Genoway v. The Queen, docket 2000-3231-GST-I (Informal Procedure)

Date: 20010427

Docket: 2000-3231-GST-I

BETWEEN:

ORAN DALE GENOWAY,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Reasons for Judgment

Beaubier, J.T.C.C.

[1]            This appeal pursuant to the Informal Procedure was heard at Regina, Saskatchewan on April 18, 2001. The Appellant testified and called David Danchilla and Barrie Bratt. The Respondent called Les Waynert, the auditor and Bob Bailey, the appeals officer on the file.

[2]            The Appellant has appealed a decision assessing him for Goods and Services Tax ("GST") which he failed to report on account of the sale of motor vehicles from his home or through his wife, Mr. Danchilla and Mr. Bratt in the area of Regina, Saskatchewan for the period May 1, 1991 to May 21, 1994. The Appellant has also claimed various items of input tax credits. These will be dealt with by each item in dispute.

[3]            The Appellant claims input tax credits on account of an old MGB and a Jaguar of $10,000 inputs each without any receipt or evidence of input of any kind. These are denied for that reason.

[4]            The Respondent conceded that the purchase and sale of a 1991 Buick LeSabre, the Appellant's description "016(2)" not the Appellant's, it was Mr. Danchilla's.

[5]            The Appellant claims that the assessments respecting the Appellant's description "004(1)" a 1990 Voyager (sold for $10,300) and a 1984 Beretta (sold for $7,500) Appellant's description "011(2)" were really transactions by Mr. Bratt's firm "Top Value Cars". Mr. Bratt confirmed this and his firm was audited by Excise Tax respecting both of these matters and paid tax on them. The Court accepts their testimony, the two men have a long history of personal and business relationships and the Appellant did many things in Top Value Cars' name with Mr. Bratt's permission. The failure of the two of them to do more than credit each other respecting these transactions is understandable in these circumstances and they are both credible respecting these two matters. These two transactions were Top Value Cars'.

[6]            Airline ticket expenditures were claimed by the Appellant as inputs respecting some cars purchased outside of Saskatchewan. These claims are denied for the following reasons:

1.              They may be deductible as business income tax expenses on a general basis;

2.              They do not directly relate to the specific transaction;

3.              The timing of the tickets in relation to the vehicle purchases indicates that there may very well be personal or other elements involved;

[7]            The remaining vehicles are the following as described in Exhibit R-7.

3	2)	1989 Grand Am
4	010 1)	1989 Chevrolet Corsica
5	2)	1990 Pontiac Grand Prix
6	3)	1989 Oldsmobile Calais
7	011 1)	1988 Oldsmobile Cutlass Cierra
11	013 1)	1989 Chevrolet Corisca
12	2)	1992 Mazda B2200
18	8)	1991 Pontiac Grand Prix
20	016 1)	1989 Chevrolet Beretta
26	2)	1990 Chevrolet Lumina

All of these were owned by the Appellant although many of them were in another person's name (particularly his wife's) in trust or as agent for the Appellant. However they were usually advertised for sale by him, bought and sold by him and (with one or two exceptions) owned for a very short period. On the evidence, the Appellant is clearly a "curber" that is a car vendor who buys and sells privately out of his home without a business license and who conducts a business in the nature of a trader in motor vehicles.

[8]            The Appellant objected strenuously to the fact that neither he nor his wife was allowed a personal vehicle. However Mr. Bailey pointed out that he always had his current vehicles (except the MGB and Jaguar) for sale and that observation is true.

[9]            The Appellant also claimed that two vehicles should be treated as personal in relation to the wheelchair requirements of one child. This claim is refuted by his own admission that the first vehicle could be used with the wheelchair by him and that he did not test the wheelchair in the second vehicle before he bought it.

[10]          Therefore, the Court finds, in addition to the foregoing, that:

1.              The Appellant ceased to be a small supplier on or before April 30, 1991;

2.              The Appellant was required to collect tax on all supplies of the motor vehicles described in paragraph [7] hereof during the period, including consignment sales and including supplies made on behalf or in the name of his wife, Val;

3.              That any sales made in the name of or on behalf of Barrie Bratt and reported by Barrie Bratt are not accountable by the Appellant insofar as they are described in paragraph [5] hereof.

4.              The claims by the Minister in paragraphs 23 and 24 of the Reply are confirmed by this Court and the appeal is dismissed respecting them.

[11]          The Appellant disputed the assessment of GST on top of what he alleged was GST charged to his customers. The Court orders that where there was a bill of sale in writing specifying GST on the sale that the GST levied be calculated accordingly. However, where the sales were not supported by such a written agreement, the GST shall be levied on the full selling prices.

[12]          These matters are referred to the Minister for reconsideration and reassessment in accordance with these reasons.

                Signed at Ottawa, Canada, this 27^th day of April, 2001.

"D. W. Beaubier"

J.T.C.C.