Petroleum and Gas Revenue Tax Act (R.S.C., 1985, c. P-12)

Marginal note:Excessive refund provisions

16 Where at any time the Minister determines that, as a consequence of the operation of subsection 5(6), an amount has been refunded to a taxpayer for a taxation year in excess of the amount to which the taxpayer was entitled as a refund,

• (a) the excess shall be deemed to be an amount that became payable under this Part by the taxpayer on the day on which the amount was refunded;

• (b) the taxpayer shall pay interest at the rate prescribed for the purposes of subsection 161(1) of the Income Tax Act on the excess from the day it became payable to the date of a payment; and

• (c) the Minister may at any time assess a taxpayer in respect of any amount payable by the taxpayer by virtue of this section and, in such case, the provisions of this Part are applicable, with such modifications as the circumstances require, in respect of the assessment as though it had been made under section 13.

Marginal note:Penalties

• 17 (1) Every person who fails to file a return of production revenue as and when required by subsection 11(1) is liable to a penalty of

  • (a) an amount equal to five per cent of the tax under this Part that was unpaid when the return was required to be filed; and

  • (b) the product obtained when one per cent of the tax under this Part that was unpaid when the return was required to be filed is multiplied by the number of complete months, not exceeding twelve, in the period between the date on which the return was required to be filed and the date on which the return was filed.

• Marginal note:Evasion

  (2) Every person who wilfully attempts to evade payment of the tax payable by him under this Part by failing to file a return of production revenue as and when required by subsection 11(1) is liable to a penalty of fifty per cent of the amount of the tax sought to be evaded.

• Marginal note:False statements, etc.

  (3) Every person who, knowingly or under circumstances amounting to gross negligence in the carrying out of any duty or obligation imposed by or under this Act, makes or participates in, assents to or acquiesces in the making of, a false statement or an omission in a return, form, certificate, statement or an answer, in this section referred to as a “return”, filed or made in respect of a taxation year as required by or under this Act is liable to a penalty of twenty-five per cent of the amount, if any, by which

  • (a) the tax for the year that would be payable under this Part by the person if the production revenue of the person for the year were computed by adding to such revenue reported in the person’s return for the year that portion of the understatement of such revenue for the year that is reasonably attributable to the false statement or omission,

  exceeds

  • (b) the tax for the year that would have been payable under this Part by that person had his tax payable for the year been assessed on the basis of the information provided in his return for the year.

• Marginal note:Understatement of revenue

  (4) For the purposes of subsection (3), the production revenue reported in a return of a person for a taxation year shall be deemed not to be less than nil and the understatement of production revenue for the year of a person means the aggregate of

  • (a) the amount, if any, by which

    • (i) the aggregate of amounts that were not reported by that person in his return and that were required to be included in computing that revenue for the year

    exceeds

    • (ii) the aggregate of such of the amounts deductible by that person in computing that revenue for the year under this Part as were wholly applicable to the amounts referred to in subparagraph (i) and were not deducted by him in computing that revenue for the year reported by him in his return, and

  • (b) the amount, if any, by which

    • (i) the aggregate of amounts deducted by that person in computing that revenue for the year reported by him in his return

    exceeds

    • (ii) the aggregate of such of the amounts referred to in subparagraph (i) as were deductible by him in computing that revenue for the year in accordance with this Part.

• Marginal note:Burden of proof

  (5) Where, in any appeal under this Act, any penalty assessed by the Minister under this section is in issue, the burden of establishing the facts justifying the assessment of the penalty is on the Minister.

Marginal note:Refunds

• 18 (1) If the return of a taxpayer’s production revenue for a taxation year has been made within four years from the end of the year, the Minister

  • (a) may, on or after mailing the notice of assessment for the year, refund to a taxpayer, without application therefor, any overpayment made on account of his tax for the year; and

  • (b) shall make such a refund after mailing the notice of assessment if application therefor has been made in writing by the taxpayer within four years from the end of the year.

• Marginal note:Application of overpayments

  (2) Instead of making a refund to a taxpayer that might otherwise be made under this section, the Minister may, where the taxpayer is liable or about to become liable to make any payment under this Act, apply the amount of the overpayment to that other liability and notify the taxpayer of that action.

• Marginal note:Interest on overpayments

  (3) Where an amount in respect of an overpayment is refunded to a taxpayer or applied under this section on other liability, interest at the rate per annum referred to in subsection 15(1) shall be paid or applied thereon for the period commencing with the latest of

  • (a) the day when the overpayment occurred,

  • (b) the day on or before which the return of the production revenue in respect of which the tax was paid was required to be filed, and

  • (c) the day when the return of the production revenue was actually filed,

  and ending with the day of the refund or the application on the other liability, as the case may be, unless the amount of the interest so calculated is less than one dollar, in which event no interest shall be paid or applied under this subsection.

• Marginal note:Excessive interest provisions

  (4) Where interest has been paid to, or applied to a liability of, a taxpayer pursuant to subsection (3) in respect of an overpayment and it is subsequently determined that the actual overpayment, if any, was less than the overpayment in respect of which interest was paid or applied,

  • (a) the amount by which the interest that has been paid or applied exceeds the interest, if any, computed in respect of the amount subsequently determined to be the actual overpayment shall, on the date on which the interest was so paid or applied, be deemed to be an amount payable by the taxpayer under this Part;

  • (b) the taxpayer shall pay interest at the rate prescribed for the purposes of subsection 161(1) of the Income Tax Act on the amount payable by virtue of this subsection from the date referred to in paragraph (a) to the date the amount is paid; and

  • (c) the Minister may at any time assess a taxpayer in respect of the amount payable by him by virtue of this subsection and in such case the provisions of this Part are applicable, with such modifications as the circumstances require, in respect of the assessment as though it had been made under section 13.

• Marginal note:Definition of “overpayment”

  (5) In this section, overpayment made on account of the tax for a taxation year of a taxpayer means the aggregate of all amounts paid on account of his tax for the year minus all amounts payable by him under this Act.

Marginal note:Objections to assessments

• 19 (1) A taxpayer who objects to an assessment under this Part may, within ninety days from the day of mailing of the notice of assessment, serve on the Minister a notice of objection in duplicate in prescribed form setting out the reasons for the objection and all relevant facts.

• Marginal note:Service

  (2) A notice of objection under this section shall, subject to subsection (6), be served by being sent by registered mail addressed to the Commissioner of Revenue at Ottawa.

• Marginal note:Duties of Minister re objections

  (3) On receipt of a notice of objection under this section, the Minister shall,

  • (a) with all due dispatch, reconsider the assessment and vacate, confirm or vary the assessment or reassess, or

  • (b) where the taxpayer indicates in the notice of objection that the taxpayer wishes to appeal immediately to the Tax Court of Canada and that the taxpayer waives reconsideration of the assessment and the Minister consents to the waiver, file a copy of the notice of objection with the Registrar of the Tax Court of Canada,

  and the Minister shall thereupon notify the taxpayer of his action by registered mail.

• Marginal note:When assessment deemed confirmed

  (4) Where the Minister files a copy of a notice of objection pursuant to paragraph (3)(b), the Minister shall be deemed, for the purposes of section 22, to have confirmed the assessment to which the notice relates and the taxpayer who served the notice shall be deemed to have thereupon instituted an appeal in accordance with that section.

• Marginal note:Idem

  (5) A reassessment made by the Minister pursuant to subsection (3) is not invalid by reason only that it was not made within four years from the day of mailing of a notice of an original assessment or of a notification described in subsection 13(4).

• Marginal note:Acceptance of notice of objection

  (6) The Minister may accept a notice of objection as having been duly served under this section notwithstanding that it was not served in duplicate or in the manner required by subsection (2).

• Marginal note:Appeals

  (7) Where a taxpayer has served a notice of objection to an assessment in accordance with this section and thereafter the Minister reassesses the taxpayer’s tax for the taxation year in respect of which the notice of objection was served or makes an additional assessment in respect thereof, and sends to the taxpayer a notice of the reassessment or of the additional assessment, as the case may be, the taxpayer may, without serving a notice of objection to the reassessment or additional assessment,

  • (a) appeal therefrom to the Tax Court of Canada in accordance with section 22; or

  • (b) if an appeal to the Tax Court of Canada has been instituted with respect to the assessment, amend that appeal by joining thereto an appeal in respect of the reassessment or the additional assessment in such manner and on such terms, if any, as that Court directs.

Marginal note:When assessment unaffected

20 An assessment shall not be vacated or varied on appeal by reason only of any irregularity, informality, omission or error on the part of any person in the observation of any directory provision of this Act.

Marginal note:Application to Tax Court of Canada for time extension

• 21 (1) Where no objection to an assessment under section 19 or appeal to the Tax Court of Canada under section 22 has been made or instituted within the time limited by section 19 or 22, as the case may be, an application may be made to the Tax Court of Canada for an order extending the time within which a notice of objection may be served or an appeal instituted and the Tax Court of Canada may, if in its opinion the circumstances of the case are such that it would be just and equitable to do so, make an order extending the time for objecting or appealing and may impose such terms as it deems just.

• Marginal note:Reasons in application

  (2) An application under subsection (1) shall set out the reasons why it was not possible to serve the notice of objection or institute the appeal to the Tax Court of Canada within the time otherwise limited by this Act for so doing.

• Marginal note:Filing application

  (3) An application under subsection (1) shall be made by filing with the Registrar of the Tax Court of Canada or by sending by registered mail addressed to the Registrar at Ottawa three copies of the application accompanied by three copies of a notice of objection or notice of appeal, as the case may be.

• (4) [Repealed, R.S., 1985, c. 51 (4th Supp.), s. 18]

• Marginal note:Where order not to be made

  (5) No order shall be made under subsection (1)

  • (a) unless the application to extend the time for objecting or appealing is made within one year after the expiration of the time otherwise limited by this Act for objecting to or appealing from the assessment in respect of which the application is made;

  • (b) if the Tax Court of Canada has previously made an order extending the time for objecting to or appealing from the assessment; and

  • (c) unless the Tax Court of Canada is satisfied that

    • (i) but for the circumstances mentioned in subsection (1), an objection or appeal would have been made or taken within the time otherwise limited by this Act for so doing,

    • (ii) the application was brought as soon as circumstances permitted it to be brought, and

    • (iii) there are reasonable grounds for objecting to or appealing from the assessment.