Harvey C. Smith Drugs Ltd. v. Canada
A-630-92
Desjardins J.A.
5/12/94
9 pp.
Appeal from Trial Division judgment with respect to interpretation of word "processing" with respect to calculation of manufacturing and processing deduction pursuant to Act, s. 125.1 -- Appellant owning and operating retail drug store, dispensing prescription drugs in both tablet and capsule form--Issue whether dispensing of tablets and capsules constituting "processing" -- Ordinary meaning of "processing" not applying to dispensing of drugs where activities limited to removing unsuitable capsules, counting tablets and placing in labelled container with safety cap -- Adverse finding of subjection of product "to particular method, system or technique of preparation, handling or other treatment designed to effect particular result" pursuant to dictionary definition -- No subjection and conversion of original product from one state to another -- Trial Judge correct in requiring product undergo physical change in form or appearance--Use of word "transformation" in French version indicative of requirement of product change or alteration -- Appeal dismissed--Income Tax Act, S.C. 1970-71-72, c. 63, s. 125.1 (as enacted by S.C. 1973-74, c. 29, s. 1; as am. by S.C. 76-77 c. 4, s. 50).