Federal Appeal


Income tax

Administration and enforcement

Use of information or documents is relevant to admissibility not who issued requirement

Minister re-assessed taxpayer for taxation years 2007 and 2008 including penalties for gross negligence. Taxpayer appealed and issued amended notice of appeal. Minister brought motion to strike several paragraphs. Motion was granted and offending paragraphs struck. Taxpayer appealed on ground whether in law plain and obvious that evidence obtained as result of issuance of requirement under s. 231.2(1) of Income Tax Act (ITA), when ongoing investigation cannot be excluded from proceedings before Tax Court under s. 8 of Charter. Appeal dismissed. While using s. 231.2 of ITA to obtain information or documents after investigation commenced may result in them being inadmissible in prosecution under s. 239 of ITA, this does not preclude information or documents being admissible in proceeding regarding validity of assessment. Use of information or documents that is relevant, not who issued requirement. Taxpayer in same position as any taxpayer appealing net worth assessment based on documents received following under s. 231.2 and should not be in better position simply because also under investigation under s. 239.

Bauer v. Canada (2018), 2018 CarswellNat 1220, 2018 FCA 62, Wyman W. Webb J.A., D.G. Near J.A., and J.B. Laskin J.A. (F.C.A.); affirmed (2016), 2016 CarswellNat 11212, 2016 CarswellNat 2096, 2016 TCC 136, 2016 CCI 136, K. Lyons J. (T.C.C. [General Procedure]).

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