CUSTOMS AND EXCISE |
Excise Tax Act |
Isaac v. Canada (Attorney General)
T-698-01
2002 FCT 410, Heneghan J.
11/4/02
11 pp.
Judicial review of decision denying applicant's request for waiver of interest, penalties pursuant to Excise Tax Act-- Applicant sole director of Salmon Arm Jewellers Ltd., company liable for collection, payment of Goods and Services Tax (GST)--Company unable to pay GST assessed as owing for period from November 1, 1992 to December 31, 1996--As consequence of status as sole director, applicant personally assessed for payment of tax--Company's application for waiver of tax liability pursuant to fairness provisions denied at both first, second levels--Applicant's offer to pay $20,000 in full settlement of tax liability upon waiver of balance of $5,000 rejected--Tax Court of Canada dismissed applicant's appeal of personal assessment, but expressed astonishment at Revenue Canada's insensitivity in not accepting offer to settle --Applicant submitted application for "fairness ruling"-- Canada Customs and Revenue Agency's denial of applicant's personal request for fairness ruling subject of judicial review application--Application allowed--Basis of request for waiver of penalty, interest of GST liability found in Excise Tax Act, s. 281.1, permitting Minister to waive, cancel interest, penalties payable--Subject to requirements of procedural fairness, exercise of such ministerial discretion will generally attract judicial restraint--Finding that applicant personally responsible for tax liability of company pursuant to s. 323 not overriding long-standing, well-recognized principle corporation distinct legal person, independent in law from directors, shareholders--Minister's delegate considered Collections Account Diary for company before entering recommendation on fairness application--Erred in law as took into consideration facts irrelevant to present application-- Applicant's application different matter than that of company--While related, facts in one not applicable to facts of other--Applicant entitled to have his case considered on basis of record, without consideration of extraneous facts such as those contained in previous application of separate person --Applicant's application not assessed on own merits-- Decision unreasonable--Excise Tax Act, R.S.C., 1985, c. E-15, ss. 281.1 (as enacted by S.C. 1993, c. 27, s. 127), 323 (as enacted by S.C. 1992, c. 45, s. 17).