Federal Commissioner of Taxation v Citylink Melbourne Ltd

HIGH COURT OF AUSTRALIAGLEESON CJGUMMOW, KIRBY, CALLINAN, HEYDON AND CRENNAN JJTHE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA  APPELLANTANDCITYLINK MELBOURNE LIMITED (FORMERLY KNOWN AS TRANSURBAN CITY LINK LIMITED)  RESPONDENTCommissioner of Taxation v Citylink Melbourne Limited [2006] HCA 3520 July 2006M49/2005ORDERAppeal dismissed with costs.On appeal from the Federal Court of AustraliaRepresentationB J Shaw QC with I B Stewart for the appellant (instructed by Australian Government Solicitor)A C Archibald QC with M M Gordon SC, M N Connock and S H Steward for the respondent (instructed by Freehills)Notice:  This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.CATCHWORDSCommissioner of Taxation v Citylink Melbourne LimitedIncome tax – Allowable deductions – Respondent entered into contracts with the State of Victoria to design, construct, operate and maintain a major system of roads – The State conceded to the respondent rights to do all that was necessary to complete those tasks, with a view to transferring the infrastructure and all associated rights back to the State at the expiry of the concession period – Respondent paid concession fees as consideration for those rights – Whether concession fees were allowable deductions – Whether concession fees which accrued semi-annually were outgoings incurred in, and referable to, the relevant years of income, where the fees were "owing" but "not due for payment" – Whether payment was contingent or theoretical – Whether concession fees were on revenue or capital account – Whether concession fees were an outgoing in...