The Supreme Court of Appeal handed down judgment in the matter between Corpclo 2290 CC ("Corpclo”) and the Registrar of Bank on 2 November 2012.
The Registrar of Banks applied to the High Court t for an interdict prohibiting Corpclo from continuing a business practice in contravention of the Banks Act.
Corplco put forward the argument that The Registrar should not have been entitled to investigate and arrive at adverse decisions impacting on the rights of Corpclo without showing due respect for Corpclo’s administrative rights to procedural fairness as contemplated in the Promotion of Administrative Justice Act 3 of 2000 ("PAJA”).
The SCA found that Corpclo’s reasoning was seriously flawed and that the Registrar’s decision to investigate the Corpclo’s business and institute proceedings against Corpclo for an interdict in terms of s 81 of the Act were not administrative actions for the purposes of PAJA as they did not adversely affect the rights of the appellants or have a direct, external legal effect or have that capacity.
Relevance to the world of tax
According to PWC (Tax Synopsis Publication November 2012), this judgment means that a decision by SARS to embark on an audit of the taxpayer would not, in and of itself, constitute a decision, as defined in PAJA, and therefore would not trigger the procedural and substantive provisions of PAJA.
Please click here to access the full judgment.