Saskatchewan Wheat Pool v. R., 99 DTC 5198, [1999] 2 CTC 369 (FCA) -- summary under Subsection 21(1)

The taxpayers, who were members of a joint venture, did not capitalize interest costs incurred during the construction of a grain elevator under s. 21, because they wished to avoid the prohibition in s. 127(11.2) against including such capitalized interest in the capital cost for investment tax credit purposes, and instead took the position that they were entitled to capitalize the interest on the authority of the Sherritt Gordon case. After concluding that "the rule in Sherritt Gordon cannot stand together with section 21", Rothstein J.A. went on to indicate (at p. 5202) that he had "no difficulty with a proposition that in circumstances not contemplated by section 21 or other statutory provisions [e.g., situations where the interest would not qualify for deduction under ss.20(1)(c), (d) or (e)], interest may be capitalized according to GAAP".