The registrant, which was a livestock marketing agency, was found to be making a taxable supply of storage services rather than a zero-rated supply of feed when it provided through-load services to transporters of cattle as contemplated by section 148 of the federal Health of Animals Regulation, which provided that cattle could not be confined in a railway car for longer than 48 hours but, rather, must be unloaded for a period of not less than five hours into a suitably covered pen provided with straw, feed and water.
Sarchuk TCJ. noted (at p. 87-5) that "a through-load customer does not have the option of acquiring any of the particular elements of the service provided by the appellant separately, rather the provision of a particular element is entirely contingent on the provision of all the other required elements". As a separate matter, the registrant would agree with auction customers to store cattle, which they had purchased, at charge of $1.50 per day per head. It was found (in light, inter alia, of evidence that the charge was $2.50 per day per head in the case of third parties who had not purchased cattle) that in substance all of this charge related to the provision of feed to the cattle and, therefore, was zero-rated.