The appellant, acting as a licensed customs broker, overpaid $2,937,123 in GST due to errors.
The appellant did not collect the overpayments from its customers but deducted the amounts from its own GST liability.
The Minister of National Revenue disallowed these deductions.
The Supreme Court of Canada held that the appellant was entitled to a rebate under s. 261(1) of the Excise Tax Act because it was the person who actually paid the amount in error, and the Minister was obliged to apply the rebate against the appellant's net tax pursuant to s. 296(2.1).
