| 6/1/2009 |
Bil-Malti
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| Board of Special Commissioners - Cases |
| Case No. 17/69 |
Decided: 10 August, 1972 |
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Overlapping, non self-contained articles; imposition of additional tax on original assessments; Commissioner not required to substantiate ex officio assessment; Commissioner's personal responsibilities; changes to original objection - article 52 and 53 ITA, now 30, Income Tax Management Act
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The Board analysed in detail the interpretation being repeatedly given to a number of articles of the Income Tax Act in taxpayers' preliminary pleas. It held that:-
It is often submitted that each article or sub-article of the Act is a self-contained empowering one and the Commissioner, in making an assessment, may not simultaneously make use of the powers vested in him by and apply the provisions of the various articles/sub-articles. Though generally speaking articles or sub-articles do not overlap, there are instances in Maltese legislation where one cannot apply an article to the exclusion of others. A notable case in point is the various subsections of articles 52 and 53.
Fiscal law is to be interpreted literally and sub-article 52(1) cannot be construed to mean that the Commissioner is bound to make an assessment strictly within the year of assessment. Such interpretation would imply that the provisions of article 52 apply exclusively to the state of affairs before the lapse of the year of assessment and article 53 to situations arising thereafter. The operative phrase, however, is "as soon as may be" and no specific time limit is stipulated. Articles 52 and 53 are, indeed, overlapping ones. The period of prescription laid down in article 53, for instance, is also binding in the case of taxpayers who might not have been assessed as required by the provisions of article 52. This despite the fact that such an assessment would be an original and not an additional one.
Given the overlapping of articles 52 and 53, the additional tax in the event of default or omission imposed in terms of article 25 is applicable on original assessments even though reference in made specifically to article 53 which, taken in isolation, relates only to additional assessments. In regards the imposition of additional tax the law makes no distinction between original and additional assessments. The only condition laid is that the Commissioner is satisfied that an omission was made.
The Commissioner is not obliged to substantiate ex officio| assessments. Indeed had it been so he would be required to submit proof supporting his action whereas at law the onus of proof rests with the taxpayer.
The Commissioner cannot delegate the determination of ex officio assessments, remission of additional tax and decisions regarding objections. His staff may carry out the groundwork for him but the ultimate responsibility lies with him personally.
The Board may authorise changes to the pleas by appellant solely with a view of clarifying his objection. A taxpayer who originally requested the annulment of an assessment cannot, however, at the objection stage be allowed to correct his objection and request also a reduction in tax. This is an essential element and constitutes a fresh appeal submitted outside the legal timeframe. The Board cannot consider an appeal that is, in the circumstances, legally invalid.
An appeal was entered before the Court from this decision. The appeal was subsequently ceded.
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