Hudson Bay Mining and Smelting Co., Ltd. v. The Queen, 2003 DTC 173 (TCC)

Tax credits received by the taxpayer from the Manitoba government were in respect of Canadian exploration expenses that it incurred as agent for its parent. Accordingly, such credits were not made in respect of an outlay or expense of the taxpayer and, therefore, were not included in income under s. 12(1)(x). Furthermore, the assistance would be deemed by the definition of cumulative Canadian exploration expense in the Act to be a reduction in the amount of those expenses so that s. 12(1)(x), being a provision of more general application, could not apply.

The definition of cumulative Canadian exploration expense, which would require a tax credit received from the Manitoba government to be set-off against the amount of Canadian exploration expense of the taxpayer, was a more specific provision than s. 12(1)(x), which would have required an inclusion in income of assistance received by the taxpayer, with the result that s. 12(1)(x) should not be applied to the assistance.