Date: 20070328
Dockets: A-170-06
A-171-06
Citation: 2007 FCA
125
CORAM: DESJARDINS
J.A.
LÉTOURNEAU
J.A.
NOËL J.A.
A-170-06
BETWEEN:
LAZAR
JEVREMOVIC
Appellant
and
HER MAJESTY
THE QUEEN
Respondent
A-171-06
BETWEEN:
NORMA MAEGE
Appellant
and
HER MAJESTY THE QUEEN
Respondent
Hearing held at Montréal, Quebec, on March 28, 2007.
Judgment delivered from the
bench at Montréal, Quebec, on March
28, 2007.
REASONS FOR
JUDGMENT OF THE COURT:
NOËL J.A.
Date: 20070328
Dockets: A-170-06
A-171-06
Référence : 2007 FCA 125
CORAM
: DESJARDINS
J.A.
LÉTOURNEAU
J.A.
NOËL J.A.
A-170-06
BETWEEN:
LAZAR
JEVREMOVIC
Appellant
and
HER MAJESTY
THE QUEEN
Respondent
A-171-06
BETWEEN:
NORMA MAEGE
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE
COURT
(Delivered from the bench at Montréal, Quebec,
on March 28, 2007)
NOËL J.A.
[1]
These are
two appeals against a decision rendered by Rip J. of the Tax Court of Canada (2006
TCC 117), dismissing the appeals lodged by the appellants and denying their
claim for deductions on the ground that the property with respect to which
these deductions were claimed was a “tax shelter” within the meaning of section
237.1 of the Income Tax Act, R.S.C. 1985, c. 1 (5th
Supp.) (the ITA).
[2]
Paragraph
237.1(8) of the ITA provides that no amount can be
claimed in respect of a tax shelter unless it has been duly registered
with the Minister, and the evidence shows that it was not.
[3]
The
appellants submit that they did not invest in a tax shelter. They argue that
their decision to invest was not made on the basis of “statements
or representations” to the effect that, should the venture turn out to be
unprofitable, the
investor would recover his investment as a deductible loss, in addition to profiting
from the federal and provincial investment tax credits. According to them it is
the quality of the project, which after analysis, led them to invest.
[4]
In this
respect, Rip J. explained in his reasons that the existence of a tax shelter
does not depend on the motivation of the investor, but rather on the equation
provided for in section 237.1 of the Act (reasons, at paragraph 30). In
this case, the product of this equation shows that the requirements of section
237.1 were met. We detect no error in this regard.
[5]
As for the
appellant Maege, counsel submitted that, although she was, as a promoter of the
venture the author of “statements or representations”
within the meaning of section 237.1,
no statement was made to her. In this respect, we agree with Rip J., when he
says that the fact that the appellant Maege did not
make statements to herself is irrelevant. What is relevant is that she knew that beneficial tax consequences would arise as a result of her
investment, as had been announced.
[6]
The
appeals will therefore be dismissed with
only one set of costs.
In accordance with the order consolidating both appeals, these reasons will be filed in the record of Lazar Jevremovic (A‑170-06)
and a copy thereof will be filed in the record of Norma Maege (A-171-06).
“Marc Noël”
Certified true translation
François Brunet,
LLB, BCL
FEDERAL COURT OF APPEAL
SOLICITORS OF RECORD
DOCKETS: A-170-06
and A-171-06
(APPEAL AGAINST A JUDGMENT RENDERED BY
THE TAX COURT OF CANADA DATED MARCH 24, 2006 IN DOCKETS 2000-245(IT)G and
2003-2332(IT)G)
STYLE OF CAUSE: Lazar
Jevremovic v. Her Majesty the Queen
Norma
Maege v. Her Majesty the Queen
PLACE OF HEARING: Montréal,
Quebec
DATE OF HEARING: March 28, 2007
REASONS FOR JUDGMENT BY: Desjardins J.A.
Létourneau J.A.
Noël
J.A.
Delivered
from the bench BY: Noël J.A.
APPEARANCES:
|
Serge Fournier
|
FOR
THE APPELLANTS
|
|
Anne-Marie Boutin
|
FOR
THE RESPONDENT
|
SOLICITORS OF RECORD:
|
BCF
Montréal, Quebec
|
FOR THE APPELLANTS
|
|
John H. Sims, Q.C.
Deputy Attorney General of Canada
Montréal,
Quebec
|
FOR THE RESPONDENT
|
Email this Content