SUPREME COURT.

Taranaki Daily News, Volume LIII, Issue 212, 16 December 1910, Page 7

SUPREME COURT.

A CONSTABLE ACQUITTED.

By Telegraph.—Press Association. Greyrnouth, Thursday

Constable Martin has been acquitted on a charge of perjury, the jury saying that owing to conflicting evidence they gave him the benefit of the doubt.

IMPORTANT INCOME TAX CASES.

Wellington, Thursday.

The hearing of the Income Tax eases, the Whiterock and Marainanga estate companies v. Commissioner ol Taxes, claiming refunds of tax allegedly overpaid, which was commenced on Monday in the Supreme Court, before Mr. Justice Cooper was concluded today, his Honor hearing legal argument on behalf of the Whiterock Company.

Mr. Skerrett submitted that the land was purchased as a permanent investment, and not with a view of sale. Mr. Greenwood formed a private company for the purpose of enabling him to hold land without incurring additional graduated tax. He had no hesitation in asking his Honor to find conclusively that this was the sole object of the company. Until the time of the sale the company carried on business as a sheep farm, and Mr. Greenwood's son resided and took an active part in the management. The legislation of 1907 frustrated the object of the company, and made Mr. Greenwood liable for additional graduated tax, and this was sufficient reason for the sale of Whiterock. This was a question for the judgment of the owners, and no doubt this legislation induced him to sell, and he invested the "money in foreign countries. The question was, is there power in the memorandum of association to acquire land generally other than Whiterock for purpose of re-sale? His submission was that there were no such powers, and if his contention was upheld that was an end of the case for the defence.

For the Commissioner of Taxes, Mr. Salmond stated that the questions were what is the ordinary business of an incorporated company, and what is meant by dealing in land? He contended that there was an essential difference between an incorporated company and an individual. If the taxpayers had been individual persons it could not have been contended for a moment that the tax was payable. Unfortunately tor themselves they had chosen to form themselves • into incorporated companies. Mr. Greenwood could not complain, as he had formed himself into a company for the special purpose of avoiding the graduated tax. In the Marainanga case it might possibly be regarded as> something of a hardship that the legal result of forming the firm into a company should he the increase of taxation. If a company came into existence for the purpose of buying a single piece of land and reselling it at a profit whether in one block or in subdivisions, that company's | ordinary business is dealing in land, and j the property taxable. His Honor reserved his judgment in both cases.