M.N.R. v. Bethlehem Copper Corp. Ltd., [1975] 2 S.C.R. 790 (1974)

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M.N.R. v. Bethlehem Copper Corp. Ltd., [1975] 2 S.C.R. 790 (1974)

Supreme Court of Canada

M.N.R. v. Bethlehem Copper Corp. Ltd., [1975] 2 S.C.R. 790

Date: 1974-10-01

Minister of National Revenue Appellant;

and

Bethlehem Copper Corporation Ltd. Respondent.

1974: February 25, 26; 1974: October 1.

Present: Martland, Judson, Pigeon, Dickson and Beetz JJ.

ON APPEAL FROM THE FEDERAL COURT OF APPEAL

Taxation-New mine-Exemption-Adjacent ore bodies-Successive mining operations by means of separate extraction facilities-Processing by same mill-Right to tax benefit for each ore body-Income Tax Act, R.S.C., 1952, c. 148 as amended, s. 83(5).

Respondent was incorporated for the purpose of exploring and dredging certain copper mineral claims in the Highland Valley area of British Columbia. In 1958 the exploratory and proving work revealed two substantial and distinct ore bodies in the Jersey and East Jersey zones. Respondent decided, as a matter of economic necessity, to develop each of the two zones separately by two individual pits. Production from the East Jersey ore body was commenced on December 31, 1962, with a mill having a capacity of 3,300 tons per day. The ore was extracted by means of open pit mining. At that capacity, the East Jersey ore body would have been mined out in approximately three years. Respondent obtained tax exemption under s. 83(5) of the Income Tax Act for the period commencing December 1, 1962, when production in reasonable commercial quantities commenced from the East Jersey ore body....

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