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Restrictive Practices
An agreement between Schweppes Ltd. and J. Lyon
and Co. Ltd. for the marketing in England and Wales of
Suncrush, Kia-ora and Sunfresh citrus fruit soft drinks
only through Rose Kia-ora Sales Co. Ltd. was held to
be registrable under the Restrictive Trade Practices Act,
1956, and therefore it must be justified before the Re
strictive Practices Court as being in the public interest.
[Registrar
of Restrictive Trading Agreement
v.
Schweppes and Others. Ch. Div.
The Times,
18 February
1971.]
Sovereigns Immunity
Before Lord Denning, Lord Justice Salmon and
Lord Justice Pillimore. A corporation established by
a statute of the Province of New Brunswick, Canada,
with power to promote the industrial development and
prosperity of the province on behalf of the Crown "in
right of New Brunswick" was held to be an arm of a
sovereign government and therefore entitled to immunity
from suit in the courts of this country.
[Mellingar and Another v. New Brunswick Corpor
ation. Court of Appeal.
The Times,
17 February, 1971.]
State Privilege
A claim of Crown privilege is not made in proper form
if the class of documents in respect of which protection
is sought is so wide as to be indeterminate, nor will a
claim of legal privilege be allowed unless the documents
sought to be protected are adequately described.
[Alfred Crompton Amusement Machines Ltd. v. Com
missioners of Customs and Excise.]
Tax Law
[See under Conflict of Interests. Brokaw and Another
v. Seetrain U.K. Ltd. and the Government of the U.S.A.
claimants.]
Their Lordships,
dismissing
an
appeal by Mr.
Pearlberg
from a decision of Mr.
Justice Penny-
cuick, last February, held that the commissioner to whom
application is made for leave to raise an assessment re
lating to the "second six years", under section six of
the Income Tax Management Act, 1964, is bound to act
fairly but is under no absolute duty to hear the taxpayer
on the making of the application. The granting of such
leave without hearing the taxpayer is not a nullity, nor
are assessments raised after leave so granted ultra vires.
For the purpose of making good to the Crown a loss
of tax wholly or partly attributable to the fraud, wilful
default, or neglect of the taxpayer, as assessment may
be raised for any of the six years before the loss has
become apparent to the Revenue (the "first six years")
without leave (Income Tax Act, 1952, section 57). Section
6 of the 1964 Act provides that assessments may be
raised out of time relating to a further six years (the
"second six years") "only .
.
. with the leave of a com
missioner given on being satisfied by an inspector .
.
.
that there are reasonable grounds for believing that tax
has or may have been lost to the Crown owing to the
fraud or wilful default or neglect of any person". Section
51 of the Finance Act, 1960, provides that an assessment
may be raised for a yet earlier period of six years (the
"third six years") "only .
.
. with the leave of the com
missioners .
.
." where, under section 51 (5) "it appears
to the [commissioners]
.
.
.
that there are reasonable
grounds for believing that tax .
.
. was or may have been
lost to the Crown .
. ." Subsection (7) provides that "An
application for leave .
.
. may be made by the [inspector]
.
.
.
and on any such application the person to be
assessed shall be entitled to appear and be heard."
[Pearlberg v. Verty (Inspector of Taxes). Court of
Appeal.
The Times,
13 February, 1971.]
A person who is entitled to an allowance under the
Family Allowances Act, 1965, in respect of one child is
not liable to have his personal reliefs against income tax
reduced in respect of that allowance under section 14
of the Finance Act, 1968, but a person in receipt of more
than one allowance is liable to suffer such a reduction
in respect of all such allowances received by him.
The Times, 5
March, 1971.]
[Restorick (Inspector of Taxes) p. Beker. Ch. Div.
Their Lordships dismissed an appeal by the taxpayers,
Shell Petroleum Co. Ltd., affirming a decision of Mr.
Justice Buckley, who had dismissed an appeal from the
special commissioners who upheld an assessment to cor
poration tax in respect of two of Shell's subsidiaries,
without giving relief under section 84 and schedule 20
of the Finance Act, 1965 in respect of excess credit for
foreign tax. The amount of relief claimed was some
£6m. for the year 1966-67.
[Shell Petroleum Co. Ltd. v. Carr (Inspector of Taxes)
Court of Appeal.
The Times, 4
March, 1971.]
Taxpayer carries on business as publican, in Bray;
the accommodation
included a shop and residential
flats which were let. Taxpayer was assessed to Income
Tax for 1964/65 on the following: —
(a) Profits as a publican; (b) Interest and income from
securities;
(c) Rents from
letting premises; and (d)
ownership of property.
Taxpayer died in July 1965, but appeal continued by
personal representatives. S.84 of Finance Act 1963 pro
vided that the profits and gains arising from any rent
in respect of any premises should be the annual profits,
i.e. rents received less specified deductions. It was con
tended that serving notices to quit and bringing eject
ments were managerial in character, and should thus
be deemed to be "earned income" from which a relief
of one fourth could be deducted. It was however held
by Kenny J. that the taxpayer was not carrying on or
exercising a
trade when she
let her property. The
Circuit Judge was wrong in deciding otherwise. Appeal
allowed.
[Meckin v. Parker. Kenny J. Unreported 8 February
1971.]
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