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[2020] ZAECPEHC 5
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Alfdav Construction CC v South African Revenue Service (399/2017) [2020] ZAECPEHC 5 (11 February 2020)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION, PORT ELIZABETH)
CASE
NO: 399/2017
Heard on: 06
February 2020
Delivered
on: 11 February 2020
In
the matter between:
ALFDAV
CONSTRUCTION CC
APPLICANT
and
THE
SOUTH AFRICAN REVENUE SERVICE
RESPONDENT
JUDGMENT
GQAMANA
J:
[1]
This is an application brought in terms of rule 42 of the Uniform
Rules of Court.
The order sought by the applicant is that, the
judgment handed down by Chetty J on 10 October 2017 by amended to
read as
follows:
“
The
applicant is ordered to res-ubmit, without incurring any penalties or
interest in respect of such re-submission, the VAT returns
for the
said period within 60 business days of this order.”
[1]
[2]
A short background to the main application is that, the applicant
filed an application
seeking an order reviewing and setting aside the
VAT assessments for the periods 07/2009 to 12/2013 as listed in
annexure “DZ1”
therein. In addition the
applicant sought an order that it be ordered to re-submit the VAT
returns for the said periods
within 60 business days from the date of
the order. The applicant was successful and obtained the order
sought before Chetty
J.
[2]
The order granted by Chetty J was exactly in the same terms as set
out by the applicant in its amended notice.
[3]
The applicant then filed the present application purportedly in terms
of rule 42 of
the Uniform Rules of Court. For comprehensive
sake, rule 42 (1) reads:
“
(1)
The court may, in addition to any other powers it may have, mero motu
or upon the application
of any party affected, rescind or vary:
(a)
An order or judgment erroneously sought or erroneously granted
in the absence of any affected party thereby
(b)
An order or judgment in which there is ambiguity, or a patent
error or omission, but only to the extent of such ambiguity, error
or
omission;
(c)
An order or judgment granted as a result of mistake common to
the parties.”
[4]
In its founding affidavit in support of the relief in the present
application, the
applicant states that, in its understanding the
effect of the judgment by Chetty J is that, the VAT 201 returns in
respect of the
periods 07/2009 to 12/2013 were re-submitted in
compliance with the court order and therefore the respondent could
not claim penalties
and interest, because they were submitted
timeously in terms of the court order. The crux of its argument
is that: the legal
consequence of the order of Chetty J could never
have intended that penalties and interest should be incurred in
re-submission
of the returns. The argument was further
developed that once the assessment which was challenged before Chetty
J was set
aside inherently is that, the penalties and interest were
also set aside and it would be absurd to penalise afresh the
applicant
to comply with the court order.
[5]
In opposition to the present application, the respondent argued
firstly that interest
and penalties arises because of late payment
and not because of compliance with the judgment and in any event the
issue of penalties
and interest was never raised before Chetty J.
It was also argued by the respondent that the procedure adopted by
the applicant
is entirely inappropriate and impermissible because the
provisions of rule 42 cannot be utilised to supplement the original
order
as the issues of penalty and interest did not arise in the
original application. It was however conceded that the
provisions
of rule 42 could be utilised for clarification of a
judgment where there is ambiguity, error or omission.
[6]
Indeed a court may clarify its judgment or order if on proper
interpretation the meaning
thereof remains obscure, ambiguous or
otherwise uncertain so as to give effect to its true intention,
provided it does not thereby
alter the sense and substance of the
judgment or order.
[3]
[7]
Both counsel for the parties are in agreement that the principles
relating to the
interpretation of judgments are the same as those on
interpretation of a contract as set out in
Natal
Joint Municipal Pension Fund v Endumeni Municipality.
[4]
[8]
In advancing its case, the applicant argued that the judgment of
Chetty J has to be
read in context of the pleadings. As
indicated above, in the main application before Chetty J, the
applicant approached the
court for an order to rectify the incorrect
assessment for the VAT for the relevant periods and such assessment
were reviewed and
set aside. The applicant was ordered to re-submit
VAT returns for the said periods within 60 days from the date of that
order.
[9]
The argument went on to state that it will be absurd to penalise the
applicant for
complying with the order, which compliance was within
the time period set out in the said order.
[10]
I have had the benefit of reading the pleadings in the main
application. The issues of
penalties and interest were not
raised. It was not an issue before Chetty J. Correctly
so, as pointed out by Mr Buchanan
SC, counsel for the respondent,
that while there is room for the court to clarify its judgment,
however, such clarification should
not alter the sense and substance
of the judgment or order.
[11]
As indicated hereinbefore, on reading of the pleadings in the main
action before Chetty J, the
issue of penalties and interest was not
raised and accordingly it will be impermissible to vary the order of
Chetty J to incorporate
interest and penalties.
[12]
Accordingly this application must fail on this leg. However,
for sake for comprehensiveness,
I deal also with the argument raised
by the respondent that the entire application has become moot.
In the supplementary
affidavit filed by the respondents,
[5]
the respondent brought to the attention of the court that, the issue
of penalties and interest has since been resolved between
the parties
wherein the applicant admitted liability to the respondent for the
penalties and interest regarding the VAT periods
relevant herein and
requested a deferred payment arrangement.
[13]
Generally, courts do not decide issues of academic interest only.
It is only in exceptional
circumstances that a court will hear and
determine a dispute which has become moot.
[6]
[14]
As indicated in paragraph 12 above, the applicant admitted liability
and entered into an agreement
to pay the said amounts to the
respondent. Therefore the relief sought in this present
application will have no practical
effect and has become moot.
[15]
Mr Barnard, counsel for the applicant screeched about the manner in
which the respondent’s
filed its supplementary affidavit.
I do accept that, there was no leave sought to file a further
affidavit by the respondent.
However, as correctly pointed out
by Mr Buchanan SC, the respondent has an obligation towards the court
to bring such facts
as they are relevant to the issues before court.
In any event, it is evident from the annexures attached to this
supplementary
affidavit that the applicant was called upon to
indicate its stance in that regard as to whether it intends to file
further supplementary
affidavits but no response was received from
it.
[16]
This belated cry by the applicant that in the event this court is
amenable to admit the respondent’s
supplementary affidavit, it
should also be given an opportunity to respond thereto is
opportunistic. I cannot accede to it
especially in the light of
the overwhelming evidence before me. The applicant was given
the opportunity to respond to it
and in any event there was indeed an
obligation on the respondent to bring such facts to the attention of
the court. Filing
of a further affidavit will simple delay the
matter because the facts cannot be changed and especially that an
agreement was reached
between the parties in respect of the penalties
and interest for the VAT period relevant hereto and that the
applicant admitted
liability for such penalties and interest.
[17]
In the circumstances the following order is issued:
The application is
dismissed with costs.
________________________
N
W GQAMANA
JUDGE
OF THE HIGH COURT
APPEARANCES:
For
the applicant
: Adv
Barnard
Instructed
by
: Greyvensteins
St
George’s House
104
Park Drive
PORT
ELIZABETH
For
the respondent
:
R
Buchanan SC
Instructed
by
: The
State Attorney
29
Western Road
Central
PORT
ELIZABETH
[1]
See: Index p 1 prayer 1.
[2]
Index page 8, annexure “R42A” is the copy of the Order
by Chetty J.
[3]
See: Firestone SA (Pty) Ltd v Gentiruco AJ
1977 (4) SA 298
(A)
at 307 (A), Thompson v South African Broadcasting Co-Operation
[2000] ZASCA 76
;
2001
(3) SA 746
(SCA) at 748 H – 749 C.
[4]
2012 (4) SA 593
(SCA) at 603 F – 610 C.
[5]
Index: pp 74 – 88.
[6]
See: Notyawa v Makhanda Municipality and Others
2020 (2) BCLR
136
(CC).