Artistic Ideas Inc. v. Canada Customs and Revenue Agency, (2005) 330 N.R. 378 (FCA)
Judge | Rothstein, Sexton and Evans, JJ.A. |
Court | Federal Court of Appeal (Canada) |
Case Date | February 14, 2005 |
Jurisdiction | Canada (Federal) |
Citations | (2005), 330 N.R. 378 (FCA);2005 FCA 68 |
Artistic Ideas Inc. v. CCRA (2005), 330 N.R. 378 (FCA)
MLB headnote and full text
Temp. Cite: [2005] N.R. TBEd. MR.008
Canada Customs and Revenue Agency (appellant) v. Artistic Ideas Inc. (respondent)
(A-266-04; 2005 FCA 68)
Indexed As: Artistic Ideas Inc. v. Canada Customs and Revenue Agency
Federal Court of Appeal
Rothstein, Sexton and Evans, JJ.A.
February 25, 2005.
Summary:
The applicant arranged the sale of art work to individual taxpayers who donated the art works to registered charities. The donors obtained a tax benefit from such donations based on the appraised value of the art works, which exceeded what the donors paid for them. The transactions were sometimes referred to as "art flips". The Minister began an audit of the applicant. A requirement to provide information and documents was served on the applicant pursuant to s. 231.2(1) of the Income Tax Act. The applicant applied for an order striking the portion of the requirement that required the applicant to provide the names of the donors and charities.
The Federal Court, in a decision reported at 251 F.T.R. 223, set aside that part of the requirement which purported to require the applicant to provide the names of the donors without prior judicial authorization. The requirement as it related to disclosure of the names of the charities was valid and no judicial authorization was necessary. The applicant appealed.
The Federal Court of Appeal dismissed the appeal.
Income Tax - Topic 9258
Enforcement - Production of information - Demand of information - Respecting unnamed persons - The applicant arranged the sale of art work to individual taxpayers who donated the art works to registered charities - The donors obtained a tax benefit from such donations based on the appraised value of the art works, which exceeded what the donors paid for them - The transactions were sometimes referred to as "art flips" - The Minister began an audit of the applicant - A requirement to provide information and documents was served on the applicant pursuant to s. 231.2(1) of the Income Tax Act, requesting the names of the donors and the charities - The Federal Court held that since the Minister intended to investigate and reassess the donors, the Minister was only entitled to demand disclosure of the names of the donors by obtaining prior judicial authorization pursuant to ss. 231.2(2) and (3) of the Act - Since there was no evidence that the Minister wanted to audit the charities, disclosure of the names of the charities was a valid part of the requirement without prior judicial authorization - The Federal Court of Appeal dismissed an appeal.
Income Tax - Topic 9258
Enforcement - Production of information - Demand of information - Respecting unnamed persons - The Federal Court of Appeal stated that under the scheme of s. 231.2 of the Income Tax Act, the Minister could require a third party to provide information and documents pertaining to the third party's compliance with the Act - However, the Minister could not impose a requirement on the third party to provide information or documents relating to unnamed persons who he wished to investigate, unless he first obtained judicial authorization (ss. 231.2(2) and (3)) - A judge could authorize the Minister to require such information only if the unnamed persons were ascertainable and only if satisfied that information or documents relating to them was required to verify compliance by them with the Act - Where unnamed persons were not themselves under investigation, ss. 231.2(2) and (3) did not apply and judicial authorization was not necessary - See paragraphs 8 to 11.
Cases Noticed:
Richardson (James) & Sons Ltd. v. Minister of National Revenue, [1984] 1 S.C.R. 614; 54 N.R. 241, refd to. [para. 9].
Canadian Bank of Commerce v. Canada (Attorney General), [1962] S.C.R. 729; 35 D.L.R.(2d) 49, refd to. [para. 9].
R. v. Van Egmond (A.) (2002), 166 B.C.A.C. 264; 271 W.A.C. 264; 215 D.L.R.(4th) 697; 2002 BCCA 226, refd to. [para. 14].
Statutes Noticed:
Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 231.2(1), sect. 231.2(2), sect. 231.2(3) [para. 7].
Counsel:
Peter A. Vita, Q.C., and P. Tamara Sugunasiri, for the appellant;
Martin Teplitsky, Q.C., for the respondent.
Solicitors of Record:
John H. Sims, Q.C., Deputy Attorney General of Canada, Ottawa, Ontario, for the appellant;
Teplitsky, Colson, Toronto, Ontario, for the respondent.
This appeal was heard on February 14, 2005, at Toronto, Ontario, before Rothstein, Sexton and Evans, JJ.A., of the Federal Court of Appeal. The following judgment of the Court of Appeal was delivered by Rothstein, J.A., on February 25, 2005.
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Table of Cases
...Mines d’Or Ltée v Canada (AG), 2010 FC 1070 .................311–12 Artistic Ideas Inc v Canada Revenue Agency, 2004 FC 573, af’d 2005 FCA 68 ......................................................................................................100 Barquero v United States, 18 F 3d 1311 (5th......
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Canada (National Revenue) v. Zeifmans LLP, 2023 FC 1000
...“consistent at a conceptual level with much authority”, including Canada (Customs and Revenue Agency) v Artistic Ideas Inc, 2005 FCA 68 [Artistic Ideas FCA] and eBay Canada Ltd v MNR, 2008 FCA 348 [eBay]. The Minister states Zeifmans is attempting to revive an interpretation......
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International Tax Enforcement in Canada
...CA, above note 12; MNR v Sand Exploration Ltd (1995), 95 DTC 5469 (FCTD); Artistic Ideas Inc v Canada Revenue Agency , 2004 FC 573, af’d 2005 FCA 68. 34 See Michael Ziesmann, “Gone Fishing: An Analysis of CRA Powers and Policies relating to the Use of Fishing Expeditions in Information Gath......
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Ghermezian v. Canada (Attorney General), 2020 FC 1137
...the leading authorities are the decisions of the Federal Court of Appeal in Canada (Customs and Revenue Agency) v Artistic Ideas Inc., 2005 FCA 68 [Artistic Ideas] and the subsequent decision of the Supreme Court of Canada in Redeemer Foundation v Minister of National Revenue, 2008 SCC 46 ......
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Canada (National Revenue) v. Zeifmans LLP, 2023 FC 1000
...“consistent at a conceptual level with much authority”, including Canada (Customs and Revenue Agency) v Artistic Ideas Inc, 2005 FCA 68 [Artistic Ideas FCA] and eBay Canada Ltd v MNR, 2008 FCA 348 [eBay]. The Minister states Zeifmans is attempting to revive an interpretation......
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Ghermezian v. Canada (Attorney General), 2020 FC 1137
...the leading authorities are the decisions of the Federal Court of Appeal in Canada (Customs and Revenue Agency) v Artistic Ideas Inc., 2005 FCA 68 [Artistic Ideas] and the subsequent decision of the Supreme Court of Canada in Redeemer Foundation v Minister of National Revenue, 2008 SCC 46 ......
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Zeifmans LLP v. Canada, 2022 FCA 160
...level with much authority: multiple binding decisions of this Court (Canada (Customs and Revenue Agency) v. Artistic Ideas Inc., 2005 FCA 68, 330 N.R. 378 and eBay Canada Ltd. v. Canada (National Revenue), 2008 FCA 348, [2010] 1 F.C.R. 145 at para. 23); an obiter of the Supreme Court of Can......
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Minister of National Revenue v. Greater Montréal Real Estate Board, (2006) 303 F.T.R. 29 (FC)
...Exploration Ltd. et al. (1995), 96 F.T.R. 113 (T.D.), refd to. [para. 17]. Artistic Ideas Inc. v. Canada Customs and Revenue Agency (2005), 330 N.R. 378; 2005 FCA 68, refd to. [para. Redeemer Foundation v. Minister of National Revenue (2005), 281 F.T.R. 143; 2005 FC 1361, refd to. [para. 17......
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Table of Cases
...Mines d’Or Ltée v Canada (AG), 2010 FC 1070 .................311–12 Artistic Ideas Inc v Canada Revenue Agency, 2004 FC 573, af’d 2005 FCA 68 ......................................................................................................100 Barquero v United States, 18 F 3d 1311 (5th......
-
International Tax Enforcement in Canada
...CA, above note 12; MNR v Sand Exploration Ltd (1995), 95 DTC 5469 (FCTD); Artistic Ideas Inc v Canada Revenue Agency , 2004 FC 573, af’d 2005 FCA 68. 34 See Michael Ziesmann, “Gone Fishing: An Analysis of CRA Powers and Policies relating to the Use of Fishing Expeditions in Information Gath......