Alan Brooks v. Her Majesty the Queen, [1995] 1 CTC 2880

Sobier J.T.C.C.:—The respondent in this matter brought a motion pursuant to section 12 to abridge the time for filing her notice of motion. That motion is granted.

I will then deal with the motion under paragraph 58(1)(b) of the Rules striking out the amended notice of appeal as disclosing no reasonable cause of action or no reasonable grounds for appeal.

I will first say that the time and the abridging can be granted by the Court since this motion under paragraph 58(1 )(b), not under paragraph 58(1 )(a) on a point of law, so I will deal with the other motions now.

The Tax Court of Canada is a statutory court and I believe that the matter was best spelled out by Judge Rip and referred to by Associate Chief Judge Christie in Lamash Estate v. M.N.R., [1990] 2 C.T.C. 2534, 91 D.T.C. 9. The Tax Court of Canada is, as I said, a statutory court and is limited to the jurisdiction conferred upon it by various statutes, which include the Income Tax Act, R.S.C. 1952, c. 148 (am. S.C. 1970-71-72, c. 63) (the "Act”) and the Tax Court of Canada Act. There are other statutes under which we hear appeals, but these are the statutes we are dealing with this morning.

Section 169 of the Act sets out what may be appealed to the Tax Court of Canada and I would like to take a moment just to read that:

169(1) Where a taxpayer has served notice of objection to an assessment under section 165, he may appeal to the Tax Court of Canada to have the assessment vacated or varied after either....

and that is what he may do.

Subsection 171(1) of the Act reads:

171(1) The Tax Court of Canada may dispose of an appeal by

(a) dismissing it, or

(b) allowing it and

(i) vacating the assessment,

(ii) varying the assessment, or

(iii) referring the assessment back to the Minister for reconsideration and reassessment.

Judge Christie in Lamash Estate at page 2545 (D.T.C. 16), after setting out section 171 stated:

On further reflection I am reinforced in my view that the court does not have the jurisdiction referred to. The Tax Court of Canada is a purely statutory creation and its jurisdiction is confined to what is expressly conferred on it by Parliament and what is necessarily implied from what is expressly conferred.

In various cases the court was asked to direct the respondent to pay interest to make an accounting, to make refunds, etc.

In Lamash Estate, Judge Christie cited Judge Rip in the case of McMillen Holdings Ltd. v. M.N.R., [1987] 2 C.T.C. 2327, 87 D.T.C. 585 (T.C.C.). Associate Chief Judge Christie states at page 2545 (D.T.C. 16) of Lamash, and I quote:

Judge Rip held that the court did not have jurisdiction. He said at pages 591-92 (the references to "the Act" are to the Income Tax Act):

and I quote from Judge Rip’s judgment:

Section 12 of the Tax Court of Canada Act grants this Court original jurisdiction to hear and determine appeals on matters arising under the Act and other statutes. Subsection 171(1) of the Act regulates how the Court may exercise its original jurisdiction to determine an appeal under the Act. Section 13 of the Tax Court of Canada Act simply grants the Court all powers, rights and privileges as are vested in a superior court of record in respect of witnesses, documents and other matters necessary or proper for the due exercise of its jurisdiction, that is, to hear and determine appeals, but section 13 does not increase the Court’s jurisdiction to that of a superior court of record. The due exercise of this Court’s jurisdiction on matters arising under the Act is to hear and determine an appeal from a tax assessment. I cannot overemphasize that the Court’s original jurisdiction is to hear and determine appeals in matters arising under the Act, an action against the Crown based on the Act, but is not an appeal from an assessment, is not an appeal arising under the Act, which is within the jurisdiction of this Court. While this Court does not have the jurisdiction that can be exercised in an action for an accounting, that does not end the matter.

The prayer for relief found in section 13 of the amended notice of appeal states:

13(a) That the Court order that Revenue Canada obtain from the company the reissue a T4 showing the deductions of $51,000 that have been made by the company.

This is not an appeal under the Act. This is not a relief which the Court has authority to order.

13(b) That the Court order a reassessment of my taxes owing including penalties and interest for the taxation year 1990 to nil.

From what the appellant has said this morning, he agrees that he wishes to have a determination made that all taxes owing have been withheld and therefore he is not liable for that reason. He is not disputing the amount of the tax which is originally assessed. He is disputing that and alleging that all amounts have been paid since they have been withheld or should have been withheld.

13(c) That the Court order an audit of the company to determine the gross profit for the relevant period to determine the amount withheld by the company in lieu of bonus.

Again this is the matter for an action between the company and Mr. Brooks and not an appeal under the Income Tax Act.

13(d) That the Court order a refund of the excess taxes withheld by WCI plus interest thereon at the prescribed rate of interest under section 227 of the Income Tax Act.

Again this Court has no jurisdiction to make such an order since it again is not an appeal under the Act. I am quite sure that Mr. Brooks has a legitimate claim either against Revenue Canada for refusing to acknowledge that amounts have been withheld or against his former employer for either failing to remit or having withheld, not remitted. However, this is not a matter which the Tax Court of Canada may determine. This would be an action against the Crown which could be brought in the Federal Court-Trial Division or an action which could brought in the Superior Court in the Province of Ontario for accounting or other matters.

For these reasons the motion is granted and the amended nntice of appeal is struck out as disclosing no reasonable grounds for appeal.

I suggest that Mr. Brooks take counsel and advice of counsel in order to proceed in the proper form in order to obtain the relief he seeks.

There will be no order as to costs.

Motion granted.