[2013] 1 F.C.R. D-7
Income Tax
Income Calculation
Deductions
Appeal from Tax Court of Canada (T.C.C.) decision (2011 TCC 386) dismissing appellant’s appeal—At issue before T.C.C. whether appellant entitled to deduct certain losses—Appellant, manufacturer of manufactured homes, selling unwanted assets, including shares in two companies, shareholder loans—Proceeds of disposition below face value of loans—Deductibility of loss resulting from disposition at issue before T.C.C.—Appellant submitting before T.C.C. that proceeds of disposition resulting from loss not on account of capital, not arguing that amount in issue doubtful account—T.C.C. quoting extensively from closing argument of counsel for respondent, agreeing with reasoning outlined therein—T.C.C. erring in law by failing to provide adequate reasons—Not explaining why it chose to frame issues as defined by respondent in its pleading despite fact appellant providing competing theory—Impossible to review T.C.C’s reasons when Court herein unable to discern how transaction characterized by T.C.C.—T.C.C. failing to reference viva voce evidence adduced through witnesses—T.C.C. not grappling with real issues, demonstrating lack of understanding in dealing with argument that amount in issue doubtful account—T.C.C. not dealing with evidence, submissions advanced with respect to appellant’s argument that loans made for income-producing purposes related to business—T.C.C. required to explain why it embraced respondent’s position so completely—Matter remitted to T.C.C. for redetermination by different judge—Appeal allowed.
SRI Homes Inc. v. Canada (A-363-11, 2012 FCA 208, Dawson J.A., judgment dated July 18, 2012, 9 pp.)