The Supreme Court of Canada (the “Supreme Court”) recently heard a matter considering whether a taxpayer had a jurisdictional right to challenge tax assessments to the Federal Court.
In Iris Technologies Inc. v. Canada (Attorney General), 2024 SCC 24, Iris Technologies Inc. (“Iris”) claimed tax refunds on their GST returns under the Excise Tax Act (the “ETA”). The return was audited by the Minister of National Revenue (the “Minister”) and denied with penalties ordered to be paid by Iris.
Iris filed a judicial review application at the Federal Court against the Ministry, arguing the following:
- The Ministry failed to afford them procedural fairness and an opportunity to respond
- The assessment was made without evidentiary foundation
- The assessment improperly deprived the Federal Court of their jurisdiction
The Federal Court struck the application on the basis that the matter was within the exclusive jurisdiction of the Tax Court. Iris appealed again to the Supreme Court.
The Supreme Court dismissed the appeal. Writing for the majority, Justice Kasirer held that that the jurisdiction over the correctness of the assessment fell within the ambit of the Tax Court, pursuant to section 302 of the ETA. Therefore, the judicial review alleging procedural unfairness, and a lack of evidentiary foundation was within the executive jurisdiction of the Tax Court.
This decision reminds administrative law practitioners of the importance of filing in the correct forums to preserve the clients’ rights to judicially review administrative decisions. For a more in-depth analysis of the court’s reasoning in Iris Technologies Inc., read the complete decision here.
