Federal Court of Australia

Zhang v Commissioner of Taxation [2025] FCA 1230

ORDERS

THE COURT ORDERS THAT:

1.    The originating application filed on 4 June 2024 be dismissed.

2.    The applicant pay the respondent’s costs as agreed or assessed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

YOUNAN J

1.    INTRODUCTION

1.1    The Application

1    The applicant, Mr Zhang, commenced this proceeding against the respondent, the Commissioner of Taxation, to challenge: first, an entry on his Australian Tax Office (ATO) Statement of Account related to his taxable income; and second, a garnishee notice issued to HSBC Bank, which resulted in the transfer of $391,735.78 to the respondent to fulfill unpaid debts.

2    The applicant, by an originating application filed on 4 June 2024 (Application), sought the following orders:

Orders sought

1.    An order declaring that the “re-raise the non-pursuit amount-Income Tax” on 17 August 2023 [sic] occurred outside the statute-barred period.

2.    An order setting aside garnishee notice issued to HSBC bank.

3    The details of this claim and the grounds of the Application were enumerated as follows (errors in original):

Details of claim

The Applicant is aggrieved by the conducts because:

1.    The “re-raise the non-pursuit amount-Income Tax” has significantly surpasses the six-year statute-barred period in New South Wales

2.    The suspicious timing of the new tax bill and garnishee notice, and potential manipulation of events effectively undermine the applicant’s access to justice.

3.    The applicant was unable to access relevant to materials to dispute this alleged debt while held in custody.

Grounds of application

1.    Breach of the statute-barred debts in New South Wales.

2.    Breach of the rules of natural justice and raising humanitarian concerns.

4    The applicant’s affidavit affirmed on 18 May 2024 indicates that the proceeding is brought under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act), without reference to any specific provision.

1.2    Additional claims

5    In written submissions filed on 9 May 2025, the applicant sought further orders regarding the payment of $395,642.61 obtained under the garnishee notice on 20 May 2024, with interest and payment for the applicant’s expenses and “burden in the mind and soul associated with this court proceedings [sic]”, as well as an order that the respondent not “raise, re-raise any debts or issue any further notice of amended assessments against the applicant for his tax returns since 2003 to 2022 that the notice of assessments had been already issued”. Those proposed orders appear to be predicated on the success of the Application.

6    Additionally, the applicant relied on allegations of fraud and the tort of misfeasance in public office. The question of whether these allegations were within the scope of the Application was the subject of dispute.

7    The applicant appeared for himself at all stages of the proceeding, including an interlocutory dispute regarding access to materials in which Registrar Segal set aside the balance of the applicant’s Notice to Produce filed on 3 October 2024 that was pressed at the hearing on 14 February 2025. It is apparent from his written and oral submissions that the applicant desires to ventilate almost every issue that has arisen over the course of his lengthy dispute with the Commissioner. As a result, his submissions frequently addressed legal issues, and referred to factual matters, that were irrelevant to the claims in his Application.

2.    BACKGROUND

8    The applicant is 62 years old and has resided in Australia since 1990. The applicant’s primary source of income has been property investment and development.

2.1    Notice of assessment

9    On 5 March 2004, a notice of assessment for the year ending 30 June 2003 was issued to the applicant, which identified the applicant’s taxable income as $19,104 and the tax on this income as $2,227.68.

10    On 9 February 2006, the applicant was the subject of an audit investigation. In its audit decision dated 22 June 2009, the respondent identified $3,306,762.89 of additional income tax and imposed an administrative penalty of $1,653,381.60. The respondent amended the assessments of the applicant’s taxable income for the financial years 2003 to 2007 inclusive.

2.2    Objection

11    On 7 June 2010, the applicant applied for an extension of time to lodge an objection against the six amended assessments issued by the respondent between 2003 and 2007. On 24 March 2011, the respondent allowed the extension of time and the objection in part, leading to reductions in the applicant’s taxable income, income tax payable and administrative penalty (Commissioner’s Decision).

12    On 29 April 2011, the applicant applied under s 29(1) of the Administrative Appeals Tribunal Act 1975 to review this decision.

13    On 5 March 2012, as a result of the Commissioner’s Decision, the respondent issued a second amended assessment for the period ending 30 June 2003, which identified an amended taxable income of $2,575,766 and a tax on taxable income of $1,197,990.02.

14    On 2 March 2016, the AAT set aside the Commissioner’s Decision with respect to the applicant’s primary tax, and remitted the matter for reconsideration with a direction that the Commissioner have regard to the concessions made by the Commissioner and the Administrative Appeal Tribunal’s conclusions and reasons (AAT Decision). The Tribunal rejected the applicant’s explanations for all amounts in dispute (a total of 216), save for the receipt of a $10,000 personal loan, and affirmed the penalty rate imposed. The Tribunal found that the amended assessments were not out of time or excessive, being satisfied of the presence of tax avoidance due to fraud or evasion in the 2003 and 2004 financial years, and the presence of fraud and evasion in the financial year 2005.

15    On 12 May 2016, the respondent issued a notice of amended assessment for the period ending 30 June 2003, which gave effect to the AAT’s decision, and reduced the applicant’s taxable income to $2,558,033 and the tax on taxable income to $1,189,655.51.

2.3    Re-raise of the debt

16    In March 2013, a non-pursuit recommendation was approved on the basis that it was uneconomical to pursue certain debts of the applicant, including the debt in relation to the period ending 30 June 2003. This recommendation was recorded on the applicant’s Statement of Account on 12 March 2013. It appears to have been made on the basis of the applicant’s limited assets in Australia and the paucity of debt recovery options while the applicant remained incarcerated.

17    On 14 July 2016, as a consequence of amendments to the applicant’s debt following the Commissioner’s Decision, a specific income tax debt totalling $1,828,271.97 was recorded in the applicant’s Statement of Account as “uneconomical to pursue”.

18    On 17 August 2022, the applicant’s Statement of Account recorded a “Re-raise of non-pursuit amount – Income Tax” of $1,819,671.46. This represented the balance of the ‘re-raise’, given that an amount of the ‘non-pursuit’ had previously been re-raised.

19    An activity note regarding the applicant’s debt was created in the ATO’s internal system on 17 August 2022, and stated:

[a]s per advice from Frontline Excellence (UKUSK) I have re-raised the non-pursuit on the ITA 551 1/7/02 – 30/6/03 period so that the false credit from ITA GIC’s could be returned to the correct periods.

Re-raised the amount of $1,828,271.97 effective date 14/7/16 on the 2003 period.

20    An email dated 10 August 2022 from a Support Officer within the ATO stated that the “purpose of performing this action [the re-raise] is for clarity of accounting only.” A submission by a case officer on 29 February 2024 for non-pursuit was rejected in order to allow for identification of the assets that could be recouped.

21    On 23 September 2022, the applicant received an email notification from the ATO that he owed a debt of $1,152,002.06. In an affidavit dated 18 May 2024, the applicant claimed that his ATO portal indicated that he had no outstanding debt in the months leading up to this notification.

2.4    Garnishee notice

22    On 6 March 2024, the respondent issued a notice to HSBC under s 353-10 of Schedule 1 to the Taxation Administration Act 1953 (TAA 1953) seeking information regarding assets, liabilities and accounts held by the applicant (s 353-10 notice). In response, on 13 March 2024, HSBC identified a term deposit of $391,735.78.

23    Case note entries in the ATO’s Siebel system on 29 February 2024 confirm that non-pursuit of the applicant’s outstanding income tax debts was considered on the basis that he was incarcerated. However, following receipt of the response from HSBC to the s 353-10 notice, it was concluded that a garnishee notice ought to be issued to recover the outstanding debt, which at the time was $2,043,255.21. The author noted that the applicant was unwilling or unable to address the debt, citing the following factors:

(1)    the applicant’s poor compliance history;

(2)    the applicant’s recent incarceration for tax evasion;

(3)    the sum of $7,597,367.12 that was already in non-pursuit;

(4)    the applicant’s latest payment for his income tax account being $363.40 on 26 June 2009; and

(5)    the significant period of time that had passed since the debt began to accrue, and the applicant’s unwillingness to pay the debt despite being aware of it.

24    On 23 April 2024, the respondent issued a notice to HSBC under s 260-5 of Schedule 1 to the TAA 1953 requiring HSBC to pay the respondent the entirety of the term deposit of $391,735.78 (which was less than the amount owing at the time, viz., $2,076,506.81). The respondent notified the applicant of the issuance of the notice by letter on the same day.

3.    LEGAL PRINCIPLES

25    The legal principles relevant to the Application pertain to:

(1)    the issuance of a garnishee notice under the TAA 1953;

(2)    the assessment of a taxpayer’s taxable income (and tax payable thereon) under Part IV of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936);

(3)    the decisions that may be subject to judicial review under the ADJR Act; and

(4)    the limitation period applicable to the statutory regime governing tax assessments.

3.1    Garnishee Notice

26    Subdivision 260-A of Schedule 1 to the TAA 1953 applies where an amount of a tax-related liability (the debt) is payable to the Commonwealth by an entity (the debtor), regardless of whether the debt has become due and payable: s 260-5(1).

27    Section 260-5(2) provides that (emphasis in original):

Commissioner may give notice to an entity

 (2)     The Commissioner may give a written notice to an entity (the third party) under this section if the third party owes or may later owe money to the debtor.

28    Section 260-5(3) clarifies that (emphasis in original):

Third party regarded as owing money in these circumstances

 (3)     The third party is taken to owe money (the available money) to the debtor if the third party:

…

 (b) holds the money for or on account of the debtor;

… .

29    The power in s 260-5(2) is discretionary, owing to the word ‘may.’ The discretion is in its terms unconfined: it does not impose preconditions on the exercise of the power, nor mandatory considerations for the Court in assessing its exercise. However, this Court has identified the purpose of the power, which is to protect revenue, but not to subvert the principle that property should not be subject to arbitrary seizure; nor to negate the statutory rights to contest assessments; nor to allow the Commissioner to be motivated in the exercise of his power by improper or collateral purposes, or punishment of the taxpayer: Edelsten v Wilcox and Another (1988) 83 ALR 99 at 111-113, in relation to then s 218 of the ITAA 1936, applied in Uratoriu v Commissioner of Taxation [2008] FCA 1531 at [21], per McKerracher J. There must be advertence to the quality of fairness, and in that regard the Commissioner must take account of the circumstances of the individual taxpayer, and of the effect on them of the contemplated recovery: Edelsten at 112-113.

3.2    Assessment of taxable income

30    Part IV of the ITAA 1936 governs returns and assessments made by the Commissioner. Under s 166, the Commissioner is required to make an assessment of a taxpayer’s taxable income and the amount of tax payable thereon based on that taxpayer’s returns.

31    Section 170 of the ITAA 1936 sets out the timeframes in which the Commissioner may amend an assessment. Items 5 and 6 relevantly provide:

5    The Commissioner may amend an assessment at any time if he or she is of the opinion there has been fraud or evasion.

6    The Commissioner may amend an assessment at any time:

(a)    to give effect to a decision on a review or appeal; or

(b)    as a result of an objection made by the taxpayer or pending a review or appeal.

These items are stated to be without qualification.

32    Section 174(1) requires the Commissioner to provide notice of an assessment to the person liable to pay the tax as soon as convenient following the assessment.

33    Section 350-10(1), item 2, of Schedule 1 to the TAA 1953 provides that production of a notice of assessment under a taxation law (viz., an Act of which the Commissioner has general administration, including the TAA 1953) is conclusive evidence that the assessment was properly made, and, except in proceedings under Part IVC of the Act, that the amounts and particulars of the assessment are correct.

34    Section 175 of the ITAA 1936 provides that “[t]he validity of any assessment shall not be affected by reason that any of the provisions of this Act have not been complied with.” If a taxpayer is dissatisfied with an assessment made in relation to them, s 175A(1) provides that they may object in the manner set out in Part IVC of the TAA 1953.

35    However, as the High Court held in Commissioner of Taxation v Futuris Corporation Ltd (2008) 237 CLR 146 at [24], “[w]here s 175 applies, errors in the process of assessment do not go to jurisdiction and so do not attract the remedy of a constitutional writ under s 75(v) of the Constitution or under s 39B of the Judiciary Act”.

36    In a proceeding brought under s 39B(1) and (1A) of the Judiciary Act 1903 (Cth) and the ADJR Act, Middleton J held in Shail v Commissioner of Taxation (2007) 162 FCR 148 at [22]:

Except in very limited circumstances, the taxpayer’s rights to dispute liability to taxation are provided for by the objection, review and appeal procedures in Pt IVC of the TAA and are to be pursued by those procedures rather than by proceedings such as this one. However, if it appears, either on the face of a notice of assessment or from elsewhere, that the Commissioner has acted for an improper purpose, has not attempted in good faith to determine the taxable income or has not made an assessment definitive of the tax liability of the taxpayer, the assessment will not attract the protection of s 175.

3.3    Reviewable decisions under the ADJR Act

37    Under s 3(1) of the ADJR Act, “a decision to which this Act applies” is defined as follows (emphasis in original):

decision to which this Act applies means a decision of an administrative character made, proposed to be made, or required to be made (whether in the exercise of a discretion or not and whether before or after the commencement of this definition):

 (a)     under an enactment referred to in paragraph (a), (b), (c), (d) or (e) of the definition of enactment; or

 (b)     by a Commonwealth authority or an officer of the Commonwealth under an enactment referred to in paragraph (ca), (cb) or (f) of the definition of enactment;

other than:

 (c)     a decision by the Governor-General; or

 (d)     a decision included in any of the classes of decisions set out in Schedule 1.

38    Schedule 1 to the ADJR Act includes the following classes of decisions (which are not decisions to which the Act applies):

(e)     decisions making, or forming part of the process of making, or leading up to the making of, assessments or calculations of tax, charge or duty, or decisions disallowing objections to assessments or calculations of tax, charge or duty, or decisions amending, or refusing to amend, assessments or calculations of tax, charge or duty, under any of the following Acts:

…

Income Tax Assessment Act 1936

Income Tax Assessment Act 1997

… .

39    Section 5 of the ADJR Act addresses the circumstances in which a Court may review a decision to which the Act applies, and relevantly provides:

5 Applications for review of decisions

(1)     A person who is aggrieved by a decision to which this Act applies that is made after the commencement of this Act may apply to the Federal Court or the Federal Circuit and Family Court of Australia (Division 2) for an order of review in respect of the decision on any one or more of the following grounds:

(a)    that a breach of the rules of natural justice occurred in connection with the making of the decision;

…

(e)     that the making of the decision was an improper exercise of the power conferred by the enactment in pursuance of which it was purported to be made;

(f)    that the decision involved an error of law, whether or not the error appears on the record of the decision;

(g)     that the decision was induced or affected by fraud;

…

(j)     that the decision was otherwise contrary to law.

(2)     The reference in paragraph (1)(e) to an improper exercise of a power shall be construed as including a reference to:

…

(c)     an exercise of a power for a purpose other than a purpose for which the power is conferred;

(d)     an exercise of a discretionary power in bad faith;

…

(j)     any other exercise of a power in a way that constitutes abuse of the power.

40    Section 6 of the ADJR Act addresses the circumstances in which a Court may review conduct engaged in for the purpose of making a decision, and relevantly provides:

6 Applications for review of conduct related to making of decisions

 (1)     Where a person has engaged, is engaging, or proposes to engage, in conduct for the purpose of making a decision to which this Act applies, a person who is aggrieved by the conduct may apply to the Federal Court or the Federal Circuit and Family Court of Australia (Division 2) for an order of review in respect of the conduct on any one or more of the following grounds:

(a)     that a breach of the rules of natural justice has occurred, is occurring, or is likely to occur, in connection with the conduct;

    …

(e)     that the making of the proposed decision would be an improper exercise of the power conferred by the enactment in pursuance of which the decision is proposed to be made;

(f)     that an error of law had been, is being, or is likely to be, committed in the course of the conduct or is likely to be committed in the making of the proposed decision;

(g)     that fraud has taken place, is taking place, or is likely to take place, in the course of the conduct;

    …

(j)     that the making of the proposed decision would be otherwise contrary to law.

(2)     The reference in paragraph (1)(e) to an improper exercise of a power shall be construed as including a reference to:

    …

(c)     an exercise of a power for a purpose other than a purpose for which the power is conferred;

(d)     an exercise of discretionary power in bad faith;

    …

    (j)     any other exercise of a power in a way that constitutes abuse of power.

41    A person aggrieved by a decision includes a person whose interests are adversely affected by the decision (s 3(4)(a)(i)). A person aggrieved by conduct that has been, or is being, or is proposed to be, engaged in for the purpose of making a decision or by a failure to make a decision, includes a person whose interests are or would be adversely affected by the conduct or failure (s 3(4)(b)). Further, conduct engaged in for the purpose of making a decision includes the doing of any act or thing preparatory to the making of the decision, including the taking of evidence or the holding of an inquiry or investigation (s 3(5)).

42    In Griffith University v Tang (2005) 221 CLR 99 at [89], Gummow, Callinan and Heydon JJ held that:

The determination of whether a decision is “made … under an enactment” involves two criteria: first, the decision must be expressly or impliedly required or authorised by the enactment; and secondly, the decision must itself confer, alter or otherwise affect legal rights or obligations, and in that sense the decision must derive from the enactment. A decision will only be “made … under an enactment” if both of those criteria are met.

43    As to the second criterion in Tang, a preliminary decision or finding will derive from an enactment where it is an “essential preliminary” or condition precedent to the making of the ultimate decision: Fuller v Lawrence (2024) 99 ALJR 103; [2024] HCA 45 at [16].

3.4    Limitation periods in NSW

44    The Limitation Act 1969 (NSW) consolidates the laws relating to the limitation of actions within the jurisdiction of NSW.

45    Relevantly, the Limitation Act constrains a cause of action related to the recovery of a debt after a 6-year period:

14   General

(1)      An action on any of the following causes of action is not maintainable if brought after the expiration of a limitation period of six years running from the date on which the cause of action first accrues to the plaintiff or to a person through whom the plaintiff claims—

…

(d)    a cause of action to recover money recoverable by virtue of an enactment, other than a penalty or forfeiture or sum by way of penalty or forfeiture.

46    Any cause of action to recover the debt is extinguished upon expiration of the relevant limitation period, by operation of s 63 of the Limitation Act.

47    In considering the application of State-based limitation periods to Commonwealth or State authorities, s 64 of the Judiciary Act provides that:

64 Rights of parties

In any suit to which the Commonwealth or a State is a party, the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject.

48    In Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55, the Court considered whether an action to recover tax brought by the Deputy Commissioner under the ITAA 1936 was subject to the Limitation of Actions Act 1974 (Qld) (Qld Limitation Act) by operation of s 64 of the Judiciary Act. The Court held the action for recovery of tax satisfied the terms of the Qld Limitation Act, making it prima facie applicable, but that the provisions of the ITAA 1936 preclude any operation of s 64 which would have the effect of applying to the proceedings the limitation periods which would be applicable if the Deputy Commissioner’s action was brought in the Supreme Court of Queensland by a subject (at 62). With reference to s 109 of the Constitution, the Court held that it was clear that the general scheme of the ITAA 1936 provisions providing for the collection and recovery of tax covered the field; that there was no room for the importation into them of such State Limitation Acts provisions; and that the intrusion of such provisions would significantly undermine the scheme for collection and recovery of tax which is contained in the ITAA 1936 (at 66). In that regard, the Court referred to the incompatibility of such provisions with the existence of the Commissioner’s broad discretionary power to grant extensions of time or delay payment to hear an objection, or to issue an amended assessment (in some cases, at any time) (at 66-68).

49    The powers considered by the High Court in Moorebank are reflected today in the ITAA 1936 and TAA 1953, and form part of the regime for the collection and recovery of tax-related liabilities. The regime created by the two Acts: (i) imposes time limits on the payment of general interest charges (s 8AAE of the TAA 1953), penalties (s 298-15 in Schedule 1 to the TAA 1953), and payable tax enumerated in an amended assessment (formerly s 204(2) of the ITAA 1936, as maintained by s 56 of the Tax Laws Amendment (Transfer of Provisions) Act 2010 (Cth)); (ii) gives the Commissioner the power to defer the time for payment (in toto and by instalment: s 255-10(1) and s 255-15 of the TAA 1953); and (iii) allows the Commissioner to amend an assessment within delineated time frames, including ‘at any time’ in the circumstances of s 170(1), items (5) and (6), of the ITAA 1936: see Moorebank at 67.

50    The operation of s 79 of the Judiciary Act does not alter the analysis. It relevantly provides (emphasis added):

79 State or Territory laws to govern where applicable

(1)     The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.

51    A law of the Commonwealth may ‘otherwise provide’ if it “evinces an intention that it cover the field of activity in relation to its subject matter, such that that intention would be undermined by the application of the State law”: Hitachi Construction Machinery (Australia) Pty Ltd v Coal Mining Industry (Long Service Leave Funding) Corporation (2024) 306 FCR 486 at [198]. This is consistent with the finding of the High Court in Rizeq v Western Australia (2017) 262 CLR 1 at [63] per Bell, Gageler, Keane, Nettle and Gordon JJ, that the purpose of s 79 is to ensure that the exercise of federal jurisdiction is effective, and, in that regard, fills a gap in the law governing the exercise of federal jurisdiction which exists by reason of the absence of State legislative power: “The section has no broader operation.”

4.    DISPOSITION

52    The Application seeks a review of the conduct of the respondent concerning: (a) the re-raise of the ‘non-pursuit amount’ of income tax; and (b) the issuance of the garnishee notice. There is no contest that the issuing of the garnishee notice under s 260-5 of Schedule 1 of the TAA 1953 is a decision that is amendable to review under the ADJR Act, either as a decision in itself (for the purposes of s 5 of the ADJR Act) or as conduct related to the making of the decision (for the purposes of s 6 of the ADJR Act).

4.1    Is the re-raise reviewable under the ADJR Act?

53    A preliminary question arises as to whether the conduct constituting the re-raise is reviewable under the ADJR Act. In my view, it is not a decision to which the ADJR Act applies, nor conduct engaged in for the purpose of making a decision to which the ADJR Act applies, within the meaning of s 3 of the Act.

54    First, the re-raise is not a decision made, proposed or required to be made, under an enactment for the purposes of s 3(1)(a) or (b) of the ADJR Act. The applicant did not refer to any provision of the taxation legislation (or other legislation) that expressly or impliedly required or authorised a decision to be made as to whether or not to pursue a debt. In that regard, the first criterion in Tang is not met. That is sufficient to deny the re-raise the character of a decision made under an enactment.

55    Second, the re-raise does not itself confer, alter or otherwise affect legal rights or obligations, and in that sense, derive from an enactment. As the respondent submitted, and the evidence demonstrates, the re-raise is an accounting process, akin to a determination that a debt may not be economical to pursue. It does not relevantly affect the applicant’s legal rights or obligations, in the sense that the debt does not arise at the point of the re-raise (in the same way that the debt is not extinguished at the point at which it is determined that it is uneconomical to pursue). It is due and payable after the issuance of the notice of assessment. As such, the second criterion in Tang is not met.

56    Third, to the extent that the re-raise may be characterised as a decision making, or forming part of the process of making, or leading up to the making of, assessments or calculations of tax, charge or duty, or decisions disallowing objections to assessments or calculations of tax, charge or duty, or decisions amending, or refusing to amend, assessments or calculations of tax, charge or duty, under either the ITAA 1936, Income Tax Assessment Act 1997 (Cth) (ITAA 1997) or (relevantly) Part 4-1 in Schedule 1 to the TAA 1953, it is not a decision to which the ADJR Act applies (s 3(1)(d) of the ADJR Act). I note that there was no argument on this point.

57    Fourth, I do not accept that the re-raise (of the non-pursuit of the debt), which was recorded on the applicant’s Statement of Account on 17 August 2022, and described as being undertaken “for clarity of accounting only”, is conduct for the purpose of making a decision to which the ADJR Act applies (s 6). While the re-raise preceded the decision to issue a garnishee notice to HSBC on 6 March 2024 in order to recover the outstanding debt, that is not sufficient to demonstrate that the re-raise was preparatory to the making of the decision to issue the notice, as per s 3(5) of the ADJR Act, or, perhaps more broadly, that the purpose of the re-raise was to make the decision to issue the garnishee notice (or any other decision). The evidence does not demonstrate the relevant purpose. Furthermore, the distance in time between the re-raise and the issuance of the garnishee notice, while not determinative, does not assist the applicant in that regard.

4.2    Is the re-raise statute-barred?

58    The applicant claims that the re-raise recorded on his Statement of Account on 17 August 2022, is outside the relevant limitation period. The applicant submits that the debt owed by the applicant to the tax office for the 2003 financial year was waived 6 years after the assessment.

59    The respondent submits – and I accept - that this ground of the application for judicial review under the ADJR Act is tantamount to an allegation of an error of law in failing to apply the Limitation Act. However, once it is determined that the ‘re-raise’ is not amenable to judicial review under the ADJR Act, this ground of the application falls away.

60    In the applicant’s written submissions, it was not always clear whether he contended that the limitation period was applicable to the re-raise or the garnishee notice, or both. In either case, it does not alter my analysis.

61    The applicant relied on two sources of time limitation:

(1)    First, the statutory limit of 6 years that is “set in NSW”. I assume the provision in question to be s 14 of the Limitation Act (in conjunction with s 63).

(2)    Second, the statutory limit of 4 years by reference to s 105-50 of Schedule 1 to the TAA 1953.

62    In relation to the first alleged source, the respondent issued a notice of a constitutional matter under s 78B of the Judiciary Act. The respondent submits that the matter is resolved by existing authority. I agree. Following the analysis in Moorebank and Rizeq, it is evident that the general scheme of the ITAA 1936 and TAA 1953 providing for the collection and recovery of tax subject to limitations as to time, covers the field. As such, the scheme is incompatible with the importation of time limits imposed by the Limitation Act. On that basis, and following the recent analysis in Hitachi, this is not a case to which the Limitation Act is applicable.

63    In relation to the second alleged source, as the respondent submits, the time limit imposed by s 105-50(1) of Schedule 1 to the TAA 1953 is not applicable to income tax. The section, which has since been repealed, was concerned with indirect taxes, and provided (as at 5 May 2016) that:

Any unpaid *net amount, *net fuel amount or amount of *indirect tax (together with any relevant general interest charge under this Act) ceases to be payable four years after it became payable by you.

*For definition, see section 995-1 of the Income Tax Assessment Act 1997.

64    The definitions of “net amount”, “net fuel amount” and amount of “indirect tax” in s 995-1 of the ITAA 1997 make clear that s 105-50(1) was not concerned with income tax. As such, even at the time at which the applicant’s tax debt was incurred (on 12 May 2016, when the respondent issued the notice of amended assessment for the 2003 financial year), the section relied upon by the applicant was not applicable such that the debt ceased to be payable four years after it became payable.

4.3    Was there a breach of the rules of natural justice in issuing the garnishee notice?

65    There are two aspects of this ground of the Application. First, the applicant claims that the garnishee notice is “suspicious” in its timing and reveals “potential manipulation of events effectively undermining the applicant’s access to justice”. Second, the applicant claims that he was unable to access relevant materials to dispute the alleged debt while held in custody, raising humanitarian concerns.

66    In relation to the first claim, insofar as the applicant alleges fraud or bad faith, the details of that allegation are not provided in the Application.

67    Section 11(1) of the ADJR Act provides that an application for review to the Federal Court must be made in such manner as is prescribed by the Federal Court Rules 2011 (Cth). Rule 31.01(2) of the Federal Court Rules provides:

31.01 Application for order of review

…

(2)     If the grounds of the application include an allegation of fraud or bad faith, the originating application must include details of the alleged fraud or bad faith.

68    I accept the respondent’s submission that the Court is confined to consideration of the relief sought and the grounds identified in the Application, and it is not for the Court itself to “go looking for” error from a general and unparticularised ground: see Singh v Minister for Immigration and Border Protection (2016) 240 FCR 1 at [34]-[35], per Charlesworth J.

69    In the absence of the detail prescribed by r 31.01(2) of the Federal Court Rules, it is not clear what the applicant means by “suspicious” timing, other than to implicate that the notice came at a time that impacted his financial ability to prosecute his claim in court proceedings (which complaint is apparent from the applicant’s written submissions). While that may have been the effect of the garnishee notice, I do not consider that this (effect) qualifies as a breach of the rules of natural justice occurring in connection with the making of the decision to issue the notice, for the purposes of ss 5(1)(a) or 6(1)(a) of the ADJR Act. To the extent that the applicant suggests that the notice was issued with the intention of undermining his access to justice (in reference to “potential manipulation of events”), I reject that claim as baseless. There is nothing in the ATO’s internal submissions and case notes presented to me that suggests such an intention. Rather, the case notes reveal that the notice was issued in response to an assessment of the prospects of debt recovery given the applicant’s incarceration.

70    The applicant did not take the Court to any evidence that had any bearing on the validity of the garnishee notice to HSBC pursuant to the requirements of s 260-5 of Schedule 1 to the TAA 1953. The Application does not claim that the Commissioner failed to consider his personal circumstances in issuing the notice: see Edelsten at 111-112. In any event, the evidence suggests that consideration was given to those circumstances in an (undated) internal submission that recommended issuance of a garnishee notice against the applicant’s term deposit, which made reference to the context in which the taxation debt arose; the applicant’s incarceration for tax fraud; debt action to date; the applicant’s awareness of the debt; and that the applicant had no known dependents and there was no indication of financial hardship.

71    To the extent that leave was sought to amend the Application to introduce new claims of fraud, I refuse leave in circumstances where the precise amendments are not identified, and the applicant seeks to supplement the Application by reference to his written submissions. That method does not provide the proper particularisation that is required to give the respondent adequate notice of the applicant’s case. Adequate notice is not simply a matter of timing in being apprised of a party’s case; it is also a matter of comprehensibility. The applicant’s proposal is deficient in both respects.

72    I also refuse leave on the basis of futility. There is no evidence to support the applicant’s allegations of fraud. At the hearing of the Application, the applicant made reference to a case management hearing on 15 April 2025 at which I indicated that I would not require an amended application given the common understanding of the parties as to the decision or conduct of the respondent that was in issue in the Application. That common understanding did not include any reference to fraud, and cannot be used as imprimatur for reliance on new claims without leave of the Court.

73    The applicant claims that the breach of the rule of natural justice raises humanitarian concerns. Those concerns are not detailed in the Application, nor supported by any evidence. In written submissions filed on 4 June 2024, the applicant outlines those concerns in terms of his advanced age, various health issues, incarceration and impediments to access to justice, as well as his partner’s health challenges. The applicant does not demonstrate a legal basis for consideration of “humanitarian concerns” as a ground of review of the decision made. As indicated above, the applicant does not claim that the Commissioner failed to consider his personal circumstances in issuing the notice, or that each “concern” was a mandatory relevant consideration. In any event, there is evidence that at least some of these “concerns” were considered as relevant to the decision to issue the notice.

74    In relation to the second claim, regarding access to materials while in custody so as to dispute the “alleged debt”, the applicant did not present any evidence that documents were intentionally withheld by the respondent, as claimed. Moreover, he did not demonstrate how that complaint was relevant to the relief sought in his Application.

75    Insofar as the applicant challenges the amended notice of assessment, no relief is sought in the Application in relation to the notice, which is conclusive evidence that the assessment was properly made, and – except in Part IVC proceedings – that the amounts and particulars of the assessment are correct. The appropriate process for review of an assessment is contained in Part IVC of the TAA 1953. The process to request a review is detailed on the notice itself. That detail was not lost on the applicant, who objected to, and then sought review of, the Commissioner’s earlier decisions by an application to the Tribunal within the scheme established by Part IVC. As the respondent submits, many of the allegations made by the applicant relate to events that pre-date the proceedings before the Tribunal, and could have been raised in that forum. The applicant did not appeal the AAT Decision. This proceeding is not an opportunity to mount such a challenge. Any attack on the validity of the amended notice of assessment is beyond the remit of this proceeding.

4.4    Is there a new allegation of misfeasance in public office?

76    In his written submissions filed on 9 May 2025, the applicant raised an allegation of misfeasance in public office, claiming that the Commissioner had stalled the making of a decision in response to the applicant’s objection to the assessment, and that senior tax officers had issued inadequate assessments; conducted a review tainted by conflicts of interest; and then orchestrated a cover up of this misconduct, which the applicant described as “targeted malice”. The applicant made further claims of the Commissioner’s abuse of power; intentional falsehood; withholding evidence; threatening the applicant’s accountant; and misleading the Court, in a “persistent and prolonged attack” and “war” against the applicant, with “actual intent to cause harm” and to “penalize” the applicant, to “disable his ability financially to bring the case to the Federal Court”.

77    The respondent submitted that the allegation of misfeasance in public office fell outside the scope of the Application, and that leave to amend the Application should not be granted. I agree, and leave is not granted to the extent that it is sought, for reasons of futility (there is no evidence to support the allegation) and prejudice to the respondent.

78    In written submissions in reply on 10 June 2025, the applicant submitted that the claim of the tort of misfeasance in public office had been raised previously in paragraph 61 of his written submissions dated 29 November 2024 (filed on 2 December 2024), in which he cited Futuris and extracted the following (incomplete) paragraph (footnotes omitted):

[What is conveyed by the holding by the Full Court that the second amended assessment did not represent an exercise by the Commissioner of the power to assess which was bona fide?] That phrase is used in several senses in public law. With cognate expressions, it also appears in formulations of the tort of misfeasance in public office. This Court has accepted that in that context it is sufficient that the public officer concerned acted knowingly in excess of his or her power. The House of Lords has since indicated that in English law recklessness may be a sufficient state of mind to found the tort. The affinity between tort law and public law has been remarked upon in this Court; that affinity reflects the precept that in a legal system such as that maintained by the Constitution executive or administrative power is not to be exercised for ulterior or improper purposes.

79    The reference to the passage of Futuris cited in the applicant’s submissions filed on 2 December 2024 does not assist the applicant. As is evident from the text in parentheses in the passage cited above, which was not cited in the applicant’s submissions, the Court’s observation was made in the context of a challenge to a notice of assessment, in which the Court was examining use of the phrase “bona fide” by reference to cognate expressions in formulations of the tort of misfeasance in public office. That reference could not possibly alter the scope of the Application, or, more practically, provide the respondent with notice that the applicant was relying on the tort of misfeasance in public office as a ground of review.

80    Furthermore, while the applicant has consistently made allegations of fraud in his written and oral submissions, those allegations have not included details of the alleged fraud or bad faith, contrary to r 31.01(2) of the Federal Court Rules. The reference to Futuris in the applicant’s submissions filed on 2 December 2024 does not serve the purpose of furnishing that detail, nor does it remedy that omission. It was not for the respondent to intuit that such vague and unparticularised allegations were intended to support a claim of misfeasance in public office that was not made in the Application.

5.    CONCLUSION

81    The applicant has attempted to re-litigate the validity of his income tax assessments, notwithstanding that the AAT Decision dealt with the applicant’s objections to the amended assessments issued by the respondent, and which decision was not challenged on appeal or before me. As Middleton J cautioned in Shail at [22], except in very limited circumstances (and this case does not qualify as such), the taxpayer’s rights to dispute liability to taxation are provided for by the objection, review and appeal procedures in the relevant taxation legislation, and are to be pursued by those procedures rather than by proceedings such as this one.

82    For the foregoing reasons, none of the grounds of the Application has merit. The Application is dismissed, with costs.

Associate:

Dated:    9 October 2025