Date: 20020328
Docket: A-418-00
Ottawa, Ontario, March 28th, 2002
BETWEEN:
GROUPE BOCENOR INC.
Appellant
and
HER MAJESTY THE QUEEN
Respondent
JUDGMENT
The appeal is dismissed with costs.
"J. Richard"
C.J.
Certified true translation
Sophie Debbané, LL.B.
Date: 20020328
Neutral citation: 2002 FCA 124
CORAM: RICHARD C.J.
DÉCARY J.A.
NOËL J.A.
BETWEEN:
GROUPE BOCENOR INC.
Appellant
and
HER MAJESTY THE QUEEN
Respondent
Hearing held at Montréal, Quebec, on March 21, 2002.
Judgment delivered at Ottawa, Ontario, on March 28, 2002.
REASONS FOR JUDGMENT BY: NOËL J.A.
CONCURRED IN BY: RICHARD C.J.
DÉCARY J.A.
Date: 20020328
Neutral Citation: 2002 FCA 124
CORAM: RICHARD C.J.
DÉCARY J.A.
NOËL J.A.
BETWEEN:
GROUPE BOCENOR INC.
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT
[1] This is an appeal from a decision of the Trial Division ([2000] F.C.J. No. 262 (QL)) dismissing the claim by the appellant for reimbursement on the ground that the administrative policy relied on for claiming the reimbursement (Memorandum ET-202) is invalid since it does not comply with the Excise Tax Act, R.S.C.,1985, c. E-15 (the Act).
[2] The parties both agree that the trial judge erred in finding that Memorandum ET-202 is invalid. In their opinion, even though that memorandum is not the result of any statutory or regulatory provision, the tax concession it creates is part of the legitimate exercise of discretion the Minister has to administer the Act equitably (Appellant's Memorandum, paragraphs 42 and 47; Respondent's Memorandum, paragraphs 30 to 33).
[3] On that assumption, the effect of Memorandum ET-202 would essentially be the one stated by Joyal J. in regard to Memorandum ET-302 in NCS International Inc. v. The Queen, 121 F.T.R. 21, at page 28:
. . . the policy set out in ET-302 is purely administrative. It is an option which a qualified manufacturer may take up. It does not create a right per se, but whatever discretion is exercisable by the Crown, that discretion must be exercised equitably and responsibly.
[4] In this case, the Minister's refusal to grant the tax concession sought by the appellant is based on the terms themselves of Memorandum ET-202:
2. Use of determined values for tax computation purposes is conditional upon compliance with all of the requirements of this Part and of the memorandum or letter authorizing a determined value for the specific goods.
5. Computation of tax on an established value becomes effective only from the date the use of this value is commenced. An established value may not be applied retroactively to adjust amounts of tax paid computed on the sale price. (Emphasis added)
[5] The appellant recognized that it failed to meet that requirement. But it argued that the fact that a determined value may apply only in the future violates s. 68 of the Act, and for that reason, the requirement must be set aside:
|
68. Where a person, otherwise than pursuant to an assessment, has paid any moneys in error, whether by reason of mistake of fact or law or otherwise, and the moneys have been taken into account as taxes, penalties, interest or other sums under this Act, an amount equal to the amount of those moneys shall, subject to this Part, be paid to that person if he applies therefor within two years after the payment of the moneys. |
68. Lorsqu'une personne, sauf à la suite d'une cotisation, a versé des sommes d'argent par erreur de fait ou de droit ou autrement, et qu'il a été tenu compte des sommes d'argent à titre de taxes, de pénalités, d'intérêts ou d'autres sommes en vertu de la présente loi, un montant égal à celui de ces sommes doit, sous réserve des autres dispositions de la présente partie, être payé à cette personne, si elle en fait la demande dans les deux ans suivant le paiement de ces sommes. |
(Emphasis added)
Moreover, because the appellant met the conditions provided in Memorandum ET-202, the Minister, it agrued, had to grant the concession it sought for the period authorized by s. 68.
[6] In my opinion, the appeal is without merit. Insofar as Memorandum ET-202 constitutes an administrative concession that is derived from the Minister's discretion (as is submitted by both the appellant and the respondent), it does not create a right. The only "right" that results from that administrative policy is the right to insure that the Minister's discretion is exercised reasonably and in compliance with the policy stated, and that is not in question in this case.
[7] Moreover, s. 68 deals with the reimbursement of taxes paid in error. However, the appellant admitted that the taxes reported in its claim for reimbursement were paid in accordance with subsection 50(1) of the Act. Furthermore, it seems that the appellant deliberately chose to forego availing itself of Memorandum ET-202 since the evidence shows that the Memorandum was sent to it at the appropriate time (Testimony of M. G. Tremblay, pages 36, 38, 81 and 82).
[8] The excerpt from the decision of MacKay J. in Sunbean Corp. (Canada) Ltd. v. M.N.R. (Customs and Exercise) 71 F.T.R. 199 (paragraph 44) relied on by the appellant constitutes an obiter dictum, the purpose of which moreover was to distinguish the decision of the Canadian International Trade Tribunal in Cook (Allen J.) Ltd. v. M.N.R. (1989), 2 T.C.T. 1167. In that case, the Canadian International Trade Tribunal dealt not with a tax concession based on the Minister's discretion but with the Minister's determination of a value specifically authorized by s. 28(1)(d) of the Act.
[9] Ultimately, the Court need not determine whether Memorandum ET-202 complies with the Act since, in any case, the appellant was not entitled to avail itself of it.
[10] I would dismiss the appeal with costs.
"Marc Noël"
J.A..
"I concur.
J. Richard, C.J."
"I concur.
Robert Décary, J.A"
Certified true translation
Sophie Debbané, LL.B.
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT FILE NO.: A-418-00
STYLE OF CAUSE: GROUPE BOCENOR INC. v. THE QUEEN
PLACE OF HEARING: MONTRÉAL, QUEBEC
DATE OF HEARING: MARCH 21, 2002
REASONS FOR JUDGMENT
OF THE COURT BY: Noël J.A.
CONCURRED IN BY: Richard C.J.
Décary J.A.
DATED: MARCH 28, 2002
APPEARANCES:
Eric AtkinsonFOR THE APPELLANT
Jacques SavaryFOR THE RESPONDENT
SOLICITORS OF RECORD:
MACINTOSH, MADDONNELL & MACDONALDFOR THE APPELLANT
New Glasgow, N.S.
Morris RosenbergFOR THE RESPONDENT
Deputy Attorney General of Canada
Ottawa, Ontario