Canada v. Chambers
T-1418-93 / T-1420-93 / T-1421-93
Tremblay-Lamer J.
15/1/96
12 pp.
Appeal from Tax Court decision allowing taxpayers' appeal from assessments regarding tax consequences of series of transactions involving acquisitions and dispositions of non-qualified investments made by RRSP trust-Monies paid out to RRSP trust in settlement of debt constituting disbursement for purposes of s. 245(1)-S. 245(1) disallowing income deduction where: (1) transactions outside spirit or scope of section permitting such scheme; and (2) transactions reducing income unduly or artificially-Parliament's objective to discourage annuitant from holding insecure investments; however, as bank letter of guarantee given to RRSP trust, investment not insecure-Parliament not including provision disallowing acquisition and disposition transactions to happen in series; Parliament disallowing series type transactions elsewhere in Act-Disposition of non-qualified investment in same taxation year resulting in deduction equal to amount of income included; taxpayer knowingly using deduction within same year not bringing transaction outside scope of statutory scheme-Word "artificial" meaning fictitious; nothing fictitious in paying off indebtedness to RRSP trust-Fact no interest paid to RRSP not sufficient to render disbursement artificial or fictitious-Appeals dismissed-Income Tax Act, S.C. 1970-71-72, c. 63, s. 245(1).