INCOME TAX.

Timaru Herald, Volume XCIV, Issue 14391, 5 January 1911, Page 6

INCOME TAX.

ANOTHER COURT CASE. ' Per Press Association. >: WELLINGTON, Jan. 4.'/'. Justice Cooper gave judgment to-day in the important income tax ease Whiteroek and' Marainanga JKsfute Company v. the Commissioner of Taxes, claiming a refund of £3650 -income, ,tax alleged to have been overpaid. His Honour said that this vas vri action brought to Tecover from the Commissioner £13650 paid under protest. Geo. Greenwood in 1905 agreed to purchase Whiteroek, Canterbury, from Mr Nicholls, for £75,000, and tio stock, etc., for £25,000. Half tho purchase money of £IOO,OOO was paid ofi. Before it was determined to Greenwood formed a private compiay of 35,000 shares, and took up all h-t two shares; Its object was to <iej i:re Whiteroek arid carry on a ing. business. Its real object, said Mr Justice Cooper, was to enable Grci nwood to avoid the h'gher rate for graduated tax if Teviotdale, whUh -l.e, owned, and Whiteroek were both :yt.».ted in him. The company then bought an adjoining property of 558 acres nc £5 an acre, and sold the whole of ita property at -a -profit of; £52,000. The, Cniraniss'oner of Taxes assessed income tax on that-profit. The company paid it under protest, and the Court -Wi-.J asked to -decide whether the coinpaiiy was liable to be-so assessed. His Honour said the point of law was an extremely narrow one. In'his opinion it was not sale of the estate in the ordinary, course of busine-s. The purpose of the f imation of the i-otj-.' piny was solely to avo : d the graduated tax. Mr Grseavood was a :h"cp farmer and a w.'.-'thy .man. was no indication that he wa>> lie cl; is of man hit at iy lho u;-..hi- Pm-Sji:' whom the te>h!iUro -.-.I lend*. I to affect with the liability were land speculators. - - . . ■«■'-.«■ Judgment was even fcr. pia'-nliff for i the amount clai n' .1, witl> tost.=>