Monday, 22 October 2007

Going to Court: Developer Caught Red-handed for Evading Stamp Duty

I've updated the Enbloc List for those who use it as a reference, and this was published recently - another in the "Going to Court" series. You can read the full article reproduced here, and the judgment by the High Court Judge here (and archived on scribd here).

Estate: Golden Towers and Eu Hock Apartments on Minbu Road
Stage: Sold at $61 million 2005. Developer appealed to High Court over stamp duty.
Source: New Paper 21 Oct 2007
Parties: Commissioner of Stamp Duties vs UOL Development (Novena) Pte Ltd
Collective Sale Lawyer: Wee Ramayah & Partners
Developer Lawyer for Appeal: Tan Lay Kheng & Teo Lay Khoon of Wong Partnership
Judge: Justice Tan Lee Meng
Developer: UOL Development (Novena) Pte Ltd
Reason: Appeal to High Court against decision by Commissioner of Stamp Duties (CSD) who treated enbloc sale as a collective contract rather than 53 independent contracts
Details: When SPA was made between owners of Golden Towers/Eu Hock Apartments, UOL asked the sale lawyers for 53 letters of acceptance from the 53 owners. The 53 contracts were presented to CSD for stamping. CSD argued that the sale should be collective and hence UOL should pay stamp duty based on enbloc price and not per unit basis. Justice Tan pointed out that in the tender, owners agreed to sell the units collectively. Said Justice Tan: 'Apart from the fact that there is no reference to 53 separate contracts in UOL's offer to purchase the properties, UOL didn't assert that there was any written evidence to support its claim that it had purchased the properties on the basis of 53 separate contracts'; ''The plan for 53 separate contracts had no sound commercial basis and was so contrived that it was clearly intended to reduce or avoid tax liabilities'.

1 comment:

rebelrouser said...

This case just goes to show the length greedy developers would go to save cost. Think again, do you trust these guys to develop your property?

Cutting corners to save stamp duty is not as material but cutting material to build filmsy buildings could cost lives!
SO this is just a little insight as to the type of greed this piece of legislation is promoting here.