Cecil Bros Pty Ltd v. Federal Commissioner of Taxation
(1964) 111 CLR 43037 ALJR 445
(Judgment by: Taylor J.)
CECIL BROS. PTY. LTD. v FEDERAL COMMISSIONER OF TAXATION
Court:
Judges:
Owen J.
Dixon C.J.
Kitto J.
Taylor J.Menzies J.
Windeyer J.
Subject References:
Income Tax
Judgment date: 25 February 1964
Judgment by:
Taylor J.
I share the difficulty felt by the Chief Justice in seeing how s. 260 of the Income Tax and Social Services Contribution Assessment Act can operate to extinguish a deduction otherwise properly allowable under s. 51. Further, I find great difficulty in identifying what, on the facts of the case, is said to constitute the contract, agreement or arrangement falling within s. 260. But assuming, as it was put in argument, that the contract, agreement or arrangement was constituted by an arrangement between the appellant and Breckler Pty. Ltd. pursuant to which the latter company was to buy goods needed for the appellant's business at a price at which those goods were available to the appellant and that the appellant should pay Breckler Pty. Ltd. for those goods at a price in excess of the price at which Breckler bought them, I fail to see how its annihilation could, on the proved facts, be said to result in any increase in the taxable income of the appellant. Subject to these observations I agree that the appeal should be allowed for the reasons given by my brother Menzies.