Page 805 - SAIT Compendium 2016 Volume1

CASE DIGEST 2014-2015
senior prosecutor, Mr. Ferreira, on proposal by SARS, appointed Adv. Ferreira to assist, who had previously assisted SARS with investigations against the taxpayers. SARS also paid for counsel to assist the NPA.
The taxpayers sought to demand acquittal on the charges in terms of a plea in terms of section 106(1)(h), namely that the prosecutor had no title to prosecute, on the basis of two challenges. The rst ground to challenge the title to prosecute was that Adv. Coetzee’s appointment did not conform to the requirements of section 38 of the NPA Act, namely that the appointment of suitably quali ed persons as prosecutors for speci c cases must be in consultation with the Minister of Justice if such person’s appointment has nancial implications, such as having to be paid.
The second challenge was against both persons’ right to prosecute them on the basis that it was in breach of the taxpayers’ right to a fair trial as set out in section 35(3) of the Constitution as the prosecutors did not meet the standard of serving impartially or without prejudice. This challenge was based on the fact that Mr. Ferreira had previously assisted in drafting an af davit for the taxpayers in support of liquidating a company they were involved in. Advocate Ferreira, it was alleged, was also tainted by supporting the appointment of Adv. Coetzee, the latter who was previous involved in criminal and civil litigation against the taxpayers in their personal capacities and entities linked to them. In all instance he was either representing SARS or the NPA.
Outcome
The taxpayers appeal was dismissed and the question of law is answered in favour of the state.
Core Reasoning
Judge Tshiqi (with all sitting judges concurring) stated that the removal of the prosecutors was not factually based on section 106(1)(h) of the CPA as the taxpayers did not have to plea to have the prosecutors removed on the basis of bias. Further, court held that factually the taxpayers’ application was based on their apprehension of bias and not being actually prejudiced by bias, but that the two matters were argued together by agreement of the relevant legal counsels. As a result, the removal of the prosecutors by the high court was therefore not in terms of section 106(1)(h) of the CPA and
that the taxpayers were therefore not entitled to demand acquittal in terms of section 106(4) of the CPA.
On the role of prosecutors the NPA submitted that the rst question to answer was whether the role of prosecutors should be equated with the role of magistrates? The court stated that there is a fundamental difference between the role
and functions of the judiciary and those of the prosecutor.
The judiciary are the decision makers of the adversarial system. The prosecutor’s role is to decide what evidence is
credible that it wants to put in front of the court as evidence of the alleged crime which makes it inevitable that there would be perceived bias. This role must be performed ef ciently with an ingrained sense of dignity and the justness of judicial proceedings.
The court stated further that the protection of the accused does not lie in the general standard of impartiality and independence of all prosecutors, but in the right to a fair trial in section 35(3) of the Constitution, which does not include a right to an independent or impartial prosecutor. A prosecutor may well be disquali ed if there is an inherent danger of unfairness such as that the prosecutor will not have due regard to basic rights and dignity of the accused.
Further, the Judges held that there was no impropriety by Adv. Coetzee and that no impropriety existed merely because SARS proposed and paid him as SARS’ interest was no more than that of the NPA, which interest is enforced on behalf of the public. Unfairness does not ow axiomatically from the dual role of investigator and prosecutor and there must be allegations of actual impropriety during the current or previous proceedings. Furthermore, the facts presented no evidence of impropriety by Ferreira or Adv. Coetzee and that the previous roles would not constitute substantive unfairness in the trial.
The court concludes that the South Gauteng High court had erred by applying the test for impartiality of magistrates to prosecutors and not the test as approved regarding whether from the facts, the perceived bias of the prosecutor will result in substantive unfairness to the accused at the trial.
26. Commissioner for the South African Revenue Service v Tradex (Pty) Ltd & Two Others (WCC; WC Case No: 12949/2013 (9 September 2015) (SARS website)
Issue
Tax Administration – Section 163(4) of the Tax Administration Act (the TAA): At issue is whether a preservation order is necessary where the taxpayer has provided suf cient security for its tax debts.
Posture of Case
The case is before the Western Cape High Court (Cape Town) as court of rst instance.
Facts
The taxpayer owns and controls two entities, Tradex (Pty) Ltd (‘Tradex’) and Business Wize Accounting and Management Services CC (‘BWA’). The former is a supplier of technology solutions and a consulting rm while the latter began operating in 2006 and subsequently acquired two properties with the intention of providing of ce accommodation to Tradex at market related charges.
A mortgage bond was used to partially nance the purchase of one of the properties. Additionally, BWA appointed Tradex as its agent in terms of section 54 of the Value-Added Tax (VAT Act), with the result that VAT on input and output supplies made by or to Tradex as agent for BWA would be treated as supplies made by or to BWA.
SAIT CompendIum oF TAx LegISLATIon VoLume 1 797
CASE DIGEST 2014-2015