Date: 20000317
Docket: A-888-96
| Coram: DÉCARY J.A. |
LÉTOURNEAU J.A.
NOËL J.A.
Between:
GARAGE MONTPLAISIR INC.,
Appellant,
- and -
HER MAJESTY THE QUEEN,
Respondent.
Hearing held at Montréal, Quebec, Friday, March 17, 2000
Judgment from the bench at Montréal, Quebec, Friday, March 17, 2000
REASONS FOR JUDGMENT OF THE COURT BY: NOËL J.A.
Date: 20000317
Docket: A-888-96
| Coram: DÉCARY J.A. |
LÉTOURNEAU J.A.
NOËL J.A.
Between:
GARAGE MONTPLAISIR INC.,
Appellant,
- and -
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT OF THE COURT
Delivered from the bench at Montréal, Quebec,
Friday, March 17, 2000
NOËL J.A.
[1] This is an appeal from a judgment by Tremblay-Lamer J. of the Trial Division that dismissed the appellant"s appeal from assessments made by the Minister of National Revenue for the 1985 and 1986 taxation years.1
[2] Despite the excellent argument by Mr. Ménard, we all consider that the trial judge properly concluded that in the case at bar the business operated by Pinard Ltée before the merger was not operated by the appellant during its 1985 and 1986 taxation years as required by s. 111(5) of the Income Tax Act.2
[3] On the other hand, in her reasons the trial judge cited with approval a passage from the Tax Court of Canada decision in the case at bar to the effect that the purpose of s. 111(5) "is not the carryover of losses as such but the strengthening or survival of a declining business".3
[4] We do not feel that the wording of s. 111(5) supports such a statement. All that can be said is that the business of a company subject to a takeover must still be "a going concern"4 after the takeover if the company resulting from the merger is to be entitled to the accumulated losses.
[5] That being said, the trial judge nonetheless came to the correct conclusion since, on the evidence, the business of Pinard Ltée was not a going concern at the relevant time.
[6] The appeal will therefore be dismissed with costs.
| Marc Noël J.A. |
Certified true translation
Bernard Olivier, LL. B.
FEDERAL COURT OF CANADA
APPEAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
| FILE No.: A-888-96 |
| STYLE OF CAUSE: Garage Montplaisir Inc. v. The Queen |
| PLACE OF HEARING: Montréal, Quebec |
| DATE OF HEARING: March 17, 2000 |
| REASONS FOR JUDGMENT OF THE COURT: Noël J.A. |
APPEARANCES:
| Mario Ménard FOR THE APPELLANT |
| Richard Gobeil FOR THE RESPONDENT |
SOLICITORS OF RECORD:
| Spiegel, Sohmer FOR THE APPELLANT |
Attorneys
Montréal, Quebec
| Morris Rosenberg, Q.C. FOR THE RESPONDENT |
Deputy Attorney General of Canada
__________________3 Reasons for judgment, appeal book, p. 684.
4 Duha Printers Ltd. v. Canada, [1998] 1 S.C.R. 795, at 806.