[2013] 2 F.C.R. D-12
Income Tax
Corporations
Income Calculation—Deductions—Losses—Appeal from Tax Court of Canada (T.C.C.) decision (2012 TCC 30) confirming reassessment by Minister of National Revenue denying business investment loss (BIL) claimed by appellant on basis that corporation receiving loan not carrying on “active business”, not “small business corporation” pursuant to Income Tax Act, R.S.C., 1985 (5th Supp.), c. 1, s. 248(1)—Corporation incorporated to acquire, operate or sell producing oil, gas properties—T.C.C. determining that word “active” descriptive of word “business”, not meant to be overlooked—Concluding that appellant failing to produce evidence to support position that corporation active business, i.e. business that is carried on—Whether T.C.C. applying proper legal test in confirming that BIL properly denied, whether evidence supporting conclusion reached by T.C.C. when proper test applied—T.C.C. erring when holding that more required in order to conclude that corporation carrying on “active business”—Documentary evidence establishing that business in existence at relevant time—When definition of “active business”, “small business corporation” read together, term “active business” meaning “any business carried on by the taxpayer”—This reading not overlooking word “active” in expression “active business”, but taking into account defined meaning given to these words—Reading consistent with legislative history surrounding words “active business”—When regard had to definition of “active business”, corporation held to qualify if carrying on business at relevant time—Admission by respondent that corporation actively pursuing ventures leading to conclusion that corporation meeting condition of “active business”—Appeal allowed.
Ollenberger v. Canada (A-89-12, 2013 FCA 74, Noël J.A., judgment dated March 8, 2013, 13 pp.)