Ghermezian – Federal Court finds that s. 231.1(1) authorizes CRA to compel the production of existing documents, but not to compel written answers

The Minister applied for s. 231.7 compliance orders respecting CRA requests for various documents made pursuant to s. 231.1(1) (and s. 231.2(1)). Southcott J found that “s 231.1(1) entitles an authorized person to demand provision of documentation without physically attending at a place or premises where the documentation is kept.” However, he accepted that “s 231.1 … does not authorize issuance of a demand compelling the recipient to provide, through written answers to questions, substantive information relevant to a taxpayer’s tax position” as contrasted to “authoriz[ing] compulsion of only pre-existing documentation.” He stated in this regard:

[T]he distinction underlying the reasoning in Cameco is between documented and undocumented information. Section 231.1(1)(a) empowers the Minister to compel provision of the former but not the latter.

After noting the taxpayers’ submission “that the Minister cannot compel the production of foreign-based information or documents, within the meaning of s 231.6, other than through s 231.6,” Southcott J accepted “that the [s. 231.2(1)] Requirements oblige the Respondents to provide the documents and information in their power, possession and control, if accessible from Canada [emphasis in original]”, but found that the taxpayers had not met their burden of establishing that the requested information was not accessible from Canada.

Neal Armstrong. Summaries of MNR v. Ghermezian, 2022 FC 236 under s. 231.1(1), s. 231.2(1), s. 231.6(2), s. 244(5) and General Concepts – Evidence.