Smith J. [Orally]:—The question in this proceeding is whether Judge J.D. Smith was right to stay proceedings in the prosecution of the accused Yogendra Sharma under section 239 of the Income Tax Act, the prosecution being under section 239 of the Income Tax Act. The learned judge invoked the provisions of paragraph 11(h) of the Charter which reads as follows:
Proceedings in Criminal and Penal Matters
11. Any person charged with an offence has the right
(h) if finally acquitted of the offence, not to be tried for it again and, if finally found guilty and punished for the offence, not to be tried or punished for it again; and
He held that the section applied in that the accused had already been assessed penalties of 25 per cent of the reassessed amounts under subsection 163(2).
A similar situation developed in British Columbia where a Provincial Court judge in R. v. Georges Contracting Ltd. and George Arthur Cloarec had reasoned as did Judge Smith in this instance. Mr. Justice Toy, who heard the appeal, disagreed.
I respectfully agree with Toy, J.'s disposition of the matter. He appears to have based his decision mainly upon the absence of a hearing. I am not certain that it ought to be the determining factor. However, I agree that the imposition of the penalties did not amount to either a trial or to a final finding of guilt in the sense contemplated by paragraph 11(h) of the Charter. With respect for Judge Smith and for counsel who appeared before me and argued the case well and forcefully, the Ontario case of Re Trumbley et al. and Re Fleming et al. and three other appeals (1986), 55 O.R. (2d) 570, do not assist him. In my view it supports the Crown position, even though the question before the Court was a different one. It was there held that the thrust of the section 11 provision of the Charter was entirely of a criminal law nature and unless it was confined to criminal or penal offences there would be serious difficulties in the way of giving it a reasonably consistent application. Morden, J.A., speaking for the Court, said in part at page 582:
The proper determination of the scope of the opening words of s. 11 requires that they be interpreted in the context of the whole of s. 11, i.e., taking into account all of its nine paragraphs.
He goes on to set out section 11 in full and then on page 583 he adds the following:
This section is replete with criminal law terms, such as “tried”, "presumed innocent until proven guilty”, “reasonable bail”, “punishment for the offence”, “acquitted for the offence”, and "found guilty of the offence”. Indeed, the word “offence” is itself a criminal law term, as opposed to a civil law term. Accordingly, the clear impression created by s. 11, read as a whole, is that it is intended to provide procedural safeguards relating to the criminal law process. The thrust of the provision is entirely of a criminal law nature. Taking this, and the features of context which I shall discuss, into account, it is my view that offence means an “offence” which is prosecuted in a criminal or penal proceeding.
I do not think that these penalties, which were imposed by the Department, were imposed in a criminal or a penal proceeding. I am further of the view that the Kienapple principle has no application. The section 163 penalty is not the result of a prosecution with a consequent punishment.
I agree with the Crown in its initial comments that the effect of Judge Smith's decision in the circumstances before him was to have ruled as unconstitutional the provisions calling for both the penalty of the section 163 variety, and a penalty following a prosecution. That matter was not before him and, like Toy, J., I say nothing of the validity of the income tax provisions in respect of penalties. In fact the Crown, I believe, if I heard counsel correctly, concedes in this case that the penalty should not have been assessed and is a nullity because it followed the issue of the warrant.
In the result, the appeal is allowed, the order of Judge Smith is set aside and the case is remitted back to him or to a judge of his court for trial at Brampton.
Appeal allowed.