Date: 20000714
Docket: 1999-3550-GST-I
BETWEEN:
RAY SULLIVAN,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
O'Connor, J.T.C.C.
[1] This appeal was heard at Toronto, Ontario on June 30,
2000.
ISSUE:
[2] The issue in the appeal is whether the Appellant is
entitled to a GST new housing rebate ("NHR") in the
amount of $3,080.97. The Minister of National Revenue
("Minister") disallowed the NHR because the Appellant
filed his application for the NHR more than two years after he
and his family first occupied the home ("home") in
question which is located in Nichol Township, Ontario.
FACTS:
[3] The relevant facts are:
(a) The Appellant, his wife and family, first occupied the
home on June 16, 1994 at which time it was substantially
completed. However, the Township of Nichol only issued an
Occupancy Permit on January 30, 1997.
(b) The Application for the NHR was received by the Minister
on May 26, 1998.
SUBMISSIONS:
[4] The Appellant submits that the time for the two-year
period to commence should be the date of the Occupancy Permit,
namely January 30, 1997 and he filed his Application
within two years from that date. He further submits that the
period for his required filing of the Application should be four
years from the date of occupation and that he filed his
Application within that period of four years. The Respondent
submits that the period is two years from the date the home was
first occupied and that the Appellant's Application was
received more than two years after the said date.
ANALYSIS AND DECISION:
[5] The relevant part of the Excise Tax Act is:
256(3) A rebate under this section in respect of a
residential complex shall not be paid to an individual unless the
individual files an application for the rebate within two years
after the earliest of
(a) the day that is two years after the day the complex is
first occupied as described in subparagraph (2)(d)(i),
(a.1) the day ownership is transferred as described in
subparagraph (2)(d)(ii); and
(b) the day construction or substantial renovation of the
complex is substantially completed.
Prior to the amendment mentioned below this provision
read:
(3) A rebate shall not be paid under subsection (2) in respect
of a residential complex to an individual unless the individual
files an application for the rebate within two years after the
earlier of
(a) the day the complex is first occupied as described in
subparagraph (2)(d)(i) or ownership is transferred as described
in subparagraph (2)(d)(ii), and
(b) the day construction or substantial renovation of the
complex is substantially completed.
The portion of subsection 256(3) before paragraph (b) was
amended by S.C. 1997, c. 10, s. 66(3), and is applicable to
any rebate in respect of a residential complex for which
an application is filed with the Minister of National Revenue on
or after April 23, 1996 except where
(a) the residential complex was, at any time after the
construction or substantial renovation thereof began and before
that day, occupied as a place of residence or lodging;
(b) the construction or substantial renovation of the
residential complex was substantially completed before that day;
or
(c) the applicant, before that day, transferred ownership of
the residential complex to a recipient of a supply by way of sale
of the complex.
[6] The French version of paragraph 66(3)(a) is clearer than
the English as it specifically states the amendment will not
apply where the taxpayer occupied the home prior to April 23,
1996.
[7] Under former subsection 256(3), the period for filing an
application for the rebate was two years after the earlier of
occupying the home or substantial completion of construction or
renovations. The Appellant is clearly beyond that period in the
case at bar.
[8] We must therefore determine whether the amended subsection
256(3) applies to someone who was already occupying his home. The
subsection states that a rebate shall not be paid unless the
individual files an application within two years after the
earliest of: (a) the day that is two years after the day the
complex is occupied, (b) the day construction or substantial
renovation of the complex is substantially completed. The change
therefore related to the occupancy of the home, which started a
four-year rather than a two-year clock running. However,
substantial completion still starts a two-year clock and
whichever clock runs out first sets the deadline.
[9] The amended subsection 256(3) was introduced by S.C. 1997,
c.10, subsection 66(3). It states that the new provision is
applicable to a rebate for which an application is filed on or
after April 23, 1996 except where the residential complex
was occupied before that day as a place of residence or lodging.
It is true that the Appellant filed his application after
April 23, 1996 but the Appellant cannot benefit from
the amendment (i.e. four years as opposed to two) because his
time period was already running as of June 16, 1994.
[10] Moreover, as substantial completion of the home had
occurred as of June 16, 1994, the two year period for that
situation was not altered by the amendment in 1997 and it is
absolutely clear that the Appellant is well beyond the two year
period commencing on June 16, 1994.
[11] Moreover, the date of the Occupancy Permit is immaterial
as the evidence disclosed that the home was substantially
completed as of June 16, 1994 and as the Appellant and his wife
and family took occupation of the home on that date.
[12] Also, the jurisprudence is clear that neither the
Minister nor this Court can, out of compassion or for any other
reason, extend the two-year period.
[13] For all of the foregoing reasons the appeal regrettably
must be dismissed.
Signed at Ottawa, Canada, this 14th day of July, 2000.
"Terrence P. O'Connor"
J.T.C.C.
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