| 7-921499 | |
| John Chan |
May 22, 1992
D R A F T
1992 VANCOUVER DISTRICT OFFICE ROUNDTABLE
QUESTION
Can Revenue Canada confirm that it will no longer apply its at-risk rules as they stood prior to the introduction of the statutory at-risk rules at subsections 96(2.1) to (2.7) given the Federal Court of Appeal's decision in The Queen v. Signum Communications Inc., 91 DTC 5360?
RESPONSE
The Federal Court of Appeal ruled in the Signum case that losses from limited partnerships are to be treated on the same basis as those originating from general partnerships in the absence of statutory provisions to the contrary. Consequently, we confirm that Revenue Canada will not apply its administrative at-risk rules as they stood prior to the statutory at-risk rules.
ISSUE SHEET
Administrative At-Risk Position After 1991 FCA Decision in Signum
On May 10, 1991. the Federal Court of Appeal ruled in the Signum case that losses from limited partnerships are to be treated on the same basis as those originating from general partnerships in the absence of statutory provisions to the contrary.
This led to Appeal's Decision # 89-9R dated July 9, 1991 which stated that the FCA's decision was final and binding and that any outstanding objections or appeals held in abeyance pending the outcome of this appeal must be processed. The Decision was issued by Mr. J.C. Boucher of Head Office Appeals.
I discussed the Roundtable question with Mr Boucher and he said that the question can be answered in the affirmative. He said that he has confirmed in both internal and external phone enquiries that the Department has abandoned the previous administrative at-risk position. Also, District Office Appeals have now processed their outstanding cases on the basis of the Department's loss in Signum.
Prepared by: John Chan