APPEAL COURT.

Timaru Herald, Volume CXXV, Issue 18617, 12 July 1930, Page 19

APPEAL COURT.

INCOME TAX CASE. By Telegraph—Press Association WELLINGTON, July 11. The Appeal Court to-day heard a case, Aspro, Limited, versus Commissioner pf Taxes, an appeal against the assessment of income by the latter. For the apellant, Mr A. Gray, K.C., and Mr C. G. White; for the respondent, the Solicitor-General.

Mr Gray asked the Court to make an order that the facts in the case should not be published. The Court said it had no power to do so, but the Chief Justice stated it was undesirable to publish the figures, which were of a private nature. Application was also made to suppress the name, but again the Chief Justice said the Court had no power to do so, and it must be left to the discretion of the Press.

The Court then proceeded to hear argument in the case, which is concerned principally with the question of the directors’ fees. The Company had appealed against this assessment, and Mr E. Page, S.M., in December, 1929, held that it should stand on the ground that the allowance made by the Company to the directors was excessive. The Company again appealed from this decision, and the case was removed by order of Sir Michael Myers, into the Court of Appeal for argument.

Mr Gray, for the apellants, said a case had come before the Court for the first time in which the right of the Commission to decide w T hat was fair remuneration for directors of a private company, was involved.

The Commissioner contended that money voted as remuneration was really distribution of profits, and should be assessed accordingly. In the apellant Company there were only two shareholders, who were also the only directors.

Mr Fair, for the Commissioner, contended that if his view was not accepted by the Court, the door would be left open to evasion of income tax. Directors’ fees in the case before the Court were not paid for remuneration of services, but constituted distribution of profits for the purpose of reducing the rate of income tax. Decision was reserved.