How Many More Times Will The CRA Get Re-Appropriation Wrong?

In Referred Realty Inc. (2018 FC 59), the Canada Revenue Agency's ("CRA")  misguided approach to T2  re-appropriation was rejected by the Federal Court — for the third time in recent memory. Hopefully, the message has sunk in for the CRA and its absurd approach will be corrected sooner rather than later.

Evidently, the work of the taxpayer's office administrator was unsatisfactory and it was determined that books and records were not well maintained.  A replacement office administrator did not bring the books and records up to date and that person's employment was also terminated.  Finally, an outside bookkeeper was engaged and records were reconstructed.  Because of these problems and the volume of work, records for the taxation years ending July 31, 2007 through July 31, 2011 were not completed until early 2012.  Cognizant of its tax obligations, the taxpayer made what it believed were accurate instalments each year.  However, on account of the failure to file