Date: 20010727
Docket: 2000-2555-IT-I
BETWEEN:
ABDALLAH A. IBRAHIM,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
For the Appellant: The Appellant himself
Counsel for the Respondent: Pascale O'Bomsawin
____________________________________________________________________
Reasons for Judgment
(Delivered orally from the Bench on May 15, 2001, at Montréal, Québec)
McArthur J.
[1] This is an appeal from an assessment for the 1998 taxation year concerning the decision of Minister of National Revenue to disallow expenses in the amount of $5,750, claimed by the Appellant as other deductions. The Minister's position is that the Appellant has not established the expenses were incurred in 1998 and that the Appellant had no reasonable expectation of profit.
[2] The Appellant graduated in electrical engineering from the University of Cairo in 1968. He immigrated to Canada in 1975 and was accredited as an electrical engineer. Between 1977 and 1983, he worked for many companies including Westinghouse for one and one-half years, Ontario Hydro for six months, and in British Columbia for several months with, I believe, a mining company. He worked for two or three electrical engineering firms in Montréal and then his last employment was with Pratt & Whitney for approximately one year from which he was laid off in 1983.
[3] Since 1983, he states that he has been in the business of writing a technical book on electrical engineering. He has never been published nor paid for any of his works but he continues writing to this date. There is no doubt that he works at attempting to be published. He appears to spend enormous time in the libraries of Concordia and McGill Universities. He claims to have written 60 books and having five under consideration with publishers. None of these efforts were placed in evidence. He had no expenditure receipts for 1998, although he did have receipts for other years, mostly for photocopies and shipping of materials to publishers.
[4] The Appellant's claim for deductions was made in 1998 and he admitted altering 1992 and 1993 receipts to read "1998". I had difficulty discerning exactly what he was claiming until it was set out by Jean-Claude Roy of Revenue Canada who testified that the expenses claimed were for the costs of reference books and information material of $1,500, library research and library photocopies of $1,000, promotion for editors, postal expenses, fax and long distance calls of $750, shipping of $1,500, copyrights of $200, storage of $500, and miscellaneous expenses of $300.
[5] Mr. Roy had asked the Appellant for vouchers. The only one provided was for $23. The Appellant filed in evidence a bundle of material, including his own notes and many publishers' rejection letters, perhaps as many as 50. Mr. Roy referred to some specific letters and in particular, one in 1997 where the publishing company author said that the material made a bad impression. Another 1997 letter from a publisher stated:
... Notes and clippings don't constitute a manuscript that we can review.
In 1998, a letter from Delmar Publishers stated:
We have reviewed your sample materials and will, unfortunately not be able to publish them. It was the consensus of our staff that the materials are too dated and the copyright in most of the material is with someone else.
[6] On a more positive note in recent months, there are a few replies from publishing houses including The Fairmount Press by way of a letter dated July 19, 2000 which stated:
We would be interested in receiving some additional information on your ninth proposal on "power factor improvement (correction) for electrical power systems and equipment". We'd like an outline containing significantly more detail of what is included in your proposal, a sample chapter, if you have one and also some idea of the book's length.
[7] It is not effort on the Appellant's part that is lacking. The Appellant's evidence was anecdotal and in cross-examination, some of his questions took two or three minutes and it was difficult to discern what the question was. He spoke of the extreme difficulties in having his material published and yet, he perseveres. It is reasonable to consider a start-up period but from 1983 to 1997 without success is unreasonable. It is a mystery why his first claim for expense deductions was in 1998.
[8] In summary, the Appellant entered virtually no receipts for expenditures in 1998. He has been working on being published since 1983, without success, and I might say without even a hint of success. I do not think it serves a useful purpose to review the law with regard to reasonable expectation of profit. I agree with the submissions of the Respondent that the Appellant did not meet the burden of proving the expenses which were claimed. He altered the dates on several receipts with the intent of deceiving Revenue Canada and the Court. He was not a credible witness. The appeal is dismissed.
Signed at Ottawa, Canada, this 27th day of July, 2001.
"C.H. McArthur"
J.T.C.C.
COURT FILE NO.: 2000-2555(IT)I
STYLE OF CAUSE: Abdallah A. Ibrahim and Her
Majesty the Queen
PLACE OF HEARING: Montréal, Québec
DATE OF HEARING: May 15, 2001
REASONS FOR JUDGMENT BY: The Honourable Judge C.H. McArthur
DATE OF JUDGMENT: May 18, 2001
APPEARANCES:
For the Appellant: The Appellant himself
Counsel for the Respondent: Pascale O'Bomsawin
COUNSEL OF RECORD:
For the Appellant:
Name: N/A
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada