Minister of National Revenue v. Chamandy, (2014) 452 F.T.R. 261 (FC)

JudgeMactavish, J.
CourtFederal Court (Canada)
Case DateMarch 31, 2014
JurisdictionCanada (Federal)
Citations(2014), 452 F.T.R. 261 (FC);2014 FC 354

MNR v. Chamandy (2014), 452 F.T.R. 261 (FC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2014] F.T.R. TBEd. AP.039

Minister of National Revenue (applicant) v. Glenn Chamandy (respondent)

(T-1812-13; 2014 FC 354; 2014 CF 354)

Indexed As: Minister of National Revenue v. Chamandy

Federal Court

Mactavish, J.

April 11, 2014.

Summary:

The Minister of National Revenue applied for a compliance order against Chamandy, a director and shareholder of 7049960 Canada Inc., based upon his alleged failure to comply with the November 29, 2012 demand letter issued by the Canada Revenue Agency under the authority of s. 231.1 of the Income Tax Act (ITA). The demand letter sought the production of specified books, records and information which, it was alleged, were requested in the course of an income tax compliance audit with respect to 7049960.

The Federal Court dismissed the application. "In light of the uncertainty as to the true addressee of the November 29, 2012 demand letter, the Minister has not satisfied me that Mr. Chamandy was personally required to provide the documents and information sought. Consequently, one of the constituent elements of paragraph 231.7(1)(a) of the ITA has not been satisfied, with the result that the Minister's application is dismissed."

Income Tax - Topic 9210

Enforcement - Records and books - [See Income Tax - Topic 9256 ].

Income Tax - Topic 9256

Enforcement - Production of information - Demand of information - Compliance - The Minister of National Revenue applied for a compliance order against Chamandy, a director and shareholder of 7049960 Canada Inc., based upon his alleged failure to comply with a demand letter issued under s. 231.1 of the Income Tax Act (ITA) - The demand letter sought the production of specified books, records and information which, it was alleged, were requested in the course of an income tax compliance audit with respect to 7049960 - The Federal Court dismissed the application - It was not clear whether the demand letter was directed to 7049960 or to Chamandy in his personal capacity - Consequently, the Court was not persuaded that the first requirement of s. 231.7 of the ITA had been satisfied by the Minister - The demand letter was addressed to 7049960 - There was no reference to possible imprisonment as a sanction for non-compliance - It was unclear whether the salutation "Dear Mr. Chamandy" was addressed to Chamandy in his personal capacity, or as a representative of 7049960 - Given the potentially serious consequences that could flow from non-compliance, "I should not exercise my discretion to order the production of the documents sought by the Minister under s. 231.7 of the ITA unless I have been satisfied that the statutory conditions of this section have clearly been met." - See paragraphs 26 to 42.

Income Tax - Topic 9256

Enforcement - Production of information - Demand of information - Compliance - The Minister of National Revenue applied for a compliance order against Chamandy, a director and shareholder of 7049960 Canada Inc., based upon his alleged failure to comply with the November 29, 2012 demand letter issued by the Canada Revenue Agency under the authority of s. 231.1 of the Income Tax Act (ITA) - The demand letter sought the production of specified books, records and information which, it was alleged, were requested in the course of an income tax compliance audit with respect to 7049960 - The Federal Court dismissed the application, given its finding that one of the constituent elements of s. 231.7(1)(a) of the ITA had not been satisfied - Although it had not been necessary to address the parties' submissions with respect to the issue of solicitor/client privilege, the Court did not wish to conclude "without expressing my dismay over the fact that the November 29, 2012 demand letter expressly sought the disclosure of advice provided by lawyers with respect to a number of issues. As counsel for the Minister quite properly conceded at the hearing, this information was clearly protected by solicitor/client privilege. As a consequence, production of the information should never have been sought." - See paragraph 44.

Income Tax - Topic 9281

Enforcement - Lawyer-client privilege from disclosure - General - [See second Income Tax - Topic 9256 ].

Cases Noticed:

Minister of National Revenue v. SML Operations (Canada) Ltd., [2003] F.T.R. Uned. 459; 2003 FC 868, refd to. [para. 31].

Statutes Noticed:

Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 231.1(1), sect. 231.7(1)(a), sect. 231.7(1)(b), sect. 231.7(3), sect. 231.7(4) [para. 25].

Counsel:

Jack Warren and Andrew Miller, for the applicant;

Guy du Pont, Ad. and Michael Lubetsky, for the respondent.

Solicitors of Record:

William F. Pentney, Deputy Attorney General of Canada, Ottawa, Ontario, for the applicant;

Davis Ward Phillips & Vineberg LLP, Montreal, Quebec, for the respondent.

This application was heard at Toronto, Ontario, on March 31, 2014, before Mactavish, J., of the Federal Court, who delivered the following reasons for judgment and judgment, dated April 11, 2014, at Ottawa, Ontario.

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12 practice notes
  • Table of Cases
    • Canada
    • Irwin Books International Tax Evasion in the Global Information Age
    • June 23, 2021
    ...Canada (National Revenue) v BP Canada Energy Co, 2015 FC 714 ............................ 99 Canada (National Revenue) v Chamandy, 2014 FC 354 ................................................ 99 Canada (National Revenue) v Lee, 2015 FC 634 .........................................................
  • Canada (National Revenue) v. Zeifmans LLP,
    • Canada
    • Federal Court (Canada)
    • July 21, 2023
    ...sought by the Minister unless the statutory conditions of section 231.7 have been clearly met: Minister of National Revenue v Chamandy, 2014 FC 354 at para 41 [Chamandy]; Minister of National Revenue v SML Operations (Canada) Ltd, 2003 FC 868 at para 15 [SML]. Zeifmans submits the statutory......
  • International Tax Enforcement in Canada
    • Canada
    • Irwin Books International Tax Evasion in the Global Information Age
    • June 23, 2021
    ...where the Minister was successful in obtaining a compliance order, and for the opposite result, Canada (National Revenue) v Chamandy , 2014 FC 354. 30 Act , above note 1, s 231.7(4). 31 Ibid , ss 231.2(1)(a) & (b). 100 • InternatIonal tax evasIon In the Global InformatIon aGe facts. In orde......
  • Friedman v. Canada (National Revenue), 2021 FCA 101
    • Canada
    • Court of Appeal (Canada)
    • May 26, 2021
    ...(Canada) Ltd., 2003 FC 868, [2003] F.C.J. No. 1111 (QL) at paras. 13-14 [SML], Canada (Minister of National Revenue) v. Chamandy, 2014 FC 354, 452 F.T.R. 261 at paras. 27-29 [Chamandy], Lin at para. 22. [14] The Federal Court reviewed the jurisprudence cited above and noted that in each cas......
  • Request a trial to view additional results
9 cases
  • Canada (National Revenue) v. Zeifmans LLP,
    • Canada
    • Federal Court (Canada)
    • July 21, 2023
    ...sought by the Minister unless the statutory conditions of section 231.7 have been clearly met: Minister of National Revenue v Chamandy, 2014 FC 354 at para 41 [Chamandy]; Minister of National Revenue v SML Operations (Canada) Ltd, 2003 FC 868 at para 15 [SML]. Zeifmans submits the statutory......
  • Friedman v. Canada (National Revenue), 2021 FCA 101
    • Canada
    • Court of Appeal (Canada)
    • May 26, 2021
    ...(Canada) Ltd., 2003 FC 868, [2003] F.C.J. No. 1111 (QL) at paras. 13-14 [SML], Canada (Minister of National Revenue) v. Chamandy, 2014 FC 354, 452 F.T.R. 261 at paras. 27-29 [Chamandy], Lin at para. 22. [14] The Federal Court reviewed the jurisprudence cited above and noted that in each cas......
  • Canada (National Revenue) v. Ghermezian, 2022 FC 236
    • Canada
    • Federal Court (Canada)
    • February 23, 2022
    ...have been “clearly met” before exercising its discretion to grant an order (see Minister of National Revenue v Chamandy, 2014 FC 354 [Chamandy] at para 35; Canada (Minister of National Revenue) v SML Operations (Canada), 2003 FC 868 [SML Operations] at para 15). [19] The Respo......
  • Canada (National Revenue) v. Friedman, 2019 FC 1583
    • Canada
    • Federal Court (Canada)
    • December 10, 2019
    ...of National Revenue) v SML Operations (Canada) Ltd, 2003 FC 868 [SML], and affirmed in Canada (Minister of National Revenue) v Chamandy, 2014 FC 354 [Chamandy]. [21] Although SML and Chamandy were known to the Friedmans’ counsel well before their motion to amend their pleadings, they argue ......
  • Request a trial to view additional results
1 firm's commentaries
  • CaseNotes For October, 2019
    • Canada
    • Mondaq Canada
    • October 16, 2019
    ...Justice Boswell noted that the criteria for the issuance of a compliance order was summarized in Canada (National Revenue) v Chamandy, 2014 FC 354, which were as The person against whom the order is sought was required under section 231.1. or 231.2 to provide the access, assistance, informa......
2 books & journal articles
  • Table of Cases
    • Canada
    • Irwin Books International Tax Evasion in the Global Information Age
    • June 23, 2021
    ...Canada (National Revenue) v BP Canada Energy Co, 2015 FC 714 ............................ 99 Canada (National Revenue) v Chamandy, 2014 FC 354 ................................................ 99 Canada (National Revenue) v Lee, 2015 FC 634 .........................................................
  • International Tax Enforcement in Canada
    • Canada
    • Irwin Books International Tax Evasion in the Global Information Age
    • June 23, 2021
    ...where the Minister was successful in obtaining a compliance order, and for the opposite result, Canada (National Revenue) v Chamandy , 2014 FC 354. 30 Act , above note 1, s 231.7(4). 31 Ibid , ss 231.2(1)(a) & (b). 100 • InternatIonal tax evasIon In the Global InformatIon aGe facts. In orde......

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