A provincial court judge in Surrey, B.C., has thrown out a small claims case between a lumber company and a fence building firm over an "unlawful scheme" between the two to avoid paying GST and PST.
The principal of Top Quality Lumber Ltd., Amarjit Dhaliwal, told the court in June that H & R Fencing owed his company almost $21,000, but H & R's owner said it was closer to $4,000 in unpaid bills.
However, Judge Jay Soloman said in his ruling issued July 29 that Dhaliwal admitted to taking cash from customers to avoid paying taxes, and he inferred from the evidence that Top Quality was "actively engaged" in the "underground economy."
Soloman ruled he was unsure of the accuracy of the balance owing, given the "absence of legitimate record keeping," and while he found the owner of H & R, Kamal Hehar, an unreliable witness, the claimant didn't prove his case.
Even though Hehar admitted to owing $4,000, the judge declined to order the award, saying both companies took part in an "unlawful scheme," but it was the seller's responsibility to charge and remit PST and GST.
The judge said the evidence presented at the hearing showed that Dhaliwal intentionally conducted his business affairs in an unlawful manner, noting the defendant paid over $64,000 in cash for products that weren't invoiced.
.jpg "One of Canada’s most wanted arrested by Coquitlam RCMP")
