Federal Commissioner of Taxation v Bendrodt [1920] HCA 47; (1920) 28 CLR 101 (17 August 1920)

HIGH COURT OF AUSTRALIA

The Federal Commissioner of Taxation Plaintiff, Appellant; and Bendrodt Defendant, Respondent.

H C of A

On appeal from a District Court of New South Wales.

17 August 1920

Knox C.J., Isaacs and Rich JJ.

F. A. A. Russell, for the appellant.

Milner Stephen, for the respondent.

The judgment of the Court, which was delivered by Knox C.J., was as follows:—

Knox C.J.,

Isaacs and Rich JJ.

This is an appeal by the Commissioner of Taxation against the decision of Cohen D.C.J. dismissing an action brought by the Commissioner against the respondent to recover £91 10s. 10d., entertainment tax in respect of entertainments held at Sargent's Buildings, Market Street.

The grounds of defence were (1) that the payments mentioned were payments of ten shillings each by patrons of the defendant's dancing suppers made on leaving the restaurant after supper in the ordinary way, and they were not payments for admission within the meaning of the Act; (2) that the payments for admission and the total sum of ten shillings were not for the entertainment, since the supper, which was not an entertainment, was substantially, in fact, the most expensive part of the proceedings. The facts found by the District Court Judge were that "the defendant ran certain dancing suppers at Sargent's refreshment rooms, in Market Street. These were advertised, and the advertisements contained a notice as to how the supper tables could be engaged. The dance generally commenced about 9 p.m., and the supper about 9.30 or 9.45 p.m. The price paid was ten shillings per head, and this was paid as the patrons left the building. Several people went there for the supper only, and did not participate in the dancing or remain after their supper as spectators. No one was admitted who had not previously engaged a table for supper, and, if one had not been already booked by a patron, he could engage it before entering the room, provided always there was one at that time disengaged. Sargent's Ltd. supplied the refreshments for the defendant, who paid them for the same at the rate of five shillings per head, namely, four shillings and sixpence for the supper, and sixpence for liquid refreshments." In addition to these facts, it appears that an advertisement was put in evidence which sets out in effect that dancing suppers were held at Sargent's in Market Street, at a charge of ten shillings, that tables could be engaged by ringing up a certain telephone number, and that the suppers were conducted by Bendrodt and Irving, teachers of dancing.

On the facts proved before him, Cohen D.C.J. thought that the case was governed by the decision in Lyons & Co. v. Fox[1], and dismissed the action. In our opinion that decision is not in point. The ground of the decision of the majority in that case was that the payment was not a payment on admission to an entertainment but a payment for a meal supplied by Lyons & Co., the music which was alleged to constitute the entertainment being held to be merely an incidental attraction. In the present case we think that it is clear that the charge of ten shillings was paid primarily for the privilege of taking part in or looking on at the dancing, and that the supper was merely subordinate and incidental to the dancing. By Act No. 25 of 1918, an entertainments tax is imposed on "payment for admission (excluding the amount of tax)." The Assessment Act, No. 36 of 1916, contains certain definitions. The phrase "payment for admission" is not exhaustively defined, though it is made to "include" matters which might not otherwise be considered as within the ordinary meaning of the expression. In its ordinary meaning it denotes a payment for the right of being admitted whenever and however that payment is actually made. "Entertainment" also is not defined further than as "including" any exhibition, performance, lecture, amusement, game or sport for admission to which payment is made. The respondent's advertisements and the facts proved establish that what are called "dancing suppers" are held to which persons are admitted only on condition of paying for admission. The charge is ten shillings and is indivisible. The supper and the dancing go on together, so that the case is entirely unlike the case of Attorney-General v. McLeod[2]. The facts, including the price charged, establish also that the dancing—whether the persons present participate in the actual dancing or merely witness it—is the dominant feature of the proceedings, the supper being merely an agreeable incident but subordinate to the main attraction. Mr. Stephen urged two grounds in favour of the respondent, first, that the charge was for the supper and only incidentally for the dancing. In our opinion this is not so. He also urged that since visitors paid only on leaving, and, if so minded, went out without paying, there was no "payment for admission." The words of the Act are not on admission but for admission, a variation from the words of the Imperial Act which we assume to be intentional. He relied on sec. 8. That section is not a limitation of the operation of the Act but a direction for safeguarding and enforcing it. Omission to observe the requirements of that section entails not immunity, but prosecution under sec. 15.

Both objections are, in our opinion, unsound, and the appeal should be allowed, the order of the District Court set aside and judgment entered for the appellant for the amount claimed, with costs in both Courts.

Appeal allowed. Order of District Court set aside and judgment entered for plaintiff for £91 10s. 10d. with costs. Respondent to pay costs of appeal.

Solicitor for the appellant, Gordon H. Castle, Crown Solicitor for the Commonwealth.

Solicitors for the respondent, Allen, Allen & Hemsley.

[1] (1919) 1 K.B., 11.

[2] (1918) 1 K.B., 13.