Blais v. The Queen, 2005 TCC 818 (Informal Procedure)

 

 

 

Dockets: 2004-206(IT)I

2004-2803(IT)I

BETWEEN:

JEAN-FRANÇOIS BLAIS,

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent.

[OFFICIAL ENGLISH TRANSLATION]

____________________________________________________________________

 

Appeals heard on common evidence with the appeals of Christiane Auray‑Blais (2004-208(IT)I and 2004‑2804(IT)I) and Innovations et intégrations brassicoles inc. (2004-42(IT)I and 2004-2805(IT)I)

February 28 to March 3, 2005, at Sherbrooke, Quebec,

 and March 11, 2005, at Montreal, Quebec.

 

Before: The Honourable Judge Paul Bédard

 

Appearances:

 

For the Appellant:	The Appellant himself and Christiane Auray-Blais (Agent)
Counsel for the Respondent:	Me Philippe Dupuis

____________________________________________________________________

 

AMENDED JUDGMENT

 

          The appeals from the assessments made under the Income Tax Act for the 1996 and 1997 taxation years are dismissed in accordance with the Reasons for Judgment of October 25, 2005, and the attached Amended Reasons for Judgment.  I further order the Minister of National Revenue to make the necessary adjustments for the 1996 and 1997 taxation years to take into account the attached Amended Reasons for Judgment.

 

          The appeals from the assessments made under the Income Tax Act for the 1998, 1999, 2000 and 2001 taxation years are allowed and the assessments are referred back to the Minister of National Revenue for reconsideration and reassessment in accordance with the Reasons for Judgment of October 25, 2005, and the attached Amended Reasons for Judgment..

 

          One set of costs is awarded to the appellants for the costs incurred with respect to their expert witness.

 

Signed at Ottawa, Canada, this 1st day of December 2005.

 

 

 

 

 

“Paul Bédard”

 

 

 

 

Dockets: 2004-208(IT)I

2004-2804(IT)I

BETWEEN:

CHRISTIANE AURAY-BLAIS,

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent.

[OFFICIAL ENGLISH TRANSLATION]

____________________________________________________________________

 

Appeals heard on common evidence with the appeals of Jean‑François Blais (2004-206(IT)I and 2004-2803(IT)I) and Innovations et intégrations brassicoles inc. (2004-42(IT)I and 2004-2805(IT)I)  February 28 to March 3, 2005, at Sherbrooke, Quebec,

 and May 11, 2005, at Montreal, Quebec.

 

Before: The Honourable Judge Paul Bédard

 

Appearances:

 

For the Appellant:	The Appellant herself and Jean‑François Blais (Agent)
Counsel for the Respondent:	Me Philippe Dupuis

____________________________________________________________________

 

AMENDED JUDGMENT

 

          The appeals from the assessments made under the Income Tax Act for the 1996 and 1997 taxation years are dismissed in accordance with the Reasons for Judgment of October 25, 2005, and the attached Amended Reasons for Judgment. I further order the Minister of National Revenue to make the necessary adjustments for the 1996 and 1997 taxation years to take into account the attached Amended Reasons for Judgment.

 

          The appeals from the assessments made under the Income Tax Act for the 1998, 1999, 2000 and 2001 taxation years are allowed and the assessments are referred back to the Minister of National Revenue for reconsideration and reassessment in accordance with the Reasons for Judgment of October 25, 2005, and the attached Amended Reasons for Judgment.

 

          One set of costs is awarded to the appellants for the costs incurred with respect to their expert witness.

 

Signed at Ottawa, Canada, this 1st day of December 2005.

 

 

 

 

 

“Paul Bédard”

 

 

 

Dockets: 2004-42(IT)I

2004-2805(IT)I

BETWEEN:

 

INNOVATIONS ET INTÉGRATIONS BRASSICOLES INC.,

 

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent.

[OFFICIAL ENGLISH TRANSLATION]

____________________________________________________________________

 

Appeals heard on common evidence with the appeals of Jean‑François Blais (2004-206(IT)I and 2004-2803(IT)I) and Christiane Auray‑Blais (2004-208(IT)I and 2004-2804(IT)I)

February 28 to March 3, 2005, at Sherbrooke , Quebec,

 and May 11, 2005, at Montreal, Quebec.

 

Before: The Honourable Judge Paul Bédard

 

Appearances:

 

Agent for the Appellant:	Jean-François Blais and Christiane Auray-Blais
Counsel for the Respondent:	Me Philippe Dupuis

____________________________________________________________________

 

AMENDED JUDGMENT

 

          The appeal from the assessment made under the Income Tax Act for the 2000 taxation year is dismissed;

 

          The appeal from the assessment made under the Income Tax Act for the 2001 taxation year is allowed and the assessment is referred back to the Minister of National Revenue for reconsideration and reassessment in accordance with the Reasons for Judgment of October 25, 2005, and the attached Amended Reasons for Judgment.

 

          One set of costs is awarded to the appellants for the costs incurred with respect to their expert witness.

 

Signed at Ottawa, Canada, this 1st day of December 2005.

 

 

 

 

 

“Paul Bédard”

 

 

 

 

Citation: 2005 TCC 818

(ASSOCIATE TO 2005CCI417)

Date: 20051201

Dockets: 2004-206(IT)I

2004-2803(IT)I

BETWEEN:

 

JEAN-FRANÇOIS BLAIS,

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent,

AND

 

Dockets: 2004-208(IT)I

2004-2804(IT)I

 

CHRISTIANE AURAY-BLAIS,

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent,

AND

 

Dockets: 2004-42(IT)I

2004-2805(IT)I

 

INNOVATIONS ET INTÉGRATIONS BRASSICOLES INC.,

 

Appellant,

and

 

HER MAJESTY THE QUEEN,

Respondent.

 

 

 

[OFFICIAL ENGLISH TRANSLATION]

 

AMENDED REASONS FOR JUDGMENT

 

 

Judge Bédard

 

 

[1]     The appellants (Jean-François Blais and Christiane Auray-Blais) in appeals numbered 2004-206(IT)I and 2004-208(IT)I respectively had raised the following issue[1] solely in respect of the 1996 and 1997 taxation years: the appellants contended that, under subsection 37(1) of the Income Tax Act (the “Act”),  they could carry forward to subsequent years the SR&ED expenditures incurred by the partnership in a taxation year.

 

[2]     In my judgment dated October 25, 2005, I allowed the appellants’ appeals for the 1996 and 1997 taxation years but did not deal with this issue.

 

[3]     I share the position argued by the respondent at the hearing according to which, under paragraph 96(1)(e.1) of the Act, any expenditures made in a taxation year must be deducted in computing partnership income or loss in the taxation year in which these expenditures were made.  Consequently, it is my opinion that no amount of SR&ED expenses can be carried over to a subsequent year. Since the only issue in these appeals was the application of paragraph 96(1)(e.1) of the Act, the appellants’ appeals for the 1996 and 1997 taxation years are dismissed and the necessary adjustments will have to be made by the Minister of National Revenue (the “Minister”).

 

[4]     Furthermore, in the appeals numbered 204-2803(IT)I, 2004‑2804(IT)I and 2004-2805(IT)I, concerning appellants Jean-François Blais and Christiane Auray-Blais and Innovations et intégrations brassicoles inc. respectively for the 2001 taxation year, the parties signed an agreement at the hearing[2] concerning the deductibility of certain expenses claimed by the appellants. The highlights of this agreement, which I did not take into account in my judgment of October 25, 2005, could be summarized as follows:

 

          (i)      the Minister correctly considered the expenses claimed by the appellants in appeals 2004-2803(IT)I and 2004-2804(IT)I and totalling $1,248 ($2,496 x 50%) as capital expenses;[3]

 

          (ii)     the expenses claimed by the appellants in appeals 2004-2803(IT)I and 2004-2804(IT)I and disallowed by the Minister must be reduced to $989 ($1,978  x 50%);[4]

 

          (iii)    the Minister incorrectly disallowed expenses totalling $416 claimed by the appellant in appeal 2004-2805(IT)I.[5]

 

[5]     I therefore endorse this agreement.

 

[6]     However, my reasons for judgment dated October 25, 2005, stand.

 

Signed at Ottawa, Canada, this 1st day of December 2005.

 

 

 

 

 

“Paul Bédard”

CITATION:                                      2005CCI417

 

COURT FILE NUMBER:                 2004-206(IT)I

 

STYLE OF CAUSE:                         Jean-François Blais and Her Majesty the Queen and Christiane Auray-Blais and Her Majesty the Queen and Innovations et intégrations brassicoles inc. and Her Majesty the Queen

 

HEARING LOCATION:                   Sherbrooke and Montreal, Quebec

 

HEARING DATES:                          February 28 to March 3, and May 11, 2005

 

REASONS FOR AMENDED

JUDGMENT BY:                             The Honourable Judge Paul Bédard

 

DATE OF AMENDED JUDGMENT:       December 1, 2005

 

APPEARANCES:

 

For the appellants Jean-François Blais Christiane Auray-Blais Innovation et intégrations brassicoles inc.	The appellant himself and Christiane Auray-Blais The appellant herself and Jean-François Blais Jean-François Blais and Christiane Auray‑Blais, agents
Counsel for the respondent:	Me Philippe Dupuis

 

COUNSEL OF RECORD:

 

       For the appellants:

 

                   Name:                           

 

                   Firm:

 

       For the respondent:                   John H. Sims, Q.C.

                                                          Deputy Attorney General of Canada

                                                          Ottawa, Ontario