Page:Mesha Feet Pty Ltd v Allen acting as Deputy Commissioner of Taxation.pdf/13

 debt by paying $48.68 was formed on the basis of "equitable estoppel" and "tacit assent".

Consideration

39 The grounds on which an application to set aside a statutory demand can be made under s 459G are set out in ss 459H and 459J of the Corporations Act. Those provisions prescribe the following four grounds on which a statutory demand may be set aside. Those sections are enlivened if the Court is satisfied that:


 * (a) there is a genuine dispute between the company and the person serving the statutory demand about the existence or amount of a debt to which the demand relates: s 459H(1)(a);


 * (b) the company has an offsetting claim: s 459H(1)(b);


 * (c) because of a defect in the demand, substantial injustice will be caused unless the demand is set aside: s 459J(1)(a); or


 * (d) there is some other reason why the demand should be set aside: s 459J(1)(b).

40 Here, Mesha Feet contended there was a genuine dispute as to the existence or amount of the debts the subject of the statutory demand.

41 It is clear on the authorities that spurious, hypothetical, illusory or misconceived arguments do not qualify as giving rise to a "genuine dispute" about the existence or amount of the debt to which a statutory demand relates: eg MNWA Pty Ltd v Deputy Commissioner of Taxation (2016) 250 FCR 381; [2016] FCAFC 154 at [98] (Rares, Farrell and Davies JJ), referring to Spencer Constructions Pty Ltd v G&M Aldridge Pty Ltd (1997) 76 FCR 452 at 464F (Northrop, Merkel and Goldberg JJ), applied in Equuscorp Pty Ltd v Perpetual Trustees WA Ltd (1997) 80 FCR 296 at 301F–G (French, Kiefel and Sundberg JJ). Similarly, a claim will not be an "offsetting claim" for the purposes of s 459H(1)(b) of the Corporations Act if there is no serious question to be tried, or the asserted claim is frivolous or vexatious: eg First Equilibrium Pty Ltd v Bluestone Property Services Pty Ltd (in liq) (2013) 95 ACSR 654; [2013] FCAFC 108 at [21] (Gordon, Griffiths and Farrell JJ).

42 The conclusion that the means by which Mesha Feet purported to pay its taxation liabilities are not approved means for payment, is dispositive of the present application. There is no "genuine dispute" as to the existence or amount of the debt to which the statutory demand relates (s 459H(1)(a) of the Corporations Act). Mesha Feet Pty Ltd v Allen acting as Deputy Commissioner of Taxation [2024] FCA 680