Judgment of the Court
Taschereau, Fauteux, Abbott, Martland and Judson JJ. 1119601 'Ex. C.R. 512, 60 D.T.C. 1189.
TASCHEREAU J.:-Section 80A, c. 179 (R.S.C. 1927 and THS amendments) provides that:
80A. 1. There shall be imposed, levied and collected, an excise tax INC.
equal to twenty-five per cent of the current market value of all dressed furs, dyed furs and dressed and dyed furs,- (i) imported into Canada, payable by the importer or transferee of such goods before they are removed from the custody of the proper customs officer; or
(ii) dressed, dyed, or dressed and dyed in Canada, payable by the dresser or dyer at the time of delivery by him.
2. Every person liable for taxes under this section shall, in addition to the returns required by subsection one of section one hundred and six of this Act, file each day a true return of the total taxable value and the amount of tax due by him on his deliveries of dressed furs, dyed furs, and dressed and dyed furs for the last preceding business day, under such regulations as may be prescribed by the Minister.
3. The said return shall be filed and the tax paid not later than the first business .day following that on which the deliveries were made. . . . The respondent M. Geller Inc. is a dealer in sheepskins, and some of this material was dressed in Canada by Nu- Way Lambskin Processors Ltd., both firms operating in the city and district of Montreall.
Nu-Way, as dresser was responsible for the payment of the tax under s. 80A, and paid $20,011.72 to Her Majesty the Queen, and on March 8, 1957, the present respondent and Nu-Way filed a Petition of Right claiming from Her Majesty the Queen the sum of $20,956.74. It is argued that the tax imposed on dressed furs in Canada is illegal because sheepskin is not a fur falling within the meaning of the Act. It is admitted by all parties that M. Geller Inc. reimbursed to Nu-Way the sum of $20,956.74 paid to Her Majesty the Queen by the latter.
I Both Nu-Way and the respondent M. Geller Inc. claimed a refund of the amount paid. The respondent in the present case alleged that it was the only one that was required to pay the tax, that it paid the tax through the intermediary of Nu-Way Lambskin and that, having made a demand for refund in writing within two years from the date of payment, as required by the Act, it was entitled to such a refund.
The learned trial judge' dismissed the Petition of Right of the suppliant Nu-Way Lambskin on the ground that it 1[1960] Ex. C.R. 512. 60 D.T.C. 1189.
'630 failed to apply for a refund within the statutory delay. Section 105(6) provides as follows:
The claim of the respondent however was maintained on the ground that the right to claim a refund is open to any person who has paid moneys which have been taken to account as taxes imposed by the Act and that the evidence established that the respondent is in fact the person who paid the moneys in question to Her Majesty.
It is clear and admitted that the said sum of $20,956.74 was paid as tax and that it was not legally owing, as this Court decided in several cases and particularly in Universal Furs Dressers and Dyers Ltd. v. Her Majesty the Queen'. In that case it was held by this Court that mouton was not fur and, therefore, not taxable under s. 80A of the Excise Tax Act. Before this Court Nu-Way did not appeal, and we are concerned therefore only with the appeal of Her Majesty the Queen against the present respondent. I have reached the conclusion that this appeal should be allowed and the Petition dismissed in part.
The person obliged to pay the tax is the dresser, and the person entitled to a refund is the dresser if the tax has been paid through mistake of law or fact. In the present case, the tax. was paid by the dresser Nu-Way and it was the sole person entitled to a refund. This was denied by the Exchequer Court, and rightly in view of the terms of s. 105, para. 6. The respondent has no legal right to dlaim. It is true that M. Geller Inc. reimbursed Nu-Way, but this payment does not give a right of action to the former, which the law denies.
The arrangements made between Geller and Nu-Way are of no concern to the appellant. They are "res inter alios acta" and cannot affect the rights of the Crown.
The appdal must therefore be allowed with costs, and the Petition dismissed except as to an amount of $945.02. It is
Statutes and regulations cited
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Unresolved citations
- Section 105(6)