Satinder v. Canada
A-574-93
Stone J.A.
17/5/95
7 pp.
Application for judicial review of decision of Tax Court of Canada re: construction of Income Tax Act, s. 39(4) -- Applicant purchasing for $138,792 non-interest bearing promissory note with face value of $150,000-Selling note on May 2, 1989 for $141,381, realizing gain of $2,589-On same day, applicant purchasing for $152,078 non-interest bearing Government of Canada Treasury Bill (T-Bill) with face value of $170,000 -- T-bill redeemed for full face value at date of maturity, resulting in gain to applicant of $17,291.23 -- Minister disallowing capital gain for both 1989 and 1990 taxation years-Applicant appealing reassessments to Tax Court of Canada -- Tax Court allowing appeal for 1989 taxation year but dismissing appeal for 1990 taxation year -- Only dismissal of appeal for 1990 taxation year before Court for review -- T-bill in question "Canadian security" under Act, s. 54(c)(ii)(A) -- "Disposition" of security upon redemption -- Purpose of s. 39(4) to allow favourable tax treatment by deeming to be capital property Canadian security owned by taxpayer and disposition thereof to be disposition of capital property -- Compensation for use of money representing interest-Bill purchased at discount -- Whether discount amount to which s. 39(4) applies -- Holder of T-bill paid blend of principal and interest upon redemption -- Respondent correctly treating discount on T-bill as interest to which Act, s. 12(1)(c) applies rather than as principal to which s. 39(4) applies -- Application dismissed-Income Tax Act, S.C. 1970-71-72, c. 63, ss. 12(1)(c) (as am. by S.C. 1980-81-82-83, c. 140, s. 4(1)), 39(4) (as enacted by S.C. 1977-78, c. 1, s. 16(2)), 54(c)(ii)(A).