Tshwane, Friday 18 August 2023 – The Commissioner for the South African Revenue Service (SARS), Mr Edward Kieswetter, has welcomed the decision of the Constitutional Court delivered yesterday (17 August 2023) in a matter involving Regiments Capital (Pty) Ltd.
The Constitutional Court refused the directors of the insolvent Regiments Capital leave to appeal a decision of the Supreme Court of Appeal (SCA) that upheld the winding up of Regiments Capital as had been argued by SARS on behalf of creditors in liquidation proceedings.
The Constitutional Court, after considering the application for leave to appeal, concluded that the matter does not fall within the jurisdiction of the court. Consequently, leave to appeal was refused.
Earlier SARS petitioned the SCA and appealed the judgement of the Gauteng Division of the High Court that set aside the winding up of Regiments. Judgment of the SCA was handed down on 18 March 2023, upholding the SARS appeal against the decision of the Gauteng Division of the High Court, Johannesburg, with the cost order of two Counsel.
During this process SARS raised an assessment amounting to R 690 million in terms of s42(5) of the Tax Administration Act.
The decision of the Constitutional Court confirms that liquidation proceedings should continue to benefit all tax-compliant creditors. SARS Commissioner Mr Edward Kieswetter said that “SARS has taken the decision to pursue this matter to its logical conclusion because it believed that the company was acting to the disadvantage of its creditors. Such taxpayers deprive Government of scarce resources to provide basic services to the poor and vulnerable. Non-compliant taxpayers need to take heed of SARS’s determination to make it hard and costly for those who wilfully and intentionally seek to use creative ways remain to abdicate their responsibility,” Mr Kieswetter said.
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