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2024
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[2024] ZAECQBHC 51
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Piet v Commissioner for the South African Revenue Service (3090/2023) [2024] ZAECQBHC 51 (27 August 2024)
FLYNOTES:
TAX
– Liability of third party –
Retirement
fund company
–
Retirement
benefit paid over to SARS following receipt of notice –
Applicant alleging no-compliance with provisions
– Various
demands issued to applicant for unpaid tax debt – Respondent
is permitted to appoint third party to
act as an agent for
taxpayer – Respondent’s conduct constitutes reasonable
and justifiable limitation of right
to have access to social
security – Application dismissed –
Tax Administration
Act 28 of 2011
,
s 179.
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN CAPE
DIVISION, GQEBERHA)
OF INTEREST
Case no: 3090/2023
In the matter between:
SIZAKELE CROSBY PIET
Applicant
and
THE COMMISSIONER FOR
THE SOUTH
Respondent
AFRICAN REVENUE
SERVICE
JUDGMENT
Govindjee J
[1]
The
applicant seeks repayment of an amount of R145 934,99 paid by
Allan Gray Retirement Annuity Fund (Allan Gray) to the respondent
on
28 August 2023. He claims that the notice for payment of the funds,
in terms of s 179(1) of the Tax Administration Act, 2011
[1]
(the TAA), violates other provisions of the TAA and contravened s
37A(1) of the Pension Funds Act, 1956,
[2]
(the PFA) so that it was invalid and a violation of the
constitutional right to have access to social security.
Background
[2]
The
founding papers were served and filed during September 2023. Notice
of opposition was filed timeously. The matter was set down
on the
uncontested opposed roll on 31 October 2023 and postponed until 7
November 2023. On that date, the matter was transferred
to the
opposed motion court roll. The respondent gave notice of its
intention to raise various questions of law on 7 November 2023.
[3]
It also gave notice requiring copies of various documentation
pertaining to the applicant’s tax affairs.
[4]
The applicant opposed that application. On 23 May 2024, Noncembu J
ordered discovery of the documentation requested in terms of
the
rule, holding that the applicant would be barred from relying on
these documents in the event of his failure to comply.
Condonation
[3]
Following various case management directives, the
respondent brought an application for condonation for late filing of
an answering
affidavit in the main application. The main explanation
for the delay is that the respondent was hampered due to the
applicant’s
failure to discover the documentation it had
requested, and the need to bring a formal application for discovery.
A further explanation
is the difficulty experienced in briefing
counsel. The respondent explains that it was necessary to offer a
response on affidavit,
in addition to the points of law raised on 7
November 2023, once all the documentation had been placed in its
possession. The delay
in doing so was a direct result of the
applicant’s opposition to the Uniform Rule 35(12) proceedings
and failure to comply
with the request for documentation. After that
matter was decided in the respondent’s favour on 23 May 2024,
the time for
the applicant to comply with the order only expired on
22 June 2024. It was only at this stage that the respondent was in a
position
to prepare and file its answering affidavit. On 19 July
2024, a case management directive was issued permitting the
respondent
to file their answering affidavit by 22 July 2024. As the
applicant opposed the filing of the answering affidavit, the
respondent
was directed to apply for condonation, and timeframes were
set for the exchange of papers.
[4]
The respondent argues that there are strong
prospects of success and that an order granting condonation cannot
occasion prejudice
to the applicant given his own role in delaying
proceedings by virtue of his lack of discovery.
[5]
The applicant opposes the application on the basis
that the filing of the answering affidavit is ten months late. On his
own version
of events, the respondent was afforded until 22 July 2024
to file their answering affidavit. This was by way of an agreement
entered
into during the course of case management. Instead, the
respondent did so a day late. The applicant argues, in effect, that
the
matter should be determined as if unopposed, also because the
‘answering affidavit’ is properly construed as a ‘further
affidavit’, as contemplated in Uniform Rule 6(5)(
e
).
Analysis
[6]
It is
well settled that, in considering applications for condonation, the
court has a discretion, to be exercised judicially upon
a
consideration of all the facts. Uniform Rule 27(3) provides that a
court may, on good cause shown, condone any non-compliance
with the
rules. In essence it is a question of fairness to both sides.
[5]
The enquiry includes the degree of non-compliance with the rules, the
explanation therefore, the prospects of success on appeal,
the
importance of the case, the respondent’s interest in the
finality of a judgment, the convenience of the court and the
avoidance of unnecessary delay in the administration of justice. The
factors are not individually decisive but are interrelated
and must
be weighed one against the other, following an objective conspectus
of all the facts, so that a slight delay and a good
explanation may
help to compensate for prospects of success which are not strong.
[6]
Condonation applications are not a matter of formality. There is an
onus on the party seeking condonation to provide a full and
satisfactory explanation for its failure to comply with the rules of
court.
[7]
[7]
The applicant’s opposition is based on a
selective understanding of the history of the matter. In particular,
it ignores the
Uniform Rule 35 proceedings, which ran between
November 2023 and May 2024 and culminated in an order for discovery
in favour of
the respondent. That the respondent was of the view that
it required discovery before finalising its answering affidavit
cannot
be gainsaid. Moreover, the procedure adopted is sanctioned by
the Uniform Rules and ran its course, albeit that that applicant is
of the view that this was a delaying tactic. As such, the period of
delay for which condonation is sought is significantly shorter
than
that alleged by the applicant.
[8]
The other delays are of the kind that may be
expected in civil litigation that is subjected to case management.
Any unexplained
periods of delay are, in my view, compensated by the
respondent’s strong prospects of success in the main
application, for
reasons that will become apparent. It is true that
the respondent’s condonation application and answering
affidavit were
filed a day late, on 23 July 2024. That was
ill-advised and disrespectful of the case management directive. But
that, together
with similar gripes, cannot on its own trump the
proper application of the established test for condonation. As has
often been
repeated, compliance with the Uniform Rules is for the
benefit of the court and slavish adherence to its provisions will not
always
be in the interests of justice. More particularly, to find for
the applicant in the main application on the basis of a delay of
a
single day would be unconscionable.
[9]
This court is obliged to exercise a discretion in
the interests of justice considering the various factors
holistically. In my view,
the interests of justice are served by
permitting consideration of the respondent’s answering
affidavit, to enable the matter
to be ventilated properly and fully,
with all relevant information placed before the court. In particular,
I am satisfied that
the respondent has explained the reasons for its
delay properly, also demonstrating strong prospects of success. The
importance
of the issues raised, including the proper interpretation
of legislation and invocation of the Constitution, supports the
granting
of condonation. Refusing the application would be manifestly
unjust in all the circumstances.
The main application
[10]
The applicant’s case originates in an
additional tax assessment imposed for 2015. He became aware of this
when submitting
his income tax return for the following year. The
explanation received was that business expenses were disallowed and
that there
was no explanation for his decline in turnover. The
applicant took issue with the additional assessment, as follows:
‘
It
is irreconcilable and extremely absurd that respondent would be
willing to accept and acknowledge business income from applicant
but
refuse to acknowledge expenses incurred in securing the income. In
the business world there can be no income without expenses
incurred.
Even in ordinary government offices there are basic expenses incurred
even if there is no income … there was no
basis for respondent
to disallow all business expenses. Such conduct amounted to arbitrary
conduct on the part of the respondent
… the basis for the
disallowance of the business expenses were unfounded, unsupported by
any rules; guidelines nor provisions
in the Tax Administration Act 28
of 2011.’ (sic).
[11]
The applicant filed an objection in March 2017. He
was advised that this was refused as it was outside the time period
prescribed
by TAA. Various other objections were rejected by the
respondent during 2017. On the applicant’s version, he
furnished exceptional
circumstances, in terms of s 104(4) of TAA, on
22 June 2017, to which no response has been received. The applicant
avers that the
process has not been finalised and that he intends to
‘…refer the outcome for condonation to a Tax Tribunal
should
application for condonation be declined by SARS’. A
request for suspension of payment pending objection or appeal was
rejected
on 9 November 2018 on the basis that no objection or appeal
was lodged within the prescribed timeframe. The applicant was
informed
that he remained obliged to pay the amount due.
[12]
On 16 August 2023, the applicant applied to Allan
Gray for the withdrawal of his retirement benefit as he had reached
the age of
55. He was informed a week later that the full amount due
had been paid over to the South African Revenue Service (SARS)
following
receipt of a notice in terms of s 179(1) of the TAA. The
applicant contests the s 179(1) notice on the basis that it was not
written
by a senior SARS official, as required by the legislation, is
‘a product of artificial intelligence’ and is null and
void. Moreover, there was non-compliance with ss 179(4) and 179(5) of
the TAA, a violation of s 37A of the PFA and s 27 of the
Constitution.
Jurisdiction
[13]
I
approach the matter on the basis that the applicant does not, in the
present application, object against an assessment or decision
as
contemplated by s 104 of the TAA. The essence of the application lies
elsewhere so that it appears unnecessary to consider whether
or not
to exercise a discretion, in terms of s 105 of the TAA, to hear the
matter.
[8]
Section 179 of the TAA
[14]
The applicant seeks, in paragraph 2 of the notice
of motion, declaratory relief premised on non-compliance with s 179
of the TAA.
That section is part of chapter 11 of the TAA, pertaining
to ‘recovery of tax’, and concerns ‘liability of
third
party appointed to satisfy tax debts’.
[15]
Section 179 of the TAA provides as follows:
‘
179.
Liability of third party appointed to satisfy tax debts
(1)
A senior SARS official may authorise the issue of
a notice to a person who holds or owes or will hold or owe any money,
including
a pension, salary, wage or other remuneration, for or to a
taxpayer, requiring the person to pay the money to SARS in
satisfaction
of the taxpayer’s outstanding tax debt.
(2)
A person that is unable to comply with a
requirement of the notice, must advise the senior SARS official of
the reasons for the
inability to comply within the period specified
in the notice and the official may withdraw or amend the notice as is
appropriate
under the circumstances.
(3)
A person receiving the notice must pay the money
in accordance with the notice and, if the person parts with the money
contrary
to the notice, the person is personally liable for the
money.
(4)
SARS may, on request by a person affected by a
notice, amend the notice to extend the period over which the amount
must be paid
to SARS, to allow the taxpayer to pay the basic living
expenses of the taxpayer and his or her dependants.
(5)
SARS may only issue the notice referred to in
subsection (1) after delivery to the tax debtor of a final demand for
payment which
must be delivered at the latest 10 business days before
the issue of the notice, which demand must set out the recovery steps
that
SARS may take if the tax debt is not paid and the available debt
relief mechanisms under this Act, including, in respect of recovery
steps that may be taken under this section –
(a)
If the tax debtor is a natural person, that the
tax debtor may within five business days of receiving the demand
apply to SARS for
a reduction of the amount to be paid to SARS under
subsection (1), based on the basic living expenses of the tax debtor
and his
or her dependants; and
(b)
If the tax debtor is not a natural person, that
the tax debtor may within five business days of receiving the demand
apply to SARS
for a reduction of the amount to be paid to SARS under
subsection (1), based on serious financial hardship.
(6)
SARS need not issue a final demand under
subsection (5) if a senior SARS official is satisfied that to do so
would prejudice the
collection of the tax debt.’
[16]
SARS
is an organ of state within the public administration.
[9]
The respondent is responsible for the performance by SARS of its
functions, including the collection of revenue.
[10]
The TAA provides for the effective and efficient collection of tax,
including measures for the recovery of tax.
[11]
As Keulder explains, it is clear that the TAA was enacted to assist
the respondent in its duty to collect tax.
[12]
As is the case in respect of other taxation legislation, SARS is
afforded further powers to enforce the collection of taxes due,
including the appointment of a third party as an agent of the
taxpayer in terms of s 179 of the TAA.
[13]
As Moosa puts it, SARS’ ‘arsenal of powers’ is
strengthened by the authority conferred on it to collect a tax
debt
from a third party who pays it on a taxpayer’s behalf.
[14]
It must be emphasised that s 179(1) explicitly includes ‘a
pension’ in its ambit. If a taxpayer’s obligation
to pay
tax pending an objection or an appeal is not suspended, SARS can
actively take steps to enforce the collection of tax.
[15]
[17]
Did
the respondent comply with its obligations in terms of s 179 of the
TAA in doing so? It is apparent from the papers that various
demands
were issued to the applicant for an unpaid tax debt in accordance
with s 179(5). The correspondence included the prescribed
details and
in each instance the applicant was put on clear and unequivocal terms
to settle his debt.
[16]
The
first such demand appears to have been made on 2 July 2019. There is
no doubt that the applicant received a letter of demand
dated 14 July
2020. In response, he corresponded with the respondent to indicate
his view that the debt had prescribed. He responded
similarly to a
letter of demand dated 1 March 2022.
[17]
There is therefore no merit in the argument that the respondent
failed to comply with s 179(5) of the TAA.
[18]
[18]
As far
as the s 179(1) notice is concerned, it is important to note that the
respondent is permitted to appoint a third party to
act as an agent
for the taxpayer. On the papers, and leaving aside the argument
centred on the PFA, SARS was entitled to issue
the third-party notice
and thereby recover the funds in question to satisfy an existing tax
debt.
[19]
Allan Gray, upon
receipt of what it considered to be due notice, effected the payment
to SARS. An investment service consultant
subsequently advised the
applicant as follows:
‘
I
have attached the IT88 which stipulates the tax liability that is
owed to SARS for your … lumpsum withdrawal … Please
note the IT88 would have been issued due to outstanding tax owed to
SARS. Allan Gray is liable to pay this amount on your behalf
as we
have received this IT88 which is a penalty instruction for the liable
tax amount owed to SARS. If you would like to dispute
this IT88 you
would have to take it up with SARS directly …’
[19]
In attaching proof of its payment to SARS, Allan
Gray also informed the applicant of the link between the IT88
directive and s 179(1)
of the TAA:
‘
The
IT88 directive comes directly from SARS via Eb Tax and is issued to
the retirement fund company (Allan Gray) in our capacity
as
withholding agents. Allan Gray then effectively becomes a ‘third
party appointment’ in terms of
section 179(1)
of the
Tax
Administration Act and
is required to comply with the tax directive…’
[20]
Furthermore, the applicant received a copy of the
IT 88 notice that Allan Gray received from SARS. That document makes
reference
to the applicant and provides ‘assessed tax
outstanding’ as the reason for the ‘stop order’.
The notice
contains various details pertaining to the possible
modalities for payment, and quotes
ss 160(1)
,
155
and
179
(1) of the
TAA, adding the following remarks:
‘
The
Tax Administration Act empowers
the Commission for the South African
Revenue Service (SARS) to appoint a third party to withhold and pay
over to SARS any amounts
due by a taxpayer in terms of the relevant
tax Act. Such a third party may be an employer of the taxpayer or any
other person who
has the management, custody or control of any
income, monies or property of the taxpayer. The abovementioned
taxpayer is indebted
to SARS for the specified amounts and it is
understood that the taxpayer is either entitled to income from you or
have money deposited
with you.’
[21]
It was
open to Allan Gray to raise any concerns about the notice received,
or its contents. Section 179(2) specifically provides
that a
recipient who is unable to comply with the terms of a notice ‘…must
advise the senior SARS official of the
reasons for the inability to
comply within the period specified in the notice’. The official
may, in response, withdraw or
amend the notice as may be appropriate
in the circumstances.
[20]
That
aside, the recipient is obliged, in terms of s 179(3), to pay the
money in accordance with the notice. This is what occurred,
seemingly
without difficulty on the part of Allan Gray following receipt of the
IT 88 notice.
[22]
On the
proper interpretative approach to s 179, any complaint in respect of
the manner of the notice, including concern whether
it had been
issued by a senior SARS official, was to be raised by the third party
appointed to satisfy the tax debt.
[21]
Any enquiries, including as to whether a senior SARA official had
authorised the notice received, could have been addressed to
the
respondent, whose details are placed prominently on the notice. While
the applicant, as the tax debtor, was affected by the
notice, his
recourse appears limited to what appears in s 179(4), namely to
request SARS to ‘… amend the notice to
extend the period
over which the amount must be paid to SARS, to allow the taxpayer to
pay the basic living expenses of the taxpayer
and his or her
dependants’.
[23]
This necessarily presupposes that Allan Gray
notified the applicant of the notice prior to making payment to the
respondent. This
would have been expected given the relationship
between Allan Gray and its member, and considering that Allan Gray
had received
a notice from SARS that would result in retirement
benefits being directed away from its member. Information about the
notice would
have enabled the applicant to request SARS to amend the
notice to the third party to extend the payment period based on his
personal
circumstances and that of his dependants. While it may, at
first blush, appear anomalous that it is third party that should
notify
the taxpayer of the notice, as opposed to SARS, this
interpretation is supported by the inclusion of s 179(5) of the TAA.
SARS
may only issue the s 179(1) notice after having itself delivered
a letter of final demand to the tax debtor. That letter, in the
case
of a natural person, already includes an opportunity for an
application for reduction of the amount to be paid based on the
basic
living expenses of the tax debtor and their dependants.
[24]
The applicant’s papers seem to suggest that
he only became aware of the notice and payment to SARS after the
event. By not
citing Allan Gray as a party to the proceedings,
however, any failure on their part to inform him of the notice
timeously is of
no moment. As far as the respondent is concerned,
there is nothing on the papers to suggest that any request for
extension of the
payment period was made either subsequent to the
final demands it had delivered, or after the notice was dispatched to
Allan Gray
and prior to receipt of payment.
[25]
Put differently, the complaint that the respondent
did not afford the applicant another opportunity to raise his
personal circumstances
overlooks the purpose of the notice and its
intended recipient. The notice is correspondence between the
respondent and a third
party, such as Allan Gray, holding money
including a pension for a taxpayer such as the applicant, requiring
payment in satisfaction
of an outstanding tax debt subsequent to the
delivery, by SARS, of a final demand for payment. The applicant had
received notification
of a final demand for payment prior to the
issue of the notice, as required by the legislation. Any complaint
that the applicant
was not informed about the notice, or given a
further opportunity to request an extension of the period over which
the amount could
be paid, based on personal circumstances, would
appear to be one properly directed to the third party.
[26]
As
Allan Gray was not joined in the present proceedings, this aspect was
not canvassed fully. As pointed out by the respondent,
a further
difficulty for the applicant is the failure to establish a cause of
action for any money to be paid directly to the applicant,
as opposed
to being returned to Allan Gray.
[22]
The prudent approach would have been to join Allan Gray as a third
party appointed to satisfy the applicant’s tax debt, bearing
in
mind the company’s potential personal liability in the event of
failure to do so. The claim based on the invalidity of
the s 179
notice must fail for these reasons.
Section 37A of the PFA
[27]
The applicant also relies on s 37A of the PFA,
interpreting this section in a manner preventing any tax deduction in
terms of s
179 of the TAA. Section 37A(1) provides as follows:
‘
Save
to the extent permitted by this Act, the Income Tax Act, 1962 (Act
No.58 of 1962), and the
Maintenance Act, 1998
, no benefit provided
for in the rules of a registered fund … or right to such
benefit … shall, notwithstanding anything
to the contrary
contained in the rules of such a fund, be capable of being reduced,
transferred or otherwise ceded, or of being
pledged or hypothecated,
or be liable to be attached or subjected to any form of execution
under a judgment or order of a court
of law…’
[28]
It is
so that
s 37A
of the PFA protects pension funds from reduction,
transferability or executability. One of the exceptions listed in the
section
is a deduction permitted by the Income Tax Act, 1962
[23]
(the Income Tax Act). Section 37A was inserted in 1976. At that time,
and until 2011, the Income Tax Act included a section providing
as
follows:
’
99.
Power to appoint agent.– The Commissioner may, if he thinks
necessary, declare any person to be the agent of any other
person,
and the person so declared an agent shall be the agent for the
purposes of this Act and may be required to make payment
of any tax,
interest or penalty due from any moneys,
including
pensions
,
salary, wages or any other remuneration, which may be held by him or
due by him to the person whose agent he has been declared
to be.’
(Own emphasis).
[29]
The PFA, in other words, must be interpreted as
having permitted the respondent to declare a person as the agent of a
taxpayer,
required to make payment of any tax due by ‘the
person whose agent he has been declared to be’. Significantly,
the
declared agent could ‘make payment of any tax’, inter
alia, from pension funds due to the person. In effect, this appears
to have been the position from the inception of the PFA. Section 99
of the Income Tax Act was repealed in 2011, but only because
a more
elaborate section was introduced courtesy of s 179 of the TAA. The
effect, however, is clearly the same: a third party may
be appointed
by a senior official of the respondent for purposes of satisfying a
tax debt. The third party may do so by paying
the money due from
money held or owed to the taxpayer in a pension. As the abbreviation
suggest, the ‘IT88’ has its
origins in the Income Tax
Act. It is seemingly now used, whether or not in modified form, to
give effect to the purpose of s 179
of the TAA. Section 37A of the
PFA must be interpreted accordingly.
[30]
The
effect of this approach is supported by various judgments pertaining
to conflict of laws. The general rule was explained in
Khumalo
v Director-General of Co-operation and Development and Others
:
[24]
‘
It
is, of course, true that in general an earlier enactment is to be
regarded as impliedly repealed by a later one if there is an
irreconcilable conflict between the provisions of the two
enactments.’
[31]
The
Constitutional Court has also endorsed the principle:
[25]
‘
The
common law rule of implied revocation provides that where there is an
irreconcilable conflict between two enactments, the later
enactment
will take precedence over the earlier one.’
[32]
Interpreting
s 37A of the PFA strictly results in a conflict with s 179 of the
TAA. This is because s 37A provides that pension
benefits are, in
general terms, not ‘reducible, transferable or executable’
save to the extent permitted in the PFA
itself, the Income Tax Act or
the
Maintenance Act, 1998
. The Income Tax Act no longer permits for
the payment of pension money to SARS by an agent, because of the
repeal of s 99 of the
Income Tax Act.
[26]
By contrast, s 179(3) of the TAA, read with s 179(1), obliges a third
party to ‘pay the money … including a pension’
to
SARS in satisfaction of the taxpayer’s outstanding tax debt. To
the extent that it is necessary to do so, and noting the
absence of
submissions on the point, it must be implied that s 179 of the TAA,
as the later enactment, takes precedence over s
37A of the PFA in
respect of payment of pension benefits to SARS.
The constitutional
right to have access to social security
[33]
The
applicant’s final submission relies on selected paragraphs
contained in
Mudau
v Municipal Employees’ Pension Fund and Others
:
[27]
‘…
a
pension is a crucial instrument through which individuals plan and
anticipate a period in which they will no longer be working
to
generate income. Pensions also contribute towards fulfilling the
right to social security as they are a means by which individuals
can
secure financial stability through monetary contributions…the
determination of the pension withdrawal benefit affects
Mr Mudau’s
section 27 right to social security…’
[34]
The argument that the respondent acted
unconstitutionally fails to consider the limitation of rights
envisaged by s 36 of the Constitution.
The PFA is a law of general
application. Section 37A curtails the protection afforded to pension
benefits deliberately and carefully.
As indicated, this section must
be interpreted in a manner that includes limitation by way of s 179
of the TAA. Alternatively,
the somewhat technical conflict that is
apparent when considering the two pieces of legislation must be
resolved in favour of the
later law. On either basis, the
respondent’s conduct in issuing final demands to the applicant
prior to notifying Allan Gray
of the tax debt, and obtaining payment,
constitutes a reasonable and justifiable limitation of the right to
have access to social
security. There is in any event no argument
advanced that either section is unconstitutional and the application
cannot succeed
on this basis.
Costs
[35]
An unsuccessful litigant engaged in constitutional
litigation against the state ought not to be ordered to pay costs as
a general
rule. I see no reason to depart from this rule. The
proceedings, while ultimately unsuccessful, were neither frivolous
nor vexatious.
The applicant represented himself commendably while
the respondent was put on terms during case management and
nonetheless failed
to comply. Moreover, the apparent conflict between
the PFA and TAA following the repeal of s 99 of the Income Tax Act is
an issue
that required clarification. The claim also included a
genuine constitutional component. It would be wholly unjust to order
the
applicant to pay costs in all the circumstances. The appropriate
order is for each party to pay their own costs, also in respect
of
the opposed condonation application.
Order
[36]
The following order is issued:
1.
The
application is dismissed.
2.
Each
party shall pay their own costs.
A GOVINDJEE
JUDGE OF THE HIGH
COURT
Heard: 08 August 2024
Delivered: 27 August
2024
Appearances:
For the
Applicant:
Mr S C Piet
In
Person
9
Mqaqoba Street
KwaDwesi
Gqeberha
Email:
crosby.piet99@gmail.com
For the
Respondent:
Adv A Masiza
Club
Chambers, Gqeberha
Instructed by:
The State Attorney
29
Western Road
Central
Gqeberha
Email:
MSisilana@justice.gov.za
[1]
Act
28 of 2011.
[2]
Act
24 of 1956.
[3]
Uniform
Rule 6(5)(
d
)(iii).
[4]
Uniform
Rule 35(12).
[5]
Van
Wyk v Unitas Hospital and Another (Open Democratic Advice Centre as
Amicus Curiae)
2007
ZACC; 2008
(2) SA 472 para 20.
[6]
United
Plant Hire (Pty) Ltd v Hills and Others
1976
(1) SA 717
(A) at 720E–H. Also see
Melane
v Santam Insurance Co Ltd
1962
(4) SA 532
(A): a slight delay and a good explanation may help to
compensate for prospects of success which are not strong. Or the
importance
of the issue and strong prospects of success may tend to
compensate for a long delay.
[7]
National
Department of Public Works v Fani and 77 Others
[2024]
ZASCA 43
para 7.
[8]
Cf
Leuven
Metals (Pty) Ltd v Commissioner for the South African Revenue
Service
[2023]
ZASCA 144
paras 14, 30.
WPD
Fleetmas CC v Commissioner: South African Revenue Services and
Another
[2020]
JOL 49693
(GP);
SIP
Project Managers (Pty) Ltd v Commissioner for the South African
Revenue Service
[2020]
ZAGPPHC 206.
[9]
S
2 of the South African Revenue Service Act, 1997 (Act 34 of 1997)
(the SARS Act).
[10]
Ss
3 and 9 of the SARS Act.
[11]
Long
title to the TAA, s 2 of the TAA.
[12]
C
Keulder “Pay now, argue later” rule – before and
after the Tax Administration Act”
PER
(2013)
vol 16(4) 125 at 145. In respect of the obligation of a taxpayer to
pay tax, s 164 of the TAA states that the obligation
will not be
suspended even pending an objection or an appeal unless a senior
SARS official indicates otherwise. A taxpayer can
request a senior
SARS official to suspend the payment if the taxpayer intends to
lodge an objection or an appeal against the
assessment, but the
request may be denied if the objection is frivolous or used by the
taxpayer simply to delay the payment of
tax: s 164(2) of the TAA.
[13]
As
Keulder notes, this section is similar to the s 47 procedure in
terms of the VAT Act: Keulder above n 12 at 147.
[14]
F
Moosa ‘
Tax Administration Act: Fulfilling
human rights through
efficient and effective tax administration’
De
Jure
(2018)
vol 51(1) at 5
[15]
Keulder
above n 12 at 147.
[16]
On the facts, the matter is therefore different to the situation
confronted by the court in
Nondabula
v Commissioner, South African Revenue Services
[2017] ZAECMHC 21;
2018
(3) SA 541
(ECM) para 5 and following.
[17]
In
fact,
s 171
of the TAA provides that proceedings for recovery of a
tax debt may not be initiated after the expiration of 15 years from
the
date of the assessment of tax, or a decision referred to in
s
104(2)
giving rise to a tax liability, becomes final. In terms of s
11 of the Prescription Act, 1969 (Act 68 of 1969), the period of
prescription of any debt in respect of any taxation imposed or
levied by or under any law is thirty years.
[18]
Cf
WPD
Fleetmas CC v Commissioner: South African Revenue Services and
Another
[2020]
JOL 49693 (GP).
[19]
CRRC
E-Loco Supply (Pty) Ltd v Commissioner for the South African Revenue
Service
[2022]
ZAGPPHC 527;
85 SATC 463
at 5.8 and following.
[20]
S
179(2) of the TAA.
[21]
See
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012
(4) SA 593
(SCA) para 18–20.
[22]
Cf
SIP
Project Managers (Pty) Ltd v Commissioner for the South African
Revenue Service
[2020]
ZAGPPHC 206 para 26.
[23]
Act
58 of 1962.
[24]
Khumalo
v Director-General of Co-operation and Development and Others
[1991]
1 All SA 297
(A) at 301.
[25]
Joseph
and Others v City of Johannesburg
and
Others
[2009]
ZACC 30
;
2010 (3) BCLR 212
(CC);
2010 (4) SA 55
(CC) para 66.
[26]
The
Income Tax Act, 1962 (Act 58 of 1962) (the Income Tax Act) is a ‘tax
Act’ according to the definition of that
notion in the TAA,
being listed in the schedule referred to in s 4 of the SARS Act. It
may be added that this is not an instance
where the TAA is silent on
a matter provided for in the Income Tax Act or a case of
inconsistency between the two, which would
result in the latter
prevailing: s 4(2) and 4(3) of the TAA. The position is that the
Income Tax Act no longer deals with a matter
it previously
regulated, the TAA now doing so.
[27]
Mudau
v Municipal Employees’ Pension Fund and Others
[2023]
ZACC 26
paras 3, 47.