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Docket: 2005-649(IT)I
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BETWEEN:
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CINDY CHOU,
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Appellant,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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____________________________________________________________________
Motion heard on June 17, 2005, at Ottawa, Ontario.
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Before: The
Honourable Justice Lucie Lamarre
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Appearances:
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For the
Appellant:
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The Appellant
herself
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Counsel for the
Respondent:
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Mylène Lévesque
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____________________________________________________________________
ORDER
Upon motion made by counsel for the respondent for an order
quashing the appellant's appeals on the basis that:
(a) the appellant cannot appeal to the Tax Court of
Canada in respect of the Notice of Reassessment dated December 13, 2004, for
the 1998 taxation year because a condition precedent to appealing has not been
met, and
(b) in regard to the 1999 taxation year, the appellant
did not file a notice of objection to the Notice of Assessment as required by
subsection 165(1) of the Income Tax Act;
And upon reading the affidavit of Anne Dagenais,
filed;
And upon hearing what was alleged by the parties;
The motion is
granted and the purported appeals made under the Act for the 1998 and 1999 taxation years are quashed.
Signed at Ottawa, Canada,
this 30th day of June 2005.
Lamarre,
J.
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Citation: 2005TCC408
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Date: 20050630
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Docket: 2005-649(IT)I
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BETWEEN:
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CINDY CHOU,
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Appellant,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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REASONS FOR ORDER
Lamarre, J.
[1] The respondent brought a motion to dismiss the
appellant's appeal from a reassessment dated December 13, 2004.
[2] I understand from the documentary evidence that
the appellant contributed $40,000 ("unused contributions") to her
Registered Retirement Savings Plan ("RRSP") in 1995 and that she did
not deduct that amount from her income in that year (see Form T746 filed as
Exhibit A to the affidavit of Anne Dagenais).
[3] It is also my understanding that the appellant
withdrew an amount of $38,541 from her RRSP and declared that RRSP income in
her 1999 tax return. In that same return, she apparently deducted an amount of
$28,426 from that income as an RRSP deduction (see Individual Income Tax Return
Information for the appellant's 1999 taxation year filed by the appellant as
Exhibit A-1; see also the computerized data summarizing the income declared and
deductions claimed by the appellant for 1999, filed by the respondent as
Exhibit R-1).
[4] It is my understanding that the appellant was
assessed on September 12, 2000, for her 1999 taxation year on the basis of the
income declared in her tax return for that year (see Exhibit R-1). It appears
that the appellant was also reassessed for that year, on November 13, 2001 (see
affidavit of Anne Dagenais at paragraph 11).
[5] The documentary evidence further discloses that
the Minister of National Revenue ("Minister") assessed the
appellant's income tax for her 1998 taxation year on July 12, 1999, and
that the normal reassessment period in respect of the appellant's 1998 taxation
year ended on July 12, 2002 (see paragraphs 4 and 5 of the affidavit of Anne
Dagenais and subsection 152(3.1) of the Income Tax Act ("Act")).
[6] Subsection 152(3.1) reads as follows:
Assessment
SECTION 152:
. . .
(3.1)
Definition of
"normal reassessment period". For the purposes of subsections (4), (4.01), (4.2), (4.3), (5) and (9), the normal reassessment period
for a taxpayer in respect of
a taxation year is
(a) where at the end of the year the taxpayer is a mutual
fund trust or a corporation
other than a Canadian-controlled private corporation, the period that ends 4
years after the earlier of the day of mailing of a notice of an original assessment under this
Part in respect of the taxpayer for the year
and the day of mailing of an original notification that no tax is payable by
the taxpayer for the year;
and
(b) in any other case, the period that ends 3 years after the
earlier of the day of mailing of a notice of an original assessment under this
Part in respect of the taxpayer for the year
and the day of mailing of an original notification that no tax is payable by
the taxpayer for the year.
[7] It appears that it was only on October 20, 2003,
that the appellant applied to the Minister for a refund of unused RRSP
contributions (see Form T746, Exhibit A to the affidavit of Anne Dagenais).
[8] The documentary evidence discloses that the
Minister agreed to reassess the appellant's income tax for the 1998 taxation
year beyond the normal reassessment period; the Notice of Reassessment was dated
December 13, 2004. In so reassessing the appellant for that year, the Minister
allowed the deduction of an amount of $11,574 (which is the balance of the
unused RRSP contributions made in 1995), and this resulted in a refund to the
appellant of $4,071.84 (see paragraphs 7 and 8 of the affidavit of Anne Dagenais
and the Notice of Reassessment dated December 13, 2004, for the 1998 taxation
year filed with the Notice of Motion).
[9] The December 13, 2004, reassessment for the
1998 taxation year was a discretionary reassessment issued after the normal
reassessment period under subsection 152(4.2) of the Act, which reads as
follows:
Assessment
SECTION 152:
. . .
(4.2)
Idem. Notwithstanding subsections (4), (4.1) and (5), for the purpose
of determining, at any time after the expiration of the normal reassessment period
for a taxpayer who is an
individual (other than a trust) or a testamentary trust in
respect of a taxation year,
(a) the amount of any refund
to which the taxpayer is entitled
at that time for that year, or
(b) a reduction of an amount payable under
this Part by the taxpayer for that
year,
the Minister may, if application
therefor has
been made by the taxpayer,
(c)
reassess tax, interest or penalties payable under this Part by the taxpayer in respect of
that year, and
(d) redetermine the amount, if any, deemed
by subsection 120(2)
or (2.2),
122.5(3),
122.51(2),
127.1(1),
127.41(3)
or 210.2(3)
or (4)
to be paid on account of the taxpayer's tax payable
under this Part for the year or deemed by subsection 122.61(1)
to be an overpayment on account of the taxpayer's liability
under this Part for the year.
[10] On December 21, 2004, the appellant filed with
the Minister a Notice of Objection appealing the December 13, 2004, reassessment
(see paragraph 9 of the Affidavit of Anne Dagenais and Exhibit B attached
thereto).
[11] By letter dated February 18, 2005, the Minister
advised the appellant that, pursuant to subsection 165(1.2) of the Act,
the Notice of Objection could not be considered as no objection may be made to
a discretionary reassessment providing a refund or reducing the tax payable
issued after the normal reassessment period under subsection 152(4.2) (see paragraph
10 of the Affidavit of Anne Dagenais and Exhibit C attached thereto).
[12] Subsection 165(1.2) reads as follows:
Objections to Assessments
SECTION 165:
. . .
(1.2) Limitation
on objections. Notwithstanding subsections (1) and (1.1), no objection may
be made by a taxpayer to an assessment made under subsection 118.1(11),
152(4.2), 169(3) or 220(3.1) nor, for greater certainty, in respect of an issue
for which the right of objection has been waived in writing by the taxpayer.
[13] It is clear under subsection 169(1) of the Act
that no appeal may be instituted before the Tax Court of Canada to have an
assessment vacated or varied where no valid notice of objection has been served
under section 165 of the Act.
[14] Subsection 169(1) reads as follows:
Appeals to the Tax Court of Canada and the Federal Court of Appeal
SECTION 169: Appeal.
(1)
Where a taxpayer has served
notice of objection to an assessment under
section 165,
the taxpayer may appeal to
the Tax Court of Canada to have the assessment vacated or
varied after either
(a) the Minister has confirmed
the assessment or
reassessed, or
(b) 90 days have elapsed after service of the notice of objection
and the Minister has not
notified the taxpayer that the Minister has vacated
or confirmed the assessment or
reassessed,
but no
appeal under this section may be instituted after the expiration of 90 days
from the day notice has been mailed to the taxpayer under section
165
that the Minister has confirmed
the assessment or
reassessed.
[15] In the present case, as the appellant could not
validly file a notice of objection to the December 13, 2004, reassessment
issued pursuant to subsection 152(4.2) of the Act, she was
consequently barred under subsections 165(1.2) and 169(1) of the Act
from instituting an appeal from that reassessment before this Court.
[16] Furthermore, in regard to the 1999 taxation year, it is not disputed that
the appellant did not file a notice of objection to the Notice of Reassessment
as required by subsection 165(1) of the Act.
[17] For these reasons, the purported appeal made under the Act for the
1998 taxation year (the December 13, 2004, reassessment) may not be entertained
and the appeal is quashed.
[18] The purported appeal made under the Act for
the 1999 taxation year is also quashed.
Signed at Ottawa, Canada, this 30th day of June 2005.
Lamarre,
J.
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