Caisse Populaire de Daveluyville ( Aro ( 1984 ) Inc. ) v. Canada
A-316-94
Létourneau J.A.
29/10/98
9 pp.
Appeal from Trial Division decision ((1994), 2 G.T.C. 7259) holding appellant liable, pursuant to Excise Tax Act, to pay sales tax on goods of Aro (1984) Inc., sold between September 4 and 30, 1987-Appellant holding several securities on goods including trust deed, general assignment of debts and transfer of property in stock-Act, s. 27(1) imposing consumption and sales tax on all goods produced or manufactured in Canada and requires manufacturer or producer to levy, collect and pay tax-S. 2(1)(a) stating "manufacturer or producer" including assignee and any person who continues business of manufacturer or producer or disposes of his assets in any fiduciary capacity-S. 27(3) making any person who acquires right to sell goods from manufacturer, producer or transferee, and who sells goods, liable to pay tax-Trial Judge properly found appellant had in fact continued business of furniture manufacturer Aro to reduce losses appellant stood to suffer because of credit extended and immediate discontinuance of appellant's operations-Exercise of rights and powers vested in transferee under transfer of property in stock does not occur only in cases where transferee takes possession of property-Transferee himself or herself not required to take possession of property transferred as security-Appellant did in fact exercise control over property in possession of appellant's mandatary and sale of property occurred for sole benefit of appellant in order to reduce line of credit appellant had extended to transferor-Taken as whole, actions of appellant indicate rights and powers vested in appellant by transfer of property in stock exercised-Appeal dismissed-Excise Tax Act, R.S.C. 1970, c. E-13, ss. 2(1)(a), 27(1), (3).