F. E. GHASSOUB (GHANA) LTD. v. COMMISSIONER OF INCOME TAX [1972] 2 GLR 395
HIGH COURT, KUMASI
Date: 25 JULY 1972
BEFORE: MENSA BOISON J.
CASES REFERRED TO
(1) Amoako Atta II v. Osei Kofi II (No.2) [1962] 1 G.L.R. 384.
(2) Commissioner of Income Tax v. Ellis, High Court, Sekondi, 1 June 1959, unreported.
NATURE OF PROCEEDINGS
APPLICATION to set aside judgment obtained in default of defence. The facts are fully set out in the
ruling.
COUNSEL
C. F. Hayfron-Benjamin for the applicant.
W. O. Gyampoh for the respondent.
JUDGMENT OF MENSA BOISON J.
This is an application on behalf of the defendants to set aside a summary judgment obtained against them in default under Order 14, r. 1 of the Supreme [High] Court (Civil Procedure) Rules, 1954 (L.N. 140A). By a specially endorsed writ filed on 7 March 1969 [p.397] of [1972] 2 GLR 395 the plaintiff claimed against the defendants a total of ¢77,763.38 being tax and penalty for the years
1965-66, 1966-67, 1967-68 and tax only for 1968-69. On 16 November 1970 the defendants successfully resisted a motion for summary judgment under Order 14, r. 1 of the Supreme [High] Court (Civil Procedure) Rules, 1954 (L.N. 140A), and were accordingly granted leave to defend the action. No defence was, however, filed by the defendants when on 18 February 1971 the plaintiff gave notice to discontinue the action “with liberty to bring a fresh action.”
A fresh action was in fact filed 18 February 1971 this time claiming by the specially endorsed writ the
income tax and penalty for 1969-70 and 1970-71 and employees’ tax deductions from June 1966 to
September 1970, in addition. The total claim now was ¢102,622.70. Appearance was entered on behalf of the defendants but no defence was filed and judgment was entered on 11 October 1971 under Order 14, r. 1 in default.
The present application is to have that judgment set aside. The ground taken is that the plaintiff having given notice to discontinue the former action without leave could not institute the fresh action without leave. The law as regards a plaintiff’s right to discontinue an action is provided under Order 26, r. 1; and as far as relevant to the facts of the discontinuance in this case it is as follows:
“The plaintiff may, at any time before receipt of the defendant’s defence, or after the receipt thereof before taking any other proceeding in the action (save any interlocutory application), by notice in writing, wholly discontinue his action against all or any of the defendants or withdraw any part or parts of his alleged causeof complaint . . . and such discontinuance or withdrawal, as the case may be, shall not be a defence to any subsequent action. Save as in this rule otherwise provided, it shall not be competent for the plaintiff to withdraw the record or discontinue the action without leave of the Court or a Judge . . .”
I think the meaning is plain and it does not require any gloss to interpret the rule. When on 18 February 1971 the plaintiff discontinued his former action no defence had been filed, and after the discontinuance the plaintiff was entitled to institute the second action for the same relief as in the first action, and, more so, for the reliefs not covered by the first action.
The case of Amoako Atta II v. Osei Kofi II (No. 2) [1962] 1 G.L.R. 384 relied on by Mr. Pobee, learned
counsel for the defendants, as supporting his contention is, in my respectful view not in point. The facts there do not show that the suit was discontinued without leave, nor exactly at what stage the earlier action was stayed, or, as contended, discontinued. In that sense, that statement of the law was obiter. [p.398] of [1972] 2 GLR 395 Even so it did not in my respectful view decide that a plaintiff is barred from instituting a fresh action where the cause of action in the second suit is not the same as that in the first, nor indeed for the same cause of action when the first action was discontinued without leave before receipt of defence within Order 26, r. 1. The second ground of objection to the judgment was that the plaintiff ought to have produced to the court, or attached to his claim an extract as required by paragraph 64 (2) of the Income Tax Decree, 1966 (N.L.C.D. 78), to be referred to hereafter as the Decree.
Now paragraph 64 (1) of the Decree empowers the commissioner to recover any tax payable or penalties incurred by action in a court of competent jurisdiction as a debt due to the government. Sub-paragraph (2) provides that: “In any suit under the provisions of sub-paragraph (1) of this paragraph the production of an extract from the list referred to in paragraph 48 and verified under the hand of the Commissioner giving the name and address of the defendant and the amount of tax due by him, or from the appropriate instrument under paragraph 54, shall be sufficient evidence of the amount so due and sufficient authority for the court to give judgment for the said amount.” By paragraph 48 the commissioner is required to prepare a list of persons assessed for tax, containing necessary particulars; and by paragraph 49 he is required to serve every such person so listed. Compliance with paragraphs 48 and 49 is a condition precedent to any demand for assessed tax or penalty, and it is upon the information so supplied that a person may dispute or object to any tax as penalty and subsequently appeal against any amount he is called upon to pay or is demanded of him.
By paragraph 53 provision is made whereby tax or penalties after dispute, objection or appeal, or where no such action is taken, become final and conclusive. Thereafter the commissioner is entitled to collect the amount due by way of demand or by recovery in a court action. That is provided by para-graph 64 (1) of the Decree, namely: “Any tax payable under the provisions of this Decree and any penalties incurred under any of the provisions of this Decree may be sued for and recovered in a court of competent jurisdiction by the Commissioner in his official name with full costs of suit from the person charged therewith as a debt due to Government.”
And then follows paragraph 64 (2) on which the defendant rests his objection.
It seems to me there is nothing special or peculiar in the right of the commissioner to recover any assessed tax by action. It follows then that, in my opinion, he can use any of the normal processes of instituting action either by a generally endorsed writ or, as was done in this case, [p.399] of [1972] 2 GLR 395 by way of specially endorsed writ of summons. Viewed in this way I think the provision in paragraph 64 (2) is merely evidential to relieve the commissioner or his representative from appearing in court to give evidence viva voce. In my opinion it does not in any way impose a mandatory prerequisite before a judgment could properly be obtained upon the writ of summons.
The issue then resolves itself to this: whether or not the writ in the suit was sufficient to ground a
judgment. It being a specially endorsed writ enough particulars must be given. As compliance with
preparation and service of the lists under paragraph 48 by the commissioner is a condition precedent to demand, or recovery of debt, it would be a good ground for setting aside a judgment if that has not been complied with in the defendants’ case. They do not raise that objection. It follows that they must have full knowledge of the particulars as to the amount due as tax and what is penalty, though not so particularised in the specially endorsed writ.
The defendants appeared to the writ and were duly served with notice under Order 14, r. 1 for summary judgment. They did not seek leave on any ground to defend, and the question is whether the court could properly enter judgment on the endorsement as it stood. My answer is yes; because the writ contained sufficient particulars to inform the defendants of the claim against them. I take note of the particulars which the commissioner is under obligation to furnish the defendants. They were nevertheless entitled to ask for further and better particulars; which they did not do. Paragraph 64 (2) being only evidential for proof of the plaintiff’s case should the defendant seek leave to dispute, I am of the opinion that the specially endorsed writ could stand without it.
Secondly, I am of the opinion that the list under paragraph 48 could not be a ground upon which the
defendants could in court raise any dispute which could constitute a defence at law: because inter alia:
(1) The defendant by paragraph 49 (2) had opportunity at the time the assessment was made to object.
(2) After consideration of the objection, if the defendants were dissatisfied, they had a right of appeal
by virtue of paragraph 51 of the Decree.
(3) By paragraph 53 of the Decree where no valid objection or appeal has been lodged within the time
limited against an assessment it shall be final and conclusive.
The above it seems applies whether assessment was presumptive or on submission of account. The
insistence of counsel for the applicants that the defendants submitted accounts, therefore, makes no
difference.
In Commissioner of Income Tax v. Ellis, High Court, Sekondi, 1 June 1959, unreported, before
Sarkodee-Adoo J., as he then was, the effect of the provisions of the Income Tax Ordinance, 1943 (No. 27 of 1943) in pari materia to the provisions of the present Income Tax Decree of 1966 was stated as follows: [p.400] of [1972] 2 GLR 395
“The taxation law of the country is the Income Tax Ordinance, 1943, and its amending Ordinances and rules, which provide for the hearing and determination of the matters raised in the statement of defence and the counterclaim before the appropriate tribunal. These provisions preclude the tax payer from raising the question of liability in an action as the present for tax by the Commissioner of Income Tax.”
I would respectfully adopt that statement of the law, and say that the application to set aside the summary judgment should fail as in my opinion there could be no defence at law disclosed by the application.
There will be costs of ¢150.000, for the plaintiff-respondent inclusive of counsel’s brief fee for this
motion.
DECISION
Application refused.
S.O.
