Chapter 5 - Appeals

Introduction

The Tribunal hears appeals from decisions of the CBSA under the Customs Act and SIMA or of the Minister of National Revenue under the Excise Tax Act. Appeals under the Customs Act relate to the origin, tariff classification, value for duty or marking of goods imported into Canada. Appeals under SIMA concern the application, to imported goods, of a Tribunal finding or order concerning dumping or subsidizing and the normal value, export price or subsidy of imported goods. Under the Excise Tax Act, a person may appeal the Minister of National Revenue’s decision on an assessment or determination of federal sales tax or excise tax.

The appeal process is set in motion when a written notice of appeal is filed with the Secretary of the Tribunal within the time limit specified in the act under which the appeal is made. Certain procedures and time constraints are imposed by law and by the Rules; however, at the same time, the Tribunal strives to encourage a relatively informal, accessible, transparent and fair proceeding.

Under the Rules, the person launching the appeal (the appellant) has 60 days to submit to the Tribunal a document called a “brief”. Generally, the brief states under which act the appeal is launched, gives a description of the goods in issue and an indication of the points at issue between the appellant and the Minister of National Revenue or the CBSA (the respondent), and states why the appellant believes that the respondent’s decision is incorrect. A copy of the brief must also be given to the respondent.

The respondent must also comply with time limits and procedural requirements. Ordinarily, within 60 days after having received the appellant’s brief, the respondent must file with the Tribunal a brief setting forth the respondent’s position and provide a copy to the appellant. The Secretary of the Tribunal, when acknowledging receipt of the appeal, schedules a hearing date. Hearings are generally conducted in public. The Tribunal publishes a notice of the hearing in the Canada Gazette to allow other interested persons to attend. Depending on the act under which the appeal is filed, the complexity and potential significance of the matter at issue, appeals will be heard by a panel of one or three members. Persons may intervene in an appeal by filing a notice stating the nature of their interest in the appeal and indicating the reason for intervening and how they would assist the Tribunal in the resolution of the appeal.

Hearings

An individual may present a case before the Tribunal in person or be represented by counsel. The respondent is generally represented by counsel from the Department of Justice. In accordance with rule 25 of the Rules, appeals can be heard by way of a hearing at which the parties or their counsel appear before the Tribunal, by way of videoconference or by way of written submissions (file hearing).

Hearing procedures are designed to ensure that the appellant and the respondent are given a full opportunity to make their cases. They also enable the Tribunal to have the best information possible to make a decision. As in a court, the appellant and the respondent can call witnesses, and these witnesses are questioned under oath or affirmation by the opposing parties, as well as by Tribunal members. When all the evidence is gathered, parties may present arguments in support of their respective positions.

The Tribunal, on its own initiative or at the request of the appellant or the respondent, may decide to hold a hearing by way of written submissions. In that case, it publishes a notice in the Canada Gazette to allow other interested persons to participate.

Within 120 days of the hearing, the Tribunal endeavours to issue a decision on the matters in dispute, including the reasons for the decision.

If the appellant, the respondent or an intervener disagrees with the Tribunal’s decision, the decision can be appealed on a question of law to the Federal Court of Appeal or, in the case of the Excise Tax Act, the Federal Court (where the case will be heard de novo by the court).

Extensions of Time

Under section 60.2 of the Customs Act, a person may apply to the Tribunal for an extension of time to file a request for a re-determination or a further re-determination with the CBSA. The Tribunal may grant such an application after the CBSA has refused an application under section 60.1 or when 90 days have elapsed after the application was made and the person has not been notified of the CBSA’s decision. Under section 67.1, a person may apply to the Tribunal for an extension of time within which to file a notice of appeal with the Tribunal. During the fiscal year, the Tribunal issued four orders under the Customs Act, granting extensions of time in three cases (in which one was granted in part) and denying the application in one case. There were six requests under the Customs Act outstanding at the end of the fiscal year.

Under section 81.32 of the Excise Tax Act, a person may apply to the Tribunal for an extension of time in which to serve a notice of objection with the Minister of National Revenue under section 81.15 or 81.17 or file a notice of appeal with the Tribunal under section 81.19. During the fiscal year, the Tribunal issued three orders under the Excise Tax Act granting extensions of time. There were no requests under the Excise Tax Act outstanding at the end of the fiscal year.

Appeals Received and Heard

During the fiscal year, the Tribunal received 73 appeals. The Tribunal heard 22 appeals, 18 under the Customs Act, 2 under the Excise Tax Act and 2 under SIMA. It issued decisions on 40 appeals, which consisted of 30 appeals under the Customs Act (including a remanded case), 7 under the Excise Tax Act and 3 under SIMA. Eighty-six appeal cases were outstanding at the end of the fiscal year.

Summary of Selected Decisions

Of the many cases heard by the Tribunal, several decisions issued during the fiscal year stand out, either because of the particular nature of the product in issue or because of the legal significance of the case. Brief summaries of a representative sample of such decisions follow, including one appeal heard pursuant to the Customs Act, one appeal pursuant to SIMA and one appeal pursuant to the Excise Tax Act. These summaries have been prepared for general information purposes only and are not intended to be of any legal value.

AP-2011-031—Grodan Inc. v. President of the Canada Border Services Agency

This appeal was filed pursuant to subsection 67(1) of the Customs Act from a decision by the CBSA made pursuant to subsection 60(4) with respect to the tariff classification of plastic plant clips and rings designed to support plant stems, imported by Grodan Inc. (Grodan). Grodan challenged the CBSA’s decision under section 60 on the basis that the underlying decisions under section 59 were invalid because the CBSA was time-barred from making a further re-determination of the tariff classification of the goods in issue. A preliminary matter was whether the Tribunal had jurisdiction to examine the issue raised in this appeal. The Tribunal found that it had the authority pursuant to section 67 to determine the correctness and validity of a decision under section 60. In the Tribunal’s view, the validity of such a decision is a matter related to its correctness; therefore, the Tribunal has the authority to deal with it by making such order, finding or declaration as the nature of the matter may require. The Tribunal concluded that the CBSA did not have the authority to make further re-determinations under section 59; therefore, the appeal was allowed.

AP-2011-015—Levolor Home Fashions Canada v. President of the Canada Border Services Agency

This appeal was filed pursuant to subsection 61(1) of SIMA from a decision made by the CBSA pursuant to section 59 with respect to requests for re-determination under section 58 relating to 13 shipments of aluminum extrusions. The CBSA found that the goods in issue did not meet the requirements of the product exclusion granted by the Tribunal in Inquiry No. NQ-2008-003. The Tribunal found that the goods in issue were of the same description as the goods to which the product exclusion applied. The appeal was allowed.

AP-2011-054—United Independent Energy Group Inc. v. Minister of National Revenue

This appeal was filed pursuant to section 81.19 of the Excise Tax Act from an assessment of the Minister of National Revenue that imposed excise tax on fuel that United Independent Energy Group Inc. (United) purchased as heating oil but subsequently sold as diesel fuel. The issues in this appeal were threefold: (1) whether the Minister of National Revenue properly assessed United for failing to remit excise tax on diverted fuel; (2) whether United should be considered a “licensed wholesaler” within the meaning assigned to that expression by section 42; and (3) whether the Tribunal can order the Minister of National Revenue to waive or cancel interest and penalties that have been assessed under the Excise Tax Act. The Tribunal found the following: (1) the Minister of National Revenue properly assessed United pursuant to subsection 23(9.1) for failing to remit excise tax on diverted fuel; (2) the Tribunal lacked jurisdiction to consider the matter in the context of this appeal, since United had never formally applied to become a licensed wholesaler and the Minister of National Revenue never rendered a decision in this respect; and (3) the Tribunal could not grant United’s request that the interest and penalties assessed against it be waived or cancelled because the decisions of the Minister of National Revenue pursuant to section 88 are discretionary in nature and may not be appealed to the Tribunal. The appeal was dismissed.