Minister of National Revenue v. Atlantic Engine Rebuilders Ltd., 67 DTC 5155, [1967] CTC 230, [1967] S.C.R. 477 -- summary under Timing

In order to secure a regular supply of rebuildable engines, when the taxpayer sold engines which it had rebuilt to Ford dealers it required the dealer to supply it with another rebuildable engine of the same model and to pay a substantial non-forfeitable deposit which would be held by the taxpayer until the dealer did supply such an engine. Cartwright J. held that because the taxpayer knew that it might not be able to retain any part of the deposit received by it (and, in fact, the probability was 96% that the amount would be returned to the dealer in the near future) the realities of the situation were that sums so received were not part of its profits. To the extent that in the following year the taxpayer ceased to be under a liability to return the amount to the depositor, the amount received became a profit in that year.