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(c) The recorded balances in the shareholder’s loan account were: December 31, 1971 ($4,605.72) December 31, 1972 ($7,052.00) December 31, 1973 $63,972.00 (d) Prior to the end of 1972, the following entries were made in the records of Jardine: DR Savings Account $60,000 CR Shareholder’s Loan Account—H J Rempel $60,000 (e) In early 1973, Adjusting Journal Entry No 1 was made in the records of Jardine as follows: DR Shareholder’s Loan $60,000 CR Bank Savings $60,000 “To reverse 1972 J/E JE 43” (f) No consideration was provided to the corporation for its apparent reduction of the Appellant’s indebtedness to it. ...

The valuation figure, I believe, was unduly increased by these considerations. ...

He reviewed the work of the Revenue auditor covering the taxation years under consideration in this appeal and with these references Mr Griffin-Warwicke states that he was able to identify each loan and the purpose for each loan. ...

The critical portions therein as far as I am concerned read as follows: In consideration of your listing, Advertising, and Offering my property known as ART ISFELD FARM for sale or exchange I hereby give you sole and exclusive authority irrevocable until the expiration hereof to offer for sale or exchange my Said property at the price of $150,000 and upon the terms set out below or at such price and on such terms as may be acceptable to me. ...

The following schedule sets out the basic particulars of the property interest of the appellants: Property Year Appellants Appellants Karopa Hilltown 1974 John Crosier X 1974 Lucille E Crosier X 1974 Albin Trella X 1974 Elizabeth Trella X 1974 Victor Prousky X 1974 Morris Prousky X 1975 233482 Investments Limited X 1975 T Caravaggio & Son Limited X 1974 Manfred Feldt X 1974 Jean Mary Haschyc X 1974 Mendel Goldstein X 1974 Harry Teperman X 1974 David Irving Teperman X 1974 Burstein Bag Limited X 1975 Burstein Bag Limited X The following information directly relevant to the appellant Burstein is common to all appellants with respect to either one or the other parcel of real estate as indicated above: —The appellant held interest in two joint ventures known as Hilltown Developments Ltd (“Hilltown”) and Karopa Enterprises Ltd (“Karopa”); —The subject assets of these joint ventures were two pieces of raw land abutting each other in the Town of Oakville near the border line with the City of Mississauga; —The original participants and their respective percentage interests of Karopa were as follows: —Shortly after the purchase of the Karopa Property, Doug Roher and Lou Sherriff, the beneficial owners of K Roher Construction Limited and Lyrad Construction Limited respectively, which corporations in partnership owned Briar Developments, declared personal bankruptcy and thereafter Briar Developments ceased its participation in Karopa; Briar Developments (Roher & Sherriff) 29.7% Burstein Bag Limited 26.9% Crosier 1.4% Goldstein 1.7% McGuigan & Feldt 5.2% Prousky (Victor & Morris) 2.3% Trella (Elizabeth & Albin) 5.9% Warwick 11.2% Welta Wool.2% Feldstein 5% Flishlek.3% Rotsteins.3% Steiglan 6.6% Tomco 1.0% 233482 Investments Limited 7.7% 100.0% UUIJ I, IvVV, (“Karopa”) for $832,742.00 satisfied as follows: Cash $245,207.97 29.4% 1st Mortgage 301,867.03 36.2% 2nd Mortgage 50,750.00 6.1 % 3rd Mortgage 234,492.00 28.2% Taxes, etc 425.00.1 % $832,742.00 100.0% — During 1972, other participants of Karopa also encountered financial difficulties, and a reorganization occurred with the remaining participants taking over the vacated syndicate participation, the result being that the eventual composition of the Karopa joint venture was as follows: Burstein Bag Limited 35.720% T Caravaggio & Son Ltd 17.860% 233482 Investments Ltd 10.716% Jean Haschyc 5.706% Elizabeth Trella 5.706% Albin Trella 3.224% Joseph Rajca Jr 3.224% Mendel Goldstein 3.572% Manfred Feldt 3.572% Prousky (Victor & Morris) 3.556% John Crosier (husband & 1.786% Lucille Crosier wife) 1.786% Dorothy McGuigan 1.786% Beverly Young 1.786% 100.000 % Limited for a consideration of $1,901,664, realizing a gross profit of $1,068,922. ...

In this case considerations of fairness operated to exclude the evidence tendered by the respondent in an attempt to establish that the appellant, in his returns, understated revenues and overstated expenses. ...

When preparing the 1975 T-4 Return of Remuneration Paid, I elected to show the amounts paid and deducted as shown on the company’s records, which for Mr Jacob resulted in the following: Gross remuneration Aggregate of cheques paid up to date of receivership, 19 x $500 $ 9,500.00 Aggregate of gross pay plus vacation pay paid by me as receiver 2,849.56 $12,349.56 Deductions Aggregate amounts deducted from remuneration paid to him by me as receiver CPP 42.84 Unemployment insurance 22.44 Income tax 702.50 767.78 Additions made by the Department’s auditor and shown on revised T-4 issued at his request For CPP $ 77.66 For unemployment insurance 112.20 189.86 957.64 11,391.92 Department audit adjustment 189.86 Net amount actually received $11,581.78 Mr Jacob maintains that his income should have been reported for 1975 on a basis consistent with 1974, in which case it would have been shown on his T-4 slip as follows: Gross pay Aggregate of salary entitlement up to date of receivership, 19 x $625 $11,875.00 Aggregate of gross pay plus vacation pay paid by me as receiver 2,849.56 $14,724.56 Deductions CPP (including audit adjustments) 120.60 Unemployment insurance (including audit adjustments) 134.64 Total deducted by me as receiver $ 702.50 Amount claimed by Mr Jacob to have been deducted, but not shown as such in the company’s records 2,185.04 2,887.54 3,142.78 Net amount actually received by Mr Jacob $11,581.78 I trust this further explanation will enable you to give favorable consideration to Mr Jacob’s income tax position, as he appears to have been a victim of improper payroll administration by the Company prior to receivership. ...

However, I do not believe, because the appellant was recorded as having an allocation of $7,481.57 as his share of the 1971 receivables, that no further consideration should be given to the partnership agreement which specifically excludes the receivables from the sale price of the appellant’s interest, nor can I ignore that the appellant had no legal right to the receivables in 1972 and that the respondent admits that the appellant never received them. ...

He argued that Mr MacDonald’s evidence should be taken into consideration, especially when Mr David Fine testified that he had only a general knowledge about the real estate activities of his father. ...

The Board accepts the letter from the bank manager as evidence (Exhibit A-8) owing to the powers conferred on the Board under subsection 9(2) of the Tax Review Board Act, which reads as follows: Notwithstanding the provisions of the Act under which an appeal is made, the Board is not bound by any legal or technical rules of evidence in conducting a hearing for the purposes of that Act, and all appeals shall be dealt with by the Board as informally and expeditiously as the circumstances and considerations of fairness will permit. ...