Just under a year ago I wrote the following regarding the full Federal Court decision in MBI Properties…
So the supply was defined form a literal rather than a practical perspective and led to a ridiculous outcome.
But remember the Federal Court also found that there was no supply by Qantas when people did not turn up for their flight… A decision laughed off by the High Court who took a practical rather than a literal view of what is a supply.
And remember the Federal Court also found that there was no supply on a forfeited deposit in Reliance Carpets… A decision laughed off by the High Court who took a practical rather than a literal view of what is a supply.
No points for guessing what the High Court will do.
Maybe the Federal Court might one day accept it is the Federal Court and not the High Court, read the Constitution (i can’t talk as I failed Constitutional Law) and start making GST decisions that the High Court does not need to overturn. I can only hope…
Well, this week the High Court has unanimously found for the Commissioner, holding that the conditions for the operation of s 135-5 were met. And just as expected the High Court said the Full Federal Court
…was wrong to reason that the only relevant supply was on the grant of the lease by South Steyne to MML, and the Full Court in South Steyne was wrong to conclude that MBI made no supply to MML.
Is it worth reminding the Full Federal Court that they only exist due to an Act of a Parliament (Federal Court of Australia Act 1976). And the only reason that Act could be created by that Parliament was that in 1900 the Constitution was adopted – a Constitution that forms one court to sit above all other Courts – the High Court.
So if the High Court, generally unanimously, keeps interpreting the GST laws in a practical way rather than a technical way, like in Qantas, like in Reliance Carpets, like in MBI Properties… maybe the Full Federal Court should start doing the same. Maybe the Federal Court should remember who they are.
If a part time tax boffin, part time Thomas the Tank Engine watcher (who I am) knows what the outcome of a Federal Court appeal will be a year in advance, then it should be obvious to much brighter tax minds than me…
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