Docket: 2007-4140(IT)I
BETWEEN:
IRMGARD KRASILOWEZ,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Appeal heard
on November 26, 2008 at Regina, Saskatchewan
Before: The Honourable Justice
G. A. Sheridan
Appearances:
|
For the Appellant:
|
The
Appellant herself
|
|
Counsel for the Respondent:
|
Cam Regehr
|
____________________________________________________________________
JUDGMENT
In accordance with the attached Reasons for Judgment,
the appeal of the assessment for the 2005 Pre-Bankruptcy Period is dismissed on
the basis that the assessment for that year was a nil assessment.
The appeal of the assessment for the 2005
Post-Bankruptcy Period is allowed and referred back to the Minister of National
Revenue for reconsideration and reassessment on the basis that the Appellant is
entitled to a refund of $360 plus interest.
Signed at Ottawa, Canada, this 4th day of December, 2008.
“G. A. Sheridan”
Citation: 2008TCC666
Date: 20081204
Docket: 2007-4140(IT)I
BETWEEN:
IRMGARD KRASILOWEZ,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Sheridan, J.
[1] The Appellant
became bankrupt on September 23, 2005; accordingly, the Minister of National
Revenue assessed her 2005 income under the special provisions in the Income
Tax Act applicable to bankruptcy which require separate assessments for the
period prior and subsequent to the declaration of bankruptcy.
[2] The Appellant
appealed the assessments of the 2005 Pre-Bankruptcy Period and the 2005
Post-Bankruptcy Period.
Pre-Bankruptcy
Period
[3] In respect of
the 2005 Pre-Bankruptcy Period, the Respondent brought a motion to have the
appeal dismissed on the ground that no tax was owed under that assessment. In paragraph
2 of the Notice of Appeal the Appellant pleaded that “… Canada Revenue Agency
retained my 2005 pre‑bankruptcy tax refund of $366.25 plus interest of
$3.99 as a set‑off…”. This admission was confirmed on cross-examination.
[4] However, the
Appellant argued that the assessment was incorrect in that the Minister ought
to have assessed the 2005 taxation year as one 12-month period. In support, she
referred the Court to the definition of the word “year” under the Interpretation
Act.
[5] There is no
merit to the Appellant’s argument. The provisions of paragraph 128(2)(d)
require the Minister to assess tax on each of the Pre‑Bankruptcy Period
and Post-Bankruptcy Period:
(2) Where an individual has become a bankrupt, the
following rules are applicable:
….
(d) except for the purposes of subsections 146(1),
146.01(4) and 146.02(4) and Part X.1,
(i)
a taxation year of the individual is deemed to have begun at the
beginning of the day on which the individual became a bankrupt, and
(ii) the
individual’s last taxation year that began before that day is deemed to have
ended immediately before that day;
These
deeming provisions supersede any general provisions in the Interpretation
Act.
[6] Given the
Appellant’s admission and that the case law establishes that there can be no
appeal from a nil assessment, the appeal of the 2005 Pre-Bankruptcy Period is
dismissed.
Post-Bankruptcy
Period
[7] At the
commencement of the hearing, counsel for the Respondent advised the Court that
the Respondent was prepared to consent to judgment allowing the appeal on the
basis that the Appellant was entitled to a refund for the Post‑Bankruptcy
Period of $360 plus interest on that amount. The Appellant confirmed that this
was the outcome she was seeking in respect of the Post-Bankruptcy Period
assessment; however, she was also seeking an order or a direction from the
Court requiring the Canada Revenue Agency to pay that amount directly to her.
[8] Under subsection
171(1) of the Income Tax Act, the Court may dispose of an appeal of an
assessment by:
(a) dismissing
it; or
(b) allowing
it and
(i) vacating
the assessment,
(ii) varying
the assessment, or
(iii) referring the assessment back to the Minister for
reconsideration and reassessment.
[9] From this it is
clear that the jurisdiction of the Tax Court of Canada does not extend to the
issuing of orders to the Canada Revenue Agency as to how refunds should be
made. It goes without saying that the Minister is required to comply with the
applicable provisions of the Act in carrying out such duties.
[10] The appeal of the
2005 Post-Bankruptcy Period is allowed and referred back to the Minister of
National Revenue for reconsideration and reassessment on the basis that the
Appellant is entitled to a refund of $360 plus interest on that amount.
Signed at Ottawa,
Canada, this 4th day of December, 2008.
“G. A. Sheridan”
CITATION: 2008TCC666
COURT FILE NO.: 2007-4140(IT)I
STYLE OF CAUSE: IRMGARD KRASILOWEZ AND HER MAJESTY THE QUEEN
PLACE OF HEARING: Regina, Saskatchewan
DATE OF HEARING: November 26, 2008
REASONS FOR JUDGMENT BY: The
Honourable Justice G. A. Sheridan
DATE OF JUDGMENT: December 4, 2008
APPEARANCES:
|
For the
Appellant:
|
The Appellant herself
|
|
Counsel for the
Respondent:
|
Cam
Regehr
|
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the
Respondent: John H. Sims, Q.C.
Deputy
Attorney General of Canada
Ottawa,
Canada
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