http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/108837/index.do
Okoroze v. The Queen (March 30, 2015 – 2015 TCC 64, Bédard J.).
Précis: This is a net worth assessment case in which the appellant was assessed with roughly $1.3 million in undeclared income for the years 2004 through 2008. The income arose largely from appropriations from corporations owned or operated by him that engaged in a Moneygram business, i.e., the wire transfer of funds, as well as undeclared rental income. The taxpayer’s basic defence was that the CRA auditor was biased and relied upon forged documents. The Court was not impressed and dismissed the appeals, with costs.
Decision: Mr. Okoroze was assessed with roughly $1.3 million in undeclared income for the years 2004 through 2008. The income was computed by means of net worth assessments and was derived largely from appropriations from corporations owned or operated by him and undeclared rental income. The defence was essentially that he had been framed by the CRA auditor, Ms. Robitaille. The Court dismissed this line of argument out of hand:
Ms. Robitaille’s conduct
[28] During the hearing, the Appellant complained ad nauseam that Ms. Robitaille conducted her investigation with malicious intent. For example, he testified that she used forged documents (namely Exhibits A‑2, A‑3, A‑4 and A‑5) and that she knew they were forged. He also testified that he was entrapped by the Sûreté du Québec. Consequently, he contends, the net worth assessment cannot stand because of these wrongdoings.
[29] Firstly, I am of the opinion that this Court is not the proper forum in which to have such a question disposed of. I would add that this Court’s jurisdiction is to render a decision as to whether or not assessments issued are correct in whole or in part.
[30] Secondly, the Appellant’s allegations of forgery, fraud, entrapment and wrongdoing are gratuitous, frivolous and not supported by sound evidence. It seems to me that these allegations stem from a misconception as to the definition of fraud, forgery and entrapment. Finally, I would add that the evidence presented by way of Ms. Robitaille’s testimony demonstrates the very opposite of malicious intent or any type of wrongdoing.
Penalties
[31] I have come to the conclusion that the Appellant
deliberately failed to report
$1,305,349 in income. In my opinion, the Minister has discharged her burden of proof and was therefore entitled to impose penalties under subsection 163(2) of the Income Tax Act. I am also of the opinion that, under subsection 152(4), the Minister was entitled to make the reassessments for the years 2004 to 2007 inclusively, which were made, I would point out, after the normal reassessment periods.
[32] For the foregoing reasons, the appeals from the reassessments are dismissed with costs.
[The Court’s emphasis]