Federal Court

Goods and Services Tax

Federal Court lacked jurisdiction to hear application to enforce settlement agreement 


Federal Court lacked jurisdiction to hear application to enforce settlement agreement 

Homebuyer entered into contract for purchase of new home from builder in 2007 and took possession in 2011. Homebuyer received full credit for Goods and Services Tax (GST) new housing rebate as part of final closing statement. Homebuyer applied for Goods and Services Tax/Harmonized Sales Tax new housing rebate, including provincial new housing rebate. Homebuyer received transitional tax rebate credit. Canada Revenue Agency disallowed application, but then offered to refund homebuyer difference between claimed amount and two previously credited amounts. Following homebuyer’s acceptance, agency found that it could not implement settlement agreement as homebuyer had already correctly received federal GST new housing rebate and transitional rebate and was not entitled to Ontario new housing rebate. Homebuyer brought application for judicial review to enforce settlement agreement. Application dismissed. Federal court did not have jurisdiction to hear application for judicial review, pursuant to s. 18.5 of Federal Courts Act and s. 12(1) of Tax Court of Canada Act. Matter was in fact appeal of tax reassessment and fell within exclusive jurisdiction of Tax Court of Canada. Essential nature and character of claim was collateral attack on validity of tax reassessment. If court had jurisdiction to hear application, it would have held that the agency was required to revoke settlement agreement as homebuyer was not eligible for provincial new housing rebate under s. 256.21 of Excise Tax Act. 
Sood v. Minister of National Revenue (Jul. 13, 2015, F.C., Denis Gascon J., File No. T-1045-14) 256 A.C.W.S. (3d) 475.


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