GRANT,
J.:—This
is
an
appeal
by
way
of
stated
case
pursuant
to
Section
734
of
the
Criminal
Code
of
Canada,
whereby
G.
G.
Marshman,
Q.C.,
Police
Magistrate
at
London
on
March
31,
1966,
convicted
the
appellant,
Empire
House
(London)
Limited
for
that
it
did
between
May
1,
1965
and
October
25,
1965
fail
to
comply
with
a
notice
of
the
Minister
of
National
Revenue
dated
April
29,
1965,
requiring
the
said
corporation
to
keep
certain
books
and
records
pursuant
to
Section
125(2)
of
the
Income
Tax
Act,
and
did
thereby
commit
an
offence
under
Section
131(2)
of
the
said
Act.
The
accused
is
a
corporation
carrying
on
business
as
a
public
house
and
sells
beer,
cigarettes
and
food
in
its
beverage
room.
Therein
it
maintains
a
cash
register
from
which
at
the
end
of
the
day
a
total
of
sales
made
is
taken.
The
cash
register
is
so
equipped
that
by
the
installation
in
it
of
a
tape
a
complete
record
showing
every
sale
which
has
been
made
can
be
recorded.
Section
125
of
the
said
Act
is
as
follows:
“125.
(1)
Every
person
carrying
on
business
and
every
person
who
is
required,
by
or
pursuant
to
this
Act,
to
pay
or
collect
taxes
or
other
amounts
shall
keep
records
and
books
of
account
(including
an
annual
inventory
kept
in
prescribed
manner)
at
his
place
of
business
or
residence
in
Canada
or
at
such
other
place
as
may
be
designated
by
the
Minister,
in
such
form
and
containing
such
information
as
will
enable
the
taxes
payable
under
this
Act
or
the
taxes
or
other
amounts
that
should
have
been
deducted,
withheld
or
collected
to
be
determined.
(2)
Where
a
person
has
failed
to
keep
adequate
records
and
books
of
account
for
the
purposes
of
this
Act,
the
Minister
may
require
him
to
keep
such
records
and
books
of
account
as
he
may
specify
and
that
person
shall
thereafter
keep
records
and
books
of
account
as
so
required.
(3)
.
.
.”?
Section
131(2)
of
such
Act
is
as
follows:
“Every
person
who
has
failed
to
comply
with
or
contravened
subsection
(1)
of
section
47,
subsection
(5)
of
section
123,
section
125
or
section
126
is
guilty
of
an
offence
and,
in
addition
to
any
penalty
otherwise
provided
is
liable
on
summary
conviction
..
.’’
On
April
29,
1965,
the
Minister
under
such
Act
for
the
Department
of
National
Revenue,
wrote
the
appellant
corporation
stating
that
as
a
result
of
reports
received
from
his
representatives
that
he
was
of
the
opinion
that
the
company’s
records
were
inadequate
for
purposes
of
the
Income
Tax
Act,
and
that
as
a
consequence
it
was
contravening
Section
125
of
such
Act
and
that
under
the
authority
of
subsection
(2)
of
such
section
that
it
was
required
to
keep
in
addition
to
the
books
and
records
then
maintained,
complete
cash
register
tapes,
dated
and
filed
in
date
order.
The
appellant
refused
to
install
and
maintain
such
tapes
and
kept
only
the
printed
totals
of
the
sales
with
their
daily
record
of
sales.
Section
125(1)
simply
requires
persons
to
whom
the
section
applies
to
keep
records
and
books
of
account
in
such
form
and
with
such
information
as
will
enable
the
taxes
payable
under
this
Act
or
the
tax
or
other
amounts
that
should
have
been
deducted,
withheld
or
collected
to
be
determined.
The
right
of
the
Minister
under
subsection
(2)
thereof
to
require
a
person
to
keep
such
records
and
books
of
account
as
he
may
specify
is
by
the
wording
thereof
dependent
upon
the
prerequisite
that
such
person
has
failed
to
keep
adequate
records
and
books
of
account
for
the
purposes
of
the
Act.
This
appeal
may
be
disposed
of
on
the
following
two
grounds.
The
witnesses
on
behalf
of
the
Crown
indicated
that
the
information
which
was
available
to
them
was
not
insufficient
for
them
to
determine
the
tax
payable
and
the
most
which
the
witness
Bagnall
would
say
was
that
the
sales
record
would
be
evidence
of
sales
to
assist
the
department,
and
further,
the
following
words,
‘‘we
feel
there
is
no
supporting
evidence
for
the
recording
of
sales’’.
None
of
the
witnesses
called
on
behalf
of
the
Crown
indicated
that
from
the
information
available
to
them
they
were
unable
to
determine
the
tax
liability.
The
Magistrate
in
his
reasons
for
Judgment
made
the
following
distinct
finding
of
fact:
“I
find
that
the
accused
corporation
kept
adequate
records
and
books
of
account
which
would
enable
a
chartered
accountant,
and
which
in
this
case
enabled
the
accountants
of
the
company
to
present
information
to
the
department
from
which
the
tax
liability
of
the
company
could
be
determined.”
Having
made
a
finding,
based
on
the
evidence
of
the
Crown
witnesses,
that
would
deprive
the
Minister
of
jurisdiction
to
require
the
taxpayer
to
keep
such
records
or
books
of
account
as
he
might
specify,
the
accused
could
not
then
be
convicted
of
failing
to
comply
with
such
notice
made
without
authority.
The
first
question
should
be
answered
that
on
the
basis
of
the
facts
set
out
in
the
case
stated
the
Magistrate
was
in
error
in
convicting
the
accused.
The
second
question
is
not
relevant
to
the
matters
in
issue.
There
will
therefore
be
judgment
setting
aside
the
conviction
and
directing
a
verdict
of
acquittal
to
be
recorded.
There
will
be
no
order
as
to
costs.
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