the respondent, have no relevance if the appellants are non-resident and
not chargeable persons. He traced, once again, the statutory provisions from s. 950 to s.
1034. It was clear that non-resident taxpayers are not taxable persons on their own
account. Rather, the person who is chargeable to tax is the agent. To say that they should
file returns is completely wrong. If CAB wanted returns it should have requested them
from the agent.
17. Counsel for the appellants submitted that CAB was fully aware that residence was an
issue. This was clear from the papers and, if necessary, an issue could have been raised
and further details sought in relation to movements etc. Submissions on residence could
have been made and a decision thereon taken which would then have been subject to an
appeal. The relevant procedures in this regard are set out in s. 824 of the Act and these
should have been followed if residence were an issue. This had not happened. All
witnesses were present. The law applies to CAB as well as to the appellants.
18. The Commissioner asked to be addressed on a point made by counsel for the Bureau,
namely, that to accept the appellants’ arguments in relation to the non-applicability of the
impugned provisions would be tantamount to a finding on ‘a substantive issue in the
appeals’, namely, that the appellants are not chargeable persons. He questioned whether
he could only accept that argument if he found as a matter of fact on the question of
residence. Counsel for the appellants replied that the hearing was ‘a preliminary issue’
and that the Commissioner was entitled to make a ‘without prejudice’ finding and there
was nothing to prevent him reversing that when the substantive argument was made.
Further, there was nothing to stop the Inspector of Taxes from making a decision under s.
824 (on the issue of residence) and that would become an appeal in itself. Section 824
constitutes a separate appeal and is not a preliminary issue. Section 824 confers a right
on any person aggrieved by a decision of an officer as to residency to make an
application, within a specified time, to have the question heard and determined. The
taxpayer can claim to be resident or non-resident, but then it falls to an authorised officer
of the respondent to make a decision in that regard. Non-residence was asserted, and no
issue was made on that point. Instead, CAB sought to rely on Part 41 (dealing with self-
assessment). However, if non-residents are not chargeable persons then Part 41 fails; it
falls out.
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19. Insofar as counsel for CAB indicated that the appellants would have to be questioned on
the number of visits carried out in the State and so forth, they had no issue with that. It
could either be done at the substantive hearing or become the subject of an appeal on the
issue of residence. When asked by the Commissioner if their interpretation of the
impugned provisions would result in those sections being made nugatory, counsel replied
that Part 41 was the starting point. Whether or not one is a ‘chargeable person’ will
determine whether one falls within or beyond Part 41 of the Act. The provisions in relation
to a person who is non-resident are certain. Once a person is non-resident he or she is
not a chargeable person. Non-residents do not file returns. Non-residents are not
chargeable or assessable to tax. Their agents may be but they themselves are not. So,
when the Revenue is raising an assessment on non-residents they raise it on the
accountant or agent. The sections referred to by the Commissioner (the impugned
provisions) ‘had chargeable persons all over them’. One needed to start with the
definition of a ‘chargeable person’ and then establish whether a taxpayer comes within
the scope of that definition or not. He had attempted to navigate the Commissioner
through the legislation, taking him from s. 118 to s. 1034 to s. 950.
20. The Commissioner stated that it was for him to interpret the legislation in accordance with
the established principles. Counsel for the appellants replied that tax legislation required a
strict interpretation and that where a doubt exists, it is the taxpayer who is accorded the
benefit. As the hearing came to an end, the Commissioner acknowledged that the
appellants had travelled for the hearing. He was also mindful that their counsel did not
wish to tender them to give evidence at this stage unless he, the Commissioner, was
satisfied that such evidence was necessary then rather than at a substantive hearing. He
was not satisfied that the taking of evidence was necessary at this juncture. He indicated
that notwithstanding the nature of the hearing, he intended to give a written decision on
the preliminary issue adding that such was warranted.
21. Some ten months later the decision of the Commissioner issued. It was communicated to
the appellants by letter dated 26 April 2018. It stated that the Commissioner:
“. . having carefully considered the arguments advanced on behalf of the
appellants and on behalf of the respondent . . . has decided that the provisions
of Section 957(2) . . . and Section 959AH (1) . . . of the Taxes Consolidation
Act 1997, as amended, are applicable to the appellants and the obligations to
submit returns and to pay tax as a pre-condition to the bringing of an appeal must
be satisfied by the appellants before their appeals can be accepted by the Tax
Appeals Commission. . . . Accordingly, where your clients have failed to deliver a
return or failed to pay their self-assessed tax liabilities in respect of a particular
year, the Tax Appeals Commission has decided not to accept the appeal for that
year.” (Emphasis added.)
The High Court
22. The appellants sought judicial review of the Commissioner’s decision, or series of
decisions in respect of specific years, primarily, on the basis that they were not provided
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with adequate reasons. On 23 July 2018 an order was made, ex parte, granting leave to
apply for judicial review seeking, inter alia:
(i) an order of certiorari quashing the series of decisions of the Commissioner;
(ii) an order pursuant to Order 84, rule (20)(8) of the Rules of the Superior Courts
staying the further pursuit of the appellants in respect of the sums allegedly due to
the revenue commissioners on foot of the assessments which are the subject
matter of the appeals refused by the Commissioner in his decision.
23. In the High Court judgment, the trial judge set out several provisions of the 1997 Act and
noted that pursuant to s. 959AH—prima facie—before a person’s appeal will be heard, the
‘chargeable person’ must have filed a return in respect of the relevant period and paid the
sum due on foot of that return. He quoted s. 58(1) which provides, inter alia, that profits
are taxable even if Revenue does not know of their source. He noted that pursuant to ss.
18(1)(a)(iii) and (iv) of the Act a person can be a ‘chargeable person’ even where that
person is not resident in the State.’ He did not, however, allude to the fact that those
provisions refer to tax in respect of trade, profession or employment ‘exercised in the
State’. He then set out to consider whether the decision of the Commissioner should be
invalidated because of the failure of the Appeal Commissioner to give reasons for that
decision.
24. In considering the decision of 26 April 2018, the trial judge’s decision emphasised that no
oral or documentary evidence had been provided before the Commissioner to show that
the appellants were not tax resident in Ireland. The appellants’ claims as to their tax
residency merely rested upon ‘bare assertions’. He also noted that there was some
documentary evidence of tax residency in Ireland in respect of the years for which tax
returns had been filed. A number of authorities were considered, including, Connelly v An
proposition that there existed a duty to give reasons. The trial judge cited Hardiman J.’s
approval in Oates v Browne [2016] 1 I.R. 481 of the judgment of Murphy J. in
O’Donoghue v An Bord Pleanála [1991] ILRM 750 whereby it was held that the reasons
stated by the decision maker must ‘satisfy the persons having recourse to the tribunal,
that it has directed its mind adequately to the issue before it.’
The trial judge also cited the judgment of Peart J. in the case of Criminal Assets Bureau v.
McCarthy [2019] IECA 140 recalling that although it may be possible to:
“discover some paragraph that might have been better phrased, or where some
particular piece of evidence has not been analysed in detail and a conclusion
reached upon it. But that is not a ground upon which to set aside the judgment
unless the perceived defect represents a fundamental flaw in the judgment such
that it is fatally undermined.”
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25. On this basis it was held that given the lack of evidence to prove the appellants’ non-
residency in the State, they could not but have known why the Commissioner found
against them. The application for an order of certiorari in respect of the Commissioner’s
decisions was therefore refused on the basis that reasonable information was provided to
the appellants as to why the Commissioner had refused to admit their appeals.
Grounds of Appeal
26. By notice of motion dated 27 July 2018, the appellants sought to set aside the High Court
order made on 12 April 2019. The principal grounds relate to the absence of reasons
accompanying the Commissioner’s series of decisions refusing to allow their appeals.
More specifically, the appellants claim that the High Court judge erred in fact and/or in
law in:
1. holding that the respondent had given adequate reasons sufficient to enable the
court to review his decision;
2. holding that the respondent had given adequate reasons sufficient to satisfy the
person having recourse to the Tax Appeals Commissioner that it had directed its
mind adequately to the issue before it;
3. deciding and making a determination on an issue of fact in a Judicial Review
application that the appellants were chargeable persons in the jurisdiction in the
relevant period;
4. holding that the lack of oral or documentary evidence provided by the appellants to
support their claim of non-residency in Ireland was the most important factor,
disregarding that the Appeals Commissioner stated that he did not wish or need or
require oral evidence from the appellants at the hearing;
5. holding that the Commissioner might have said more clearly that he rejected the
argument that the appellants were not resident in Ireland because there was no
evidence to support that proposition because this would have rendered the hearing
procedurally unfair;
6. failing to consider the submission to the Commissioner that the fifth applicant was a
minor and on that basis alone failed to consider the submission that the appeal bar
set out in s. 957 of the Taxes Consolidation Act 1997 did not apply for the income
tax years 2005 and 2006;
7. holding that ‘there could be no question that justice has not been seen to be done,
by the relative brevity of the Appeal Commissioner’s decision, since any observer of
the proceedings would have seen that no evidence was provided to support a
finding of residence somewhere other than Ireland’ in circumstances where it was
argued before the Appeals Commissioner that there was no need for residence
anywhere and it was sufficient that the appellants were not resident in Ireland;
Page 11 ⇓
8. holding that ‘this was not a case of intellectual exchange, with reasons and analysis
advanced on either side, where the decision maker must enter into the issues
canvassed before him and explain why he prefers one case over the other’ in
circumstances where the Appeals Commissioner had stated that there was no need
for the appellants to give oral evidence and the entire hearing consisted of an
intellectual exchange; and
9. failing to have regard to the fact that in submissions to the Appeals Commissioner
the issue of non-residency was assumed by the appellants not to be in issue.
The appellants submitted that, in all circumstances, the Commissioner’s decision was
wrong in principle and in law.
The Parties’ Submissions
27. The appellants submitted that the Commissioner should have provided adequate reasons
as to why their appeals were rejected. Where a tax residency dispute arises, the default
rights set out in s. 933 and s. 949 of the Act apply. The appellants should have a right of
appeal on this issue without any such obligations as filing an income tax return and/or
payment of income tax due on foot of this return. Not to do so would be prejudicial to the
claimed a necessity for decision makers to provide reasons for their decisions. The trial
judge misapplied Criminal Assets Bureau v. McCarthy [2019] IECA 140 in his finding that
sufficient information was given to them. Mallak v Minister for Justice, Equality and Law
Reform [2012] 3. I.R. 297 should be applied. The Commissioner had failed to engage with
their central argument that an individual not tax resident in the State cannot be a
chargeable person and that obligations to be fulfilled prior to an appeal, to include the
filing of an annual return and the payment of tax, fall upon their agent. As no
determination was made by the Commissioner on the issue of non-residency, the High
Court was incorrect in refusing the relief sought by finding the Commissioner’s decision
was supported by adequate reasons.
28. CAB acknowledged that the essential facts of the case were not in dispute; rather, it was
the interpretation of the legislative provisions of the Act and the interpretation of the
established legal principles that were contested. The Commissioner’s statement during
the hearing that he did not require the appellants to give evidence was acknowledged.
Had oral and documentary evidence been provided by the appellants, it may have
required more involved reasoning by the Commissioner in his determination. The
appellants could still have been called by their own counsel to give evidence. The High
Court found that a person can fall within the definition of ‘chargeable person’ even while
not being resident. No appeal lies against an assessment unless s. 959AH of the Act has
been complied with. Section 959AH does not disapply the provisions of the Act which
require returns to be filed and tax paid, providing, in subs. (3):
“Where the provisions of the Acts relevant to the appeal concerned require
conditions specified in those provisions to be satisfied before an appeal may be
made, a notice of appeal shall state whether those conditions have been satisfied.”
Page 12 ⇓
References to s. 1034 of the Act were not relevant to the matter at issue. The High Court
was correct, and the jurisprudence had been applied correctly. The trial judge was correct
in his finding that while more involved reasoning may have been required had additional
evidence been before the Commissioner, the appellants were in no doubt as to the
reasons for his decision, and accordingly, this appeal should be dismissed.
Legal Principles
29. When reviewing a discretionary decision of the High Court on appeal, the approach to be
taken by this Court has been summarised by Irvine J. in Collins v. Minister for Justice
[2015] IECA 27. At para. 79, Irvine J. stated that the true position is as set out by
MacMenamin J. in Lismore Homes, namely:-
“. . . that while the Court of Appeal (or, as the case may be, the Supreme Court)
will pay great weight to the views of the trial judge, the ultimate decision is one for
the appellate court, untrammelled by any a priori rule that would restrict the scope
of that appeal by permitting that court to interfere with the decision of the High
Court only in those cases where an error of principle was disclosed.”
30. The requirement of a strict construction to taxation statutes has been confirmed in a
number of decisions of the Irish courts. In Inspector of Taxes v Kiernan [1981] IR 117
where the assessment of income tax pursuant to s. 78 of the Income Tax Act 1967 was in
issue, the Supreme Court (Henchy J.) held at p. 122 that:
“when a word or expression is used in a statute creating a penal or taxation
liability, then if there is looseness or ambiguity attaching to it, it should be
construed strictly so as to prevent the fresh imposition of liability from being
created unfairly by the use of oblique or slack language.”
‘there is a countervailing principle that where there is an ambiguity a taxing statute will
be interpreted in favour of the taxpayer.’
31. It is also a well settled principle of Irish law that a public law decision maker is obliged to
give reasons for decisions made. The obligation was stated in the following terms by
“An administrative decision affecting the rights and obligations of persons should at
least disclose the essential rationale on foot of which the decision is taken. That
rationale should be patent from the terms of the decision or capable of being
inferred from its terms and its context. Unless that is so then the constitutional
right of access to the courts to have the legality of an administrative decision
judicially reviewed could be rendered either pointless or so circumscribed as to be
unacceptably ineffective.”
Page 13 ⇓
32. The Irish courts have long recognised that the absence of reasons can lead to a decision
being quashed for unreasonableness (State (Daly) v. Minister for Agriculture [1987] I.R.
165); that reasons are necessary where a right of appeal is allowed (Pok Sun Shum v.
Ireland [1986] ILRM 593); and, that reasons must be given to an applicant who has a
right to re-apply for a licence (International Fishing Vessels v. Minister for the Marine
[1991] 2 I.R. 93). These cases embrace a broad range of circumstances. The Supreme
Court in Mallak v Minister for Justice, Equality and Law Reform [2012] 3. I.R. 297 rejected
the contention that where a decision maker is exercising an ‘absolute discretion’ he is
discharged from the obligation to provide reasons. Fennelly J., giving the judgment of the
Court, noted that ‘the rule of law requires all decision-makers to act fairly and rationally’.
He recalled the overarching principle that:
“persons affected by administrative decisions should have access to justice, that
they should have the right to seek the protection of the courts in order to see that
the rule of law has been observed, that fair procedures have been applied and that
their rights are not unfairly infringed.”
The furnishing of reasons, according to Fennelly J, is an intrinsic aspect of the fairness of
proceedings. He stated at para. 68: -
“In the present state of evolution of our law, it is not easy to conceive of a decision
maker being dispensed from giving an explanation either of the decision or of the
decision making process at some stage. The most obvious means of achieving
fairness is for reasons to accompany the decision. However, it is not a matter of
complying with a formal rule: the underlying objective is the attainment of fairness
in the process. If the process is fair, open and transparent and the affected person
has been enabled to respond to the concerns of the decision maker, there may be
situations where the reasons for the decision are obvious and that effective judicial
review is not precluded.”
the Chief Justice reiterated the two principal bases for the obligation to provide
reasons. Firstly, a person is entitled to have enough information to consider whether they
can or should seek to avail of any appeal or bring judicial review of a decision. Secondly,
the reasons provided must be such as to allow a court hearing an appeal from or
reviewing a decision to engage properly in such an appeal. Of course, there may be
debate about the extent to which decisions require to be reasoned and about the level of
detail required. On that point, Clarke C.J. in A.P. v Minister for Justice and Equality
[2019] IESC 47, confirmed that notwithstanding such debate, the party affected must always be
enabled to identify the reasons for the decision and must be able to challenge this
decision by way of judicial review if necessary.
75) that:
Page 14 ⇓
“A tribunal, or other decision-maker which is under a duty to give reasons for its
decision, should, as part of this process, give some outline of the relevant facts and
evidence upon which the reasoning is based. This does not in any sense, mean that
a determination must set out all of the evidence; but it should set out such
evidential material which is fundamentally relevant to its decision or determination;
still more if such relevant evidence is not disputed.
…
There is already a rich and evolved jurisprudence on the duty of deciding bodies to
give reasons … Parties to a decision are entitled to know why they have won or lost,
as a matter of fair procedure, and in order to decide whether to appeal. But parties
are also entitled to be assured that, in making a decision, an administrative or
curial tribunal has had regard to very relevant evidence which arguably had the
potential to be potentially determinative of an issue, if not the claim, before it.”
In Nano Nagle v Daly, whilst the Supreme Court found that a thorough investigation had
been carried out by the Labour Court, it nevertheless held that significant and relevant
material had not been recorded or properly evaluated and, on this basis, it quashed the
decision of the Labour Court.
Discussion
35. The extent to which, if at all, significant and relevant material which had been opened to
the Commissioner was, in fact, evaluated by him falls to be considered in this appeal.
Whilst it is recognised that not every situation of every administrative tribunal requires to
be subjected to ‘minute analysis’, a review of the jurisprudence demonstrates,
unequivocally, that parties to litigation have a right to be apprised of the basic reasons
why decisions that concern them have been made. It is, therefore, necessary to assess,
on the facts of this case, whether the appellants were furnished with reasons as to why
their application to admit appeals—which they claimed did not fall within the impugned
provisions—was nevertheless refused admission by the Tax Appeal Commissioner.
36. The first matter to be observed is that the hearing before the Commissioner on 21 June
2017 was a hearing held pursuant to s. 949E(2) of the 1997 Act. It was arranged,
specifically, for the purpose of deciding whether or not the appeals sought by the
appellants should be admitted in the context of CAB having objected to their admission
because, in its view, the preconditions necessary for an appeal as laid down in ss. 957(2)
and 959AH had not been met. The appellants’ starting point was that those very
preconditions laid down in the impugned provisions did not apply to their application.
They applied only to a ‘chargeable person’ and as the appellants were not ‘chargeable
persons’ under the Act, they could not and did not apply to them. Through their counsel,
they had submitted a careful, detailed and structured analysis of a number of statutory
provisions which, they claimed, led to the conclusion that they were not ‘chargeable
persons’. On that basis, the preconditions which applied to chargeable persons before
their appeal could be heard, did not apply to them. Their appeals, it was argued, did not
fall to be determined under those impugned provisions but rather fell to be determined by
Page 15 ⇓
way of a general appeal whether under s. 933 or under s. 824. In these circumstances,
whether they had fulfilled the preconditions of the impugned sections was irrelevant.
37. It is clear from the foregoing that the legal question to be decided by the Commissioner
was whether the preconditions contained in the impugned sections apply to a non-
resident having regard to the Act’s definition of what constitutes a ‘chargeable person’.
The factual question as to whether the appellants were de facto non-resident would only
need to be addressed if their argument on the legal one succeeded.
38. A review of the transcript demonstrates that, at various stages throughout the hearing,
the Commissioner made interventions which indicated that he understood and engaged in
exchanges on the issue at the heart of the appellants’ submission. For example, the
Commissioner queried whether he needed to take evidence in relation to the factual basis
for CAB’s assertion that ‘These are not valid appeals because these two statutory pre-
conditions are not met’ (at p. 42). Counsel for CAB suggested that the taking of evidence
would tend to turn matters around, to ‘set a hare running in terms of examining and
cross-examining’. He was anxious to preserve ‘the mechanism of the forum and the
mechanism of the legislation’. In so replying, it appears that counsel for CAB may not
have appreciated that it was the application of that very legislative mechanism to the
appellants’ request for the admission of their appeals that was being challenged in the
preliminary hearing. The Commissioner did not pursue the question.
39. Another example of the Commissioner’s manifest understanding of and engagement in
the appellants’ position was when he asked to be addressed on the argument that they
were not chargeable persons and that, therefore, the impugned provisions did not apply
to them (at p. 45 of the transcript). Counsel for CAB replied that ‘There was no basis
being laid’ for the proposition that the appellants are not chargeable persons. It must be
said that even a cursory reading of the transcript discloses that, in fact, a detailed legal
basis had been laid for the proposition espoused by the appellants. Their counsel had
presented a study of statutory provisions on the meaning of a ‘chargeable person’ in the
context of non-residence, the interpretation of which provisions, in his view, led to no
other conclusion but that the appellants were not chargeable persons and that,
consequently, the impugned provisions which applied to chargeable persons did not apply
to them. Without addressing the legal issue at the heart of the Commissioner’s request,
counsel for CAB replied only in terms of the factual situation of the appellants.
40. The Commissioner’s engagement during the hearing with the appellants’ core argument
may be seen, once again, when he asked to be addressed on the submission that s. 1034
meant that because of their non-residence it was the appellants’ agent and not they
themselves against whom an assessment ought to have been raised (see p. 49 of the
transcript). Counsel for CAB replied in terms of wanting to hear ‘the pattern of business’
and ‘the factual position’ in relation to the appellants. He said he ‘hoped he was not
treating the issue of the agent too lightly’. It appears, perhaps, that he was, because he
did not address the Commissioner on the question of agency. He pointed out that the
legislation was ‘clear about what should happen and clear about the consequences of not
Page 16 ⇓
doing it’ without, apparently, appreciating that it was the application of that very
legislation to the appellants’ situation that was the subject of the challenge in the
preliminary hearing.
41. The above interventions demonstrate that the Commissioner had understood the essence
of the appellants’ submissions at the preliminary hearing. Indeed, at the end of the
hearing, he stated that it was for him to interpret the legislation in accordance with the
established principles. Having regard to the interventions made by the Commissioner and
to the analysis of provisions of the Act which had been opened to him in support of the
argument that the impugned provisions did not apply to the appellants, one cannot but be
struck by the brevity of the Commissioner’s reply. Essentially, his response was - ‘They
do!’ The letter of 26 April 2018 states that having considered the arguments advanced by
both parties, the Commissioner decided the impugned provisions are applicable to the
appellants. Since the appellants had failed to comply with the required preconditions in
those provisions, their appeals were not accepted.
42. The letter acknowledges that the Commissioner had ‘carefully considered’ the arguments.
However, it does not articulate, even summarily, why he had rejected them. At the very
least, as a matter of fair procedure, the appellants were entitled to know why their
arguments had failed or, in other words, why they had lost (see Nano Nagle v Daly). The
decision that issued does not provide any reason as to why, nor any explanation as to
how, the Commissioner arrived at the conclusion that the impugned provisions apply to
the appellants. At no stage does he address, let alone weigh, the principal arguments
raised by the appellants to the effect that the pre-conditions contained in the impugned
provisions refer to a ‘chargeable person’ and, since they are not ‘chargeable persons’
because of their non-residence, the provisions do not apply to them. Although he had
stated that it was for him to interpret the legislation in accordance with the established
principles, no such interpretation was offered by way of an alternative to the one carefully
set out by the appellants.
43. Furthermore, there is no evidence in the letter of 26 April 2018 which demonstrates that
the Commissioner had addressed his mind to any of the arguments raised by the
appellants. For example, at no stage is it explained why he considers the appellants to be
chargeable persons. At no stage does he address the question of their agent (as distinct
from the appellants) being the appropriate ‘chargeable person’ under the Act. At no stage
does he consider, let alone determine, the issue of the residence or non-residence of the
appellants. Nor does he address whether a determination under s. 824 of the Act (a
determination on residence) ought to have been made. At no stage is it explained why
the general provisions of s. 933 relating to appeals should not apply to the appellants. It
had been pointed out to him that under s. 933 ‘any person aggrieved by an assessment
was entitled to an appeal’ without the preconditions contained in the impugned
provisions. Without identifying even one of arguments raised by the appellants, the
Commissioner simply proceeded to find only that the impugned provisions were applicable
to them. That being so and those preconditions not having been met, he then refused to
Page 17 ⇓
admit the appeals. Such a failure to engage in any way with any of the points raised by
the appellants is problematic, to say the least.
44. In the High Court, the trial judge noted, by reference to ss. 18(1)(a)(iii) and (iv) of the
1997 Act, that a person can still fall within the definition of ‘chargeable person’ even
where that person is not resident in the State. However, those provisions insofar as they
concern profits or gains accruing to any non-resident person, refer, expressly, to profits
or gains arising from the sale of goods or wares manufactured ‘in the State’ or from any
trade, profession or employment ‘exercised in the State’. The appellants’ case was that as
non-resident tarmacking contractors, they carried on their business outside the State at
various locations in other EU countries. A substantial part of the trial judge’s reasoning
centred on the question of residence. He held against the appellants, noting that no
documentary evidence had been provided by them to support their contention that they
were not tax resident in Ireland nor was any documentation tendered to suggest they
were tax resident in any other jurisdiction. He considered that the case before the
Commissioner was based solely on the submissions of counsel rather than evidence. On
this last points, two comments are apposite—the first on the question of submissions and
the second on the issue of residence.
45. Firstly, it is true that the case before the Appeal Commissioner was based, substantially,
on the legal submissions of counsel (although the appellants had, in fact, travelled to be
available, if required, to give evidence at the hearing). Their counsel had, in the first
instance, raised an issue concerning the correct legal interpretation of the term
‘chargeable person’. He provided a detailed analysis of specific legal provisions which, to
his mind, led to two conclusions:
(i) that the term ‘chargeable person’ did not include a non-resident person; and
(ii) that as the appellants were non-resident they were not chargeable.
The first conclusion was a legal one—purely a matter of statutory interpretation—and,
thus, a question for submission; the second was a factual one—to be determined on the
basis of evidence.
46. To my mind, the Commissioner was obliged, at the very least, to consider and determine
whether the appellants’ submission on (i) above was correct (Step 1). He was obliged to
address his mind to the interpretation of the provisions that had been offered by the
appellants. If that interpretation was not correct, then he was obliged to explain, even
briefly, why. Had he so found, then, to my mind, he would have been discharged from
proceeding to consider (ii) above, since chargeability and residence were unquestionably
intertwined in the submission offered by the appellants. At that point, having explained
why he rejected the submission that the appellants were not chargeable persons, the
Commissioner would have been entitled to find that the impugned provisions applied and
that in default of compliance with the necessary pre-conditions, the appeals would not be
admitted. Had he so done, the appellants would have known why the interpretation of the
Page 18 ⇓
provisions upon which they relied was incorrect and why they did, in fact, come within the
terms of the impugned provisions.
47. If, on the other hand, at the end of Step 1, the Commissioner had concluded that the
interpretation offered by the appellants was correct in law and that the term ‘chargeable
person’ did not include a non-resident person, then he would have been obliged to move
to Step 2 and to consider whether the appellants’ submission to the effect that they were
non-resident (and, therefore, not chargeable) was correct. It is only at this stage of the
process of consideration that the taking of evidence would have been necessary in order
to make a such a determination. If he had found—based on evidence that was called and
tested—that the appellants were non-resident (for some or all of the years in question)
then they would have succeeded in establishing that the admission of their appeals (in
respect of the relevant years of non-residence) was not to be determined in accordance
with the impugned provisions which contained the aforesaid preconditions. If,
alternatively, the Commissioner had found—based on evidence that was called and
tested—that the appellants were resident in Ireland for tax purposes, then he would have
been entitled to find that the appellants, being resident, were chargeable, that,
consequently, they came within the terms of the impugned provisions, that they had not
met the pre-conditions and that their appeals ought not be admitted. What he was not
entitled to do was to bypass Step 1 by ignoring the submissions made as to the meaning
of ‘chargeable person’ under the 1997 Act and proceed to determine Step 2, in the
absence of any evidence and without having offered any reasons as to why he had
proceeded so to do.
48. The second comment to be made in relation to the trial judge’s reasoning concerns the
considerable reliance he placed upon the fact that the appellants had not offered any
evidence (documentary or otherwise) of their alleged non-residence for tax purposes. It
must be said that the question of residence and the taking of evidence in connection
therewith had been raised on several occasions during the preliminary hearing before the
Commissioner. Counsel for the appellants had stated that it was clear from the papers
that the appellants were claiming non-residence. He addressed the Commissioner on what
ought to have happened if their non-residence was in issue. The question of residence
and the right to have that issue heard and determined came within the provisions of s.
824 of the Act. That section contained specific procedures that ought to have been
followed in the event that the tax authorities took issue with a claim of non-residence.
Had those procedures been followed then further details of his clients’ movements could
have been sought and submissions on residence could have been made. Thereafter, a
decision could have been taken which would then, in itself, have become the subject of an
appeal. The relevant procedures are set out in s. 824 of the Act and these procedures
should have been followed by CAB if residence was in issue. CAB was obliged to comply
with the law and this had not happened.
49. Counsel for the appellants had pointed out that his clients had travelled from abroad for
the hearing and that if the Commissioner considered it necessary to hear their evidence
they were available for that purpose. He had ‘no issue’ with them being questioned about
Page 19 ⇓
the number of visits they made to the State (at p. 61 of the transcript). The transcript, to
my mind, does not support a view that counsel for the appellants had failed or neglected
to put his clients into evidence. It appears to me that he was concerned, primarily, with
the logical sequence of proceedings. He was asserting the need to determine, firstly, the
correct legal interpretation of certain statutory provisions before, secondly, deciding the
factual question of residence.
50. It should also be recalled that notwithstanding their presence at the preliminary hearing it
was the Commissioner who decided that he did not wish to hear evidence on the issue of
residence (at p. 64 of the transcript). On any reading of the letter of 26 April 2018, it
seems clear that the decision which ultimately issued was based on the Commissioner’s
presumption that the appellants were resident and were, thus, chargeable persons. In my
view, such a presumption could not have been reached, appropriately, by the decision
maker without his having heard evidence in circumstances where the factual question of
residence was at the heart of the matter in issue once the legal issue as to the meaning of
‘chargeable person’ under the 1997 Act had been determined.
51. The trial judge regarded the central question in the judicial review proceedings as being
whether the wording of the decision of the Commissioner was fatally undermined for want
of reasons. He cited a number of extracts from the relevant jurisprudence and confirmed
that a decision maker must give reasons to ensure that individuals are in no doubt as to
why they have won or lost and so that a court reviewing the decision is satisfied that the
decision maker directed his/her mind to the issue at hand. He also noted that the nature
of the requirement to give reasons would depend on the nature and extent of the
conflicting evidence before the decision maker. In his view, however, ‘the most important
factor’ in considering the appellants’ complaints regarding the Commissioner’s decision
was the fact that they did not provide documentary or oral evidence to support their claim
of non-residence. He took the position that all the Commissioner had to decide was
whether the ‘bare assertions’ made in respect of non-residence should be accepted or not.
With respect to the trial judge, I disagree. My reasons for so doing are set out in paras.
46 and 47 of this judgment.
52. The trial judge, it appears, was inclined to the view that the appellants ‘well knew’ of the
reasons for the refusal to admit their appeals, namely, their failure to produce evidence of
non-residence. This was to overlook the very nature of the application before the
Commissioner which was to hear and rule on a legal submission as to the meaning of a
statutory provision and, thereafter, to apply that ruling to the factual situation of the
appellants. The trial judge, in my view, had insufficient regard to the fact that this was a
preliminary hearing on a legal issue as to whether certain appeals were admissible.
Clearly, their counsel’s reluctance to put them into evidence on the factual issue was
based on the reality that the legal issue had not, as yet, been determined or, as it was
put, that the proceedings had not moved ‘to the substantive issue’ (p. 32 of the
transcript). The preliminary hearing was not an appeal but a request for the admission of
an appeal based on an argument as to the correct construction of certain statutory
provisions.
Page 20 ⇓
53. I have come to the view that the trial judge’s criticism of the appellants’ failure to provide
evidence is misplaced in circumstances where (i) the issue to be decided in the first
instance was a legal one, the outcome of which would then determine whether evidence
on residence was required; (ii) the appellants had travelled for the purpose of being
present at what was a preliminary hearing and where they were available to give oral
evidence as to fact, if required so to do by the decision maker; and (iii) it was, ultimately,
the Commissioner who had decided that he did not wish to hear their evidence at that
stage of the proceedings. To counsel for the appellants he had stated (at p. 64 of the
transcript):
“[Y]ou indicated that you were not proffering your clients to give evidence unless I
was satisfied that it was necessary for me to do so today rather than at a
substantive hearing. And what I’m saying is I’m not satisfied at this juncture
that it’s necessary for them to do so, but I do want to acknowledge the fact
that they travelled for the hearing today . . .” (emphasis added).
Having taken this position, the Commissioner, to my mind, was not entitled to proceed to
determine (or at least to presume) that the appellants were, in fact, resident having
declined to take evidence on point and the trial judge’s criticism of the appellants’ failure
to provide evidence was inapposite in all the circumstances.
54. The trial judge was of the view that this ‘was not a case of an intellectual exchange, with
reasons and analysis advanced on each side, where the decision maker must enter into
the issues canvassed before him and explain why he prefers one case over the other’.
With great respect to the learned judge, I disagree. This was, precisely, a case where an
intellectual exchange had occurred as to the correct statutory construction of the term
‘chargeable person’ under the 1997 Act. A forensic analysis of several statutory provisions
had been presented which, in the appellants’ view, led to one conclusion only as to the
meaning of the term ‘chargeable person’. That was the legal issue. If they succeeded on
that point, then the factual question of residence fell to be determined. On various
occasions throughout the hearing the Commissioner had engaged in that intellectual
exchange and had requested to be addressed on the implications of submissions made
(see paras. 38-40 above). Once that interpretive exercise had been resolved, one way or
another, by the Commissioner, then the question of its practical implications, if any, for
the appellants’ situation required to be addressed.
55. This did not, in fact, occur. On the contrary, both the Commissioner and the trial judge
focused only on the conclusion as to fact (reached in the absence of evidence) that the
appellants were chargeable persons without having addressed the detailed legal
arguments as to why they were not. The decision of 26 April 2018 demonstrates a failure
on the part of the Commissioner to address his mind, adequately, to the issues that had
been raised before him (see Murphy J. in O’Donoghue v An Bord Pleanála). This was not a
case in which ‘some paragraph of the decision’ might have been better phrased (see
Criminal Assets Bureau v McCarthy). This was a case in which no reason at all had been
offered as to why the Commissioner concluded that the appellants’ submission as to the
Page 21 ⇓
correct meaning of the term ‘chargeable person’ was incorrect as a matter of law and,
why it should, therefore, be rejected. Far from being ‘left in no doubt as they why they
lost’ (see Henry L.J. in Flannery v Halifax Estate Agencies Limited) the appellants are left
in a position that, as the losing party, they do not know why the Commissioner has
decided that they are, in fact, chargeable persons and that they thus come within the
terms of the impugned provisions.
56. It is not uncommon for courts to be called upon to rule on a legal submission as to the
meaning of a statutory provision and only, thereafter, to hear evidence in a given case.
This was a case calling for (i) a legal interpretation of the term ‘chargeable person’ and
(ii) the application of that legal interpretation to the factual situation of the appellants.
Having regard to the substantial arguments raised as to the correct interpretation of the
relevant statutory provisions and to the principle that requires a strict interpretation of a
taxing statute (see Harris v Quigley) it was not open to the Commissioner, or to the trial
judge, to fail to consider those arguments.
57. The Commissioner in his decision bypassed the submissions made on the correct
interpretation of certain statutory provisions and proceeded to make a decision founded
upon what can only have been a presumption of residence, the evidential basis of which
had not been established. The result has been that the appellants are left in a situation in
which it appears to them that they have not been ‘heard’. Their detailed legal submissions
were rejected, and they have not been told why. An intrinsic aspect of fairness has thus
been breached.
58. The brevity of the Commissioner’s decision and its silence regarding the submissions
made is all the more remarkable in circumstances where he had, expressly, taken the
view that the arguments raised by the appellants were such that they warranted a written
decision, notwithstanding the preliminary nature of the hearing. Despite his statement to
this effect, a decision issued some ten months after the hearing which failed to address
any of the arguments raised by the appellants. It stated that the impugned provisions did
apply and that in default of the preconditions therein being met, the appellants’ request
for the admission of appeals was refused.
59. The terms of the letter cannot but lead to the conclusion that the Commissioner failed to
engage with any of the substantive arguments, or indeed, with any of the arguments, put
forward by the appellants. As noted by Clarke C.J. in A.P. v Minister for Justice and
Equality the reasons required to be set out by decision makers need not be overly
extensive or detailed. There is no requirement to give a discursive determination such as
might be found in a superior court’s judgment. However, ‘it is equally true that the
reasoning cannot be so anodyne that it is impossible to determine why the decision went
one way or the other’ (see Clarke C.J. in Connelly). This is a case in which it is impossible
to know why the Commissioner rejected the appellants’ core legal argument that a
‘chargeable person’ does not include a non-resident person and to know why he had come
to that view.
60. For the reasons set out in this judgment I would allow the appeal.
Result: Allow appeal