Docket: A-9-15
Citation:
2016 FCA 85
|
CORAM:
|
RYER J.A.
NEAR J.A.
BOIVIN J.A.
|
|
BETWEEN:
|
|
TAMER SALLOUM
|
|
Appellant
|
|
And
|
|
HER MAJESTY THE
QUEEN
|
|
Respondent
|
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Vancouver, British
Columbia, on March 14, 2016).
RYER J.A.
[1]
This is an appeal from a decision of Justice
John Owen of the Tax Court of Canada (the "Judge"), dated December 12,
2014, in Dockets 2012-2746(IT)I and 2012-2750(GST)I.
[2]
In the income tax matter, the Judge upheld
reassessments, pursuant to the Income Tax Act, R.S.C. 1985, c. 1 (5th
Supp.) (the "ITA"), of Mr. Tamer Salloum's (the "Taxpayer")
2006, 2007 and 2008 taxation years, which disallowed the Taxpayer's claims for
certain business losses in those years on the basis that he had not carried on
a business, within the meaning and for the purposes of the ITA, in those years.
[3]
In the goods and services tax
("GST/HST") matter, the Judge upheld reassessments, pursuant to the Excise
Tax Act, R.S.C. 1985, c. E-15 (the "ETA"), of the Taxpayer's
GST/HST reporting periods for January 1, 2005 to December 31, 2008, which
disallowed the Taxpayer's claims for input tax credits, within the meaning of
subsection 169(1) of the ETA, in respect of those reporting periods on the
basis that the Taxpayer was not carrying on a commercial activity, within the
meaning of subsection 123(1) of the ETA, during those reporting periods. In the
course of argument, counsel for the Taxpayer conceded the appeal with respect
to the GST/HST issue.
[4]
The remaining question is whether the Taxpayer
was carrying on a business for the purposes of the ITA. This is a question of
mixed fact and law that is largely factual in nature and, as such, is reviewed
on the standard of palpable and overriding error.
[5]
The Taxpayer accepts that the Judge used the
correct legal test with respect to the question of whether the Taxpayer was
carrying on a business for ITA purposes. However, the Taxpayer argues that in
applying this test to the facts, the Judge committed a palpable and overriding
error that ought to compel us to intervene.
[6]
In considering the evidence presented to him, and
applying the test laid down in Stewart v. Canada, 2002 SCC 47,
[2002] 2 S.C.R. 645, the Judge specifically noted the Taxpayer’s own testimony
to the effect that during the time period under consideration, the Taxpayer did
not offer mechanic’s services to the public because he lacked the
qualifications to do so and his lack of qualifications made it impossible for
him to obtain liability insurance. The Judge found that, during the time frame
under consideration, the Taxpayer was not engaged in the current pursuit of
profit. Instead, the Judge concluded that the Taxpayer was pursuing the "inherently personal activity" of getting an
education so that, at some future time, he could use that education to pursue a
profit.
[7]
In our view, the evidence in the record before
the Judge amply supports this conclusion and in reaching it, the Judge
committed no palpable and overriding error, even if, as argued before us today
by Appellant’s counsel, the alleged business was a research and development
business, rather than an automotive service business, as found by the Judge in
paragraph 40 of his reasons.
[8]
The Taxpayer is essentially asking this Court to
reweigh the evidence that was before the Judge and to reach a different
conclusion than that reached by the Judge. This we cannot do.
[9]
Accordingly, the appeal will be dismissed without
costs.
"C. Michael Ryer"
Email this Content