The Royal Commission on Taxation has made the following recommendation:

We recommend, therefore, that a tribunal consisting of a single judge should be constituted with jurisdiction to review all decisions of Commonwealth or State commissioners; that it should have power in any case to call in such expert assistance as it might think desirable; that its decisions should be final and conclusive upon all matters of discretion or questions of fact; that an appeal should lie from this tribunal on questions of law only to the full High Court; that such appeals should be limited to cases involving a specified minimum amount, subject to the right of the tribunal itself or of the High Court in any case to grant special leave to appeal; and that where an appeal to the High Court is instituted by a commissioner the reasonable costs incurred by the taxpayer upon such appeal be borne by the Crown.

This recommendation involves the constitution of a court having jurisdiction to deal with matters arising under Commonwealth taxation legislation and also under State taxation legislation.

It is necessary to consider the means whereby such a court could be constituted. The Commonwealth has power to create federal courts and to invest courts with federal jurisdiction, so that the Commonwealth could constitute a court to deal with matters arising under Commonwealth taxation legislation, but it could not invest that court with jurisdiction to deal with matters arising under State legislation.

Each State, on the other hand, could constitute a court to decide matters arising under the legislation of that State but could not give that court any federal jurisdiction.

Power therefore does not exist to constitute one court to exercise the proposed jurisdiction, but by agreement between the Commonwealth and States, and by the passage of the necessary legislation, it might be possible to constitute seven courts, each presided over by the same judge, to deal with all matters arising under Commonwealth and State taxation legislation.

In this connexion it should be remembered that the judge in his federal jurisdiction would have life tenure, whereas in his State jurisdiction he would have only such tenure as is permitted by the laws of the respective States, and some at least of the States provide for retirement at a specified age.

The appellate jurisdiction of the High Court is laid down in section 73 of the Constitution, the relevant part of which is as follows:

73. The High Court shall have jurisdiction, with such exceptions and subject to such regulations as the Parliament prescribes, to hear and determine appeals from all judgments, decrees, orders, and sentences–

1. of any Justice or Justices exercising the original jurisdiction of the High Court;
2. of any other federal court, or court exercising federal jurisdiction; or of the Supreme Court of any State, or of any other court of any State from which at the establishment of the Commonwealth an appeal lies to the Queen in Council;
3. of the Interstate Commission, but as to questions of law only;

and the judgment of the High Court in all such cases shall be final and conclusive.

It is assumed that in such an event the agreement would provide for the apportionment, of the total remuneration of the judge, between the Commonwealth and the participating States.

Presumably before any such proposal is proceeded with consideration would be given to the question whether the work involved would be more than could be performed by one judge.

An additional difficulty arises out of so much of the recommendation of the Commission as involves the right of appeal from the proposed court to the High Court on questions of law only.

There could of course be an appeal to the High Court from any federal court constituted to deal with Commonwealth taxation litigation, or from any other court invested with the power to deal with such litigation. Under the Constitution the High Court has power, with such exceptions as the Parliament prescribes, to hear appeals from various courts, including any federal court, or court exercising federal jurisdiction. Any court which was empowered to deal with Commonwealth taxation litigation would necessarily fall within one or other of these categories; and the Parliament could limit, to such extent as it thought fit, appeals from such courts to the High Court.

The position of the appellate jurisdiction of the High Court in relation to State courts is, however, different. The only appellate jurisdiction which the High Court has or can have in relation to State courts is jurisdiction to entertain appeals from the Supreme Courts of the States or from State courts from which at the establishment of the Commonwealth an appeal lay to the Privy Council. Actually, there is only one court included within the last expression–an anomalous court in South Australia consisting of the Governor and all the members of the Executive Council except the Attorney–General. The Commonwealth Parliament may limit the cases in which the High Court may entertain appeals from such courts but it may not extend the appellate jurisdiction of the High Court in relation to State courts. (See Hannah v. Dalgarno 1 C.L.R. 1, at p. 10). Consequently neither by Commonwealth nor by State law could the High Court be given any appellate jurisdiction in relation to appeals from such a taxation appeal court as is proposed when that court is sitting as a State tribunal.

From the foregoing it will appear that the recommendation of the Royal Commission is one to which, for constitutional reasons, full effect cannot be given.

[Vol. 28, p. 164]