The taxpayer sold a residence eight months after the point at which she had completed its construction and moved in. The Minister reassessed beyond the normal reassessment period on the basis that the gain was realized on income account. Hogan J. stated (at para. 16):
[T]he real question is whether subparagraph 152(4)(a)(i) applies to a taxation year that is otherwise time-barred when the facts considered incorrect are presented because the taxpayer interpreted the circumstances to favour the non-taxation theory since they fall in the grey zone of tax law. I believe, in view of the case law, the question can be answered in the negative where the taxpayer's position is not unreasonable.
Here, the taxpayer's position was not unreasonable, and the reassessment was statute-barred.