THE INCOME TAX CASE.

Manawatu Herald, Volume XXXII, Issue 810, 5 March 1910, Page 3

THE INCOME TAX CASE.

JUDGMENT RESERVED

Christchurch, March 3

The Income Tax case against Bowron Bros, was concluded today. Mr Skerrelt, for defendant, said the charge being one of fraud, it had to be proved completely. He contended that the defendants’ books were honestly kept, though not scientifically or artistically correct. Mr Tyers had admitted that the entries were honest. There had been no concealment of books or documents. It was also conceded that there were mistakes of an important kind in the returns made by defendants. The controversy as to the short paying of duty depended on whether the allowar.c" should have been made in respect to the debt ,£IOB,OOO, which it had been admitted was incurred, and of which there was no evidence of recovery.

Mr Stringer: I do not admit that we say it will not effect the question. Mr Skerrett continued ; “ Informant had to prove the return for 1906 was knowingly false in some material particular.” The prosecution had to prove that by false return the amount of duty had been shown less than the amount properly payable. He submitted there was no evidence in proof of this. He also raised the point that the return dealt with the income for the year ending March 31st. and that to justify the substitution of any other date special application must be made to the Commissioner. No evidence had been offered to prove that the firm made greater profit than ,£IB,OOO in the period effected by the return. The business was one in which great fluctuations occurred, and it could not be argued that because certain profit was made between September 30th and September 30th, the same profit had been made in the year ended March 31st. He submitted that the bad debt of ,£IOB,OOO had been proved. It was for the Crown to show that this amount was taxable.

Mr Stringer rejoined that the Commissioner of Taxes could not adjudicate on bad debts unless claimed. Smith had said the returns were made up to September 30th, and in many instances they agreed with the balance-sheets made up to that date. It was agreed by the counsel that other informations should be held over until the decision was given in the first. The magistrate reserved his decision.