AMPLE SUN LTD v. COLLECTOR OF STAMP REVENUE

DCSA 42/2013
DCSA 43/2013
DCSA 44/2013
DCSA 9/2012
DCSA 111/2016
(Heard Together)

[2021] HKDC 659

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

STAMP APPEAL NO 42 OF 2013

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BETWEEN

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IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

STAMP APPEAL NO 43 OF 2013

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BETWEEN

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IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

STAMP APPEAL NO 44 OF 2013

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BETWEEN

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IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

STAMP APPEAL NO 9 OF 2012

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BETWEEN

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IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

STAMP APPEAL NO 111 OF 2016

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BETWEEN

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DECISION

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INTRODUCTION

1.  Before the court are 5 stamp duty appeals (the “Appeals”) brought by Ample Sun Limited (“Ample Sun”), Genius Express Limited (“Genius Express”), Danix Limited (“Danix”) and Land Concept Limited (“Land Concept”) (collectively the “Appellants”) respectively pursuant to section 14 of the Stamp Duty Ordinance, Cap 117 (the “Ordinance”).

2.  By the Order of Master Maurice Lam made on 17 August 2020, the Appeals were heard together.

THE UNDISPUTED FACTS

3.  The undisputed facts are set out in the Case Stated in each of the Appeals and the salient ones are extracted and consolidated below. 

The Appellants

4.  Ample Sun was incorporated in Hong Kong as a private company on 21 April 2006.  At all relevant times, Mr Young Tai Chiu, Thomas (“Mr Young”) and Bitaki Limited (“Bitaki”) were the sole director and sole shareholder of Ample Sun respectively.

5.  Bitaki was incorporated in Hong Kong as a private company on 29 October 1982.  At all material times, Mr Young was the sole director of Bitaki.  The issued share capital of Bitaki was $1,020,000 comprising 102,000 shares of $10 each.  Mr Young and Kornex Limited (“Kornex”) held 2,000 shares (2%) and 100,000 shares (98%) in Bitaki respectively.

6.  Kornex was incorporated in Hong Kong as a private company on 30 October 2008.  At all material times, Mr Young was the sole director of Kornex.  The issued share capital of Kornex was $100 comprising 100 shares of $1 each.  Mr Young and Mr Young John Martin held 99 shares (99%) and 1 share (1%) in Kornex respectively.

7.  Charm Surplus Limited (“Charm Surplus”) was incorporated in Hong Kong as a private company on 5 October 2004.  At all material times, Mr Young and Ms Kwok Sau King (“Ms Kwok”) were the directors of Charm Surplus.  Ms Kwok was the sole shareholder of Charm Surplus.

8.  Genius Express was incorporated in Hong Kong as a company on January 2004.  At all relevant times, Mr Young was the sole director of Genius Express.  The issued share capital of Genius Express was $1,100,000 comprising 1,110,000 shares of $1 each.  Mr Young, Bitaki and Vipin Enterprises Limited held 99,999 shares (9.0908%), 1,000,000 (90.9091%) and 1 share (0.0001%) in Genius Express respectively.

9.  Danix was incorporated in Hong Kong as a private company on 3 August 2010.  At all relevant times, Mr Young was the sole director and shareholder of Danix. 

10.  Land Concept was incorporated in Hong Kong as a private company on 8 January 2003.  At all material times, Mr Young was the sole director of Land Concept.  The issued share capital of Land Concept was $2,000,000 comprising 2,000,000 shares of $1 each.  Mr Young, Bitaki, Eitaki Limited held 10,000 shares (0.5%), 1,900,000 shares (95%) and 90,000 shares (4.5%) in Land Concept respectively.

11.  Suneasy Limited (“Suneasy”) was incorporated in Hong Kong as a private company on 30 November 2006.  At all relevant times, Mr Young was the sole director and shareholder of Suneasy.

The property transactions

12.  By a provisional agreement for sale and purchase dated 28 October 2010 (the “Provisional Agreement”), Charm Surplus agreed to purchase the properties known as Shops A, B, C and D on the 1^st Floor of Jolly Garden, No 151 Reclamation Street, Kowloon (collectively the “Property”) from Capital Gain Development Limited (“Capital Gain”) at a consideration of $17,000,000.  The Property was a non-residential property within the meaning of section 29A(1) of the Ordinance. 

13.  The Provisional Agreement stipulated, among other things, that the balance of purchase price of $15,300,000 should be paid upon completion.  Clause 14 of the Provisional Agreement provided that the sale and purchase of the Property shall be completed on or before 28 March 2011. Clause 15 further provided that since the Property was to be sold to Charm Surplus subject to and with the benefit of existing tenancy, vacant possession of the Property was deemed to have been delivered to Charm Surplus upon completion and the Property would be delivered to Charm Surplus on an “as is” basis.

14.  On 12 November 2010, Charm Surplus entered into the formal agreement for sale and purchase (the “Agreement”) as purchaser with Capital Gain.  The Agreement provided, inter alia, the following:-

Clause 5

“The sale and purchase shall be completed at the office of Messrs Woo, Kwan, Lee & Lo during office hours on or before 28^th day of March 2011.”

Clause 35(a)

“The Property is sold subject to and with the benefit of four Chinese Tenancy Agreements (collectively called “the Tenancy Agreements”) dated 25th May 2010, 5th February 2008, 9th June 2010 and 2nd June 2009 respectively and made between the Vendor as landlord and the respective Tenants as herein mentioned… The Purchaser acknowledges receipt of copies of the Tenancy Agreements and declare that they are fully aware of the terms and conditions thereof.”

Clause 35(d)

“Subject to sub-clause (h) hereof, the Vendor shall not after the signing of this Agreement agree to vary or modify the terms of the Tenancy Agreement or accept a surrender thereof without the consent in writing of the Purchaser.”

15.  The Tenancy Agreements annexed to the Agreement provided, inter alia, the following:-

Table A: existing tenancies

Date of Agreement	Tenant	Property Address	Lease Period	Monthly Rent
25 May 2010	黃江健	Shop A	1 Jun 2010 – 31 May 2012	$18,000
5 Feb 2008	What is Cafe and Catering Services Limited	Shop B	1 Dec 2008 – 30 Nov 2010	$16,000 (Note)
9 Jun 2010	DWG Consultant Limited	Shop C	1 Jul 2010 – 30 Jun 2013	$14,500
2 Jun 2009	Amazing Good Limited	Shop D	15 Jun 2009 – 14 Jun 2011	$22,500

Note: Clause 35(h) of the Agreement provided that subject to the agreements of Capital Gain, Charm Surplus and the existing tenant of Shop B, Capital Gain would renew the existing tenancy of Shop B for a term commencing from 1 December 2010 and expiring on 30 November 2012 at the monthly rent of $19,000 inclusive of rates, government rent and management fee.

16.  By a provisional agreement for sale and purchase dated 15 March 2011 (the “Sub-sale Agreement”), Charm Surplus as confirmor agreed to sell Shop D to Land Concept at a consideration of $2,000,000.  Clause 8 of the Sub-sale Agreement provided that Land Concept agreed and had no objection to purchase Shop D subject to the obligations and rights in the existing tenancy.

17.  By four separate assignments all dated 28 March 2011 (collectively the “Assignments”) executed between Capital Gain as vendor, Charm Surplus as confirmor and various companies as purchasers, the Property was assigned to the respective purchasers as follows:-

Table B: stated considerations

Property Address	Purchaser	Consideration
Shop A	Danix	$1,930,000
Shop B	Ample Sun	$2,300,000
Shop C	Genius Express	$1,900,000
Shop D	Land Concept	$2,000,000
	Total:	$8,130,000

18.  Clause 1 of the Assignments stated:-

“IN CONSIDERATION of the Principal Price paid by the Confirmor to the Vendor on or before execution of these presents … and IN CONSIDERATION of the Sub-Sale Price paid by the Purchaser to the Confirmor … the Vendor as beneficial owner and at the request and by the direction … of the Confirmor ASSIGNS and the Confirmor as Confirmor ASSIGNS AND CONFIRMS to the Purchaser the Property

STAMP DUTY ASSESSMENTS

19.  The Assignments were presented to the respondent (the “Collector”) for stamping together with the respective stamping request forms (the “Forms”).  In the Forms, it was stated that an instruction for sale or a provisional agreement in relation to the Assignments had been executed on 15 March 2011 (the “Relevant Date”) and the Relevant Date was preferred for valuation purposes.

Shop A

20.  It was stated in the relevant Form that Shop A was sold subject to an existing tenancy from 28 March 2011 to 27 March 2017 at a monthly rent of $22,000.

21.  Based on the stated consideration of $1,930,000, the Assignment of Shop A was stamped with stamp duty of $100 under head 1(1)(a) of the First Schedule to the Ordinance.

Shop B

22.  It was stated in the relevant Form that Shop B was sold subject to an existing tenancy from 28 March 2011 to 27 March 2017 at a monthly rent of $28,000.

23.  Based on the stated consideration of $2,300,000, the Assignment of Shop B was stamped with stamp duty of $30,100 under head 1(1)(b) in the First Schedule to the Ordinance.

Shop C

24.  It was stated in the relevant Form that Shop C was sold subject to an existing tenancy from 28 March 2011 to 27 March 2017 at a monthly rent of $22,000.

25.  Based on the stated consideration of $1,900,000, the Assignment of Shop C was stamped with stamp duty of $100 under head 1(1)(a) in the First Schedule to the Ordinance.

Shop D

26.  It was stated in the relevant Form that Shop D was sold subject to an existing tenancy from 28 March 2011 to 27 March 2017 at a monthly rent of $37,000.  This tenancy together with those tenancies mentioned in paragraphs 20, 22 and 24 are collectively called the “6-year Tenancy Agreements”.

27.  Based on the stated consideration of $2,000,000, the Assignment of Shop D was stamped with stamp duty of $100 under head 1(1)(a) in the First Schedule to the Ordinance.

28.  The Collector requested the Commissioner for Rating and Valuation (the “Commissioner”) to assess the value of Shop D as at the Relevant Date.  The Commissioner was of the opinion that the value of Shop D as at the Relevant Date was $3,500,000. 

29.  Land Concept, through its then solicitors, objected to the value of Shop D assessed by the Commissioner and contended that the stated consideration of $2,000,000 was the fair market value, on the ground that Shop D was sold to Land Concept subject to the following:-

(a) Shop D had been leased by Charm Surplus to a tenant for a term of 6 years at a month rent of $37,000.

(b) The tenant had an option to purchase Shop D at $2,300,000 on or before 27 March 2017.

(c) The tenancy became the head tenancy of any existing or subsequent tenancy of Shop D.

(d) The total rent payable of $2,664,000 under the 6-year term had been paid by the tenant in advance to Charm Surplus. 

(e) The sum of $2,664,000 would not be reimbursed by Charm Surplus to Land Concept.

30.  In support of these contentions, Land Concept’s then solicitors provided:-

(1) A tenancy agreement dated 18 February 2011 between Charm Surplus as landlord and Suneasy as tenant for a term of 6 years commencing on 28 March 2011 at a month rent of $37,000 (ie the 6-year Tenancy Agreement in respect of Shop D).

(2) An agreement dated 28 March 2011 between Charm Surplus and Land Concept (“Advanced Rental Agreement”) stating that the advanced rental payment of $2,664,000 paid by Suneasy to Charm Surplus should not be refunded or transferred to Land Concept.

31.  The Commissioner maintained the opinion that the value of Shop D as at the Relevant Date was $3,500,000.  The Collector therefore considered that the stated consideration of $2,000,000 in the Assignment of Shop D was considerably below the value of Shop D as assessed by the Commissioner.  The Collector took the view that, pursuant to section 27(4) of the Ordinance, the stated consideration was deemed not to be valuable consideration and the Assignment was deemed to be a conveyance operating as a voluntary disposition inter vivos and the Assignment should be chargeable with stamp duty at the value of $3,500,000 under section 27(1) of the Ordinance.

32.  The Collector raised on Land Concept the first assessment as follows:-

Stamp Duty Chargeable ($3,500,000 x 2.25%)	$78,750
Less: Stamp Duty paid	$100
Balance payable	$78,650

33.  By a Notice of Appeal dated 18 May 2012, Land Concept appealed against the first assessment in DCSA 9 of 2012.

34.  Separately, in reply to the Collector’s enquiry, Amazing Good through Talent Partners CPA (“Talent Partners”) confirmed that the tenancy agreement executed between Capital Gain and Amazing Good with the original term up to 14 June 2011 (“2009 Tenancy Agreement”) had been renewed for 2 years from 11 June 2011 to 14 June 2013 at a month rent of $26,500 (“2011 Tenancy Agreement”).  Rental payment was paid by cheque to Taipan Management Company (“Taipan”)^[1].  The 2011 Tenancy Agreement was subsequently terminated on 14 May 2012.

35.  Talent Partners provided, inter alia, copies of the following documents:-

(1) The 2011 Tenancy Agreement dated 5 May 2011 between Taipan as landlord and Amazing Good as tenant.

(2) A memorandum dated 16 June 2011 (the “Memorandum”) among Capital Gain as vendor, Land Concept as purchaser and Amazing Good as tenant.  The Memorandum provides, inter alia, that the deposit paid by Amazing Good under the 2009 Tenancy Agreement was transferred by Capital Gain to Land Concept; Amazing Good agreed and undertook with Land Concept to observe and perform all the terms and conditions contained in the 2009 Tenancy Agreement on its part; and Land Concept agreed and undertook that it would hold and refund the deposit to the tenant in accordance with the terms and conditions of the 2009 Tenancy Agreement.

The Collector’s views in respect of all four Shops

36.  The Collector then enquired with Messrs Woo, Kwan, Lee & Lo, solicitors then acting for Capital Gain, who advised, amongst other things, the following:-

(1) The four Shops were offered for sale in the market on an individual basis.  Negotiations were made on the basis that Charm Surplus would purchase all four Shops at the same time.

(2) Capital Gain agreed to sell and Charm Surplus agreed to purchase all four Shops in one agreement (ie the Agreement).  According to Clause 3(1), Charm Surplus was obliged to purchase all four Shops and complete the transaction by paying the balance of purchase price of $15,300,000 on completion.  Such obligation was not conditional upon Charm Surplus finding a willing purchaser or not.

37.  After considering the circumstances mentioned above, the Collector came to the following views:-

(1) There was only one single transaction for the sale of the Property by one vendor under a single agreement and that the sale and purchase transaction in respect of each of the Shops formed part of a larger transaction.

(2) Alternatively, there was co-ordination or interdependence between the sale and purchase transactions in respect of the Property and so each of the transactions in respect of Shop A, Shop B, Shop C and Shop D formed part of a larger transaction or series of transactions having taken into account the following factors:

(a) Capital Gain agreed to sell and Charm Surplus agreed to purchase Shop A, Shop B, Shop C and Shop D at the consideration of $17,000,000 in one agreement.

(b) The Provisional Agreement and the Agreement specified that the sale and purchase of Shop A, Shop B, Shop C and Shop D should be completed on or before 28 March 2011 and that according to the legal representation of Capital Gain, Charm Surplus was obliged to purchase all four Shops and complete the transaction by paying the balance of purchase price of $15,300,000 on completion.

(c) Charm Surplus and the purchasers of Shop A, Shop B, Shop C and Shop D were all related companies.  At all relevant times, Mr Young was the director of these companies.  Neither Mr Young nor any of the purchasers of Shop A, Shop B, Shop C and Shop D was a shareholder of Charm Surplus.

(3) The transaction was artificially split into four transactions to take advantage of the reduced rates for computing stamp duty liability of each individual transaction separately.

(4) In respect of Shop A and Shop C, according to the Agreement, Charm Surplus purchased these two shops subject to a tenancy agreement executed between Capital Gain and 黃江健and another between Capital Gain and DWG Consultant Limited respectively.  No documentary evidence has been adduced to prove that these tenancy agreements had been terminated at an earlier date and that the 6-year Tenancy Agreements in respect of Shop A and Shop C had been put into effect. As such, the 6-year Tenancy Agreements should be disregarded.

(5) In respect of Shop B, according to Clause 35(h) of the Agreement, the existing tenancy of Shop B would be renewed for a term commencing from 1 December 2010 and expiring on 30 November 2012 at a monthly rent of $19,000.  No documentary evidence has been adduced to prove that the tenancy had not been renewed and that the 6-year Tenancy Agreement had been put into effect.

(6) In respect of Shop D: According to Amazing Good, the 2009 Tenancy Agreement had not been surrendered at an earlier date.  Instead, the 2009 Tenancy Agreement had been renewed into the 2011 Tenancy Agreement for two years until 14 June 2013.  It contradicted Land Concept’s claim of the existence of the 6-year Tenancy Agreement.

38.  On divers dates, the Collector wrote to the purchasers of Shop A, Shop B, Shop C and Shop D to express his opinion that there existed co-ordination or interdependence among the transactions of the Property and each of the transactions in respect of Shop A, Shop B, Shop C and Shop D formed a larger transaction or series of transactions.

39.  According to the Collector, the applicable rate of stamp duty on each of the four Assignments should be ascertained by reference to the consideration of the Property at $17,000,000 and the consideration of $17,000,000 should be allocated to Shop A, Shop B, Shop C and Shop D in proportion to each of their respective saleable areas as follows:-

Table C: attributed consideration

based on a total valuation of $17,000,000

Shop	Attributed Consideration
Shop A	$3,487,273
Shop B	$4,295,730
Shop C	$3,461,699
Shop D	$5,755,298

40.  Under section 13(3)(b) of the Ordinance, the Collector raised on the Appellants the assessments (the “Assessments”) in respect of the Assignments as follows:-

Table D: the Assessments

	Shop A	Shop B	Shop C	Shop D
Stamp duty chargeable	$130,773	$161,090	$129,814	$215,824
Less: Stamp duty paid	$100	$30,100	$100	$78,750
Balance payable	$130,673	$130,990	$129,714	$137,074

THE APPEALS

41.  The Appellants settled the stamp duty payable and appealed against the Assessments in DCSA 42 of 2013, DCSA 43 of 2013, DCSA 44 of 2013 and DCSA 111 of 2016.

42.  On 3 August 2018, Danix, Ample Sun and Genius Express submitted copies of the 6-year Tenancy Agreements between Charm Surplus as landlord and Suneasy as tenant.

THE COMMISSIONER’S VALUATION

43.  The Collector requested the Commissioner to assess the value of the Property on the basis that it was sold as one single transaction as at the Relevant Date.  The Commissioner assessed that subject to the existing tenancies as set out in paragraph 15 above, the valuations of the Property and each of the Shops as at the Relevant Date are:-

Table E: the Commissioner’s valuations

	Commissioner’s valuations
Shop A	$3,210,000
Shop B	$4,110,000
Shop C	$3,440,000
Shop D	$4,970,000
Total (ie The Property)	$15,730,000

44.  After considering these valuations, the Collector came to the following views:-

(1) The stated considerations of each of the Shops were considerably below their values assessed by the Commissioner as at the Relevant Date.  By reason of the inadequacy of the considerations, the Assignments conferred a substantial benefit on the Appellants.

(2) Pursuant to section 27(4) of the Ordinance, the stated considerations of the Shops were deemed not to be valuable consideration and the Assignments were deemed to be a conveyance operating as voluntary disposition inter vivos.

(3) Accordingly, the Assignments should be chargeable with stamp duty by reference to the Commissioner’s valuations.

(4) The transactions in respect of Shop A, Shop B, Shop C and Shop D form a larger transaction or series of transactions and stamp duty on the Assignments should be assessed at the rate pertinent to the valuation of the Property.  Since the valuation of the Property is $15,730,000, the applicable rate of stamp duty is 3.75% pursuant to head 1(1)(i) in the First Schedule to the Ordinance.  The Assignments should be charged with different stamp duties and there would be refunds to the Appellants as follows:

Table F: chargeable stamp duties (revised)

	Shop A	Shop B	Shop C	Shop D
Stamp duty chargeable	$120,375	$154,125	$129,000	$186,375
Less: Stamp duty paid	$130,773	$161,090	$129,814	$215,824
Refund	($10,398)	($6,965)	($814)	($29,449)

QUESTIONS FOR THE OPINION OF THE COURT

45.  In each of the Appeals, the following questions are submitted for the opinion of the court:-

(1) Whether there is co-ordination or interdependence between the subject transaction and the other three transactions and therefore the subject transaction forms part of a larger transaction or series of transactions;

(2) Whether the Assignment is chargeable with stamp duty in the amount as assessed by the Collector in paragraph 44(4); and

(3) If not, with what amount stamp duty it is chargeable.

QUESTION 1:  WHETHER THERE IS CO-ORDINATION OR INTERDEPENDENCE

46.  Section 29(1) of the Ordinance provides that references in head 1(1) in the First Schedule to a conveyance on sale being certified at a particular amount mean that such conveyance on sale contains a statement certifying that the transaction effected by the instrument does not form part of a larger transaction or series of transactions in respect of which the amount or value, or aggregate amount or value, of the consideration exceeds that amount.

47.  In relation to stamp duty chargeable on a conveyance operating as a voluntary disposition inter vivos, the amount or value of the consideration in section 29(1) shall be construed as the value of the property conveyed: section 29(2).

48.  The purpose of this section is to prevent purchasers from evading their liability to a higher ad valorem stamp duty by splitting a larger transaction into a number of smaller transactions each with a lower consideration.

49.  Section 73 of the English Finance (1909-10) Act, 1910 and section 66ab of the Australian Stamp Duties Act, 1923-1978 also contained a phrase similar to the phrase “part of a larger transaction or series of transactions” in section 29(1) of the Ordinance.  The meaning of those phrases has been considered in the following cases.

50.  In Attorney General v Cohen [1937] 1 KB 478 (Court of Appeal), it was held that:-

(1) The question whether certain transactions fall within the language used in the section is a question of the construction of the section, and therefore a question of law (per Greene LJ at 489).

(2) It is incumbent upon those who assert that a number of transactions constitute a series within the meaning of the section at least to point to some quality in them which upon some intelligible ground removes them from the category of separate transactions and unites them under the head of a series (per Greene LJ at 489).

(3) In considering whether a transaction formed part of a larger transaction or series of transaction, the court would see if there was any evidence of interdependence or if they might be so related that one would cause or qualify another (per Slesser LJ at 482).

(4) The expression “part of a series” suggests that by a series is meant something of which it can be said there is some integral relationship between its parts.  It does not convey the idea that all that is required is that the transaction should be one of a number of transactions related to one another in time or space or both (per Greene LJ at 490).

(5) The phrase “part of a series of transactions” is intended to sweep in cases where the relationship between the transactions is an integral and not a fortuitous one depending merely on such circumstances as contiguity in time or space, but is such that it would not or might not be sufficient to bring them within the phrase “part of a larger transaction” (per Greene LJ at 491).

51.  Whether there is interdependence amongst the transactions depends on the facts of a particular case: Attorney General v Cohen [1936] 2 KB 246 at 252 per Lawrence J, whose decision was upheld by the Court of Appeal (supra).

52.  In Jeffrey v Commissioner of Stamps (1980) 23 SASR 398, the Supreme Court of South Australia applied Attorney General v Cohen and added at 405:-

“the phrase points to some essential unity, some ‘oneness’, some unifying factor that brings the several transactions within the section….In every case…it will be necessary to find a relationship or connection or interdependence between the transaction that gives to them the essential unity at which s. 66ab is directed.”

53.  Cohen and Jeffrey were applied in Old Reynella Village Property v Commissioner of Stamps (1981) 51 SASR 378, where the subject transactions (the purchases of 17 properties which were acquired for the purpose of amalgamation so that a shopping complex could be erected on the land in question) were held to fall within the meaning of the phrase as their relationship were found to be integral and not fortuitous.

54.  The above three cases have been applied in Hong Kong in the case of Wong Sau Har & Anor v The Collector of Stamp Revenue [2019] 3 HKC 299, where HH Judge MK Liu held that the transactions from the two conveyances on sale by the appellants (who were husband and wife) formed part of a larger transaction or a series of transaction, as completion of the two transactions must both take place together at the same time (failing which neither transaction could be completed) and therefore were interdependent or would cause or qualify the other, and the transactions were not fortuitous.

55.  In accordance with section 11 of the Ordinance, all the facts and circumstances which might affect the assessment of the stamp duty chargeable should be fully and truly set forth in the instrument.  The subjective view and intention of the stamp duty payer on the transactions are not matters for the court’s consideration when interpreting the instrument: Chan Koon Ping & Anor v Collector of Stamp Revenue, unreported, DCSA 2/1984, 3 May 1985.

56.  It follows that the issue to be determined for this question is whether there was co-ordination or interdependence in the conveyances on sale of the four Shops such that each of them formed part of a larger transaction or together they were a series of transactions, thereby rendering them a conveyance operating as a voluntary disposition inter vivos and stamp duty is chargeable on their aggregate market value as at the Relevant Date.

57.  The Collector submitted that there was an interdependent and integral relationship amongst the conveyances on sale of the four Shops in the light of the following facts:-

(1) Shop A, Shop B, Shop C and Shop D located on the same floor in the same building.  This was said to demonstrate the unity of location.

(2) The transactions of the Property were based on one single agreement, ie the Provisional Agreement.  Under the Provisional Agreement and, subsequently, the Agreement:

(a) Capital Gain agreed to sell and Charm Surplus agreed to purchase Shop A, Shop B, Shop C and Shop D;

(b) The sale and purchase of Shop A, Shop B, Shop C and Shop D should all be completed on or before 28 March 2011; and

(c) Negotiations between Capital Gain and Charm Surplus were made on the basis that Charm Surplus would purchase all four shops at the same time.  Charm Surplus was obliged to purchase all four shops in one transaction.

These were said to demonstrate the unity of the underlying transaction.

(3) The transfer of legal titles of Shop A, Shop B, Shop C and Shop D from Capital Gain to the Appellants were all subject to Charm Surplus’s performance under the Agreement.

(a) The initial deposit and further deposits due to Capital Gain were paid by Charm Surplus in accordance with the Provisional Agreement and the Agreement.

(b) Under the Agreement, the balance of the purchase price ($15,300,000) must be paid by Charm Surplus on or before the completion date.

(c) It was provided in the four Assignments that “the Principal Price payable by the Confirmor to the Vendor under the Principal Agreement [ie the Agreement] has been fully paid on or before the date of this Assignment” (Preamble (C) of the Assignments).

(d) Each Shop was assigned to each of the Appellants in consideration of the principal price of $17,000,000 paid by Charm Surplus to Capital Gain (Clause 1 of the Assignments).

These were said to demonstrate the interdependence in respect of contractual performance.

(4) Although the Agreement and the Sub-sale Agreement (in respect of Shop D only) were entered into on different dates, ie 12 November 2010 and 15 March 2011 respectively, both were due to be completed on the same date, ie 28 March 2011.  Coincidentally, the tenancy terms provided in the 6-year Tenancy Agreements also commenced on 28 March 2011.  This was said to demonstrate the unity of time.

(5) Charm Surplus and the respective purchasers of Shop A, Shop B, Shop C and Shop D (ie the Appellants) in the four Assignments were all related companies:

(a) Mr Young had direct or indirect control of both the confirmor, Charm Surplus, and the purchasers in the four Assignments. Although he was not a shareholder of Charm Surplus, he was one of its two directors.  Meanwhile, he was the sole director and shareholder of all of the Appellants, either directly or indirectly through his controlling companies.

(b) Mr Young’s involvement in the parties was further demonstrated by the fact that he signed on behalf of both Charm Surplus as confirmor and the Appellants as purchasers in all the four Assignments.

(c) The tenant under the four 6-year Tenancy Agreements was Suneasy, of which Mr Young was also the sole director and shareholder.

(d) The Collector submitted that the above arrangements demonstrate that the Appellants were related companies acting together and were not strangers fortuitously taking the conveyances of the neighbouring properties.  It was further submitted that, as Charm Surplus and Suneasy were also related companies sharing the same director, it is apparent that the rental arrangement under the 6-year Tenancy Agreements was not fortuitous and the transaction was artificially split into four transactions under the four Assignments.

58.  In my view, these indicia are all features relevant to the question to be decided here.  Taken as a whole, these indicia demonstrate an integral relationship amongst the parties as well as amongst the transactions, and that the Agreement and the Assignments were clearly interdependent.  The relationship of the parties and the unity in respect of the contractual arrangements also indicate that the transactions were integral and not fortuitous.

59.  The Appellants argued that the above features were insufficient to prove any co-ordination or interdependence amongst the transactions, which in their submission were independent and separate.

60.  First, the Appellants relied on Slesser LJ’s decision in Attorney General v Cohen at 481 and argued that features such as the same parties, close proximity in respect of the time of the transactions, and contiguous subject matter of the various conveyances were casual matters which did not make it proper to say that they constituted parts of a series within the meaning of the section.

61.  As the Collector rightly pointed out, however, although Cohen indicated that these factors alone might not be sufficient to prove co-ordination or interdependence, the case cannot be taken as authority that these factors were irrelevant.  In fact, similar factors were taken into account in Jeffrey and Wong Sau Har, and the court must look at all the relevant circumstances of the transaction to determine whether it forms a part of a larger transaction or series of transactions.

62.  It is also important to note that the sales in Cohen were by way of public auction, not by way of private treaty as in these Appeals.  At first instance in Cohen at 252, such a difference was highlighted as a distinguishing feature which set the subject transactions apart from a conveyance on sale by private treaty:-

“In my judgment, an auction raises somewhat different consideration from a conveyance on sale by negotiation; it may be that a number of conveyances on sale negotiated between two parties privately, at or about the same time, would constitute a series of transaction within the meaning of the section, but so far as it is important for me to express my view to the general construction of the section, I should hold that there cannot be a series of transactions, unless there is some interdependence between the various transactions, whether or not there is such interdependence depends upon the facts of each case. Where the lots have been bought at an auction, as in this case, and there is no evidence of circumstances known to the vendor and the purchaser which in any way connects the various lots and makes the bids of the purchaser dependent upon the bids for the other lots, I am of opinion that there is no series of transactions within the meaning of the section.”

63.  Thus, it has been suggested that although transactions related by time and place and between the same parties do not necessarily constitute a series of transactions, a strong presumption that they do so arises if the sales are by private treaty: Encyclopaedia of Hong Kong Taxation, Vol 1 at §2186.

64.  Secondly, the Appellants submitted that Charm Surplus was unrelated to the Appellants since Mr Young was not Charm Surplus’s shareholder.  In my view, this submission misses the point.  While ownership is no doubt an indicator of control, directorship (which concerns the management and operation of a company) is also relevant to the consideration of whether there is co-ordination amongst the parties, whether the congruences in the transactions are fortuitous or intended, and whether there is an integral relationship between the parties to the transactions.  Here, Mr Young’s involvement in those companies is demonstrably clear from his execution of the Assignments on behalf of both Charm Surplus as confirmor and the Appellants as purchasers.

65.  Thirdly, the Appellants sought to distinguish Wong Sau Har, Jeffrey and Old Reynella by contending that the present Appeals do not bear the same features by reason of which the respective courts concluded that there was interdependence in the transactions:-

(1) In Wong Sau Har, the purchasers were required by the vendor to purchase the two properties together and they had to complete the transactions at the same time.  In these Appeals, the four Shops were offered for sale in the market on an individual basis and Charm Surplus chose to purchase the four Shops at the same time.

(2) In Jeffrey, the appellants were mother and son who purchased two adjoining parcels of land.  The second agreement was expressed to be subject to the fulfilment of certain special conditions in the first agreement, providing for the sale by the mother of another property owned by her and for her obtaining consent to build on the land she intended to purchase.  In these Appeals, there was no such special condition in the Agreement or Assignments.

(3) In Old Reynella, the 17 properties were purchased for the purpose of amalgamation so that a shopping complex could be erected on the land in question.  In these Appeals, there is no evidence of any such development plans for the four Shops.

66.  While these observations are fair, I do not think this approach to factual analysis is correct for the purpose of these Appeals.  As I see it, the presence of a particular feature or the lack thereof does not necessarily distinguish one case from another.  After all, it is not a mechanical box-ticking exercise where all the features need to be identical before the same conclusion can be made.  Clichéd as it might sound, each case is to be decided on its own facts by taking into account all the relevant circumstances, and the weight to be given to each feature may well be different depending on the factors at play in a particular case.

67.  In any event, I do not think that the differences as pointed out by the Appellants are sufficient to distinguish the present Appeals from those cases.

(1) Although Capital Gain as the vendor offered the Shops for sale on an individual basis, it does not detract from the fact that under the Agreement Charm Surplus was obliged to purchase all four Shops and such obligation was not conditional upon Charm Surplus finding a willing purchaser or not.

(2) While the Agreement or the Assignments did not contain special conditions similar to those in Jeffrey, as mentioned above, the transfer of legal titles of Shop A, Shop B, Shop C and Shop D from Capital Gain to the Appellants were all subject to Charm Surplus’s performance under the Agreement and hence the transactions were interdependent.

(3) Although there is no evidence of any plans to merge the four Shops, each of the Shops was said to be subject to a materially identical 6-year Tenancy Agreements under all of which Suneasy, a related party of the Appellants, was the tenant. 

68.  Having considered all the relevant features in these cases, I am of the view that there was essential unity amongst Charm Surplus, the Appellants and Suneasy.  There was an interdependent and integral relationship amongst the transactions and they were not fortuitous.  In this connection, the comments of Jocabs J in Jeffrey at 405 are apposite:-

“One can imagine, for example, a situation in which four related companies each contracted to purchase a separate lot, each contract being conditional upon the due performance of all the other contracts, thereby manifesting a clear intention that the four companies intended to acquire between them the four allotments, or none at all. It might be very difficult in such a case to contend that each transaction did not form part of a series or part of a larger transaction, or indeed that there was not, in the language of s. 66ab of the Act, substantially one transaction, although the parties are different.”

69.  I think the same comments can be made on the facts of these cases.

70.  For the reasons set out above, I find that there was co-ordination or interdependence amongst the conveyances on sale of the four Shops and each of them formed part of a larger transaction or series of transactions.  My answer to Question 1 is “yes”.

QUESTION 2:  WHETHER THE ASSIGNMENT IS CHARGEABLE WITH STAMP DUTY IN THE AMOUNT AS ASSESSED BY THE COLLECTOR IN PARAGRAPH 44(4)

71.  Since my answer to Question 1 is “yes”, each of the Assignments should be deemed to be a conveyance operating as a voluntary disposition inter vivos and, pursuant to section 29(2)(a), stamp duty should be assessed at the rate pertinent to the valuation of the Property as a whole as at the Relevant Date.

72.  Section 27(4) of the Ordinance provides that any conveyance shall for the purposes of the Ordinance be deemed to be a conveyance operating as a voluntary disposition inter vivos, and the consideration for any conveyance or transfer shall not for this purpose be deemed to be valuable consideration where the Collector is of the opinion that by reason of the inadequacy of the sum paid as consideration or other circumstances the conveyance confers a substantial benefit on the person to whom the property is conveyed.

73.  The Collector’s view is that the stated consideration of each of the four Shops was considerably below its market value as assessed by the Commissioner and, by reason of the inadequacy of the considerations, the four Assignments conferred substantial benefit on the Appellants.

74.  In respect of the valuation of the Property, the issue to be determined here is whether the stated consideration of each of the four Shops should be deemed not to be valuable consideration and the 6-year Tenancy Agreements should be disregarded for the purposes of valuation.

75.  The Collector urged the court to disregard the 6-year Tenancy Agreements for the purposes of valuation by reason of the following matters:-

(1) The four Assignments set out, amongst other things, that there was the Agreement in which Capital Gain agreed to sell to Charm Surplus the Property for $17,000,000, and that Charm Surplus has since agreed to sell part of the Property to the respective purchaser for the sub-sale price specified therein, subject to and with the benefit of existing lettings and tenancies.  The Appellants argue that the words “lettings” and “tenancies” in the plural form denote the inclusion of both the pre-existing Chinese Tenancy Agreements and the 6-year Tenancy Agreements.  However, there is no further detail about any such existing tenancies or lettings or relevantly, the 6-year Tenancy Agreements, even though such facts and circumstances were required to be fully and truly set forth in the Assignments pursuant to section 11 of the Ordinance.

(2) The 6-year Tenancy Agreements contained a “special harsh term” that the monthly rental over the six-year period would be paid by Suneasy to Charm Surplus upfront (the “Advanced Payments”) before completion of the acquisition:

Table G: Advanced Payments

Shop	Advanced Payment (ie 6 years of rental)	Payment due date
Shop A	$1,584,000	26 Mar 2011
Shop B	$2,016,000	26 Mar 2011
Shop C	$1,584,000	26 Mar 2011
Shop D	$2,664,000	26 Mar 2011
Total	$7,848,000

(3) Having taken into account the total amount received by Charm Surplus arising from the stated consideration under the four Assignments and the Advanced Payments ($8,130,000 + $7,848,000 = $15,978,000), Charm Surplus still suffers a net loss of $1,022,000 ($17,000,000 - $15,978,000).  It is questionable as to why it is commercially realistic for Charm Surplus to incur a loss in such a short period of time.

(4) It is also questionable whether Suneasy had indeed made the Advance Payments to Charm Surplus. Even assuming that the Advanced Payments have actually been made, save for Land Concept which provided a self-serving confirmation claiming the receipt and retention of the Advanced Payment by Charm Surplus, the other Appellants had not provided any documentary evidence to support their assertions that the Advanced Payments were paid to and retained by Charm Surplus.

(5) The Appellants tried to argue that, since the confirmor had to come up with sufficient money to pay the vendor for the balance of the consideration in the Assignments, it would have received the upfront payment of the rentals in the 6-year Tenancy Agreements.  But  Charm Surplus’s ability to settle the balance of the consideration does not necessarily mean that it has received any upfront payment from Suneasy, and hence there is no merit in the Appellants’ argument.  In any event, the Appellants have failed to produce any evidence of such payment.

(6) The Collector further submitted that the 6-year Tenancy Agreements ought to be disregarded as there was a lack of commercial sense in the whole arrangement:

(a) There was no upside but only downside for the Appellants to purchase the Shops when they would not benefit from any rental income or possession for six years but would be subject to substantial liabilities under the 6-year Tenancy Agreements, including the return of the Advanced Payments if the Appellant landlords decided to terminate the tenancy early. In particular, in respect of Shop D:

(i) Pursuant to Clause 8 of the Sub-sale Agreement, Land Concept agreed to purchase Shop D subject to the liabilities and with the benefit of the existing lettings and tenancies.

(ii) It is the Land Concept’s case that it had agreed that the Advance Payment received by Charm Surplus would not be transferred to Land Concept.

(iii) Despite the Assignment on 28 March 2011, Land Concept had agreed that it would neither receive vacant possession nor any rental income of Shop D until 27 March 2017, ie six years after the date of the Assignment.

(b) In respect of Shop A, Shop B, and Shop C, according to the Agreement, the Appellants purchased these Shops subject to the Chinese Tenancy Agreements.  It was further provided in Clause 35(d) of the Agreement that the vendor should not after the signing of the Agreement agree to vary or modify the terms of the Tenancy Agreements or accept a surrender thereof without the consent in writing of the purchaser.  No documentary evidence has been provided by the Appellants to prove that the Chinese Tenancy Agreements had been terminated at an earlier date and that the 6-year Tenancy Agreements had been put into effect.  In particular, the Chinese Tenancy Agreement in respect of Shop A and Shop C should end on a date later than the alleged execution date of the 6-year Tenancy Agreements. It was not possible to “insert” a 6-year Tenancy Agreement executed between Charm Surplus and Suneasy on 18 February 2011 without the consent from the existing tenants.

(c) In respect of Shop D, there seemed to be two tenancy agreements that operated at the same time. The existing tenant of Shop D, Amazing Good, had renewed its lease for two years for the period from 15 June 2011 to 14 June 2013, ie the 2011 Tenancy Agreement. The lease was subsequently terminated on 14 May 2012.  By the Memorandum dated 16 June 2011, Capital Gain transferred the initial deposit of Amazing Good under the 2009 Tenancy Agreement to Land Concept.  Land Concept’s case of the existence of the 6-year Tenancy Agreement is therefore self-contradictory, as it was impossible for two tenants to rent Shop D at the same time.  On the understanding that the 2009 Tenancy Agreement had not been terminated at an earlier date, it should end on 14 June 2011.  It follows that it was not possible to “insert” a 6-year Tenancy Agreement executed between Charm Surplus and Suneasy on 18 February 2011 without the consent from Amazing Good which was the pre-existing tenant.

76.  I agree with the Collector’s submissions that the 6-year Tenancy Agreements do not seem to make any commercial sense.  It is also doubtful if Suneasy had indeed made the Advanced Payments to Charm Surplus as asserted by the Appellants, as there is no evidence proving the existence of such payments save for a self-serving letter by Charm Surplus in respect of Shop D.  One would expect such evidence to be readily available from Suneasy, a related company of the Appellants.

77.  As the Collector rightly pointed out, the burden is on the appellant in a stamp duty appeal to adduce evidence in support of his grounds of appeal.  If the Appellants’ contention is that the Collector should have taken into account the 6-year Tenancy Agreements and the Advanced Payments in the valuation of the Property, it is incumbent on the Appellants to put in evidence of such payments.

78.  In response to this, Mr Joseph Lee (“Mr Lee”), solicitor acting for the Appellants, suggested in the course of his oral submissions that no such payment records were available, as there were certain set-off arrangements between Charm Surplus on one hand, and Suneasy and the Appellants on the other.  I do not understand this submission. In any event, it was raised for the first time at the hearing and it was not supported by any evidence.  Moreover, it was contradictory to the Appellants’ case that the transactions in respect of each of the Shops were separate and distinct and hence one would expect Suneasy to have made the Advanced Payments to Charm Surplus in respect of each Shop separately.  It remains the case that there is no cogent evidence to support the Appellants’ case that Suneasy made the Advanced Payments as alleged.

79.  In respect of the Collector’s submission that it was impossible to “insert” the 6-year Tenancy Agreements prior to the expiry of the Chinese Tenancy Agreements, the Appellants replied that it was not uncommon to have concurrent tenancies and here, Suneasy was the head tenant and the tenants under the Chinese Tenancy Agreements were sub-tenants.  The Appellants referred to a term in the 6-year Tenancy Agreements providing that the 6-year tenancy should become the head tenancy of any existing or subsequent tenancy of the premises.  It was further submitted that so long as Suneasy willingly gave up physical possession of the Shops in the meantime, there was no contradiction at all.  In other words, it was said that the original tenants had occupied the Shops as the sub-tenants and Suneasy was the absentee principal tenant not in occupation.

80.  It was then pointed out by the Collector that in the Memorandum dated 16 June 2011, only Capital Gain, Land Concept and Amazing Good were named as parties.  At this point in time, Suneasy should have been the head tenant according to the 6-year Tenancy Agreement and the 2011 Tenancy Agreement.  Therefore, if subletting by Suneasy to Amazing Good already existed, Suneasy should have been named as a party to the Memorandum.  At the hearing, Mr Lee explained that because the Memorandum dealt with the rental deposit paid by Amazing Good to Capital Gain and since Suneasy did not receive the deposit, it was unnecessary to name Suneasy as a party to the Memorandum.  However, what seems peculiar is that the Memorandum made no mention of the 2011 Tenancy Agreement which was executed before the Memorandum and pursuant to which Amazing Good paid a deposit of $53,000 to Taipan (ie Suneasy).  If the 2011 Tenancy Agreement was considered as a renewal of the 2009 Tenancy Agreement, one would expect the Memorandum to have mentioned the latter agreement.

81.  In any event, if Suneasy was the absentee principal tenant, Suneasy would have paid the Advanced Payments to Charm Surplus without enjoying the physical possession of the property until the Chinese Tenancy Agreements came to an end.  Moreover, in respect of Shop D, Suneasy was supposed to have paid an Advanced Payment of $2,664,000, ie at an effective average monthly rent of $37,000, but under the 2011 Tenancy Agreement, the effective monthly rent payable by Amazing Good was only $26,500.  In other words, Suneasy was making a loss of $10,500 per month during the term of that sub-lease.  In respect of Shop A, Shop B and Shop C, no evidence has been provided that the sub-tenants’ rental payments were made to Suneay. The Collector submitted, and I agree, that Suneasy had no benefit from this arrangement and it was of no commercial sense. In short, the alleged existence of sub-letting by Suneasy is highly doubtful.

82.  On a separate note, it was observed that the actual benefits received by Charm Surplus from the transactions (ie the stated consideration under the Assignments plus the Advanced Payments) was similar to the value of each Shop as assessed by the Commissioner:-

Table H: Comparison of total benefits received by

Charm Surplus and the Commissioner’s valuations

Shop	Stated consideration	Advanced Payment	Total benefits	Commissioner’s valuation
Shop A	$1,930,000	$1,584,000	$3,514,000	$3,210,000
Shop B	$2,300,000	$2,016,000	$4,316,000	$4,110,000
Shop C	$1,900,000	$1,584,000	$3,484,000	$3,440,000
Shop D	$2,000,000	$2,664,000	$4,664,000	$4,970,000
Total	$8,130,000	$7,848,000	$15,978,000	$15,730,000

83.  At the hearing, Mr Lee accepted that under normal leasing arrangements, the rentals from the 6-year Tenancy Agreement would have been paid by Suneasy to the Appellants as landlords.  But here, the Advanced Payments were said to have been paid by Suneasy to Charm Surplus without regard to the Appellants.  Mr Lee further accepted that the Advanced Payments could be viewed as part of the consideration moving from the Appellants as purchasers to Charm Surplus as the confirmor, and it did not matter to Charm Surplus whether the money came from the Appellants or Suneasy.  Under these arrangements, therefore, the total consideration received by Charm Surplus was split into two parts (ie the Advanced Payments and the stated considerations) with the result that the stated considerations in the Assignments were reduced and the instruments were chargeable with a lower ad valorem stamp duty.

84.  Mr Lee argued that such arrangements were not illegal, and they were legitimate to reduce the stamp duty chargeable on the Assignments.  Mr Lee referred to IRC v Duke of Westminster [1936] AC 1 and Wu Wai Sum Stella v Man Ting Chu [2010] 5 HKLRD 125[2] for the proposition that every person is entitled to arrange his affairs in a way to minimise tax liability, so long as the arrangement does not overstep the principles and approach as enunciated in the leading authority of Ramsay Ltd v IRC [1982] AC 300.

85.  The ratio of Ramsay (or the “Ramsay approach”) has been the subject of many judicial discussions. For present purposes, it is sufficient to note that Ramsay reasserted the need to apply orthodox purposive approach of statutory interpretation to tax legislation, and it involved a realistic analysis of the facts and the transactions in question: Collector of Stamp Revenue v Arrowtown Assets Ltd (2003) 6 HKCRAR 517 at §3 per Li CJ and §40 per Ribeiro PJ.

86.  The Ramsay approach was authoritatively summarised by Lord Browne-Wilkinson in IRC v McGuckian [1997] 1 WLR 991 at 998:-

“The approach pioneered in the Ramsay case and subsequently developed in later decisions is an approach to construction, viz that in construing tax legislation, the statutory provisions are to be applied to the substance of the transaction, disregarding artificial steps in the composite transaction or series of transactions inserted only for the purpose of seeking to obtain a tax advantage. The question is not what was the effect of the insertion of the artificial steps but what was its purpose. Having identified the artificial steps inserted with that purpose and disregarded them, then what is left is to apply the statutory language of the taxing Act to the transaction carried through stripped of its artificial steps. It is irrelevant to consider whether or not the disregarded artificial steps would have been effective to achieve the tax saving purpose for which they were designed.”

87.  In my opinion, the present cases fall squarely within the Ramsay approach.  As discussed above, the 6-year Tenancy Agreements and the alleged sub-letting by Suneasy do not seem to make any commercial sense.  Even on the Appellants’ case, it appears that the sole function of Suneasy was to make the Advanced Payments to Charm Surplus.  The 6-year Tenancy Agreements do not seem to serve any real business purpose and they were inserted solely for the purpose of reducing the stated considerations in the Assignments.  The stated considerations were therefore artificially suppressed to attract lower ad valorem stamp duties. Taking a purposive approach, it seems to me that this is precisely the kind of mischief that section 27(4) is intended to address.

88.  In the light of all the matters discussed above, I am of the view that the stated consideration of each of the four Shops in the Assignments were inadequate and they conferred a substantial benefit on the Appellants.  The four Assignments should be deemed to be conveyances operating as voluntary dispositions inter vivos and they should be chargeable with stamp duty by reference to their respective value at the Relevant Date as assessed by the Commissioner.

89.  Since I have held that the transactions in respect of the four Shops formed a larger transaction or series of transactions, stamp duty on each of the Shops should be assessed at the rate pertinent to the valuation of the entire Property.  Given the Commissioner’s valuation of the Property at the Relevant Date is $15,730,000, the applicable rate of stamp duty is 3.75% pursuant to head 1(1)(i) in the First Schedule to the Ordinance.  The four Assignments should be charged with stamp duty as per Table F above, with refunds to be made to the Appellants respectively.  My answer to Question 2 is therefore “yes”.

QUESTION 3:  IF THE ANSWER TO QUESTION 2 IS “NO”, WITH WHAT AMOUNT OF DUTY IT IS CHARGEABLE

90.  Since my answer to Question 2 is “yes”, this question is no longer applicable and does not need to be decided.

CONCLUSION

91.  In conclusion, my answers to the questions submitted to the court are:-

(a) Whether there is co-ordination or interdependence between the subject transaction and the other three transactions and therefore the subject transaction forms part of a larger transaction or series of transactions;

Answer: yes

(b) Whether the Assignment is chargeable with stamp duty in the amount as assessed by the Collector in paragraph 44(4); and

Answer: yes

(c) If not, with what amount stamp duty it is chargeable.

Answer: not applicable

92.  At the end of the hearing, I indicated that parties would be directed to make submissions on costs after the handing down of my decision on the substantive issues.  I therefore order that parties do file and exchange their respective written submissions on costs within 14 days from the date of this decision.

93.  I thank parties’ legal representatives for their assistance rendered to the court.