Health Quest Inc v. The Queen, 2014 TCC 211 (Informal Procedure) -- summary under Section 24.1

By services, 28 November, 2015

The appellant ("Health Quest") distributed footwear for the relief of various disabling conditions of the foot. The Minister reassessed the taxpayer on the basis that many of the shoes sold were not zero-rated supplies under s. 24.1 of Part II of Schedule VI of the ETA. Campbell J found that the Minister's pleading of this legal conclusion did not shift the burden of proof to the taxpayer (see summary under General Concepts - Onus).

The Minister was unable to prove that the shoes were not specially designed for use for a "crippled or deformed or similarly disabled foot," as the appeal officer's evidence was based on there not being sufficient information to conclude that they were. Campbell J suggested that "product literature, any scientific studies conducted and testimony of medical professionals" would have been beneficial in drawing any conclusions (para. 37) and indicated (at para. 41) that Masai Canada Ltd. v. Canada (Border Services Agency), 2012 FCA 260 "implied that to establish if a product, at least under the Customs Tariff, is 'specially designed' there should be evidence on the design and purposive intent behind the design of the product."

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insufficient product design evidence
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