Minister of National Revenue v. Goldsmith Brothers Smelting and Refining Company Limited, [1952] CTC 16, 52 DTC 1041

CAMERON, J.:—This is an appeal by the Minister of National Revenue from a decision of the Income Tax Appeal Board dated October 17, 1950 (3 Tax A.B.C. 14). By consent, I heard this appeal and similar appeals in four other cases at the same time. In the other cases, the Minister of National Revenue had also appealed from decisions of the Income Tax Appeal Board, the respondents being L. D. Caulk Co. of Canada, Ltd. (No. 46469), Dominion Dental Co. Ltd. (No. 48983), The Dental Company of Canada, Ltd. (No. 46470), and S. S. White Co. of Canada (No. 43982). The principles involved in each case were precisely the same and it was therefore agreed that a formal judgment should be rendered in one case only, and that that judgment should be applicable to all.

In this case, the Minister, in the Notice of Assessment dated May 28, 1949, for the taxation year 1947, disallowed a deduction of $6,312.50, said to have been incurred for legal expenses. The Income Tax Appeal Board found that of that sum only $312.50 was actually disbursed by the respondent in the taxation year 1947, and that that expenditure was incurred in payment of solicitors who represented the respondent at the investigation held by the Commissioner under the Combines Investigation Act. The Board allowed the respondent’s appeal as to the said sum of $312.50, vacated the assessment and referred the matter back to the Minister to allow the said deduction. The Board further disallowed the appeal as to the sum of $6,000.00, that sum having been expended in a subsequent year.

The respondent herein, in its Reply to the Notice of Appeal, stated that a substantial part of the sum of $6,000.00 so disallowed by the Board was incurred in the year 1947 and to that extent it claimed that it was an allowable deduction in that year. This matter was not pressed at the hearing and inasmuch as there is no evidence before me that any part of that sum was expended by the respondent in the taxation year 1947, it could not be allowed as a deduction in this appeal.

Judgment has now been given in the Caulk case [ [1952] C.T.C. 1] and for the reasons therein given the decision of the Income Tax Appeal Board is affirmed and the appeal herein will be dismissed with costs to be taxed.

Judgment accordingly.