http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/144160/index.do
Mendoza v. The Queen (April 6, 2016 – 2016 TCC 112, Hershfield J.).
Précis: Mr. Mendoza claimed a transit pass credit in respect of his use of a Toronto Transit Commission (“TTC”) pass. CRA denied the claim because he could not produce a record from TTC detailing the nature of his use of the pass. The Tax Court accepted Mr. Mendoza’s evidence of the nature of his use of the pass and rejected CRA’s position. There was no order as to costs as this was an informal procedure appeal.
Decision: Mr. Mendoza was not aware of CRA’s requirement of a record from TTC until after the fact:
The problem we have here is that the TTC would not or could not release the required information unless it had been requested in advance of the record date requested. The Appellant, as I said, testified that based on the guidelines that he had read, he had no idea as to the requirements that would be imposed by the CRA administratively until more than a year later when he received the June letter in 2015. By that time, of course, according to the systemic issues within the TTC, he could not produce the required records.
The Court rejected CRA’s position (which was an administrative position not set out in the statute or regulations):
As I have said, I think substantial compliance in a case where a third party qualifying transit organization, over which the taxpayer has no control, has the ability to provide that which legislation requires it to provide and otherwise meets the requirements of the legislation, then there has to be some guideline by the CRA on an administrative basis that allows for substantial compliance using other evidentiary means where that organization fails to issue the required documentation. I am referring to there being substantial compliance where the taxpayer provides the relevant information which the legislation requires (albeit in a different form).
I think these remarks are sufficient to give the parties the reasons for my decision to allow the appeal in respect of this second issue.
There was no order as to costs since this was an informal procedure appeal.