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\i\f0\fs24\insrsid13595768 of }{\i\f0\fs24\insrsid5315415\charrsid13595768 income 
\par }{\f0\fs24\insrsid13595768 
\par }{\i\f0\fs24\insrsid5315415\charrsid13595768 M. }{\i\f0\fs24\insrsid13595768\charrsid13595768 J}{\i\f0\fs24\insrsid5315415\charrsid13595768 . Scott}{\f0\fs24\insrsid5315415\charrsid5770064  for Apellant 
\par }{\i\f0\fs24\insrsid5315415\charrsid13595768 G.M.G. }{\i\f0\fs24\insrsid13595768\charrsid13595768 John}{\i\f0\fs24\insrsid5315415\charrsid13595768 son}{\f0\fs24\insrsid5315415\charrsid5770064  for Respondent 
\par }{\f0\fs24\insrsid13595768 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Appeal by Deputy Commission of Inland Revenue against a decision of the Court of Review where
by it allowed an appeal in respect of an assessment for income tax levied on the respondent as to items which the respondent had treated as deductible from the taxpayer}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 
s total income. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 These items were interest payments. The facts (summarised below) were not in dispute. 
\par 
\par A certain David Neale Wilson and Stanley Harold Quigg wished to acquire an interest in Blue Lagoon Limited, a tour operating company, 53.3% of whose shares were owned by }{\f0\fs24\insrsid13595768 Fairmile}{\f0\fs24\insrsid5315415\charrsid5770064 
 Enterprises Limited in which all the shares were held by Claude Ivan Mi}{\f0\fs24\insrsid13595768 ll}{\f0\fs24\insrsid5315415\charrsid5770064 ar Wilson and Quigg arranged to purchase Fairmile for $800,000. They }{\f0\fs24\insrsid13595768 formed}{
\f0\fs24\insrsid5315415\charrsid5770064  a company Marine Management Ltd. (Respondent) which borrowed $600,000 from a Bank}{\f0\fs24\insrsid9046771 ,}{\f0\fs24\insrsid5315415\charrsid5770064  $120,000 was provided by the shareholders of respondent. The 
respondent was to manage Blue Lagoon for a substantial management fee of 7}{\f0\fs24\insrsid11294854 \'bd}{\f0\fs24\insrsid5315415\charrsid5770064 % gross receipts of Blue Lagoon (ceiling $130,000). In the respondent}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s accounts was $57,778 being interest on the loan of$600,000. The respondent claimed this interest as a deduction from assessable income. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The respondent argued that the interest on the loan should }{\f0\fs24\insrsid13595768 b}{\f0\fs24\insrsid5315415\charrsid5770064 e set off or }{\f0\fs24\insrsid13595768 b}{\f0\fs24\insrsid5315415\charrsid5770064 
e a deduction against the management fee charged }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  respondent}{\f0\fs24\insrsid13595768 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 which was income in the accounts of Fairmile. The deduction was }{\f0\fs24\insrsid13595768 disallowed}{\f0\fs24\insrsid5315415\charrsid5770064 . 
\par }{\f0\fs24\insrsid13595768 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The respondents argument was set out in the Review judgment}{\f0\fs24\insrsid13595768  \endash }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid13595768 "}{\f0\fs24\insrsid5315415\charrsid5770064 ........ it raised a loan from the Bank to buy Fairmile and }{
\f0\fs24\insrsid13595768 thus}{\f0\fs24\insrsid5315415\charrsid5770064  got control of Blue Lagoon, thus to obtain for itself a management fee." "It should be entitled to set off against the}{\f0\fs24\insrsid13595768  }{
\f0\fs24\insrsid5315415\charrsid5770064 income (management fee) interest it was to pay the bank ........ the interest is an expense incurred in producing the income." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid13595768 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The court considered the Income}{\f0\fs24\insrsid13595768  Tax Act s.}{\f0\fs24\insrsid5315415\charrsid5770064 19(}{\i\f0\fs24\insrsid5315415\charrsid9046771 f}{\f0\fs24\insrsid5315415\charrsid5770064 
) and was of the view that the interest paid by the respondent was apportionable}{\f0\fs24\insrsid9046771  }{\f0\fs24\insrsid5315415\charrsid5770064 -}{\f0\fs24\insrsid9046771  }{\f0\fs24\insrsid5315415\charrsid5770064 one ha
lf should be regarded as an expense incurred in respect }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Blue Lagoon shares, i.e.}{\f0\fs24\insrsid13595768  }{\f0\fs24\insrsid5315415\charrsid5770064 
that it was an expense incurred in earning the management fee. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Under s.l7(37) of the Act dividends from a company incorporated in Fiji received by a Fiji resident are exempt from tax. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 S.19 of the Act read}{\f0\fs24\insrsid13595768  }{\f0\fs24\insrsid5770064\charrsid5770064 -}{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 "19. }{\f0\fs24\insrsid5770064  }{\f0\fs24\insrsid5315415\charrsid5770064 
In determining total income, no deductions }{\f0\fs24\insrsid13595768 shall}{\f0\fs24\insrsid5315415\charrsid5770064  be }{\f0\fs24\insrsid13595768 allowed}{\f0\fs24\insrsid5315415\charrsid5770064  in respect of}{\f0\fs24\insrsid9046771  }{
\f0\fs24\insrsid5315415\charrsid5770064 ..................... 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li1430\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1430\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 (b) any disbursement or expense not being money }{\f0\fs24\insrsid13595768 wholly}{
\f0\fs24\insrsid5315415\charrsid5770064  and exclusively laid out or expended for the purpose }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  trade, business, profession, employment or vocation of the taxpayer; }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid9046771 ...............................................
\par ...............................................}{\f0\fs24\insrsid9046771\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li1430\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1430\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 (}{\f0\fs24\insrsid9046771 f}{\f0\fs24\insrsid5315415\charrsid5770064 ) any expense incurred in respect of}{
\f0\fs24\insrsid13595768  }{\f0\fs24\insrsid5770064\charrsid5770064 -}{\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \fi11\li2200\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin2200\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 (i) any amount received, receivable or accrued which is not included in total income or, if so 
included, is exempted under section 16 or 17 of this Act, or is not included in chargeable income under any }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  provisions of this Act; 
\par (ii) any investment or property the income arising from which }{\f0\fs24\insrsid13595768 will}{\f0\fs24\insrsid5315415\charrsid5770064  not be included in total income or,}{\f0\fs24\insrsid13595768  if so}{\f0\fs24\insrsid5315415\charrsid5770064  include
d, }{\f0\fs24\insrsid13595768 will}{\f0\fs24\insrsid5315415\charrsid5770064  be exempted under section 16 or 17 }{\f0\fs24\insrsid13595768 of this}{\f0\fs24\insrsid5315415\charrsid5770064 
 Act, or will not be included in chargeable income under any of the provisions of this Act; }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li2200\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin2200\itap0\pararsid12665911 {\f0\fs24\insrsid12261302 .......................................................
\par .......................................................}{\f0\fs24\insrsid12261302\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li1430\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1430\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 (h) interest, }{\f0\fs24\insrsid13595768 other than}{\f0\fs24\insrsid5315415\charrsid5770064 
 interest actual1y incurred in the production of}{\f0\fs24\insrsid13595768  }{\f0\fs24\insrsid5315415\charrsid5770064 income or interest in respect of a loan obtained by a taxpayer to purchase his own residence}{\f0\fs24\insrsid9469833 ;}{
\f0\fs24\insrsid5315415\charrsid5770064  Provided that in the case }{\f0\fs24\insrsid13595768\charrsid5770064 of interest}{\f0\fs24\insrsid5315415\charrsid5770064  in respect }{\f0\fs24\insrsid13595768 of a}{\f0\fs24\insrsid5315415\charrsid5770064 
 loan obtained by a taxpayer to purchase his own residence}{\f0\fs24\insrsid5770064\charrsid5770064 -}{\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li2200\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin2200\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 (i) he maintains only one residence}{\f0\fs24\insrsid9469833 ;}{\f0\fs24\insrsid5315415\charrsid5770064 

\par (ii) any deduction shall not exceed two hundred dollars per annum; and 
\par (iii) such deduction shal1 not continue on a change of residence except on enforced change." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid13595768 
\par }{\i\f0\fs24\insrsid5315415\charrsid13595768 Held}{\f0\fs24\insrsid5315415\charrsid5770064 : The expenditure of the loan moneys involving payment of interest was solely and exclusively in connection with the respondent}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s }{\f0\fs24\insrsid13595768\charrsid5770064 business}{\f0\fs24\insrsid5315415\charrsid5770064 . }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid13595768 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 ...... the expenditure was}{\f0\fs24\insrsid13595768  }{\f0\fs24\insrsid5315415\charrsid5770064 
not for two separate purposes ......}{\f0\fs24\insrsid13595768 b}{\f0\fs24\insrsid5315415\charrsid5770064 ut for two }{\f0\fs24\insrsid13595768\charrsid5770064 or more}{\f0\fs24\insrsid5315415\charrsid5770064  purposes connected with the company}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s business. }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid13595768\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 the learned Jud}{\f0\fs24\insrsid13595768 ge}{\f0\fs24\insrsid5315415\charrsid5770064  said:}{
\f0\fs24\insrsid5770064\charrsid5770064 -}{\f0\fs24\insrsid12261302 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid12261302 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 "S.}{\f0\fs24\insrsid13595768 1}{\f0\fs24\insrsid5315415\charrsid5770064 9(}{
\i\f0\fs24\insrsid5315415\charrsid6107222 b}{\f0\fs24\insrsid5315415\charrsid5770064 ) does not have any application to this case ....}{\f0\fs24\insrsid13595768\charrsid5770064 if the}{\f0\fs24\insrsid5315415\charrsid5770064 
 (Review) meant this when it said the (respondent) was entitled to succeed on s.l9(}{\i\f0\fs24\insrsid5315415\charrsid6107222 b}{\f0\fs24\insrsid5315415\charrsid5770064 )". I agree. }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid13595768\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 ..}{\f0\fs24\insrsid9469833 .}{\f0\fs24\insrsid5315415\charrsid5770064 ...}{\f0\fs24\insrsid12261302 (}{
\f0\fs24\insrsid5315415\charrsid5770064 Review) erred when it came to consider s.19(}{\i\f0\fs24\insrsid6107222\charrsid6107222 f}{\f0\fs24\insrsid5315415\charrsid5770064 ). }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid12665911 {\f0\fs24\insrsid13595768\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid12665911 {\f0\fs24\insrsid5315415\charrsid5770064 ......In Fiji Regulation "interest has to }{\f0\fs24\insrsid12261302 b}{
\f0\fs24\insrsid5315415\charrsid5770064 e actually incurred in the production of income". 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid6107222 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 So far as the management fee was concerned}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 the expense of the interest in my view played no direct or relevant part in earning the management fee. (Thi}{\f0\fs24\insrsid6107222 s}{\f0\fs24\insrsid12261302 )}{\f0\fs24\insrsid5315415\charrsid5770064  was ea
rned solely as a result of the efforts of the company in the course }{\f0\fs24\insrsid6107222\charrsid5770064 of its}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid6107222 business}{\f0\fs24\insrsid5315415\charrsid5770064 
. The production of the fee involved no expenditure of interest. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid12261302\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The payment of }{\f0\fs24\insrsid6107222 the interest}{\f0\fs24\insrsid5315415\charrsid5770064  on the }{\f0\fs24\insrsid12261302 l}{\f0\fs24\insrsid6107222 o}{\f0\fs24\insrsid5315415\charrsid5770064 
an "was a payment independent of the}{\f0\fs24\insrsid6107222  assessable income (management }{\f0\fs24\insrsid5315415\charrsid5770064 fee) and was not an expenditure incurred in the course of its }{\f0\fs24\insrsid6107222 production"}{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The....interest....was incurred in purchasing the shares in Fairmile the income from which was exempt. It resulted in the (respondent) }{\f0\fs24\insrsid6107222 obtaining}{\f0\fs24\insrsid5315415\charrsid5770064 
 a management fee}{\f0\fs24\insrsid12261302 ;}{\f0\fs24\insrsid5315415\charrsid5770064  it was not incurred in the production }{\f0\fs24\insrsid6107222 of that}{\f0\fs24\insrsid12261302  fee. S.}{\f0\fs24\insrsid5315415\charrsid5770064 19(}{
\i\f0\fs24\insrsid12261302\charrsid12261302 f}{\f0\fs24\insrsid12261302 )}{\f0\fs24\insrsid5315415\charrsid5770064  (ii) prevented the company from claiming a deduction for any part }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  interest. Apportionment did not arise}{\f0\fs24\insrsid12261302 ;}{\f0\fs24\insrsid5315415\charrsid5770064  if it had}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 the interest could be apportioned. S. }{\f0\fs24\insrsid6107222 1}{\f0\fs24\insrsid5315415\charrsid5770064 9(}{\i\f0\fs24\insrsid6107222\charrsid6107222 f}{\f0\fs24\insrsid6107222 )}{\f0\fs24\insrsid12261302  " ..}{
\f0\fs24\insrsid5315415\charrsid5770064 ..}{\f0\fs24\insrsid12261302  }{\f0\fs24\insrsid5315415\charrsid5770064 wholely and exclusively ....}{\f0\fs24\insrsid12261302 "}{\f0\fs24\insrsid5315415\charrsid5770064 \'b7would preclude apportionment. }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 S.19 (}{\i\f0\fs24\insrsid5315415\charrsid6107222 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) had no application. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Appeal allowed. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Order of Court of Review set aside. 
\par 
\par Assessment of Commissioner }{\f0\fs24\insrsid6107222\charrsid5770064 of Taxation}{\f0\fs24\insrsid5315415\charrsid5770064  confirmed. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Cases referred to: }{\f0\fs24\insrsid6107222 
\par 
\par }{\i\f0\fs24\insrsid5315415\charrsid6107222 Lee v Commissioner }{\i\f0\fs24\insrsid6107222\charrsid6107222 of Taxation}{\f0\fs24\insrsid5315415\charrsid5770064  (NSW) }{\f0\fs24\lang9\langfe2057\langnp9\insrsid12261302 3 ATD }{
\f0\fs24\insrsid5315415\charrsid5770064 78. }{\f0\fs24\insrsid6107222 
\par }{\i\f0\fs24\insrsid5315415\charrsid6107222 Amalgamated Zinc (}{\i\f0\fs24\insrsid9469833\charrsid9469833 d}{\i\f0\fs24\insrsid5315415\charrsid9469833 e}{\i\f0\fs24\insrsid5315415\charrsid6107222  Bavay}{\i\f0\fs24\insrsid5770064\charrsid6107222 '}{
\i\f0\fs24\insrsid5315415\charrsid6107222 s)}{\i\f0\fs24\insrsid9469833\charrsid9469833  }{\i\f0\fs24\insrsid9469833\charrsid6107222 Ltd}{\i\f0\fs24\insrsid5315415\charrsid6107222  v }{\i\f0\fs24\insrsid9469833\charrsid9469833 FCT}{
\i\f0\fs24\insrsid9469833  }{\f0\fs24\insrsid9469833\charrsid9469833 (19}{\f0\fs24\insrsid5315415\charrsid9469833 35)}{\f0\fs24\insrsid5315415\charrsid5770064  54 CLR 295 }{\f0\fs24\insrsid6107222 
\par 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 KERMODE}{\f0\fs24\insrsid11683080 ,}{\f0\fs24\insrsid5315415\charrsid5770064  Mr Justice.
\par 
\par }\pard \qc \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid6107222 {\f0\fs24\insrsid5315415\charrsid11683080 Judgment}{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The appellant in this appeal is the Deputy}{\f0\fs24\insrsid6107222  C}{\f0\fs24\insrsid5315415\charrsid5770064 ommissioner}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 of}{
\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 Inland Revenue. He is authorised by section 3 }{\f0\fs24\insrsid6107222 subsection}{\f0\fs24\insrsid5315415\charrsid5770064  (3) of the Income Tax Act}{\f0\fs24\insrsid6107222 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  subject to any express directive }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  the Commissioner to the contrary}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 to exercise the powers }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Commissioner. The Deputy Commissioner being dissatisfied with the decision of the Court of Review has referred this matter to this Court. }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 There are four reasons given }{\f0\fs24\insrsid6107222 by}{\f0\fs24\insrsid6107222\charrsid5770064  the}{\f0\fs24\insrsid5315415\charrsid5770064  Deputy }{\f0\fs24\insrsid6107222\charrsid5770064 Commissioner for}{
\f0\fs24\insrsid5315415\charrsid5770064  his dissatisfaction which I will }{\f0\fs24\insrsid939603 b}{\f0\fs24\insrsid5315415\charrsid5770064 e referring to later in this judgment. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid11683080 I}{\f0\fs24\insrsid5315415\charrsid5770064 t is not in dispute that the relevant provisions of the Income Tax Act Cap. 20}{\f0\fs24\insrsid939603 1}{\f0\fs24\insrsid5315415\charrsid5770064 
 which the Court of Review had to consider are three subsections }{\f0\fs24\insrsid6107222\charrsid5770064 of Section}{\f0\fs24\insrsid5315415\charrsid5770064  19 }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Act wh
ich refer to items which are not }{\f0\fs24\insrsid6107222 deductible}{\f0\fs24\insrsid5315415\charrsid5770064  from a }{\f0\fs24\insrsid6107222 t}{\f0\fs24\insrsid5315415\charrsid5770064 ax payer}{\f0\fs24\insrsid5770064\charrsid5770064 '}{
\f0\fs24\insrsid5315415\charrsid5770064 s total income. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Subsection (}{\i\f0\fs24\insrsid6107222\charrsid6107222 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) was deleted from the Act by Act 21 of 1980 with effect from }{\f0\fs24\insrsid6107222 1}{
\f0\fs24\insrsid6107222\charrsid6107222 st}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 January 1980. The appeal before the Court }{\f0\fs24\insrsid6107222\charrsid5770064 of Review}{\f0\fs24\insrsid5315415\charrsid5770064 
 was in connection with the assessment of the respondent}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s income for the year ended 31st May 1980. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 There is no dispute in this appeal about the facts found }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064 
 the Court of Review and I can do no better than repeat its clear recital of those facts. The Court said in its judgment: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid6107222\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 
"Blue Lagoon Cruises Ltd. is a company operating out of Lautoka and conducts tours throughout the Yasawa Islands off}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 Western Viti L}{\f0\fs24\insrsid6107222 e}{
\f0\fs24\insrsid5315415\charrsid5770064 vu. }{\f0\fs24\insrsid6107222\charrsid5770064 It is}{\f0\fs24\insrsid5315415\charrsid5770064  a public company, but 53.3% }{\f0\fs24\insrsid6107222\charrsid5770064 of its}{\f0\fs24\insrsid5315415\charrsid5770064 
 shares are held by a company called Fairmile Enterprises Ltd. (which I shall hereafter refer to as "Fairmile"). That was a company wholly owned by Claude Ivan Millar}{\f0\fs24\insrsid6107222  w}{\f0\fs24\insrsid5315415\charrsid5770064 
ho had founded Blue Lagoon Cruises Ltd. (which I shall call "Blue Lagoon") and his family, who thus controlled Blue Lagoon. In 1978 Millar 
wanted to retire and David Neale Wilson and Stanley Harold Quigg became interested in buying his interest in Blue Lagoon. Wilson was a tour and marketing agent and was interested in two companies already operating in Fiji}{\f0\fs24\insrsid6107222 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  New Zealand Pacific Marketing Ltd. and Tapa Tours Ltd., and Quigg}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 was an engineer, at that time managing }{\f0\fs24\insrsid6107222 A}{
\f0\fs24\insrsid5315415\charrsid5770064 ir}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 Pacific Ltd. on secondment from Qantas, but about to leave Air Pacific and return to Qantas. The two }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064 m negotiated with Millar and eventually they agreed to buy Fairmile for $800,000, which would thus give them control of}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 
Blue Lagoon. To enable them to finance this arrangement, they formed a company called Marine Management Ltd. with a capital of}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 $500,}{\f0\fs24\insrsid6107222 000 }{
\f0\fs24\insrsid5315415\charrsid5770064 in}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 $1 shares,}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 of}{\f0\fs24\insrsid6107222  }{
\f0\fs24\insrsid5315415\charrsid5770064 which 210,000 were issued}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064  one each to Wilson and Quigg,
 125,999 to New Zealand and Pacific Marketing Ltd. in which Wilson held all but one of the issued shares, and $3,999 to a concern called Cantabrian Trust which was controlled b}{\f0\fs24\insrsid6107222 y}{\f0\fs24\insrsid5315415\charrsid5770064 
 Quigg. They arranged for Marine Management Ltd. to borrow $600}{\f0\fs24\insrsid1932875 ,}{\f0\fs24\insrsid5315415\charrsid5770064 000 fro}{\f0\fs24\insrsid6107222 m}{\f0\fs24\insrsid5315415\charrsid5770064  the Bank }{
\f0\fs24\insrsid6107222\charrsid5770064 of New}{\f0\fs24\insrsid5315415\charrsid5770064  South Wales}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064  which sum together with $200}{\f0\fs24\insrsid6107222 ,}{
\f0\fs24\insrsid5315415\charrsid5770064 000 put up by the shareholders }{\f0\fs24\insrsid6107222\charrsid5770064 of Marine}{\f0\fs24\insrsid5315415\charrsid5770064 
 Management Ltd. enabled that company to complete the purchase of Fairmile. It should perhaps be said that both Wilson and Quigg realised that the talents }{\f0\fs24\insrsid6107222\charrsid5770064 of both}{\f0\fs24\insrsid5315415\charrsid5770064  }{
\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064 m would be fully utilised for some time in the management }{\f0\fs24\insrsid6107222\charrsid5770064 of Blue}{\f0\fs24\insrsid5315415\charrsid5770064 
 Lagoon, and they intended that Blue Lagoon should pay a substantial management fee to Marine Management Ltd. Accordingly when, with the acquisition of}{\f0\fs24\insrsid6107222  }{\f0\fs24\insrsid5315415\charrsid5770064 Fairmile}{\f0\fs24\insrsid6107222 ,
}{\f0\fs24\insrsid5315415\charrsid5770064  Wilson and Quigg came into a position where they became directors of Blue Lagoon}{\f0\fs24\insrsid6107222 ,}{\f0\fs24\insrsid5315415\charrsid5770064  and the former chairman}{\f0\fs24\insrsid6107222 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  one }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  first actions }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064 
 diretors was to engage Marine Management Ltd. to manage Blue Lagoon and to pay that company a fee of}{\f0\fs24\insrsid10683226  7}{\f0\fs24\insrsid1932875 \'bd}{\f0\fs24\insrsid5315415\charrsid5770064 % }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  gross receipts of Blue Lagoon}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  with a ceiling of $}{\f0\fs24\insrsid10683226 1}{\f0\fs24\insrsid5315415\charrsid5770064 30}{
\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064 000. That sum has now been paid for two years}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  although for the first year}{\f0\fs24\insrsid10683226 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  since Blue Lagoon}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s financial year goes from }{\f0\fs24\insrsid939603 1}{\f0\fs24\insrsid5315415\charrsid5770064 
st June to 31st May}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  and the management fee became payable only from 9th August 1978, only that proportion from 9th August to 31st May}{\f0\fs24\insrsid939603 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  1979 was paid. 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 When Marine Management Ltd. caused its accounts to be prepared}{\f0\fs24\insrsid939603 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  it showed among its expenses a sum of}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 $57}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064 778 which had been paid as }{
\f0\fs24\insrsid10683226\charrsid5770064 interest to}{\f0\fs24\insrsid5315415\charrsid5770064  the Bank }{\f0\fs24\insrsid10683226\charrsid5770064 of New}{\f0\fs24\insrsid5315415\charrsid5770064  South Wales in respect }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  loan of}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 $600}{\f0\fs24\insrsid1932875 ,}{\f0\fs24\insrsid5315415\charrsid5770064 000}{\f0\fs24\insrsid10683226 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  to which I have previously referred. The Commissioner of Inland Revenue disallowed the deduction. Marine Management Ltd. }{\f0\fs24\insrsid10683226 objected}{\f0\fs24\insrsid5315415\charrsid5770064 
 and the Commissioner disallowed the }{\f0\fs24\insrsid10683226 objection}{\f0\fs24\insrsid5315415\charrsid5770064 . Marine Management Ltd.........thereupon appealed to this Court. 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid2981632 {\f0\fs24\insrsid10683226 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 The appellant}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s argument}{
\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  put }{\f0\fs24\insrsid10683226 succinctly,}{\f0\fs24\insrsid5315415\charrsid5770064  is that it raised a loan from the Bank to }{\f0\fs24\insrsid10683226 b}{
\f0\fs24\insrsid5315415\charrsid5770064 uy Fairmile}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  and thus get control }{\f0\fs24\insrsid10683226\charrsid5770064 of Blue}{\f0\fs24\insrsid5315415\charrsid5770064  Lagoon}{
\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  and its intention in controlling Blue Lagoon was t}{\f0\fs24\insrsid10683226 o}{\f0\fs24\insrsid5315415\charrsid5770064  obtain for itself a m}{\f0\fs24\insrsid10683226 a}{
\f0\fs24\insrsid5315415\charrsid5770064 nagement fe}{\f0\fs24\insrsid10683226 e}{\f0\fs24\insrsid5315415\charrsid5770064 . It did so}{\f0\fs24\insrsid939603 ,}{\f0\fs24\insrsid5315415\charrsid5770064  and should therefore be entitl
ed to set off against its income}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 -}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 the management fee}{\f0\fs24\insrsid10683226  }{
\f0\fs24\insrsid5315415\charrsid5770064 -}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 the interest which it has to pa}{\f0\fs24\insrsid10683226 y}{\f0\fs24\insrsid5315415\charrsid5770064 
 the Bank for the loan through which it became entitled to get the management fee. In other words}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  the interest is an expense incurred in producing the income." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The Court considered section 19(}{\i\f0\fs24\insrsid5315415\charrsid939603 f}{\f0\fs24\insrsid5315415\charrsid5770064 ) }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Act and was }{
\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid10683226 view that the}{\f0\fs24\insrsid5315415\charrsid5770064 
 interest paid by the Company was apportionable and came to the conclusion that one half of the interest should be regarded as an expense incurred in respect of the Blue Lagoon shares. The Court allowed the appeal to the extent }{\f0\fs24\insrsid10683226 
of one}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid10683226 half of}{\f0\fs24\insrsid13595768  the}{\f0\fs24\insrsid5315415\charrsid5770064  interest being of the view that the proportion was a permissible deduction. }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Although the Court }{\f0\fs24\insrsid10683226\charrsid5770064 of Review}{\f0\fs24\insrsid5315415\charrsid5770064  did not specifically state that }{\f0\fs24\insrsid10683226\charrsid5770064 half the}{
\f0\fs24\insrsid5315415\charrsid5770064  interest was allowed as a deduction as being an expense inc}{\f0\fs24\insrsid10683226 urre}{\f0\fs24\insrsid5315415\charrsid5770064 d in respect }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  management fee}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  it is apparent that it was of that view. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Under section 17(37) of the Act any dividend from a company incorporated in Fiji received by or accrued to a resident company is exempt from
 basic and normal tax. The dividends passed from Blue Lagoon to Fairmile and from Fairmile to the respondent company. No attempt has been made to tax this income in the hands of the respondent company. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Mr Scott in openi}{\f0\fs24\insrsid10683226 ng}{\f0\fs24\insrsid5315415\charrsid5770064  his argument for the appellant, pointed out that there has been no cross appeal by the company and the Court of Review}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s allowance of one }{\f0\fs24\insrsid10683226 half of}{\f0\fs24\insrsid13595768  the}{\f0\fs24\insrsid5315415\charrsid5770064 
 interest as a deductible item cannot be varied if in fact the Court should have allowed the total amoun}{\f0\fs24\insrsid10683226 t of interest as a deduction. M}{\f0\fs24\insrsid5315415\charrsid5770064 r Sc
ott contends the interest is not deductible at all and is not in any event apportionable in the circumstances. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 There are certain relevant findings and comments in the Court }{\f0\fs24\insrsid10683226\charrsid5770064 of Review's}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid10683226\charrsid5770064 Judgment}{
\f0\fs24\insrsid5315415\charrsid5770064  which }{\f0\fs24\insrsid10683226 I}{\f0\fs24\insrsid5315415\charrsid5770064  consider require to be stated before I }{\f0\fs24\insrsid10683226\charrsid5770064 consider the}{\f0\fs24\insrsid5315415\charrsid5770064  
issues involved. The extracts indicate how the Court arrived at its decision. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 At page 27 of the Record the Court on considering the credibility of Mr Wilson said: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "I have however, no reason to doubt anything in his evidence}{\f0\fs24\insrsid14756138  }{
\f0\fs24\insrsid5315415\charrsid5770064 -}{\f0\fs24\insrsid14756138  }{\f0\fs24\insrsid5315415\charrsid5770064 so far as it goes, save that }{\f0\fs24\insrsid14756138 I}{\f0\fs24\insrsid5315415\charrsid5770064 
 do not accept that his principal interest in Blue Lagoon was the management fee. His concern with Blue Lagoon was the income." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 At page 28 the Court stated: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "In this case there are two main items of income}{\f0\fs24\insrsid10683226 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  first the dividend income which the taxpayer received as the holder }{\f0\fs24\insrsid13595768 of a}{\f0\fs24\insrsid5315415\charrsid5770064  53.3% interest in Blue Lagoon and }{
\f0\fs24\insrsid10683226\charrsid5770064 secondly}{\f0\fs24\insrsid5315415\charrsid5770064  the management fee, and there is one main item }{\f0\fs24\insrsid10683226\charrsid5770064 of deduction}{\f0\fs24\insrsid10683226 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid10683226\charrsid5770064 namely}{\f0\fs24\insrsid5315415\charrsid5770064  the inte}{\f0\fs24\insrsid10683226 r}{\f0\fs24\insrsid5315415\charrsid5770064 est....."
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 At page 30 the Court in comparing the Fiji and Australian legislation said: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 
"It will be seen that in Fiji interest has to be actually incurred in the production of income whereas the Australian section allows to be deducted all losses and outgoings to the extent to which they are incurred in gaining or producing the ass
essable income." }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Also on the same page the Court stated: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 
"I have no doubt that here the interest is payable on capital sums which themselves are employed in the production }{\f0\fs24\insrsid10683226\charrsid5770064 of income}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 and the Australian cases treat interest payable on capital utilised in the production of income as an outgoing incurred in gaining income and thus deductible ......... 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 
\par The last quotation from the Court}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s judgment which I desire to quote is at page 31}{\f0\fs24\insrsid5770064\charrsid5770064 :}{\f0\fs24\insrsid5315415\charrsid5770064  }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "Now, here, the expenditure of interest is related to the production 
of two matters of income, the management fee and the dividends, in the sense that }{\f0\fs24\insrsid10683226\charrsid5770064 if there}{\f0\fs24\insrsid5315415\charrsid5770064 
 had been no loan and consequently no expenditure for interest there would have been no management fee and no dividends. In my view the expense, viz, the expenditure 
for interest was partly incurred in relation either to an amount received, or to income from property either of which, will be exempted under section 17 (37) of the Act and hence not deductible." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The Court went on to conclude its judgment after the last quotation and }{\f0\fs24\insrsid10683226\charrsid5770064 apportioned}{\f0\fs24\insrsid5315415\charrsid5770064 
 the interest and allowed the appeal as to half the interest. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Mr Scott with his usual industry has produced a number }{\f0\fs24\insrsid13595768 of a}{\f0\fs24\insrsid5315415\charrsid5770064 uthorities and has greatly assisted the Court by furnishing photocopies }{
\f0\fs24\insrsid10683226\charrsid5770064 of judgments}{\f0\fs24\insrsid5315415\charrsid5770064  of most of the authorities he relies on. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 I will deal seriatum with the four reasons for dissatisfaction which I will treat as grounds of appeal. The first ground is: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "}{\f0\fs24\insrsid10683226 1}{\f0\fs24\insrsid5315415\charrsid5770064 
. The Court of Review erred in law in holding that the taxpayer company}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s deduction claim was not barred in its entirety by Section 19(}{
\i\f0\fs24\insrsid3553617\charrsid3553617 b}{\f0\fs24\insrsid5315415\charrsid5770064 ) }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid10683226  Income Tax Act."}{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid2981632 {\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 There was no }{\f0\fs24\insrsid10683226\charrsid5770064 finding as}{\f0\fs24\insrsid5315415\charrsid5770064 
 to nature }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  business }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  respondent company. On the facts al
l it did was to borrow a large sum of money to acquire a capital asset i.e. shares in Fairmile which company derived income from dividends paid to it by Blue Lagoon. The }{\f0\fs24\insrsid10683226\charrsid5770064 only active}{
\f0\fs24\insrsid5315415\charrsid5770064  business the }{\f0\fs24\insrsid10683226\charrsid5770064 Company appears}{\f0\fs24\insrsid5315415\charrsid5770064  to have done was to provide management for Blue Lagoon at a fee not exceeding $130,000 per annum. }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The payment of interest on the moneys borrowed cou}{\f0\fs24\insrsid10683226 l}{\f0\fs24\insrsid5315415\charrsid5770064 
d be considered as an expense solely for the loan raised to purchase a capital asset from which income accrued. It could also be considered as being paid for two purposes}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064 
 firstly for acquisition }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Fairmile shares and secondly to obtain control }{\f0\fs24\insrsid10683226\charrsid5770064 of Blue}{\f0\fs24\insrsid5315415\charrsid5770064 
 Lagoon so that it was in a position to obtain a management fee for itself from that company. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 A difficulty that arises in this appeal is that Austr
alian tax law differs from the English law and also Fiji law and this has to be borne in mind when considering Australian and English authorities. So far as the Fiji section 19(}{\i\f0\fs24\insrsid5315415\charrsid3553617 b}{
\f0\fs24\insrsid5315415\charrsid5770064 ) is concerned section 23(}{\i\f0\fs24\insrsid5315415\charrsid3553617 g}{\f0\fs24\insrsid5315415\charrsid5770064 ) of the South African Income Tax Act is very similar. It provides: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "23. No deductions shall in any case }{\f0\fs24\insrsid14900974 b}{\f0\fs24\insrsid5315415\charrsid5770064 
e made in respect o}{\f0\fs24\insrsid10683226 f }{\f0\fs24\insrsid5315415\charrsid5770064 the following matters}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  namely }{\f0\fs24\insrsid3553617 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid2981632 {\f0\fs24\insrsid3553617 
\par }\pard \ql \li1430\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1430\itap0\pararsid2981632 {\i\f0\fs24\insrsid5315415\charrsid14900974 (g)}{\f0\fs24\insrsid5315415\charrsid5770064 
 any moneys claimed as a deduction from income derived from trade}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  which are not wholly or exclusively laid out or expended for the purposes of trade." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid10683226 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Section 51 (}{\f0\fs24\insrsid10683226 1}{\f0\fs24\insrsid5315415\charrsid5770064 ) }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Australian Income Tax Assessment Act deals with }{
\f0\fs24\insrsid10683226\charrsid5770064 allowable}{\f0\fs24\insrsid5315415\charrsid5770064  deductions and is as follows: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid10683226\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "Losses and outgoings}{\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 -}{
\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 (1 )A}{\f0\fs24\insrsid10683226 ll}{\f0\fs24\insrsid5315415\charrsid5770064  Losses and outgoings to the extent to which they are incurred in gaining or producing the }{
\f0\fs24\insrsid10683226\charrsid5770064 assessable}{\f0\fs24\insrsid5315415\charrsid5770064  income}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  or are }{\f0\fs24\insrsid10683226\charrsid5770064 necessarily}{
\f0\fs24\insrsid10683226  }{\f0\fs24\insrsid5315415\charrsid5770064 incurred in carrying on a }{\f0\fs24\insrsid6107222 business}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid10683226 for the}{\f0\fs24\insrsid5315415\charrsid5770064 
 purpose }{\f0\fs24\insrsid10683226\charrsid5770064 of gaining}{\f0\fs24\insrsid5315415\charrsid5770064  or producing such income}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  shall }{\f0\fs24\insrsid10683226 b}{
\f0\fs24\insrsid5315415\charrsid5770064 e }{\f0\fs24\insrsid10683226\charrsid5770064 allowable}{\f0\fs24\insrsid5315415\charrsid5770064  deductions except to the extent to which they are losses or outgoings of capital}{\f0\fs24\insrsid10683226 ,}{
\f0\fs24\insrsid5315415\charrsid5770064  or of a capital}{\f0\fs24\insrsid10683226 ,}{\f0\fs24\insrsid5315415\charrsid5770064  private or domestic nature, or are incurred in relation to the gaining or production of exempt income." 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid15542419 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Section 37 }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid15542419 U}{\f0\fs24\insrsid5315415\charrsid5770064 .K. Income Tax Act 1952 is also
 similar to the Fiji provision and covers non deductible items. It reads: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "No sum shall be deducted in respect of }{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid3545071 {\f0\fs24\insrsid15542419\charrsid5770064 
\par }\pard \ql \li1430\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1430\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 (}{\i\f0\fs24\insrsid5315415\charrsid9190624 a}{\f0\fs24\insrsid5315415\charrsid5770064 
) disbursements or expenses, not being money wholly or exclusively laid out or expended for the purposes of the trade........}{\f0\fs24\insrsid9190624 "}{\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid15542419 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The }{\f0\fs24\insrsid15542419 U}{\f0\fs24\insrsid5315415\charrsid5770064 .K. and Fiji provisions make no reference to capital expenditure or to revenue producing expenditure. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 This point was considered by Williams }{\f0\fs24\insrsid15542419 J}{\f0\fs24\insrsid5315415\charrsid5770064 . in Civil Appeal 9 of 1974. }{\i\f0\fs24\insrsid5315415\charrsid15542419 The Commissioner of}{
\i\f0\fs24\insrsid15542419\charrsid15542419  In}{\i\f0\fs24\insrsid5315415\charrsid15542419 land Revenue v. M}{\i\f0\fs24\insrsid15542419\charrsid15542419 ot}{\i\f0\fs24\insrsid5315415\charrsid15542419 ibhai & Co. L}{
\i\f0\fs24\insrsid15542419\charrsid15542419 t}{\i\f0\fs24\insrsid5315415\charrsid15542419 d}{\f0\fs24\insrsid5315415\charrsid5770064 . }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid14681823 "}{\f0\fs24\insrsid5315415\charrsid14681823 
The U.K. and Fiji Acts make no reference to capital expenditure or to revenue producing expenditure}{\f0\fs24\insrsid15542419\charrsid14681823 ,}{\f0\fs24\insrsid5315415\charrsid14681823  but the number }{\f0\fs24\insrsid15542419\charrsid14681823 
of decisions}{\f0\fs24\insrsid5315415\charrsid14681823  touching upon section 37 }{\f0\fs24\insrsid13595768\charrsid14681823 of the}{\f0\fs24\insrsid5315415\charrsid14681823  }{\f0\fs24\insrsid15542419\charrsid14681823 U}{
\f0\fs24\insrsid5315415\charrsid14681823 .K. Act which refer to capital expenditure and revenue expenditure are too numerous to mention. In deciding}{\f0\fs24\insrsid15542419\charrsid14681823  }{\f0\fs24\insrsid5315415\charrsid14681823 whether}{
\f0\fs24\insrsid15542419\charrsid14681823  }{\f0\fs24\insrsid5315415\charrsid14681823 an item of}{\f0\fs24\insrsid15542419\charrsid14681823  }{\f0\fs24\insrsid5315415\charrsid14681823 expenditure is deduct}{\f0\fs24\insrsid15542419\charrsid14681823 ible}{
\f0\fs24\insrsid5315415\charrsid14681823  from income the Courts have frequently considered whether or not}{\f0\fs24\insrsid15542419\charrsid14681823  it was a capital expenditure.}{\f0\fs24\insrsid14681823 "}{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 I am not in }{\f0\fs24\insrsid15542419 t}{\f0\fs24\insrsid5315415\charrsid5770064 his appeal concerned with a claim to deduct capital expenditure but with a claim to ded
uct interest paid on a loan utilised to obtain a capital asset which produced income. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The Australian }{\f0\fs24\insrsid15542419 pro}{\f0\fs24\insrsid5315415\charrsid5770064 vision specifically excludes outgoings }{\f0\fs24\insrsid13595768 of a}{\f0\fs24\insrsid5315415\charrsid5770064 
 capital, private or domestic nature bu}{\f0\fs24\insrsid15542419 t un}{\f0\fs24\insrsid5315415\charrsid5770064 like the Fiji provision (i.e. section 19(}{\i\f0\fs24\insrsid5315415\charrsid15994603 b}{\f0\fs24\insrsid5315415\charrsid5770064 )) it permits 
}{\f0\fs24\insrsid13595768 of }{\f0\fs24\insrsid15542419 a}{\f0\fs24\insrsid15542419\charrsid5770064 pportionment}{\f0\fs24\insrsid5315415\charrsid5770064  of outgoings. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The previous Australian }{\f0\fs24\insrsid15542419\charrsid5770064 law was}{\f0\fs24\insrsid5315415\charrsid5770064  in some respects similar to the present Fiji provision. In }{
\i\f0\fs24\insrsid5315415\charrsid15542419 Lee }{\i\f0\fs24\insrsid15542419 v}{\i\f0\fs24\insrsid5315415\charrsid15542419 . Commissioner o}{\i\f0\fs24\insrsid15542419 f }{\i\f0\fs24\insrsid5315415\charrsid15542419 Taxatio}{\i\f0\fs24\insrsid15542419 n}{
\f0\fs24\insrsid15994603  (N.S.}{\f0\fs24\insrsid15542419 W) ATD Vol. 3}{\f0\fs24\insrsid15994603  }{\f0\fs24\insrsid5315415\charrsid5770064 78 interest paid on }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 
orrowed money secured by mortgages over 2 properties one }{\f0\fs24\insrsid15542419\charrsid5770064 of which}{\f0\fs24\insrsid5315415\charrsid5770064  wa
s used as a residence was held not to be deductible. It was held that it was not money "wholly and exclusively laid out for the production of the }{\f0\fs24\insrsid15542419\charrsid5770064 assessable}{\f0\fs24\insrsid5315415\charrsid5770064  income". }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The facts in the instant case indicate that the respondent company }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 
orrowed money to purchase the shares in Fairmile resulting in it obtaining control of Blue Lagoon. The Court }{\f0\fs24\insrsid15542419\charrsid5770064 of Review}{\f0\fs24\insrsid5315415\charrsid5770064  accepted that }{\f0\fs24\insrsid6107222 obtaining}{
\f0\fs24\insrsid5315415\charrsid5770064  the management fee was one of Mr Wilson}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s }{\f0\fs24\insrsid15542419\charrsid5770064 objectives}{
\f0\fs24\insrsid5315415\charrsid5770064 . The purchase resulted in the company deriving non }{\f0\fs24\insrsid15542419 assessable}{\f0\fs24\insrsid5315415\charrsid5770064  income from Fairmile as a result }{\f0\fs24\insrsid6107222 of that}{
\f0\fs24\insrsid5315415\charrsid5770064  company receiving non taxable income from Blue Lagoon. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 One }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  reasons for purchasing the shares in Fairmile was for the company to }{\f0\fs24\insrsid15542419 obtain}{
\f0\fs24\insrsid5315415\charrsid5770064  control of Blue Lagoon and through such control to later procure for}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 itself}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 
a management fee. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Section 19(}{\i\f0\fs24\insrsid15994603\charrsid15994603 b}{\f0\fs24\insrsid5315415\charrsid5770064 ) is concerned with "money wholl}{\f0\fs24\insrsid15542419 y}{\f0\fs24\insrsid5315415\charrsid5770064 
 and exclusively laid out or expended for the p}{\f0\fs24\insrsid15542419 urpose}{\f0\fs24\insrsid5315415\charrsid5770064  of the...............}{\f0\fs24\insrsid15542419 bus}{\f0\fs24\insrsid15994603 iness.}{\f0\fs24\insrsid5315415\charrsid5770064 
..............of the taxpayer". }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid15542419 I }{\f0\fs24\insrsid5315415\charrsid5770064 do }{\f0\fs24\insrsid15542419\charrsid5770064 not think}{\f0\fs24\insrsid5315415\charrsid5770064  there can }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 e any}
{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 dou}{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 t}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 on the facts that the expenditure }{
\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  loan }{\f0\fs24\insrsid15542419 moneys}{\f0\fs24\insrsid5315415\charrsid5770064  i}{\f0\fs24\insrsid15542419 nvolving}{\f0\fs24\insrsid5315415\charrsid5770064  payment of}{
\f0\fs24\insrsid15542419  i}{\f0\fs24\insrsid5315415\charrsid5770064 n}{\f0\fs24\insrsid15542419 terest was solely a}{\f0\fs24\insrsid5315415\charrsid5770064 nd exclusively in connection with the compa}{\f0\fs24\insrsid15542419 ny's busi}{
\f0\fs24\insrsid5315415\charrsid5770064 ness. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 There is not in this instance as in }{\i\f0\fs24\insrsid5315415\charrsid15994603 Lee}{\i\f0\fs24\insrsid5770064\charrsid15994603 '}{\i\f0\fs24\insrsid5315415\charrsid15994603 s}{
\f0\fs24\insrsid5315415\charrsid5770064  case, an expense incurred on both income and non income bea
ring assets. Nor in my view was the expenditure for two separate purposes, one business and the other non business, as in the South African cases Mr Scott relies on. The expenditure was for two or more purposes connected with the company}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s business. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 I hold the }{\f0\fs24\insrsid15542419\charrsid5770064 view that}{\f0\fs24\insrsid5315415\charrsid5770064  section 19(}{\i\f0\fs24\insrsid5315415\charrsid15994603 b}{\f0\fs24\insrsid5315415\charrsid5770064 
) does not have any application in this case and if the Court}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 of}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 Review}{\f0\fs24\insrsid15542419  }{
\f0\fs24\insrsid5315415\charrsid5770064 meant}{\f0\fs24\insrsid15542419  }{\f0\fs24\insrsid5315415\charrsid5770064 this when it said the company was entitled to succeed on section 19(}{\i\f0\fs24\insrsid5315415\charrsid15994603 b}{
\f0\fs24\insrsid5315415\charrsid5770064 ) I agree with the Court}{\f0\fs24\insrsid11672201 .}{\f0\fs24\insrsid5315415\charrsid5770064  The first ground of appeal fails. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The second and fourth grounds }{\f0\fs24\insrsid13595768 of a}{\f0\fs24\insrsid5315415\charrsid5770064 ppeal can be considered together. They are as follows: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "2. The Court of Review erred in law in holding that the taxpayer company}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s deduction claim was not barred in is entirety }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  Section 19(}{
\i\f0\fs24\insrsid2050329\charrsid2050329 f}{\f0\fs24\insrsid5315415\charrsid5770064 )(ii) of the Income Tax Act; 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid15542419 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 
4. The Court of Review erred in law in holding that apportionment was (i) legally permissible and (ii) factually }{\f0\fs24\insrsid15542419\charrsid5770064 justifiable}{\f0\fs24\insrsid15542419 ,}{\f0\fs24\insrsid5315415\charrsid5770064  in the taxpayer}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s appeal.}{\f0\fs24\insrsid2050329 "}{\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid15542419 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 It is when the Court of Review came to consider section 19(}{\i\f0\fs24\insrsid5315415\charrsid2050329 f}{\f0\fs24\insrsid5315415\charrsid5770064 ) that it erred in my view. The Court was }{
\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid15542419\charrsid5770064 view that}{\f0\fs24\insrsid5315415\charrsid5770064  the interest related to the production}{\f0\fs24\insrsid15542419  o}{
\f0\fs24\insrsid15542419\charrsid5770064 f two}{\f0\fs24\insrsid5315415\charrsid5770064  matters of income "in the sense that if there had }{\f0\fs24\insrsid15542419 been}{\f0\fs24\insrsid5315415\charrsid5770064 
 no loan and consequently no expenditure for interest there would have }{\f0\fs24\insrsid15542419 been}{\f0\fs24\insrsid5315415\charrsid5770064  no management fee and no dividends". }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 That statement may }{\f0\fs24\insrsid2050329 b}{\f0\fs24\insrsid5315415\charrsid5770064 
e factual but the Court appears to have overlooked or not considered the fact it had earlier noted in its judgment that in the Fiji legislation "interest has to be actually incurred in the production of income". }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 So far as the management fee was concerned the expense }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064 
 interest incurred in my view played no direct or relevant part in earning the management }{\f0\fs24\insrsid15542419\charrsid5770064 fee. The}{\f0\fs24\insrsid5315415\charrsid5770064  fee was earned solely as a result }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  efforts }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  company in the course }{\f0\fs24\insrsid15542419\charrsid5770064 of its}{\f0\fs24\insrsid5315415\charrsid5770064  }{
\f0\fs24\insrsid15542419\charrsid5770064 business}{\f0\fs24\insrsid5315415\charrsid5770064 . The production of the fee incurred involved no expenditure of interest. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Mr Scott quoted a South African case which is almost on all fours with the present case. While the case is not }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 inding on this Court, it is }{
\f0\fs24\insrsid15542419\charrsid5770064 of persuasive}{\f0\fs24\insrsid5315415\charrsid5770064  value since the South African legislation is similar to the Fiji legislation
\par 
\par The case is Income T
ax Case No. 296 (1934) 7 SATC 353. The case dealt with a claim to deduct interest. The appellant had set up a private company in which he held 90% of the shares and under the articles of association of the company was entitled to hold the office }{
\f0\fs24\insrsid15542419\charrsid5770064 of managing}{\f0\fs24\insrsid5315415\charrsid5770064  director at a }{\f0\fs24\insrsid15542419 substantial}{\f0\fs24\insrsid5315415\charrsid5770064  salary. He sought to deduct from his salary the interest paid }{
\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  him on the sums }{\f0\fs24\insrsid15542419 borrowed}{\f0\fs24\insrsid5315415\charrsid5770064  to pay for his shareholding and to cover his advances to the company. }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 It was held}{\f0\fs24\insrsid15542419 ,}{\f0\fs24\insrsid5315415\charrsid5770064  dismissing the appeal}{\f0\fs24\insrsid2050329 ,}{\f0\fs24\insrsid5315415\charrsid5770064  that the salary drawn }{
\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  the appellant had }{\f0\fs24\insrsid15542419 been}{\f0\fs24\insrsid5315415\charrsid5770064  earned }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064 
 his energy and }{\f0\fs24\insrsid15542419 ability}{\f0\fs24\insrsid5315415\charrsid5770064  as managing director and not }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  the expenditure }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  interest }{\f0\fs24\insrsid13595768 by}{\f0\fs24\insrsid5315415\charrsid5770064  him on the moneys }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 orrow}{\f0\fs24\insrsid15542419 e}{
\f0\fs24\insrsid5315415\charrsid5770064 d the li}{\f0\fs24\insrsid15542419 ability}{\f0\fs24\insrsid5315415\charrsid5770064  for which had }{\f0\fs24\insrsid15542419 been}{\f0\fs24\insrsid5315415\charrsid5770064 
 incurred for the purpose of ultimately earning dividends from the company}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s activities. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The Court in that case mention}{\f0\fs24\insrsid15542419 e}{\f0\fs24\insrsid5315415\charrsid5770064 d that it had to find that the expenditure was incurred in the direct production }{\f0\fs24\insrsid13595768 
of the}{\f0\fs24\insrsid5315415\charrsid5770064  income }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 efore it could come to any conclusion in favour of the appellant. It found no such d}{\f0\fs24\insrsid15542419 i}{
\f0\fs24\insrsid5315415\charrsid5770064 rect connection }{\f0\fs24\insrsid15542419 b}{\f0\fs24\insrsid5315415\charrsid5770064 etween the expenditure and the production of the income. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid15542419\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Dixon.}{\f0\fs24\insrsid16058662 J}{\f0\fs24\insrsid5315415\charrsid5770064 . in the }{\i\f0\fs24\insrsid5315415\charrsid16204019 Amalgama}{\i\f0\fs24\insrsid16204019\charrsid16204019 te}{
\i\f0\fs24\insrsid5315415\charrsid16204019 d Zinc (D}{\i\f0\fs24\insrsid16204019\charrsid16204019 e Bavay}{\i\f0\fs24\insrsid5770064\charrsid16204019 '}{\i\f0\fs24\insrsid5315415\charrsid16204019 s) L}{\i\f0\fs24\insrsid16204019\charrsid16204019 t}{
\i\f0\fs24\insrsid5315415\charrsid16204019 d. }{\i\f0\fs24\insrsid16204019\charrsid16204019 v. Th}{\i\f0\fs24\insrsid5315415\charrsid16204019 e Federal Commissioner }{\i\f0\fs24\insrsid16204019\charrsid16204019 of}{
\i\f0\fs24\insrsid5315415\charrsid16204019  Taxa}{\i\f0\fs24\insrsid16204019\charrsid16204019 t}{\i\f0\fs24\insrsid5315415\charrsid16204019 ion}{\f0\fs24\insrsid5315415\charrsid5770064  [1935] 54 C}{\f0\fs24\insrsid16058662 .}{
\f0\fs24\insrsid5315415\charrsid5770064 L.R. 295 o}{\f0\fs24\insrsid16058662 n}{\f0\fs24\insrsid5315415\charrsid5770064  which the Court }{\f0\fs24\insrsid16204019\charrsid5770064 of Review}{\f0\fs24\insrsid5315415\charrsid5770064  also relied at}{
\f0\fs24\insrsid16204019  }{\f0\fs24\insrsid5315415\charrsid5770064 p. 310 }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064  Repo}{\f0\fs24\insrsid16204019 rt}{\f0\fs24\insrsid5315415\charrsid5770064  stated: }{
\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid2981632 {\f0\fs24\insrsid5315415\charrsid5770064 "What is important is the entire lack of connection }{\f0\fs24\insrsid16204019 between}{
\f0\fs24\insrsid5315415\charrsid5770064  the assessable income and the expenditure. None of the }{\f0\fs24\insrsid15542419 assessable}{\f0\fs24\insrsid5315415\charrsid5770064 
 income arose out of the business in the course of which the taxpayer became liable to the charge. The sources from which the assessable income did arise included no operations in the course }{\f0\fs24\insrsid16204019\charrsid5770064 of which}{
\f0\fs24\insrsid16204019  the pa}{\f0\fs24\insrsid5315415\charrsid5770064 yment was made. }{\f0\fs24\insrsid16204019\charrsid5770064 It was}{\f0\fs24\insrsid5315415\charrsid5770064  a payment independent }{\f0\fs24\insrsid13595768 of the}{
\f0\fs24\insrsid5315415\charrsid5770064  production of the income, not an expenditure incurred in the course of its }{\f0\fs24\insrsid16204019 production.}{\f0\fs24\insrsid16058662 "}{\f0\fs24\insrsid5315415\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid16204019 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The final statement can be applied to th
e facts in the instant case. The payment of the interest on the loan was a payment independent of the assessable income (management fee) and was not an expenditure incurred in the course }{\f0\fs24\insrsid16204019\charrsid5770064 of its}{
\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid16204019\charrsid5770064 production}{\f0\fs24\insrsid5315415\charrsid5770064 . The management fee was solely derived from the management activities of the company. }{\f0\fs24\insrsid5315415 

\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The whole }{\f0\fs24\insrsid13595768 of the}{\f0\fs24\insrsid5315415\charrsid5770064 
 interest in the instant case was incurred in purchasing the shares in Fairmile the income from which was exempt. It resulted in the company being able to obtain a management fee but}{\f0\fs24\insrsid16204019  }{\f0\fs24\insrsid5315415\charrsid5770064 it}
{\f0\fs24\insrsid16204019  }{\f0\fs24\insrsid5315415\charrsid5770064 was not incurred in the production }{\f0\fs24\insrsid6107222 of that}{\f0\fs24\insrsid5315415\charrsid5770064  fee. It follows that section 19(}{
\i\f0\fs24\insrsid16058662\charrsid16058662 f}{\f0\fs24\insrsid5315415\charrsid5770064 )(ii) operates to prevent the company from }{\f0\fs24\insrsid16204019\charrsid5770064 claiming}{\f0\fs24\insrsid5315415\charrsid5770064 
 any part of the interest as a deduction. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The question of apportionment in my view does not arise. Had the question arisen however I would have agreed with the Court }{\f0\fs24\insrsid16204019\charrsid5770064 of Review}{\f0\fs24\insrsid16204019 
 that the interest could be a}{\f0\fs24\insrsid5315415\charrsid5770064 pportioned. 
\par 
\par The language used in section 19(}{\i\f0\fs24\insrsid5315415\charrsid16058662 b}{\f0\fs24\insrsid5315415\charrsid5770064 ) would preclude any apportionment if that section had application. The words "wholly and exclusively"}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064  leave no doubt about that. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 Section 19(}{\i\f0\fs24\insrsid16058662\charrsid16058662 f}{\f0\fs24\insrsid5315415\charrsid5770064 ) }{\f0\fs24\insrsid16204019 h}{\f0\fs24\insrsid16204019\charrsid5770064 owever is}{
\f0\fs24\insrsid5315415\charrsid5770064  }{\f0\fs24\insrsid16204019\charrsid5770064 couched}{\f0\fs24\insrsid5315415\charrsid5770064  in different }{\f0\fs24\insrsid16204019 terms and I}{\f0\fs24\insrsid5315415\charrsid5770064  agree wit}{
\f0\fs24\insrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064  t}{\f0\fs24\insrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064 e Court of Review "t}{\f0\fs24\insrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064 
at only the expense related to those ma}{\f0\fs24\insrsid16204019 tters }{\f0\fs24\insrsid5315415\charrsid5770064 (}{\f0\fs24\insrsid16204019 i}{\f0\fs24\insrsid16058662 .}{\f0\fs24\insrsid16204019 e. the matters referred }{
\f0\fs24\insrsid5315415\charrsid5770064 to in section 19(}{\i\f0\fs24\insrsid16204019\charrsid16204019 f}{\f0\fs24\insrsid5315415\charrsid5770064 ) is not deductible". 
\par 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 It follows}{\f0\fs24\insrsid5315415\charrsid5770064  from the foregoing}{\f0\fs24\insrsid16204019  }{\f0\fs24\insrsid16204019\charrsid5770064 that the}{\f0\fs24\insrsid5315415\charrsid5770064 
 appellant succeeds on the second ground of appeal but fails on the fourth. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 There remains the third ground which is as follows: }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }\pard \ql \li770\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin770\itap0\pararsid3500151 {\f0\fs24\insrsid5315415\charrsid5770064 "3. The Court of Review erred in law in holding that the taxpayer company}{
\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s deduction claim was not barred as to seven}{\f0\fs24\insrsid16204019  }{\f0\fs24\insrsid5315415\charrsid5770064 twelths }{\f0\fs24\insrsid16204019\charrsid5770064 
thereof by}{\f0\fs24\insrsid5315415\charrsid5770064  Section 19(}{\i\f0\fs24\insrsid16204019\charrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) of the Income Tax Act.}{\f0\fs24\insrsid11672201 "}{\f0\fs24\insrsid5315415 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16204019 {\f0\fs24\insrsid16204019\charrsid5770064 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5770064 {\f0\fs24\insrsid5315415\charrsid5770064 I am unable to appreciate }{\f0\fs24\insrsid16204019\charrsid5770064 w}{\f0\fs24\insrsid16204019 hy}{
\f0\fs24\insrsid5315415\charrsid5770064  Mr Scott argues in the alternative that the Court }{\f0\fs24\insrsid16204019 s}{\f0\fs24\insrsid5315415\charrsid5770064 hould have apportioned the deduction because section 19(}{
\i\f0\fs24\insrsid5315415\charrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) was deleted from the Act}{\f0\fs24\insrsid16204019  w}{\f0\fs24\insrsid5315415\charrsid5770064 ith effect from 1st January 1980}{\f0\fs24\insrsid11672201 .}{
\f0\fs24\insrsid5315415\charrsid5770064  I do appreciate that the Section was only in force for 7 months so far as the company}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 
s 1980 return was concerned. It appears to me that section 19(}{\i\f0\fs24\insrsid5315415\charrsid16058662 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) only had to be considered if the interest was not "actually incurred in the production }{
\f0\fs24\insrsid16204019\charrsid5770064 of income}{\f0\fs24\insrsid5315415\charrsid5770064 ". Such interest was already excluded from section 19(}{\i\f0\fs24\insrsid16058662\charrsid16058662 h}{\f0\fs24\insrsid5315415\charrsid5770064 
) because on the facts it was interest incurred in production of income and delegation of section 19(}{\i\f0\fs24\insrsid16058662\charrsid16058662 h}{\f0\fs24\insrsid5315415\charrsid5770064 ) in the circumstances made no difference in my view}{
\f0\fs24\insrsid16204019 .
\par }{\f0\fs24\insrsid5315415\charrsid5770064 
\par The Court of Review did not seek to apportion the interest under section }{\f0\fs24\insrsid16204019 1}{\f0\fs24\insrsid5315415\charrsid5770064 9(}{\i\f0\fs24\insrsid5315415\charrsid16204019 h}{\f0\fs24\insrsid5315415\charrsid5770064 
) and in my view was correct in that approach. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The third ground fails. 
\par }{\f0\fs24\insrsid16204019 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The appeal is allowed. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The Court of Review}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s order allowing the appeal is set aside and the Co}{\f0\fs24\insrsid16204019 m}{
\f0\fs24\insrsid5315415\charrsid5770064 missioner}{\f0\fs24\insrsid5770064\charrsid5770064 '}{\f0\fs24\insrsid5315415\charrsid5770064 s assessment is confirmed. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 The appellant is to have the costs of this appeal and of the appeal to the Court of Review. }{\f0\fs24\insrsid5315415 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\i\f0\fs24\insrsid5315415\charrsid16204019 Appeal allowed. 
\par }{\f0\fs24\insrsid16204019\charrsid5770064 
\par }{\f0\fs24\insrsid5315415\charrsid5770064 [Note: An appeal against this decision is reported at 29 FLR 39] 
\par }}