Federal Appeal

Administrative Law

No practical end served by setting aside Minister’s decision

This was appeal from Federal Court’s decision upholding Minister of National Revenue’s decision. Appellants used common financial representative to make tax filings. For 2000 to 2003 taxation years appellant’s representatives’ were of opinion that they did not need to file T1135 forms, contrary to wording of s. 233.3(3) of Income Tax Act (Can.). Canadian Revenue Agency (“CRA”) alerted appellants to fact that they had not filed forms. Appellants filed forms late and explained misunderstanding. Appellants’ representatives requested relief under s. 220(3.1) of Act against penalty and interest assessed against appellants for late filing of forms. CRA denied request, finding that appellants did not fall within one of three specific situations set out in information circular. Appellants applied for relief to Minister, who reduced interest for six months due to CRA’s delay in replying. Appellants applied for judicial review. Federal Court found that Minister had not fettered discretion and that decision was reasonable. Appeal dismissed. Standard of review of Minister’s decision was reasonableness. Decision that was product of fettering of discretion was unreasonable. In circumstances, Minister did not draw upon law that was source of authority, s. 220(3.1) of Act, but fettered discretion by having regard to only three specific scenarios set out in information circular. Minister’s reasons as set out in decision letter evidenced that Minister restricted consideration to three scenarios in information circular. Record shed no light on grounds for Minister’s decision and decision letter must speak for itself. As Minister did not draw upon law that was source of authority and drew only on information circular, decision was unreasonable. However, there would be no practical end served by setting aside Minister’s decision. Appellants’ excuses and justifications for delay in filing forms and grounds offered in support of relief had no merit. Granting relief under s. 220(3.1) would be unreasonable exercise of discretion.

Stemijon Investments Ltd. v. Canada (Attorney General)

(Oct. 26, 2011, F.C.A., Noel, Trudel and Stratas JJ.A., File No. A-376-10; A374-10; A375-10; A-377-10; A-378-10; A-382-10) Decision at 193 A.C.W.S. (3d) 1016 was affirmed. 209 A.C.W.S. (3d) 721 (30 pp.).

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