CCLI (1994) Inc. v. Canada, 2007 CAF 185 (2007)

Date: 20070514

Docket: A-237-06

Citation: 2007 FCA 185

CORAM: NADON J.A.

SHARLOW J.A.

PELLETIER J.A.

BETWEEN:

CCLI (1994) INC.

Appellant

and

HER MAJESTY THE QUEEN

Respondent

Heard at Vancouver, British Columbia , on March 29, 2007.

Judgment delivered at Ottawa, Ontario , on May 14, 2007.

REASONS FOR JUDGMENT BY: SHARLOW J.A.

CONCURRED IN BY: NADON J.A.

PELLETIER J.A.

Date: 20070514

Docket: A-237-06

Citation: 2007 FCA 185

CORAM: NADON J.A.

SHARLOW J.A.

PELLETIER J.A.

BETWEEN:

CCLI (1994) INC.

Appellant

and

HER MAJESTY THE QUEEN

Respondent

REASONS FOR JUDGMENT

SHARLOW J.A.

[1] This is an appeal by CCLI (1994) Inc. of a judgment of the Tax Court of Canada (2006 TCC 240) dismissing income tax appeals relating to assessments for 1989, 1990 and 1993 and loss determinations for 1991 and 1992. One issue is whether foreign exchange gains and losses incurred in respect of money borrowed to finance CCLI’s equipment leasing transactions are to be treated for income tax purposes as income or capital. The other issue is whether, in the circumstances of this case, the Income Tax Act , R.S.C. 1985, c. 1 (5 th Supp.) requires CCLI to deduct more of its 1991 non-capital loss in 1989 than it has chosen to deduct.

Foreign exchange gains and losses

[2] During the years under appeal, CCLI was a wholly owned subsidiary of Citibank Canada , a Canadian chartered bank. Citibank Canada is subject to the Bank Act , S.C. 1991, c. 46. Prior to 1992, Citibank Canada was precluded by the Bank Act from providing financing to its customers through leasing transactions. Citibank Canada could, however, own a ...

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