J
B
Goetz:—This
appeal
came
on
before
me
for
hearing
at
the
City
of
Toronto,
Ontario,
on
March
21,
1979.
The
said
appeal
is
from
an
income
tax
assessment
whereby
the
Minister
of
National
Revenue
determined
that
the
appellant
had
failed
to
include
in
his
income
tax
return
for
the
taxation
year
1974,
the
sum
of
$27,873.59.
In
the
aggregate
amount,
loans
totalling
$199,386.03
were
made
to
the
appellant
in
the
1974
taxation
year
by
Bomarc
Electric
Limited
(hereinafter
referred
to
as
“Bomarc”
or
“the
Company”),
a
company
controlled
by
the
appellant
and
in
which
he
and
his
wife
were
the
only
sharholders.
The
appellant
repaid
Bomarc
$91,512.44
in
1974.
The
Minister
further
alleged
that
the
loans
were
not
made
in
the
ordinary
course
of
business
of
Bomarc
and
were
not
laid
out
to
earn
income
and
further
that
no
bona
fide
arrangements
for
repaying
the
monies
to
the
Company
had
been
made
in
the
statutory
period
pursuant
to
paragraph
15(2)(b)
of
the
Income
Tax
Act,
SC
1970-71-72,
c
63
and
amendment
thereto.
In
the
reply
to
notice
of
appeal,
the
Minister
also
relied
upon
sections
2,
3
and
18
of
the
said
Act.
The
appellant
is
an
electrician
by
occupation
and
incorporated
Bomarc
in
1971.
Appearantly
Bomarc
did
quite
well
financially
in
the
years
1973
and
1974
and
the
appellant
decided
to
purchase
Olympic
coins
in
the
sum
of
$21,450.55,
same
being
purchased
through
the
issue
of
a
Bomarc
cheque.
The
coins
were
kept
in
a
safety
deposit
box
held
by
Bomarc.
The
appellant
says
that
this
transaction
was
wrongly
placed
into
the
books
by
his
accountant
as
a
loan
from
the
Company
to
the
appellant.
The
coin
transaction
was
discovered
in
the
course
of
an
audit
of
Bomarc’s
books
by
the
Department
of
National
Revenue.
At
the
close
of
the
appellant’s
case,
counsel
for
the
respondent
made
a
motion
for
dismissal
of
the
appeal.
The
burden
is
on
the
appellant
to
show
that
the
respondent’s
assessment
is
incorrect.
This
burden
of
proof
results
especially
from
several
judicial
decisions,
including
the
judgment
delivered
by
the
Supreme
Court
of
Canada
in
R
W
S
Johnston
v
MNR,
[1948]
CTC
195;
3
DTC
1182.
I
find
that
the
appellant
has
not
discharged
the
onus
resting
upon
him
and
therefore
allow
the
motion
for
dismissal.
The
appeal
is
therefore
dismissed.
Appeal
dismissed.
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