Docket: 2013-149(GST)I
BETWEEN:
GAMDUR SINGH BRAR,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Appeal heard on February 28, 2014, at Edmonton, Alberta
Before: The Honourable Justice
B. Paris
Appearances:
|
Agent for the Appellant:
|
Satvir
Kaur Brar
|
|
Counsel for the Respondent:
|
Paige MacPherson
|
____________________________________________________________________
JUDGMENT
The
appeal from the assessment of a GST/HST New Housing Rebate made under Part IX
of the Excise Tax Act dated January 19, 2012 is dismissed in accordance
with the attached reasons for judgment.
Signed at Ottawa, Canada, this 17th day of March 2014.
“B.Paris”
Citation: 2014 TCC 76
Date: 20140317
Docket: 2013-149(GST)I
BETWEEN:
GAMDUR SINGH BRAR,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Paris J.
[1]
The appellant is
appealing the disallowance of a GST/HST new housing rebate claim in respect of
the purchase of a newly constructed house in Edmonton. He was represented at
the hearing by his spouse.
[2]
The Minister of
National Revenue disallowed the appellant's rebate claim on the basis that he did
not apply for it within the time limit set out in subsection 254(3) of the
Excise Tax Act. (“ETA”)
[3]
That section reads:
A rebate under this
section in respect of a residential complex or residential condominium unit
shall not be paid to an individual unless the individual files an application
for the rebate within two years after the day ownership of the complex or
unit is transferred to the individual.
[My emphasis]
[4]
The facts in this case
are undisputed.
[5]
On September 4, 2004
the appellant and his spouse entered into an agreement with Landview Homes Ltd.
(“Landview”) to purchase property consisting of a house that was to be
constructed on a lot at 1408-69 Street in Edmonton (the “Property”). The
Property was a “residential complex” as defined in subsection 123(1) of
the Act. The agreement with Landview required that the appellant assign
the new housing rebate to Landview as part of the consideration for the Property.
[6]
The title to the Property
was transferred by Landview to the appellant and his spouse on January 24, 2005
and they took possession and moved into the house on May 5, 2005. Shortly
thereafter, the appellant and his spouse became aware of deficiencies in the
construction of the house. It appears that, because of the dispute, the
appellant and his spouse did not take the steps necessary to assign the new
housing rebate to Landview. Eventually, the appellant and his spouse sued
Landview and Landview counter-sued.
[7]
The matter was finally
resolved by a Judgment issued by the Alberta Court of Queen’s Bench in 2011. The
Court found Landview liable to the appellant and his spouse for certain construction
deficiencies, and found the appellant and his spouse liable to Landview for the
amount of the rebate.
[8]
On October 31, 2011, the
appellant submitted his GST/HST new housing rebate application for a house
purchased from a builder.
[9]
The question that was
put before me was whether the appellant’s application for the new housing
rebate was made beyond the 2-year time limit set out in subsection 254(3)
of the Act.
[10]
Before dealing with
that question, one preliminary matter should be addressed. Pursuant to
paragraph 254(2)(e) of the Act, one of the conditions for obtaining a
new housing rebate for a house purchased from a builder is that ownership of
the property be transferred after the construction is substantially completed.
In this case, the Property was transferred to the appellant and his spouse on
January 24, 2005 but they did not take possession and move in until May 5,
2005. According to the appellant’s spouse, the house was not completed until some
time after they moved in. She produced an inspection report for the house that
showed a number of deficiencies in the construction, as well as a list of work
that was incomplete as of May 16, 2005. The sidewalk, driveway and front stairs
and the final exterior stucco coat and exterior grading still remained to be
done. From this evidence, it might be possible to infer that the house was not
substantially completed at the time of transfer on January 24, 2005. However, neither
party addressed the legal consequences that would flow from such a finding, and
after considering this matter, it appears to me that it would not assist the
appellant even if I were to accept that the house was not substantially
completed at that date. This is because paragraph 254(2)(e) would bar any claim
under section 254 and, while it might be arguable that section 256 of the Act
(which provides for rebates in respect of owner-built houses) could apply on
the basis that the appellant and his spouse engaged Landview to finish
construction of the house after the date of transfer, a claim
under that section would nonetheless be statute-barred. Subsection 256(3) sets
out that the deadline for making a rebate application for owner-built homes is
the earliest of the day that is:
- two years after the day that is two years
after the house is occupied; or
- two years after the day the house is sold
before being occupied; or
- two years after the day the house is
substantially completed or renovated.
In this case, since the appellant and his spouse moved
into the house on May 5, 2005, a rebate application under section 256 would
have had to have been made no later than May 5, 2009.
[11]
Returning now to subsection
254(3), the appellant’s spouse did not deny that the claim was not made within
2 years of the date the Property was transferred to them but she maintained
that it was necessary to wait until the court case against Landview was
resolved to file the rebate claim. It does not appear to me, though, that the
appellant was prevented by the lawsuit from making the rebate claim and no
evidence to this effect was led. Although Landview claimed that the appellant
had agreed to assign the rebate to it, it was still open to the appellant to
file a claim for the rebate before the matter was decided by the Court. While
it is understandable that the appellant and his spouse may have been confused
as to whether a new housing rebate could be made while the lawsuit was ongoing,
the fact remains that the claim was not made within 2 years of the transfer of
the Property to them.
[12]
Unfortunately, once the
statutory deadline has expired, no new housing rebate can be obtained. In Cairns v. The Queen, 2001 GSTC 52, this Court stated:
. .
. The intention of Parliament to limit the time period for the filing of a
rebate application has been set out in clear and unambiguous language. When the
meaning is clear, the Court has no jurisdiction to mitigate a harsh
consequence. . .
[13]
Regretfully, I must
dismiss the appeal.
Signed at Ottawa, Canada, this 17th day of March 2014.
“B.Paris”
CITATION: 2014 TCC 76
COURT FILE NO.: 2013-149(GST)I
STYLE OF CAUSE: Gamdur Singh Brar and Her Majesty the Queen
PLACE OF HEARING: Edmonton, Alberta
DATE OF HEARING: February 28, 2014
REASONS FOR JUDGMENT BY: The
Honourable Justice B. Paris
DATE OF JUDGMENT: March 17, 2014
APPEARANCES:
|
Agent for the
Appellant:
|
Satvir Kaur Brar
|
|
Counsel for the
Respondent:
|
Paige MacPherson
|
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the
Respondent: William F. Pentney
Deputy
Attorney General of Canada
Ottawa,
Canada
Email this Content