Binder Capital – Federal Court finds that it lacks the jurisdiction to overturn CRA’s decision not to extend s. 129(1) refund-claim deadline

In 1057513, Webb JA found that a corporation was ineligible for dividend refunds for various years because it did not file the returns claiming the dividend refunds within three years of the taxation year-ends in question as required under s. 129(1).

Binder Capital sought extension of the three-year deadline on the basis of extenuating circumstances explaining its delay in filing returns, and submitted that the discretion accorded to the Minister under s. 220(3) to extend a return-filing deadline impliedly accorded the Minister the discretion to extend the s. 129(1) 3-year deadline. In denying this request, CRA applied its position in 2011-0426331E5 that:

Although subsection 220(3) of the Act provides the Minister with the discretion to extend the time for making a return of income, this discretion does not extend to the filing deadline in subsection 129(1) of the Act… Subsection 220(3) does not alter or affect whether a corporation has factually filed its return of income within the period required under the Act.

In dismissing Binder Capital’s application to overturn this decision, Campbell J stated:

[W]hether the Minister’s discretion applies to s. 129 is a jurisdictional question with respect to an interpretation of the ITA which is not within this Court’s authority to decide.

Given the findings in 1057513, this effectively seems to indicate that the s. 129(1) claim-deadline cannot be extended even where there are extenuating circumstances explaining the delay.

Neal Armstrong. Summary of Binder Capital Corp v. Canada (National Revenue), 2017 FC 642 under s. 129(1).