The
Chairman
[TRANSLATION]:—Nelson
McGowan
Ltd
applied
under
subsection
167(1)
of
the
Income
Tax
Act
for
an
order
extending
the
time
within
which
notices
of
objection
might
be
served
against
reassessments
issued
on
October
27,
1980
for
the
1974
to
1979
taxation
year
(see
Form
T500A).
The
applicant’s
application
reads
as
follows:
(TRANSLATION)
An
application
for
an
extension
is
being
made
for
the
following
reasons:
(A)
Notices
of
objection
not
filed
within
the
time
prescribed:
A
notice
of
objection
was
not
filed
within
the
prescribed
time
limit
of
90
days
from
the
date
of
the
assessments
as
a
result
of
misunderstandings
resulting
from
a
change
of
accountant.
Neither
accountant
prepared
a
notice
of
objection
for
the
company
concerned,
each
believing
that
this
was
the
responsibility
of
the
other.
(B)
The
work
leading
up
to
the
preparation
of
the
notice
of
objection
was
done
within
the
90-day
period
following
the
date
of
assessment:
The
notices
of
assessment
with
respect
to
which
an
application
for
an
extension
is
being
made
are
directly
related
to
notices
of
assessment
respecting
the
company
directors
(Mr
and
Mrs
Nelson
McGowan).
The
dates
of
the
directors’
notices
of
assessment
(November
17
and
December
5,
1980)
are
very
close
to
the
date
of
the
assessments
of
the
company
seeking
the
extension.
Since
notices
of
objection
were
filed
with
respect
to
the
assessments
of
the
directors
within
the
prescribed
time
limits
and
the
work
involved
in
preparing
all
the
notices
of
objection
to
the
assessments
mentioned
above
is
the
same,
it
seems
logical
to
conclude
that
the
work
leading
up
to
the
preparation
of
the
notice
of
objection
was
done
within
the
prescribed
time
limit
of
90
days
from
the
date
of
assessment.
(C)
Possibility
of
unjustified
double
taxation:
As
a
result
of
a
meeting
with
Mr
Gabriel
Khoury,
appeals
officer
for
the
Montreal
region,
it
became
apparent
that
there
was
a
possiblity
of
double
taxation
if
the
assessments
of
the
applicant
company
were
not
reopened.
Certain
items
in
dispute
appear
in
the
directors’
notices
of
assessment
and
the
company’s
notice
of
assessment.
We
do
not
believe
that
it
is
in
accordance
with
the
spirit
of
the
Income
Tax
Act
to
collect
unjustified
amounts
and
we
accordingly
hope
to
receive
a
favourable
reply
to
our
application.
Summary
of
Facts:
The
taxpayer
was
represented
at
the
hearing
by
Messrs
Serge
Girouard
and
Bernard
Forget,
both
chartered
accountants
associated
with
the
same
firm
of
accountants,
which
also
looked
after
Mr
Nelson
McGowan’s
personal
affairs.
The
Minister
of
National
Revenue
served
a
notice
of
reassessment
dated
October
27,
1980
on
the
applicant.
The
application
for
an
extension
of
time
is
dated
August
25,
1981,
ten
months
after
the
notice
of
reassessment.
Messrs
Girouard
and
Forget
testified
in
support
of
the
application
that
the
Minister
of
National
Revenue
had
previously
issued
reassessments
with
respect
to
Mr
McGowan
personally
using
the
capital
reconciliation
method,
against
which
notices
of
objection
had
duly
been
filed.
There
were
discussions
between
Messrs
Girouard
and
Forget
and
employees
of
the
Department
of
National
Revenue
concerning
Mr
McGowan’s
personal
assessments
and
it
is
alleged
that
a
proposal
had
even
been
made
to
the
Department
concerning
Mr
McGowan’s
personal
affairs.
These
discussions
dealt
with
amounts
that
affected
both
Mr
McGowan’s
personal
assessments
and
the
assessments
of
the
applicant
Nelson
McGowan
Ltd.
The
Department
refused
in
its
discussions
to
make
any
adjustments
to
the
assessments
of
the
McGowan
company,
however.
It
is
alleged
that
it
was
at
this
time,
namely
on
August
24,
1981,
that
Messrs
Girouard
and
Forget
received
instructions
to
represent
the
McGowan
company,
replacing
Mr
Jean
Chagnon
of
Samson,
Belair
and
Associates,
who
until
then
had
been
taking
care
of
the
company’s
books
and
tax
returns.
On
August
25,
1981
the
present
application
for
an
extension
was
prepared.
No
notice
of
objection
was
filed
in
respect
of
the
applicant’s
assessments
by
Mr
Chagnon,
who
was
looking
after
the
McGowan
company’s
affairs
at
the
time.
Messrs
Girouard
and
Forget
suggested
to
the
Board
that
since
the
discussions
with
the
Minister
of
National
Revenue
concerning
Mr
McGowan’s
assessments
also
dealt
with
the
McGowan
company’s
affairs,
they
thought
that
it
was
not
necessary
for
the
applicant
to
file
notices
of
objection.
This
testimony
contradicts
what
is
stated
in
paragraph
(A)
of
the
application
for
an
extension,
where
it
is
alleged
that
there
was
a
misunderstanding
between
the
company’s
accountants
and
Mr
McGowan’s
accountants
as
to
which
of
the
two
firms
was
to
prepare
the
notices
of
objection
for
the
McGowan
company’s
assessments.
It
seems
clear
to
me
from
the
evidence
adduced
that
as
part
of
his
duties
for
the
company
Mr
Chagnon
would
normally
have
prepared
the
notices
of
objection
within
the
prescribed
time
limit
if
the
company’s
directors
had
so
desired.
Messrs
Girouard
and
Forget
were
not
hired
to
represent
the
company
until
August
24,
1975.
It
is
admitted
in
paragraph
(B)
of
the
application
that
the
work
necessary
to
prepare
the
notice
of
objection
for
the
applicant
had
been
done
within
the
90
days
following
the
date
of
assessment.
It
does
not
seem
that
it
would
have
been
impossible
to
serve
the
notices
of
objection
within
the
time
prescribed
if
this
had
been
the
intention.
The
question
that
arises
is
why
this
was
not
done.
Regardless
of
any
connection
there
may
have
been
between
Mr
McGowan’s
personal
affairs
and
the
affairs
of
the
company
or
any
proposal
that
might
have
been
made
in
connection
with
Mr
McGowan’s
assessments,
I
cannot
accept
that
chartered
accountants
who
recognized
that
Mr
McGowan
and
the
McGowan
company
were
two
separate
legal
entities,
as
evidenced
by
the
fact
that
they
filed
a
separate
tax
return
for
each,
could
have
thought
that
it
was
unnecessary
to
file
separate
notices
of
objection
if
they
also
intended
to
dispute
the
company’s
assessments.
Under
subsection
167(1)
of
the
Act,
the
Board
may
make
an
order
extending
the
time
for
objecting
where
the
circumstances
are
such
that
it
would
be
just
and
equitable
to
do
so.
However,
it
is
necessary
first
to
indicate
the
reasons
why
it
was
not
possible
to
serve
the
notice
of
objection
within
the
time
limited
by
the
Act
for
so
doing
(subsection
167(2)).
Since
the
work
on
preparing
the
notices
of
objection
had
been
done,
I
must
conclude
that
it
was
possible
for
Mr
Chagnon
to
serve
the
notices
of
objection
within
the
90-day
time
limit,
if
he
had
so
wished.
I
do
not
accept
as
a
reason
that
would
justify
an
extension
the
contention
that
there
was
a
misunderstanding
between
the
chartered
accountants
or
that
they
did
not
know
that
they
had
to
file
notices
of
objection
for
the
company.
Mr
Chagnon,
the
person
responsible
at
the
time,
was
not
present
at
the
hearing
to
explain
why
he
had
not
served
the
notices
of
objection.
Mr
McGowan,
a
well-advised
businessman
and
director
of
the
company,
was
not
able,
owing
to
his
absence,
to
state
under
oath
that
it
was
in
fact
the
company’s
intention
to
object
to
the
reassessments
within
the
90
days
following
the
notice
of
assessment
and
at
the
same
time
explain
why
it
was
not
possible
to
do
so
within
the
time
prescribed.
The
applicant
has
not
satisfied
the
conditions
that
would
justify
an
extension
of
the
time
for
serving
its
notice
of
objection
pursuant
to
subsection
167(1)
of
the
Income
Tax
Act.
The
application
is
dismissed.
Application
dismissed.
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