J.B. O'C. v P.C.D.

• Jurisdiction: Ireland
• Judgment Date: 23 January 1985
• Date: 23 January 1985
• Docket Number: 1983 No. 597 Sp.]
• Court: Supreme Court

High Court

Supreme Court

1983 No. 597 Sp.]

J.B. O'C. v. P.C.D.

In the matter of section 18, of the Finance Act, 1983, J.B. O'C., Applicant

and

P.C.D. and A Bank, Respondents [

Cases mentioned in this report:—

Reg. v. Jones [1978] 1 W.L.R. 195; [1978] 2 All E.R. 718; 66 Cr. App. R. 246.

Reg. v. Dadson (1983) 77 Cr. App. R. 91.

Revenue - Information - Disclosure - Banker - Order directing financial institution to furnish information concerning taxpayer's accounts - statutory condition precedent - Demand that taxpayer deliver a statement of profits or gains or a return of income - burden of proving compliance with condition precedent - Failure to prove demand - Extent of information properly the subject of an order - Statute - Interpretation - "full particulars of accounts" -"bankers' books" - Bankers' Books Evidence Act, 1879 (42 & 43 Vict. c. 11), s. 9 - Bankers' Books Evidence (Amendment) Act, 1959 (No. 21), s. 2 - Income Tax Act, 1967 (No. 6), ss. 169, 172, 174 - Finance Act, 1983 (No. 15), s. 18.

Special Summons.

On the 17th November, 1983, the applicant, an inspector of taxes, issued a special summons claiming an order under s. 18 of the Finance Act, 1983, directing the second named respondent bank to furnish full particulars of all accounts maintained with the bank by the first respondent, a taxpayer. In particular the applicant sought disclosure of all transactions on those accounts and of all correspondence and notes of telephone conversations in the possession of the second respondent. The affidavit filed on behalf of the applicant averred that the first respondent had failed either to make returns or to keep proper accounts and that he had been unco-operative with the revenue authorities. The first respondent did not file an affidavit contradicting the facts set out in the applicant's affidavit but resisted the claim on the ground that it had not been shown that the statutory preconditions to relief under s. 18 had been complied with. The second respondent did not argue the issue as to whether an order should be made in the particular circumstances of the case, but an affidavit was filed on its behalf pointing out the administrative burden which the bank might face in complying with an order in the terms sought.

Section 18, sub-ss. 1-3, of the Finance Act, 1983, provide:—

"(1). In this section- "authorised officer" means an inspector or other officer of the Revenue Commissioners authorised by them in writing to exercise the powers conferred by this section;

"books" means—

• (a) bankers' books, within the meaning of the Bankers' Books Evidence Acts, 1879 and 1959, and

• (b) records and documents of persons referred to in section 7 (4) of the Central Bank Act, 1971;

"financial institution" means—

• (a) a person who holds or has held a licence under section 9 of the Central Bank Act, 1971, and

• (b) a person referred to in section 7 (4) of that Act;

"judge" means a judge of the High Court;

"person" (other than in the definition of "financial institution") means an individual who is ordinarily resident in the State.

• (2). Where—

  • (a) a person who, for the purposes of tax, has been duly required by an inspector to deliver a statement of the profits or gains arising to him from any trade or profession or to deliver to the inspector a return of income, fails to deliver that statement or that return to the inspector, or

  • (b) the inspector is not satisfied with such a statement or return so delivered,

an authorised officer may, if he is of opinion that that person maintains or maintained an account or accounts, the existence of which has not been disclosed to the Revenue Commissioners, with a financial institution or that there is likely to be information in the books of that institution indicating that the said statement of profits or gains or the said return of income is false to a material extent, apply to a judge for an order requiring that financial institution to furnish the authorised officer—

• (i) with full particulars of all accounts maintained by that person, either solely or jointly with any other person or persons, in that institution during a period not exceeding ten years immediately preceding the date of the application, and

• (ii) with such information as may be specified in the order relating to the financial transactions of that person, being information recorded in the books of that institution which would be material in determining the correctness of the statement of profits or gains or the return of income delivered by that person or, in the event of failure to deliver such statement or return, would be material in determining the liability of that person to tax.

  • (3). Where the judge to whom an application is made under sub-section(2) is satisfied that there are reasonable grounds for making the application, he may, subject to such conditions as he may consider proper and specify in the order, make an order requiring the financial institution to furnish the authorised officer with such particulars and information as may be specified in the order . . ."

Section 169, sub-s. 1, of the Income Tax Act, 1967, provides:—

"(1). Every person chargeable under this Act, when required to do so by any general or particular notice given in pursuance of this Act, shall, within the period limited by such notice, prepare and deliver to the inspector, a statement in writing as required by this Act, signed by him, containing—

• (a) the annual value of all lands and tenements in his occupation;

• (b) the amount of the profits or gains arising to him, from each and every source chargeable according to the respective schedules, estimated for the period and according to the provisions of this Act."

Section 172, sub-s. 1, of the Act of 1967, provides:—

"(1). Every individual, when required to do so by a notice given to him in relation to any year of assessment by an inspector, shall, within the time limited by the notice, prepare and deliver to the inspector a return in the prescribed form of—

• (a) all the sources of his income for the year of assessment (in this section referred to as the preceding year) immediately preceding the year of assessment in relation to which the notice is given;

• (b) the amount of income from each source for the preceding year computed in accordance with subsection (2);

• (c) such further particulars for the purposes of income tax (including sur-tax) for the preceding year or the year of assessment as may be required by the notice or indicated by the prescribed form."

Section 174, sub-s. 1, of the Act of 1967, provides:—

"(1). Where a person who has been duly required to deliver a statement of the profits or gains arising to him from any trade or profession fails to deliver the statement, or where the Revenue Commissioners are not satisfied with the statement delivered by any such person, the Revenue Commissioners may serve on that person a notice in writing or notices in writing requiring him to do any of the following things, that is to say—

• (a) to deliver to an inspector copies of such accounts (including balance sheets) relating to the trade or profession as may be specified or described in the notice within such period as may be therein specified, including, where the accounts have been audited, a copy of the auditor's certificate;

• (b) to make available, within such time as may be specified in the notice, for inspection by an inspector or by any officer authorised by the Revenue Commissioners, all such books, accounts and documents in his possession or power as may be specified or described in the notice, being books, accounts and documents which contain information as to transactions of the trade or profession."

The applicant appealed to the Supreme Court against the judgment and order of the High Court. The appeal was heard on the 23rd January, 1985.

The applicant inspector of taxes applied to the High Court for an order pursuant to s. 18 of the Finance Act, 1983, directing the second respondent ("the bank") to furnish full particulars of all accounts maintained with the bank by the first respondent ("the taxpayer") as well as other information relating to the financial transactions of the taxpayer. The uncontroverted evidence of the applicant was that the taxpayer had failed to make returns of income for over...