Section 241

The taxpayer participated in an alleged tax avoidance scheme involving the subscription of units in a corporation that generated dubious business losses. In the course of largely allowing the taxpayer's application under the Access to Information Act for the Minister's records on the taxpayer, O'Keefe J disallowed the taxpayer's request for the tax information of the corporation, as this would be "the same as allowing a home buyer to access a realtor's tax records" (para. 66). The taxpayer was unable to demonstrate that the corporate information was necessary to prosecute her own appeal.

In an action by the mortgagee of a building against Revenue Canada for damages sustained by the building in the course of a seizure, the Crown refused to supply documents containing docket notations made by four collections officers. Décary J.A. noted that the purpose of ss.241(1)(a) and (b) was to protect from disclosure information obtained by the Minister from other persons, and not internally generated documents which are not based on outside information but which instead were generated as "part of a process, the collection proceedings, which is in itself in the public domain and which involves by its very nature the publication of information that would otherwise have remained confidential" (p. 5031). In addition, "section 241 was not enacted for the purpose of helping the Minister out of a negligence claim" (p. 5031), and the Court was not prepared to interfere with the finding of Collier J., who had examined the documents, that their disclosure would entail no breach of confidentiality.

It was held that although the Unified Family Court did not have the power to order Revenue Canada to produce records of the respondent that it had seized, the Court in an action by the applicant for the variation of a maintenance order could order the respondent to authorize Revenue Canada to produce those records to counsel for the applicant.

Docket notations made by four Collection Investigations Officers of Revenue Canada came into existence as a result of collection proceedings started against the mortgagor of the plaintiff, and were not made or gathered by the Minister for the purposes of the Act (i.e., respecting general income tax information, procedures and investigations).

The provision of the Appellants' tax return to the Crown prosecutor in connection with a review as to whether the Appellants were suffering from financial hardship which should affect their sentencing for an offence committed by them under the Meat Inspection Act (Canada) was not authorized under s. 241(3)(a) as that statute dealt with regulatory offences rather than criminal offences.

The respondent had commenced an action alleging that the Minister, in giving a ruling, had bestowed an undue preference and special benefit on the taxpayer who received it. Sharlow J.A. described an argument of the Crown that s. 241(3)(b) precluded the Minister from disclosing the name of the person to whom the ruling had been granted as an argument that "in essence ... a legal proceeding that seeks to uncover improper administration of the Income Tax Act cannot be said to be related to its administration", and characterized such an argument as illogical and unacceptable. However, this finding did not prevent the Crown from resisting disclosure on the basis of seeking a judicial determination that there was a specified public interest against disclosure of such name.

Before going on to confirm the decision of the Tax Court Judge to allow the appeal of the respondent from an assessment for UIC premiums in relation to temporarial secretary help obtained by him because of a failure of Revenue Canada to produce the income tax returns of the secretary's, Mohoney J.A. noted that amendments to s. 241 would not have prevented what had happened here (pp. 107 - 108):

"The prohibition of s-s.(2) against disclosure of an income tax return 'in connection with any legal proceedings' is subject to the exception of s-s.(3)(b) as to proceedings relating to the administration or enforcement of, among others, the Unemployment Insurance Act ... The order made here can still be made without a taxpayer knowing that his or her return is required to be disclosed in its entirety to a business connection."

A trustee in bankruptcy of a taxpayer was permitted to introduce testimony of two Revenue Canada officials in proceedings instituted in the New Brunswick Court of Queen's Bench for a declaration that certain assets registered in the name of the taxpayer's wife were held in trust for the taxpayer's estate. After noting (at p. 5447) that the phrase "relating to" in s. 241(3) had the same wide scope as "in respect of," Iacobucci, J. found that the proceedings related to the enforcement of the Act because their ultimate purpose was the payment of taxes owed to Revenue Canada, which was a preferred beneficiary of the estate. In addition, a contrary conclusion would result in the absurdity that confidential information obtained by Revenue Canada could not be disclosed in proceedings initiated by the trustee in bankruptcy, whereas if the trustee in bankruptcy refused to act and Revenue Canada then took the same proceedings under s. 38(1) of the Bankruptcy Act, such information could arguably be disclosed. Finally, as a policy matter, there was no valid reason why the Minister should be inhibited from recourse to the bankruptcy process, as opposed to being restricted to the administrative remedies set out in Part XV of the Act, such as that contained in s. 160.

Communication of information by Revenue Canada officers to public officers engaged in the prosecution of criminal offences where that information may be of relevance to the offences being prosecuted is within the permitted scope of the subsection.

The taxpayer, in a V-Day value dispute, was permitted to call evidence of another taxpayer's assessment with the consent of that taxpayer.

A seizure by police officers conducting a criminal investigation of documents in the possession of Revenue Canada pursuant to a search warrant was effected "in respect of criminal proceedings."