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Volume 67 No 8, August 2018 www.taxpayer.co.za
E d i t o r i a l u e D e f e r e n c e T o T h e S p e c i a l i s t T a x C o u r t
The Constitutional Court has, on several occasions, held that due deference should be shown by other courts to specialist courts where judgments of the latter are taken on appeal – yet recent judgments of the Supreme Court of Appeal (‘the SCA’) demonstrate that this injunction is honoured more in the breach than in the observance thereof, at least as far as tax is concerned.
Before turning to certain relevant pronouncements of the Constitutional Court, it is necessary to make the case that the Tax Court is indeed a specialist court, established in terms of section 116 of the Tax Administration Act, 28 of 2011, as amended, (‘the TAA’), read with section 166(e) of the Constitution of the Reublic of South Africa, 1996, as amended, which recognises as a court ‘any other court established or recognised in terms of an Act of Parliament, including any court of a status similar to either the High Court of South Africa or the Magistrates’ Courts’.
Section 116 of the TAA provides that: ‘(1) The President of the Republic may by proclamation in the Gazette establish a tax court or additional tax courts for areas that the President thinks fit and may abolish an existing tax court as circumstances may require. (2) The tax court is a court of record.’ Section 117 of the TAA provides as follows concerning the jurisdiction of the Tax Court:
‘(1) The tax court for purposes of this Chapter has jurisdiction over tax appeals lodged under section 107. (2) The place where an appeal is heard is determined by the “rules”.
(3) The court may hear and decide an interlocutory application or an application in a procedural matter relating to a dispute under this Chapter as provided for in the “rules”.’ Section 118(1) of the TAA provides that the Tax Court consists of a Judge of the High Court, as President, nominated by the Judge-President of the Division of the High Court having jurisdiction in the area where the relevant Tax Court is situated, an accountant selected from the panel of members appointed in terms of section 120, and a representative of the commercial community selected from the panel of members appointed in terms of section 120. There is much more that can be said about the status of the Tax Court as a specialist court, but the above is sufficient to make the point that the Tax Court has exclusive jurisdiction to hear appeals pursuant to the disallowance of an objection to an assessment in terms of section 107 of the TAA.
Section 133 of the TAA governs the matter of appeals by either the taxpayer or the South African Revenue Service (‘SARS’) against decisions of the Tax Court. An appeal to the full bench of the Provincial Division of the High Court which has jurisdiction in the area in which the Tax Court sitting was held requires no leave, and may be exercised as of right, whereas the losing party in the Tax Court can appeal to the SCA without an intermediate appeal to the Provincial Division only with the leave of the President of the Tax Court. It is when either of these rights of appeal are exercised that an appeal court comes to hear an appeal against the decision of the