taxTaxpayer seeking relief under double taxation agreement in respect of income from Jersey partnership - provision conferring supremacy on double taxation agreement qualified by apparently irreconcilable provision - relief not availablePadmore v Inland Revenue Commissioners (No.2): ChD (Lightman J): 22 January 2001The taxpayer claimed relief from income tax in respect of his share, as a partner, of the profits of a partnership resident in Jersey, under s.497(1) of the Income and Corporation Taxes Act 1970 (for 1987-88) and s.788(3) of the Income and Corporation Taxes Act 1988 (for 1988-99), and (in both cases) pursuant to para 3 of the Sched to the Double Taxation Relief (Taxes on Income) (Jersey) Order 1952.

The Revenue refused relief on the basis that para 3 had been superseded by s.62(1) of the Finance (No.2) Act 1987, now s.112(4)(5) of the consolidating 1988 Act.

Special commissioners upheld the revenue's decision.

The taxpayer appealed.Peter Whiteman QC (instructed by Morgan Cole) for the taxpayer.

Launcelot Henderson QC (instructed by the Solicitor of the Inland Revenue) for the Revenue.Held, dismissing the appeal, that there was a conflict between, on the one hand, s.497 of the 1970 Act and s.788(3) of the 1988 Act which provided that double taxation arrangements had effect 'notwithstanding anything in any enactment' and, on the other hand, s.62(1) of the1987 Act, reproduced by s.112(4) of the 1988 Act, which limited the effect of such arrangements; that the purpose of a consolidation Act was to obviate the need for recourse to the pre-consolidated legislation, and it was only permissible to take into account the earlier legislation if the language of the consolidated legislation was ambiguous, obscure or likely to lead to an absurdity; that every effort had to be made to find a construction which gave effect to all of the sections, which could be achieved by treating the general rule in favour of the supremacy of double taxation arrangements as being qualified by the special rule in s.62 of the 1987 Act and s.112(4)(5) of the 1988 Act; that, if that solution were not adopted, the conflict itself either constituted an ambiguity in the 1988 Act or gave rise to unease as to the resolution of the conflict and, in either case, entitled the court to give effect to the purpose behind s.62(1) of the 1987 Act, which was to deny the relief offered by the 1952 order; and that, accordingly, the taxpayer's claim failed.