Forwood Down & Co Ltd v. Commissioner of Taxation (Western Australia)

53 CLR 403

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(Judgment by: Rich J)

Forwood Down & Co Ltd v. Commissioner of Taxation (Western Australia)

Court:

Judges:
Rich JStarke J
Dixon J
Evatt J
McTiernan J

Subject References:
Taxation and revenue
Dividend duties
Sale of lease and machinery
Profit from sale taken into profit and loss account

Legislative References:
Dividend Duties Act 1902 (WA) No 32 - Section 5; Section 6

Judgment date: 26 August 1935

PERTH

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Judgment by:
Rich J

I think that the conclusion arrived at by Dwyer J. is entirely supported by the facts. His Honour did not, I think, accept the evidence that the property was not intended to be resold but that it was acquired and intended to be retained as a capital asset. In the course of his judgment his Honour said:"But in view of the company's letter of 28th June 1923 I think the company's present statement of its intention is mistaken and that there was throughout a purpose to resell the mine if that could be effected. Some of the machinery was disposed of during succeeding years, but a substantial quantity was retained. I gather from the company's communication that the portion disposed of was regarded as surplus plant and the residue kept was sufficient to work the mine." I would add that the company did not intend to work the mine itself. I consider that the facts warrant the conclusion that the sale in question resulted in a profit arising from carrying on the business of the company.

The appeal should be dismissed with costs.