Urie,
J:—It
will
not
be
necessary
to
call
upon
you,
Mr
Verchere.
Despite
the
able
submissions
of
appellant’s
counsel,
we
have
not
been
persuaded
that
the
learned
trial
judge
erred
in
finding
that
the
assessments
for
tax
against
the
respondent
ought,
in
the
circumstances
of
this
case,
to
be
vacated.
There
is
no
question
that
if
it
were
not
for
the
Canada-US
Tax
Convention
the
guarantee
fees
here
in
issue
would,
by
virtue
of
paragraph
214(15)(a)
of
the
Income
Tax
Act,
be
subject
to
tax.
It
is
also
beyond
doubt
that
if
it
were
not
for
that
section
guarantee
fees
would
fall
within
the
term
“industrial
and
commercial
profits’’
exempted
from
Canadian
tax
by
virtue
of
Article
I
of
the
Convention.
While
undoubtedly
for
the
purpose
of
its
domestic
tax
law
Canada
could
enlarge
the
definition
of
“interest”
to
include
guarantee
fees,
as
the
learned
trial
judge
held,
the
definition
could
not
be
“unilaterally
expanded
by
Canada
to
embrace
income
that
is
not
interest
at
all.”
In
saying
that,
we
expressly
refrain
from
any
finding
that
a
“deeming”
provision
in
the
domestic
tax
law
might
not,
in
other
circumstances,
be
embraced
by
the
provisions
of
international
conventions.
Accordingly,
the
appeal
will
be
dismissed
with
costs.
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