Maurice
Boisvert:—This
case
concerns
a
motion
to
obtain
an
extension
of
time
to
appeal
from
assessments
dated
November
12,
1970
covering
the
taxation
years
1961
to
1967
inclusive.
The
reasons
therefor,
as
set
out
in
the
application
are
the
following:
(TRANSLATION)
The
reasons
for
this
application
for
an
extension
of
time
are
the
following:
(1)
Mr
Louis
Vachon,
residing
at
Ste-Marie,
Beauce
County,
Quebec,
the
Subject
of
reassessments
on
November
12,
1970,
made
an
assignment
of
his
property
on
December
3,
1970,
as
appears
in
a
judgment
by
the
Assistant
Registrar
of
the
Bankruptcy
Court,
Quebec
District;
As
appears
from
the
order
referred
to
in
the
preceding
paragraph,
Mr
Gaston
Béliveau
was
appointed
trustee
in
bankruptcy
for
the
said
Louis
Vachon;
When
the
said
trustee
learned
that
a
reassessment
had
been
sent
to
Mr
louis
Vachon
the
time
for
sending
a
notice
of
objection
to
the
Minister
of
National
Revenue
had
expired;
They
accordingly
took
the
necessary
steps
to
obtain
photocopies
of
these
notices
of
assessment
from
the
representatives
of
the
Assistant
Deputy
Minister
of
National
Revenue,
since
the
trustee
was
not
in
a
position
to
obtain
them
from
the
bankrupt;
When
they
were
received
by
the
trustee
they
were
examined,
and,
on
being
so
advised,
the
inspectors
in
the
bankruptcy
of
Louis
Vachon
commissioned
the
undersigned
counsel,
Mr
Louis
Dorion,
to
ask
for
an
extension
of
time
in
which
to
submit
a
notice
of
objection
against
the
said
assessments
to
the
Minister
of
National
Revenue,
in
conformity
with
subsection
61A(1)
of
the
Income
Tax
Act;
Both
the
trustee
and
the
counsel
responsible
for
making
this
application,
as
well
as
the
inspectors
in
the
bankruptcy
of
Louis
Vachon,
have
acted
with
all
due
diligence
in
submitting
this
application.
The
section
of
the
Income
Tax
Act
(RSC
1952,
c
148,
as
amended),
which
applies
here,
states
that:
61A.
(1)
Where,
because
of
the
death,
incapacitating
sickness
or
bankruptcy
of
a
taxpayer
no
objection
to
an
assessment
under
section
58
or
appeal
to
the
Tax
Appeal
Board
under
section
59
has
been
made
or
instituted
within
the
time
limited
by
section
58
or
59,
as
the
case
may
be,
for
so
doing,
an
application
may
be
made
to
the
Tax
Appeal
Board
for
an
order
extending
the
time
within
which
a
notice
of
objection
may
be
served
or
an
appeal
instituted
and
the
Board
may
make
an
order
extending
the
time
for
objecting
or
appealing
and
may
impose
such
terms
as
it
deems
just.
(2)
The
application
referred
to
in
subsection
(1)
shall
set
forth
the
reasons
why
it
was
not
possible
to
serve
the
notice
of
objection
or
institute
the
appeal
to
the
Board
within
the
time
otherwise
limited
by
this
Act
for
so
doing.
(3)
An
application
under
subsection
(1)
shall
be
made
by
filing
with
the
Registrar
of
the
Tax
Appeal
Board
or
by
sending
by
registered
mail
addressed
to
him
at
Ottawa
3
copies
of
the
application
accompanied
by
3
copies
of
a
notice
of
objection
or
notice
of
appeal,
as
the
case
may
be.
(5)
No
order
shall
be
made
under
subsection
(1)
.
.
.
(a)
unless
the
application
to
extend
the
time
for
objecting
or
appealing
is
made
within
one
year
after
the
expiration
of
the
time
otherwise
limited
by
this
Act
for
objecting
to
or
appealing
from
the
assessment
in
respect
of
which
the
application
is
made;
(b)
if
the
Board
.
.
.
has
previously
made
an
order
extending
the
time
for
objecting
to
or
appealing
from
the
assessment;
and
(c)
unless
the
Board
...
is
satisfied
that,
(i)
but
for
the
circumstances
mentioned
in
subsection
(1)
.
.
.
,
an
objection
or
appeal
would
have
been
made
or
taken
within
the
time
otherwise
limited
by
this
Act
for
so
doing,
(ii)
the
application
was
brought
as
soon
as
circumstances
permitted
it
to
be
brought,
and
(iii)
there
are
reasonable
grounds
for
objecting
to
or
appealing
from
the
assessment.
The
motion
was
heard
in
Quebec
City
on
October
12,
1971
under
the
provisions
of
the
foregoing
section.
On
the
one
hand
it
was
allowed
that
Louis
Vachon’s
bankruptcy
had
provided
the
grounds
for
this
motion.
On
the
other,
respondent
proved
that
appellant
had
not
acted
with
sufficient
diligence
to
object
to
the
assessments
within
the
time
limit,
and
that
he
had
not
established
that
he
was
prevented
from
acting
in
accordance
with
the
Act
by
circumstances
beyond
his
control
or
knowledge.
The
assessments
are
dated
November
11,
1970
and
the
application
for
an
extension
of
time
is
dated
August
11,
1971.
It
was
accompanied
by
a
Notice
of
Objection
to
each
assessment
made
for
the
above-mentioned
years.
The
evidence
establishes
that
on
December
8,
1970
appellant
was
informed
by
a
letter
from
a
special
investigator
of
the
Department
of
National
Revenue,
giving
complete
information
relating
to
the
assessments.
On
November
16,
1970
respondent
effected
seizure
and
on
December
3,
1970
appellant
made
an
assignment
of
his
property.
On
December
14,
1970
the
bankrupt
was
examined
by
the
Receiver
in
accordance
with
the
provisions
of
the
Bankruptcy
Act.
At
this
examination
appellant
stated
that
the
Notices
of
Assessment
had
brought
about
his
insolvency.
The
trustee
appointed
was
Mr
Gaston
Béliveau,
who
was
informed
of
the
assessments,
first
by
the
bankrupt
and
then
by
respondent’s
representative
on
February
15,
1971.
A
letter
was
sent
by
appellant’s
trustee
in
bankruptcy
the
same
day,
requesting
inter
alia
return
of
the
documents
seized
in
December
1970,
cancellation
of
the
notice
of
seizure
against
the
debtor’s
immovables,
and
finally
an
injunction
to
stay
proceedings.
The
Act
required
the
trustee
to
submit
his
objections
within
90
days
(subsection
58(1)
of
the
aforementioned
Act).
The
moment
he
decided
to
challenge
the
assessments,
his
first
duty
was
to
submit
Notices
of
Objection.
Far
from
acting
with
diligence,
he
procrastinated.
Since
the
first
meeting
of
the
creditors
of
the
bankrupt
Louis
Vachon,
held
on
December
23,
1970,
at
which
Maurille
Savard,
the
representative
of
the
Department
of
National
Revenue,
Taxation
Division,
was
present,
the
trustee
has
been
fully
aware
of
the
assessments
made
by
the
aforementioned
Division.
Instead
of
carrying
out
the
provisions
of
the
Income
Tax
Act
for
challenging
the
assessments,
he
tried
unsuccessfully
to
have
the
assessments
cancelled
by
a
motion
before
a
judge
sitting
in
matters
of
bankruptcy.
I
have
come
to
the
conclusion
that
the
trustee’s
motion
does
not
show
grounds
which
made
it
impossible
for
him
to
file
the
Notice
of
Objection
within
the
time
limit.
Subsection
46(7)
of
the
Act
reads
as
follows:
46.
(7)
An
assessment
shall,
subject
to
being
varied
or
vacated
on
an
objection
or
appeal
under
this
Part
and
subject
to
a
re-assessment,
be
deemed
to
be
valid
and
binding
notwithstanding
any
error,
defect
or
omission
therein
or
in
any
proceeding
under
this
Act
relating
thereto.
sections
58,
59
and
60
of
the
Act
indicate
the
procedure
to
be
followed
and
specify
the
tribunals
which
have
jurisdiction
to
cancel
an
assessment.
Under
subsection
44(3)
trustees
in
bankruptcy
are
substituted
for
bankrupts
and
are
required
to
do
what
the
bankrupt
has
failed
to
do.
I
feel
I
must
refer
the
parties
to
two
judgments,
one
by
the
Supreme
Court
of
Ontario,
delivered
by
Smily,
J
in
Carnat
Construction
Co
Ltd,
37
CBR
47;
the
other
by
the
Superior
Court,
Bankruptcy
Division,
delivered
by
Edouard
Martel,
J
in
Continental
School
of
Music
and
Melvin
C
Zwaig,
CA,
Trustee-Respondent,
and
Her
Majesty
the
Queen
in
Right
of
Canada.
This
latter
decision
is
dated
October
20,
1971.
In
the
two
aforementioned
cases,
the
learned
Judges
came
to
the
following
conclusions:
The
provisions
of
The
Income
Tax
Act
are
binding
on
the
estate
of
the
bankrupt
debtor;
and
there
is
no
conflict
with
the
provisions
of
The
Bankruptcy
Act.
There
is
no
question
that
The
Bankruptcy
Act
provisions
must
be
complied
with,
by
the
filing
of
proof
of
claim
by
the
Crown
with
respect
to
income
tax,
and
that
an
income
tax
assessment
may
be
disallowed
by
the
trustee,
and
that
in
such
event
the
Crown
is
called
upon
to
proceed
under
the
provisions
of
The
Bankruptcy
Act
and
appeal
from
that
disallowance.
But
in
so
far
as
determining
the
amount
of
the
tax,
that
should
be
done
in
accordance
with
the
provisions
of
The
Income
Tax
Act.
The
trustee
may
properly
inquire
into
the
matter
to
determine
whether
the
assessment
is
properly
made
in
order
that
he
may
decide
whether
or
not
there
should
be
proceedings
taken
against
that
assessment
which
would
be
complying
with
the
terms
of
The
Income
Tax
Act
and
thus
provide
for
the
procedure
such
as
filing
objections,
and
so
forth,
and
also
disallow
the
claim.
However,
when
that
disallowance
comes
before
the
Court,
then
the
proper
procedure
is
that
the
amount
of
the
income
tax
be
determined
under
the
provisions
of
The
Income
Tax
Act
rather
than
by
the
Court
in
bankruptcy
deciding
the
matter
on
the
merits.
S
46(7)
of
The
Income
Tax
Act
applies
to
such
a
case.
For
the
foregoing
reasons
I
have
to
dismiss.
the
motion.
Motion
dismissed.
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