High Court – Comptroller of Income Tax v BJX – [2013] SGHC 145

2 August 2013

Civil Procedure – Judgment and Orders

On 26 February 2013, the Comptroller of Income Tax (“CIT”) made an application to the High Court pursuant to Section 105J of the Income Tax Act for an order for two banks to release information, documents and bank records pertaining to BJX. Under Section 105J, the CIT can make an application to the High Court for an order to obtain information that is protected from any unauthorised disclosure under Singapore’s domestic law (such as the Banking Act) in response to requests from tax authorities of other jurisdictions that invoke the provisions of the Exchange of Information Article under the tax treaties Singapore has with such jurisdictions. On 5 July 2013, the High Court granted the Order in favour of the Comptroller. Subsequently, on 9 July 2013, BJX applied for a stay of execution of the Order.

Counsel for BJX submitted that disclosure of confidential information pursuant to the Order would cause irreparable loss of confidentiality in the information disclosed.

Replying, Counsel for the CIT contended that since there was no appeal pending, the stay should not be allowed. Moreover, there were no special circumstances justifying the application.

The Judge ruled that there were no convincing reasons to grant the application.

First, BJX had not filed an appeal against the Order.

Second, there were no special circumstances supporting the application. If the information disclosed to the Indian tax authorities proved to be irrelevant, BJX would not be adversely affected as the authorities are bound by secrecy obligations under the Singapore-India DTA.

Third, the information requested was detailed, specific and foreseeably relevant to the administration or enforcement of Indian tax law. The test of foreseeable relevance was not meant to be a high and exacting standard, but rather, to provide for the exchange of information in tax matters to the “widest possible extent”.

For the above reasons, the application was dismissed.

The above judgment was delivered on 30 July 2013.