2758-4747 QUÉBEC INC.
MINISTER OF NATIONAL REVENUE
Appeal No. AP-2005-002
Decision and reasons issued
Wednesday, May 10, 2006
TABLE OF CONTENTS
IN THE MATTER OF an appeal heard on January 31, 2006, under
section 81.19 of the Excise Tax Act, R.S.C. 1985, c.
AND IN THE MATTER OF decisions of the Minister of National
Revenue dated January 18, 2005, with respect to objections to
determinations of the Minister of National Revenue under section
81.17 of the Excise Tax Act.
2758-4747 QUÉBEC INC.
THE MINISTER OF NATIONAL REVENUE
OF THE TRIBUNAL
The appeal is dismissed.
Meriel V. M. Bradford
Meriel V. M. Bradford
Place of Hearing:
Date of Hearing:
January 31, 2006
Pierre Gosselin, Presiding Member
Meriel V. M. Bradford, Member
Elaine Feldman, Member
Counsel for the Tribunal:
Clerk of the Tribunal:
Ghislain Bernier and Natacha Jodoin, for the appellant
Yannick Landry, for the respondent
Please address all communications to:
Canadian International Trade Tribunal
Standard Life Centre
333 Laurier Avenue West
Telephone: (613) 993-3595
Fax: (613) 990-2439
1. This is an appeal pursuant to section 81.19 of the Excise
from eight decisions of the Minister of
National Revenue (the Minister) dated January 18, 2005, with
respect to objections to determinations of the Minister under
section 81.17 of the Act.
2. The issue in this appeal is whether 2758-4747 Québec Inc. is
entitled to a refund of excise tax paid on the portion of diesel
fuel purchased in Canada and transported outside of Canada in the
fuel tank of a vehicle, but consumed in the United States, for the
period from January 1, 2001, to December 31, 2002.
3. This is one of a series of appeals under the Act that
have arisen as a result of the Government’s decision to respond
legislatively to the decision of the Federal Court of Appeal in
Penner International Inc. v.
4. Following the decision in Penner, the Government
announced in the Federal Budget of February 18, 2003, its
intention to amend Part VII of the Act to clarify that
diesel fuel taken out of the country in the fuel tank of a vehicle
does not qualify as an export and that no rebate of tax is payable
in respect of that fuel. It also announced that the amendment would
apply to rebate applications received by the Canada Customs and
Revenue Agency (CCRA) (now the Canada Revenue Agency [CRA]) after
February 17, 2003.
5. Bill C-28, the Budget Implementation Act, 2003,
received royal assent on June 19, 2003.
6. Section 63 of the Budget Implementation Act, 2003
reads as follows:
63. (1) Section 68.1 of the Act is amended by adding the
following after subsection (2):
(3) For greater certainty, no amount is payable to a person
under subsection (1) in respect of tax paid on gasoline or diesel
fuel transported out of Canada in the fuel tank of the vehicle that
is used for that transportation.
63. (1) L’article 68.1 de la même loi est modifié par
adjonction, après le paragraphe (2), de ce qui suit :
(3) Il est entendu qu’aucun montant n’est à payer à une personne
aux termes du paragraphe (1) au titre de la taxe payée sur
l’essence ou le combustible diesel qui est transporté en dehors du
Canada dans le réservoir à combustible du véhicule qui sert à ce
(2) Subsection (1) applies in respect of any application for a
payment under section 68.1 of the Act received by the Minister of
National Revenue after February 17, 2003.
(2) Le paragraphe (1) s’applique à toute demande de paiement,
prévue à l’article 68.1 de la même loi, reçue par le ministre du
Revenu national après le 17 février 2003.
7. In its brief, 2758-4747 Québec Inc. alleged that it completed
its refund applications on March 4, 2003 and that the
refund applications were received by the CCRA on March 6, 2003. The
Minister did not contest those allegations. The parties agree that
the refund applications were not mailed to or received by the
Minister until after February 17, 2003.
8. The Tribunal decided to hold a hearing by way of written
submissions pursuant to Rules 25, 25.1 and 36.1 of the Canadian
International Trade Tribunal Rules,3
since there were no
material facts in dispute. The Tribunal gave notice of this
decision to the parties on November 29, 2005, and published a
notice to this effect in the January 14, 2006, edition of the
It invited 2758-4747 Québec Inc. to submit a
reply brief, if any, by January 3, 2006.
9. 2758-4747 Québec Inc. argued that it is entitled to a refund
because the refund applications were received by the CCRA on March
6, 2003, prior to the coming into force of the Budget
Implementation Act, 2003 on June 19, 2003.
10. 2758-4747 Québec Inc. further argued that, as a result of
the decision in Penner and the filing of its refund
applications on March 6, 2003, before the coming into force of the
Budget Implementation Act, 2003, it had “acquired rights”
and was entitled to the refunds for which it had applied.
11. 2758-4747 Québec Inc. submitted that the amendments to the
Act as a result of the coming into force of the Budget
Implementation Act, 2003 must respect the principle of repeal
(i.e. the continued application of the repealed legislation to
facts occurring before the repeal).
12. According to 2758-4747 Québec Inc., the Budget
Implementation Act, 2003 could only be effective in respect of
the 2003 tax year, as its purpose is to give effect to the 2003
Federal Budget. Therefore, it only applies to refund applications
received after February 18, 2003, for fuel exported after February
13. 2758-4747 Québec Inc. submitted that it would suffer serious
prejudice if it were denied its right to a refund by the passage of
legislation having retroactive effect to refund applications filed
after February 18, 2003. Accordingly, it argued that the
Tribunal should find that the refund applications were properly
filed and that 2758-4747 Québec Inc. is entitled to the refunds
claimed or, alternatively, remit the matter to the CRA for a
determination of the amount of refund to which 2758-4747 Québec
Inc. is entitled.
14. The Minister argued that section 63 of the Budget
Implementation Act, 2003 was clear and that it was expressly
intended to have retroactive effect.
15. The Minister further submitted that it was also clear that
any refund applications received by the Minister after
February 17, 2003, were not eligible for a refund; it was not
sufficient for an application to have been mailed on or before
February 17, 2003, it must actually have been received by February
16. Finally, the Minister argued that the Tribunal has no
jurisdiction to decide cases on the basis of principles of
17. Although a statute is presumed to have only prospective
effect, it is a rebuttable presumption.5
In Sullivan and
Dreidger on the Construction of Statutes, one can read:
“Retroactive legislation often states that it is deemed to come
into force or to take effect on a date prior to the date of
enactment . . . .”6
In Gustavson Drilling
(1964) Ltd. v. M.N.R.,7
the Supreme Court of Canada stated the
. . .
. . . The general rule is that statutes are not
to be construed as having retrospective operation unless such a
construction is expressly or by necessary implication required by
the language of the Act. An amending enactment may provide that it
shall be deemed to have come into force on a date prior to its
enactment or it may provide that it is to be operative with respect
to transactions occurring prior to its enactment. In those
instances, the statute operates
retrospectively . . . .8
18. The Supreme Court has reaffirmed, on several occasions, that
the presumption against retroactivity or interference with vested
rights can be rebutted by the express words of the statute or by
If the intended application of a statute is
not clear from a plain reading of the words of the statute, it is
necessary to ascertain the intent of the legislature to determine
if the statute was intended to operate retroactively or interfere
with vested rights.10
19. In construing a statute, the Tribunal must read the words in
their context and in their ordinary and grammatical sense in a
manner that is harmonious with the scheme of the act, the object of
the act and the intention of Parliament.11
20. The intention of the Government is expressed in clear terms
in The Budget Plan 2003
released on February
18, 2003. The Government explains that its past practice was not to
rebate tax paid on fuel that is transported outside of Canada in
the fuel tanks of a vehicle and similarly not to apply tax to fuel
transported into Canada in the fuel tanks of a vehicle. Further, it
expressly states that it is clarifying its position as a result of
the decision in Penner. Finally, it states its intention to
apply the amendment retroactively:
The budget proposes to amend Part VII of the Excise Tax Act to
clarify that fuel taken out of the country in the fuel tank of a
vehicle being driven across the border does not qualify as an
export and that no rebate of excise tax is payable in respect of
that fuel. It is proposed that this amendment apply to rebate
applications received by the Canada Customs and Revenue Agency on
or after February 18, 2003.13
21. The Budget Implementation Act, 2003, which became
effective on June 19, 2003, expressly amended section 68.1 of the
Excise Tax Act and expressly stated that the amendment
applied “. . . in respect of any application
for a payment under section 68.1 of the Act received by the
Minister of National Revenue after February 17, 2003.”
(Emphasis added). The legislation is not ambiguous. It was intended
to be retroactive to the date of the budget announcement and to
affect expectations (or rights) to receive a refund if the
application was received by the Minister after February
17, 2003. The Tribunal notes that retroactive application of
taxing legislation to the date of its announcement is not
22. The Tribunal has not previously interpreted the meaning of
the words “received by the Minister”. 14
The date on which
the application was received by the Minister is not in issue in
23. In the present case, the Tribunal notes that 2758-4747
Québec Inc. admitted that it did not complete its refund
applications until after February 17, 2003. Accordingly, it finds
that the refund applications were received by the Minister after
February 17, 2003, and that, therefore, 2758-4747 Québec Inc. is
ineligible for refunds pursuant to subsection 63(2) of the
Budget Implementation Act, 2003.
24. Finally, the Tribunal has held in several decisions that it
does not have jurisdiction to order equitable relief.15
obliged to respect statutory limitation periods even, for example,
if there was no prior notice of a tax change.16
limited to making findings within its express statutory mandate. It
is therefore unable to grant the equitable relief requested by
2758-4747 Québec Inc.
25. For the foregoing reasons, the appeal is dismissed.
. R.S.C. 1985, c. E-15 [Act].
.  2 F.C. 581 (C.A.)
. C. Gaz. 2006.I.110.
. See Ruth Sullivan, Sullivan and
Dreidger on the Construction of Statutes, 4th ed. (Markham:
. Ibid. at 562.
.  1 S.C.R. 271, Dickson J.
. Ibid. at 279. Subsequently, the
term “retrospective” used by Dickson J. has been more appropriately
referred to as “retroactive”. See Ruth Sullivan, Sullivan and
Dreidger on the Construction of Statutes, 4th ed. (Markham:
Butterworths, 2002) at 562.
. Venne v. Quebec (Commission de
protection du territoire agricole),  1 S.C.R. 880 at
paras 81 and 97-101; Dikranian v. Quebec (Attorney General),
 S.C.J. No. 75 (QL) at paras 30-36; British Columbia v.
Imperial Tobacco Canada Ltd.,  S.C.J. No. 50 (QL) at
paras 69-72 and 74-75; see also Air Canada v.
British-Columbia,  1 S.C.R. 1161 at 1192; and Grand
Rapids (Town) v. Graham,  M.J. No. 342 (Man. C.A.) (QL)
at paras 14 and 23-28.
. Quebec (Attorney General) v.
Healey,  1 S.C.R. 158 at 165-67.
. Bell ExpressVu Limited Partnership v.
Rex,  2 S.C.R. 559 at 580-81.
. Department of Finance Canada (Ottawa:
Canada, 2003) at 343.
. Ibid. at 344.
. The Tribunal has previously interpreted
the term “filed with the Minister” as meaning that an application
for a rebate is filed at the time that it is mailed and that the
postmark is evidence of that date. See e.g. Vern Glass Company
(1976) Limited v. M.N.R. (13 December 1993), AP-92-221 (CITT);
Lakhani Gift Store v. M.N.R. (15 November 1993),
AP-92-167 (CITT); Super Générateur Inc. v. M.N.R. (6 March
1996), AP-94-265 (CITT); Jorwalt Building Designers Ltd. v.
M.N.R. (4 September 1997), AP-96-012 (CITT); The
Satellite Station v. M.N.R. (15 July 1994), AP-93-279
(CITT); BDR Sportsnutrition Laboratories Ltd. v. M.N.R. (6
March 1996), AP-95-050 (CITT); Hergert Electric Ltd. v.
M.N.R. (7 June 1994), AP-93-089 (CITT); Wood v. M.N.R.
(28 February 1994), AP-93-050 (CITT); and Ryerson
Polytechnical Institute v. M.N.R. (24 November 1994), AP-93-303
. See e.g. Walbern Agri-Systems Ltd.
v. M.N.R. (21 December 1989), AP 3000 (CITT); Peniston
Interiors (1980) Inc. v. M.N.R. (22 July 1991), AP-89-225
(CITT); Sturdy Truck Body (1972) Limited v. M.N.R. (23 June
1989), AP 2979 (CITT); A.G. Green Co. Limited v. M.N.R.
(9 August 1990), AP-89-134 (CITT).
. Aerotec Sales and Leasing Ltd. v.
M.N.R. (25 January 1996), AP-94-114 (CITT); Power’s Produce
Ltd. v. M.N.R. (1 February 1993), AP-90-011 (CITT).