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[2021] ZAGPPHC 138
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Commissioner for the South African Revenue Service v Hamiltonn Holdings (Pty) Ltd and Others (2020/35696) [2021] ZAGPPHC 138 (1 March 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION,
PRETORIA)
Case
No: 2020/35696 [P]
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED
DATE:
1 March 2021
THE
COMMISSIONER FOR THE SOUTH AFRICAN
REVENUE
SERVICE
Applicant
IN
RE:
THE
COMMISSIONER FOR THE SOUTH AFRICAN
REVENUE
SERVIC
E
Applicant
and
HAMILTONN
HOLDINGS (PTY)
LTD
First Respondent
HAMILTONN
PROJECTS CC
Second Respondent
MOK
PLUS ONE (PTY)
LTD
Third Respondent
ABOMPETHA
(PTY)
LTD
Fourth Respondent
FELIHAM
(PTY)
LTD
Fifth Respondent
THABISO HAMILTON
NDLOVU
Sixth
Respondent
The
order and judgment
are
uploaded to Caselines on 1 March 2021 and the parties notified by
email and that constitutes the deemed date of delivery.
THE ORDER
(1)
The
Provisional
order
of
10 September
2020
is
confirmed
and made final.
(2)
The
respondents shall bear the costs. including the costs of two counsel,
jointly
and
severally. the one paying the others to be absolved.
JUDGMENT
SUTHERLAND
ADJ
P:
Introduction
[1]
On 20 September 2020. the applicant, (SARS) obtained,
ex
parte,
from
Potterill
ADJP. a
provisional
preservation
order against all six respondents, as contemplated
in section
163
of
the
Tax
administration
Act.
[1]
This
judgment
addresses
the
question
whether.
on
the this,
the
Return
Day,
the
order should
be
confirmed or
be
discharged. The order resulted
in the
seizure of several assets including the freezing of banking accounts
and the removal of vehicles.
[2]
All the respondents oppose the confirmation. The 6
th
respondent
Hamilton
Ndlovu. (Ndlovu)
deposed
to
two
answering
affidavits
on
hehalf
of
all
respondents.
He
is
the
sole
director of the first Respondent, Hamiltonn Holdings (Pty) Ltd (HH)
and the sole member of the second respondent. Hamiltonn
Projects CC
(HP). The
third
respondent,
Mok
Plus One
(Pty) Ltd
(Mok)
whose
sole
director
is
Sechaba
Mokone
and
the
fourth
respondent.
Abompetha (Pty) Ltd (Abompetha) whose
directors
arc
Thuthuka
Kunene
and
Kagiso
Sekgaolelo are entities and persons who, says Ndlovu, have a close
relationship with him and collaborate in business. The
fourth
respondent, Feliham (Pty) Ltd (Feliham) has as its sole director,
Felicia Sekate, who Ndlovu identifies as his fiance. They
too,
says
Ndlovu,
collaborate
in
business
with
him.
The
common
cause
facts
as
adduced
in
evidence
bear
out
a symbiotic
relationship among the respondents. The probabilities are that they
are all alter egos of Ndlovu. Among other companies
in which Ndlovu
has an evident interest and are part of the “Ndlovu circle”
of businesses is most notably
Kgodumo
Mokane
Trading
Enterprises
(Pty) Ltd (Kgodumo) to which reference is made hereafter.
[3]
The
business
in which these several entities are engaged is the sale of various
good exclusively
to
various
organs of stale. Their declared
scope is
wider than
that,
but
the account
of their business transactions given by Ndlovu shows the more modest
and limited de facto scope. An extensive list of
transactions is
provided in the answering affidavit to substantiate the supposed
legitimacy of their trading activities and not
a single private
sector customer is mentioned.
[4]
The demand
for goods specifically relevant to combatting the covid crisis
resulted in contracts to supply goods to the National
Health
Laboratory Service (NHLS) being awarded to HH. to Mok. to Abompetha
and to Feliham at virtually the same time. Kgodumo also
got a similar
contract.
[5]
The Hawks are apparently investigating these contracts to determine
whether they are
vitiated
by
improprieties. That investigation
is of no
relevance
to
the section
163 order.
There is
some
controversy
about
whether
SARS
knew
that
a
few days
before
it
got
the
provisional
preservation order, it already knew that the Hawks were to raid the
respondents. SARS deny knowledge prior to the raid.
In my view.
nothing turns on whether SARS knew or not. No part of SARS’s
case is premised
on any
unlawfulness
in the
contracts between
NIILS and
any of the respondents.
[6] The
issues in dispute were crystalised by the parties and agreed to in a
practice note.
These
are the key questions for decision.
6.1
In
relation
to
the
ex
parte
application.
did SARS fail to disclose material
information
whid1. had it been communicated to the judge, could have resulted in
her refusing the order?
6.2
Did SARS make out a cogent case for a section 163 Order? Of the three
key elements pertinent.
one is common cause, ie, the assets seized
are indeed “realisable” assets as contemplated in section
163( I). The other
two elements are whether the ot1icial who formed
the opinion that an order was required acted reasonably, and
moreover, has it
been shown that the order was indeed required to
prevent the frustration of the collection of TAX and VAT that was
likely to be
due as contemplated in section 163(1 ).
[7]
The approach
of
the court
is
that as set out comprehensively in
Commissioner,
South
African
Revenue Service
v
Tradex
(Pty) Ltd & Others
2015
(3) SA 596
(WCC) and no need
repetition
of those dicta is necessary.
[8]
Ancillary
to these
points are
the
questions
whether
any
tax
is
indeed
due
by
the
respondents,
and whether the assets seized so exceed the sum of likely tax due and
as a result the order is overbroad.
The
basis
for
the order being sought by SARS
[9]
First,
an overview of how this matter began is useful. Ndlovu is solely
responsible for SARS raking an interest in his affairs and
that of
the respondents. l le thrust himself out of obsecurity by doing two
things. First. in May 2020, he bought five luxury vehicles
at the
about same time as certain of the other respondents
received
payment for lucrative contracts
with the NHLS.
The
collective value of the cars is said to be about
R10.5m. Then
he bragged about this feat on
social media. Apparently. there are people at SARS who trouble lo
follow social
media.
They
looked
at
his
tax
affairs
and
were
impressed
that
Ndlovu
had
spared SARS the burden of
reading any tax returns since 2016. They referred the big spender to
the Illicit Economy Unit who have
a keen interest in mismatched
income and expenditure phenomena. They delved into Ndlovu’s
affairs, including his banking
accounts. What was observed were flows
of money to and from one or other of the respondents and to elsewhere
and other incongruent
cashflows into one or other respondent which
did not ostensibly have a rational
business purpose. No less
interestingly,
the
Tax
and VAT
affairs
of the
several respondents were not in
order. Not only were returns outstanding, some for several years. but
the income streams, especially
payments from the NHLS contracts, to
the several respondents could not be matched with the VAT that would,
by inference. be due
and payable. Moreover.some of the respondents
had declared themselves to be dormant yet were supposedly trading
during the period
of dormancy.
[10]
The Illicit Economy Unit looked especially at the NHLS transactions.
The four respondents
who
had
the
contracts
had
received
huge
sums from
NHLS.
On
31
March
HH
got
paid
7.2m. On 24 April, Abompetha
got
paid
R17.4m
and
on
the
same day Feliham got paid R7.2m. Mok got paid R17.8m on 29 April.
What was not visible was any money paid by these
respondents
to
produce
or
acquire
the
goods
sold.
Mok
paid
R17.7m
to
Ndlovu.
Abompetha
paid
sums
totalling
R17.460m
to
Ndlovu.
Feltham
paid
R14.990m
into
same
Ashburton account into which HH made a R30m deposit. HH, among other
transactions. bought luxury vehicles. In addition, after
the order
was granted, it was discovered that Kgodumo
had
a contract
with
NHLS and paid the proceeds to HP. Of these funds. R20m was then moved
to the Sue and Ed Trust. controlled by Ndlovu, about
which
more
is
said hereafter.
[11]
An estimate was made by SARS of the likely revenue. in its opinion.
that was due from tax liability and
VAT, based on the data available.
11.1
HH: Tax R11.042m and VAT R5.248m.
11.2
HP: Tax R1 .398m and VAT R874,000.
11.3
Mok: VAT R2.391m
11.4
Abompetha: VAT R2.391
11.5
Feltham: VAT R1.889m
11.6
Ndlovu: Tax for the years Y2017 to Y2021: R36, 840m. (of which
R23,341.292 was due only in the Y2021, an
aspect addressed
hereafter.)
[12]
The state of the respondents·tax affairs was non-compliant as
regards Provisional Tax
und VAT. This is, per se, not disputed
although the scale of non-compliance is disputed. The view taken by
SARS is thus:
12.1
HH:
No
VAT
returns
after
Y2020/03. Inadequate disclosure of
output VAT
in Y020/03 to Y2020/03. Registration as a VAT
Vendor
in Y2017 was late. Inadequate tax returns for Y2017 until Y2019. The
data
reflected
income
in Y2017 of
R1.243m yet a nil income was declared. The same pattern occurred in
Y2018 and
Y2019.
The bank account reflects income: in every year from Y2017 to Y2021:
ie, R1.519m; R2.457m: R.2. 233m; R33.421m;
R10.915m.
An estimate of the minimum VAT owed was R 5,248m. An estimate of the
minimum Tax owed was R11.042m.
12.2
HP
:
No VAT returns made after Y2020/05. Inadequate VAT output declaration
from Y2019/03 until Y2020/05.
Registration
as VAT vendor, in 2019, was late. Inadequate income declarations from
Y2017 until Y2019. Income tax outstanding: Rl.398m.
VAT
liability:
R2.39
1
m.
12.3
Mok:
Late
registration as VAT vendor in Y2020. No output VAT paid in Y2020 and
Y2021.
inadequate income declaration in Y2018 and Y2019. In Y2021 despite a
declaration of
income
of R2m it declared u nil first provisional Tax liability.
12.4
Abompetha:
Late registration as a VAT vendor in
Y2021. No output VAT paid in Y2021. Estimated VAT liability R2.282m.
12.5
Feliham:
Late
registration as VAT vendor on Y2018. No output VAT paid
in
Y2021. No Income declaration for Tax from Y2017 to Y2018. No Tax
return Y2Ul9.
Estimated
VAT
liability: R1.889.
12.6
Ndlovu:
No
tax returns for Y2016 to Y2019. Yet both HH and HP deducted his
remueration in their returns. Demands had been made by SARS in
June
2020 to rectify non-compliant status. Penalties had been imposed for
the delinquency. Over the period Y2017 Y2021, based on
the bank
accounts, Ndlovu had a gross
income
of R72,590m. The estimated tax liability was estimated thus: 2017:
R1.211 m; 2018: R3.103m; 2018: R5.045m; 2020: R4. 132m;
2021: R23.341
m.
[13]
The nub of the opinion formed by the SARS officials was that Ndlovu
used these
entities as his alter egos to spread potential liabilities
and evade the scale of liability from progressive tax scales. The
income
derived from the NHLS contracts by Mok, Abompetha and Feliham
were channelled to HH. There was a need to probe these transactions
and the respondents·tax affair to determine who was the true
beneficiary and what was the genuine tax and VAT liability
of each
respondent.
[14]
This
account
of
the
tax
affairs
of
the
respondents
is
hardly
in
dispute
although
the
accuracy
of
SARS’s
figures
arc.
in
certain
aspects
ch
a
llenged.
However,
these
proceedings
are not concerned to decide disputes of fact. The quibbles raised in
the affidavits by the respondents take the matter
no further.
So-called experts engaged by the respondents
to
contradict tile perspectives advanced by SARS are also
unhelpful
and
in
argument
any
reliance thereon was abandoned. Their reports, in any event. fail to
resemble expert reports and are. moreover,
not from
an
independent source. At
the
interim
stage of
the evaluation of the liability of the respondents the fact that
there are contending views on quantum of Tax
or
VAT
owing
and due is not dispositive of the issue at hand.
Was
there a material non-disclosure?
[15]
The respondents allege that a
material
non-disclosure
occurred
in
the
ex parte
hearing. A duty to disclose
any material fact that might be relevant to the absent adversary’s
interest is trite. To that
issue I now turn..
[16]
What is argued to be the
material information? The contention
is that
before the order was granted on
10 September 2020.
all
the respondents were already engaged in putting right any
inadequacies
in
their
tax
affairs. This effort
was omitted
from
the affidavits
put
before
the court when
the
provisional
order
was
granted.
Moreover.
the fact
that
PA
YE
was
paid
prior to
the order being taken
was not mentioned.
Why should these omissions
matter?
[17]
These facts which the respondent complain would have made a potential
difference
between the order being granted or not would not in my
view, have made any material impression of the evaluation of the
application.
Against the panoply of tax irregularities, factual
oddities and absence of apparent commercial rationale, exhibited by
the common
cause
facts.
these details
are
peripheral.
In
any
event
much
of
the effort
to
regularise
non-compliance
was
pursuant
to
a demand
made by
SARS on 26
June 2020.
There is no
indication that the regularisation efforts were spontaneous. The
contention is thus lacking in cogency.
[18]
A second argument was advanced that, taking the founding affidavit
as
gospel. the
allegations made were
completely
unsubstantiated
because the
bank
statements
were
not
attached for the judge to scrutinise . It is true that the source
documentation upon which the opinion
was
expressed
was not
before
the
court
in
the
ex
parte
proceedings.
The contention is. however.
not
well
founded.
What
was set out
was an
account of the various
respondents’
tax status, their degree of compliance and a summary account of the
mismatch between declared income and apparent
tax liability. This
pattern of behaviour married to the conspicuous consumption and cash
flow movements are all aspects that inform
an impression,
which
in my view.
reasonably.
is one that
the
respondents
are
splurging
without
regard
to
making
provision
for or
paying
what they
owe
to
the
fiscus.
The
notion
that
the judge
would,
in this
context. scrutinise
the
bank
statements
to check
the
arithmetic,
is far-.
fetched. Accordingly, the criticism is
misplaced.
Does
the case made out meet the requirements of section 163?
[19]
A major contention of the respondents is that. at best. the case of
SARS is aimed at showing
a ‘possible tax liability’ and
this is wrong. What is needed is a ‘probable’·liability.
In my view
this is mere semantics: it matters not what label is used
as a shorthand. rather what matters is whether the opinion formed
that
the collection of revenue was likely to be imperilled having
regard to the conspectus of facts and circumstances known at the
time.
This notion of ‘possible/probable’·tax
liability need not trouble us again.
[20]
Allied to this notion is the complaint that SARS has not computed the
tax and VAT liability accurately
and has exaggerated what could be
due. It is correct that in respect of Ndlovu’s personal income
and potential tax liability
there is an unexplained anomaly that
vitiates the estimate to exaggerate the quantum due. However, the
contention that this anomaly
vitiates the estimate is at cross
purposes with the provisions of section 163. The very premise of the
section and
the
utility of the preservation order is that the true tax liability is
unknown and remains to be determined. The officials can,
on the basis
of the fragmentary information available, at best make an estimate,
and self-evident practicality dictates that the
estimate should be
generous rather than conservative because the purpose is to ensure
that all due lax shall he collected. A sensible
estimate ought
generically, to result in a reduction of the amount thought owing
upon
the
completion of the whole audit exercise. A dispute of fact about
the
sum
of
the
estimate
in
interim
proceedings is
futile.
If
hardship
because
of
the seizure
of assets has resulted,
the section
makes provision
for relief.
As the curator remarks, no such relief has been sought, as yet.
[21]
The critical question is whether reasonable grounds exist to believe
that there is a real risk of assets being dissipated and thereby
frustrate
the fiscus’s attempt to collect what is due. Given
the picture
that emerges would
a
reasonable observer suspect that the behaviour of the
respondents
presented a threat to revenue collection?
In my view
these are the salient factors:
21.1
The
delinquency in the rendering of lax
returns is an obvious and
strong indication that the taxpayer is. at best, irresponsible and,
at worst, is hiding income. When that
conduct occurs
over several
years
the inference
of deliberate
resistance
to the payment
of
tax due becomes even stronger.
21.2
The
diversion of huge sums of money among
various
businesses supports
the
inference of them all being mere alter egos of one person and
implies.
strongly,
that
shady
dealings are likely. The principal cash flows have been described
already.
21.3
The
spendthrift
behaviour
of Ndlovu; That 5 luxury
cars acquired, at virtually
one go, is
evidence of consumption on a grand scale and gives rise to the
inference
that the
assets under his control are unlikely to be deployed to the fiscus
and are more
likely
to be devoted to immediate and extravagant gratification of material
wants depleting what is available
to pay tax
liabilities,
present and
future.
21.4
The storage
of a huge sum in an investment vehicle with international links, like
Ashburton in the context of the whole, hints at
a readiness to export
the wealth
or deploy
it elsewhere at the opportunity arises. It is
true that
holding reserve funds in an investment
vehicle
gives rise to no reasonable adverse inference, per se, but the
context colours the inferences that are appropriate. None
of these
respondents have any infrastructure or assets to speak of; they
are mere conduits to procure a flow of money from
state tenders.
Since the order. not one of the respondents has tried to
trade.
The
prospect of ·capital reserves· being ploughed back into
the businesses is nil.
21.5
The episode of the buying of a
house in Bryanston is of especial interest in showing the risk of
dissipation. R20m was paid by HH
to the Sue and Ed trust which
thereupon concluded a purchase agreement for a house. The property
sale agreement was then novated
to have it registered in the name of
a company notionally unrelated to Ndlovu: ie Ziason Kaihatsu (Pty)
Ltd. The controlling mind
of this convoluted transaction was Ndlovu
The modus operandi speaks to a likely process of secreting asset or
insulating them from
retrieval.
[22]
ln my view. the opinion that a preservation order was required was
wholly reasonable
and appropriate.
[23]
It is necessary to scrutinise the order to assess that it is
appropriate to the circumstances.
The essential complaint is that
order appropriates more value in assets that the likely tax
liability. Can this be determined at
the interim stage?
[24]
The heart of this contention is located in the fact that a large
portion of the liability is for the Y2011. At the
time of the hearing
and the writing this judgment, the second provisional payments on tax
are not yet due, but at least 5 of the
6 VAT payment periods have
fallen due. When the order was granted on 10 September 2020, the
first provisional tax payment due dates
had passed unpaid and at
least 4 of the 6 VAT payment periods had fallen due, either unpaid or
the correct sum due was in dispute.
Plainly most of the liabilities
which wen: due by 10 September had not been paid. The contention of
the respondents is therefore
thin and in the context of the
circumstances is of no great moment. Moreover, at a purely practical
level the revenue derived in
Y2021 is likely needed to address the
arrears liabilities too.
[25]
Of course, the opportunity to offer an explanation to refute the
impression created by the objective facts existed.
But the answering
affidavits arc bereft of any materially helpful allegations. The high
point is that they were intent on paying
what shall fall due. This is
belied by the duration of the non-compliance. The cash flows which
objectively show that the several
corporate respondents are mere
fronts for Ndlovu to whom all money seeps like oil to u sump is
telling; the answer offered to explain
that flow is that the various
entities assist one another with loans. However, loans for what? They
are mere conduits. If the respondents
could have explained a rational
business model they would have done so. They have not.
[26]
It is
likely
that the
estimated
liability
is
higher
than
what
shall
eventually
be determined. That does not
establish overbroadness.
Conclusions
[27]
The order is required as contemplated in section 163.
[28] There
was no material non-disclosure in the
ex
parte
application.
[29]
The
order is not overbroad.
The
Costs
[30] There
was a grievance articulated that a costs award against a respondent
in
ex
parte
proceedings is inappropriate. These
costs
must be distinguished from the expense of paying the curator’s
costs and an order that the respondent pay those amounts.
In my view,
it is preferable in an
ex
parte
application to seek merely an order that the respondent show cause on
the return day why it should not pay the legal costs rather
than make
an order at that Lime. However, because the proceedings ,ire interim
it makes no practical difference as that costs order
can be revisited
on the Return Day. In the circumstances where the order is confirmed.
the controversy evaporates.
The
Order
1.
The
Provisional order of 10 September 2020 is confirmed and made final.
2.
T
he
respondents shall bear the costs, including the costs of two counsel,
jointly and severally, the one paying the others to be
absolved.
ROLAND
SUTHERLAND
Acting
Deputy .Judge-President, Johannesburg
Gauteng
Division of the High Court of South Africa
Date
of Hearing: 22 February 2021
Date
of Judgment: 1 March 2021
For
Applicant:
Adv
C Naude,
with
her, Adv K Ramaimela and Adv [ Hlalethoa
Instructed
by Savage Jooste & Adams attorneys.
For
First to Sixth Respondents :
Adv
L Sigogo,
with
him, Adv M Ramabulana,
lnstructed
by Victor Nkwahu Attorneys.
[1]
Section 163 of the Tax Administration Act 28 of 201 provides:
(1)
A senior SARS official may in order to prevent any realisable:
assets from being
disposed of or removed which may frustrate the
collection of the full amount of tax that is clue or payable or the
official on
reasonable grounds is satisfied may be due or payable.
authorise an
ex parte
application to the High Court for un
order for the preservation of any assets of a taxpayer or other
person prohibiting any person,
subject to the conditions and
exceptions as may be specified in the preservation order, from
dealing in any manner with the assets
to which the order relates.
[Sub-s.
(1) substituted by s. 57
(a)
of Act 39 of 2013,(wef 1 October
2012).)
(2)
(a)
SARS may, in anticipation of the application under
subsection (1) seize the assets pending the outcome of an
application for
a preservation order, which application must
commence within 24 hours from the time of seizure of the assets or
the farther period
that SARS and the taxpayer or other person may
agree on.
[Para.
(a)
substituted by s 57
(b)
of Act 39 of 2013.(wef 1
October 2012).]
(b)
Until a preservation order is made in respect of the seized assets,
SARS must take reasonable steps to preserve and safeguard
the assets
including appointing a
curator
bonis
in whom the
assets vest.
[Para
, (b)
substituted by. s. 57
(c)
of Act 39 of 2013 (wef
1 October 2012).]
(3)
A preservation order may be made if required to secure the
collection of the tax referred to in subsection (1) and in respect
of-
(a)
realisable assets seized by SARS under subsection (2):
(b)
the realisable assets as may be specified m the order and which are
held by the person
against whom the preservation order is being
made,
(c)
all realisable assets held by the person, whether it is specified in
the order or
not; or
(d)
all assets which, if transferred to the person after the making of
the preservation
order, would be realisable assets.
[Sub-s
.(3) amended by s. 57
(d)
of Act 39 of 2013 (wef 1
October2012).]
(4)
The court to which an application for a preservation order is made
may-
(a)
make u provisional preservation order having immediate effect;
(b)
simultaneously grant a rule nisi calling upon the taxpayer or other
person upon a business
day mentioned in the rule to appear and to
show cause why the preservation order should not be made final;
(c)
upon application by the taxpayer or other person, anticipate the
return day for the
purpose of discharging the provisional
preservation order if 24 hours' notice of the application has been
given to SARS; and
(d)
upon application by SARS confirm the appointment of the
curator
bonis
under subsection (2) (a) or appoint a
curator bonis
in whom the seized assets vest.
[Para
.(d)
added by s 57
(g)
of Act 39 of 2013 (wef 1 October
2012).]
(5)
A preservation order must provide for notice to be given to the
taxpayer and a person from whom the assets are seized
(6)For purposes of the
notice or rule required under subsection (4)
(b)
or (5), if
the taxpayer or other person has been absent for a period of 21
business days from his or her usual place of residence
or business
within the Republic, the court may direct that it will he sufficient
service of that notice or rule if a copy thereof
is affixed to or
near the outer door of the building where the court sits and
published in the
Gazette
. unless the court directs some:
other mode of service.
(7)The
court, in granting a preservation order, may make any ancillary
orders regarding how the assets must be dealt with,
including-
(a)
authorising the
seizure of all movable assets:
(b)
if not appointed under subsection (4)
(d)
, appointing a
curator bonis
in whom the assets vest;
[Para.
(b)
substituted by -s 57
(h)
of Act 39 of 2(013 (wef 1
October 2012 ).]
(c)
realising. that assets in satisfaction of the tax debt;
(d)
making provision as the court may think lit for the reasonable
living expenses of
a person against whom the preservation order is
being made and his or her legal dependants, if the court is
satisfied that the
person has
disclosed
under oath all direct or in direct interests in asset subject to the
order and that the person cannot meet the expenses
concerned out of
his or her unrestrained a sets ; or
(e)
any other order that the court considers appropriate for the proper.
fair and effective
execution of the order.
(8)The court making a
preservation order may also make such further order in respect of
the discovery of any fact including facts
relating to an) asset over
which the taxpayer or other person may have effective control and
the location of the assets as the
court may consider necessary or
expedient with a view to achieving the objects of the preservation
order .
(9)The court which made
a preservation order may on application by a person affected by that
order vary or rescind the order or
an order authorising the seizure
of the assets concerned or other ancillary order if it is satisfied
that-
(a)
the operation of the order concerned will cause the: applicant undue
hardship ;
and
(b)
the hardship that the applicant will suffer as result of the order
outweighs the
risk that du: asset concerned may be destroyed, lost,
damaged, lost concealed or transferred.
(10)A preservation order
remains in force-
(a)
pending the setting aside thereof on appeal, if any. against the
preservation order
, or
(b)
until the assets subject to the preservation order are no longer
required for purposes
of the satisfaction of the tax debt.
(11) In order to prevent
an y realis able assets that were nor seized under subsection (2)
from being disposed of or removed contrary
to a preservation order
under this section, a senior SARS official may seize the assets if
the official has reasonable grounds
to believe that the assets be so
disposed of or removed.
(12)Assets seized under
this section must be dealt with in accordance with the directions of
the High Court which made the relevant
preservation order.