Square Root Logistics (Pty) Ltd v The Commissioner for the South African Revenue Services and Others

• Jurisdiction: South Africa
• Judge: Lopes J
• Judgment Date: 28 February 2022
• Docket Number: D2068/2022
• Hearing Date: 25 February 2022
• Court: KwaZulu-Natal Local Division, Durban
• Citation: 2022 JDR 0441 (KZD)

Lopes J:

[1]

The applicant, Square Root Logistics (Pty) Ltd, issued a vindicatory application against the Commissioner for the South African Revenue Services (SARS/the first respondent), the Minister of Finance (the Minister/the second respondent) and the third and fourth respondents, two companies to whom I shall refer as 'the tax debtors'. The application was delivered to me on Friday morning, and set down to be heard on Friday afternoon at 2:00pm. It consists of 451 pages. Urgent matters on which I was then working, had to be set aside at some stage so that I could attempt to get to grips with the application. Unsurprising, SARS and the Minister, having been given less than a days' notice (the certificate of urgency

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Lopes J

was signed on the 24th February 2022), had delivered a very brief answering affidavit.

[2]

The subject matter of the application is some 50 motor vehicles, attached by SARS, which it believed were owned by the tax-debtors, and which were in the possession of the tax-debtors. The applicant, however, maintains that it is the owner of the motor vehicles, and not the tax-debtors. That is why it brought this application, as a matter of urgency.

[3]

The application was opposed by SARS and the Minister. Ms M Ngqanda, who appeared for them, took the preliminary point that the applicant had not complied with the provisions of s 96 of the Customs and Excise Act, 1964. The section reads:

'96. Notice of action and period for bringing action. – (1)(1)(a)(i) No process by which any legal proceedings are instituted against the State, the Minister, the Commissioner or any officer for anything done in pursuance of this Act may be served before the expiry of a period of one month after delivery of a notice in writing setting forth clearly and explicitly the cause of action, the name and place of abode of the person who is to institute such proceedings (in this section referred to as "the litigant") and the name and address of his attorney or agent, if any.

(ii) Such notice shall be in such form and shall be delivered in such manner and at such places as may be described by rule.

(iii) No such notice shall be valid unless it complies with the requirements prescribed in this section and in such rules.'

. . .

(c) (i) The State, the Minister, the Commissioner or an officer may on good cause shown reduce the period specified in paragraph (a) . . . by agreement with the litigant.

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Lopes J

(ii)

If the State, the Minister, the Commissioner or any officer refuses to reduce or extend any period as contemplated in subparagraph (i), a High Court having jurisdiction may, upon application of the litigant , reduce or extend any such period where the interests of justice so requires.'

[4]

Ms Ngqanda submitted that the provisions of s 96 were peremptory, and had not been complied with by the applicant, rendering its application fatally defective. Condonation could only be sought after a request from SARS or the Minister, and their refusal to grant the request. Ms Ngqanda relied upon the following:

(a)

In Hisense SA Development Enterprise (Pty) Ltd v The Commissioner for SARS & Another, a judgment of Fabricius J, heard on the 28th December 2011 under Case No: 77081/2011 in the North Gauteng High Court, Pretoria. The learned judge dismissed the application, because, inter alia, the applicant failed to comply with the provisions of s 96. As in this matter, the applicant merely sought condonation for the failure to comply with the section in its notice of motion. The learned judge stated:

'In my view the failure to give proper notice in terms of the Customs and Excise Act is fatal,'

(b)

In Boustred v Riol CC t/a Thrutainers & Another an unreported judgment of the Cape High Court (Case No: 11509/13) heard on the 28th October 2014, Riley AJ, relying on Hisense, dismissed the applicants application to set aside customs dues on property which the applicant imported into the...