Canadian Muslim charity asks Supreme Court to review CRA suspension

The Canada Revenue Agency levied the one-year suspension in July 2021 following an audit by the revenue agency's charities directorate that flagged concerns about six initiatives.

A Muslim international relief charity is telling the Supreme Court of Canada the federal government should not be allowed to “shoot first and hold a hearing later” when it comes to levying administrative penalties.

Ottawa-based Human Concern International is asking the top court to review the Federal Court of Appeal’s refusal to freeze a government-imposed suspension – which prohibited the charity from issuing tax receipts – while a challenge of the penalty played out.

The Canada Revenue Agency levied the one-year suspension in July 2021 following an audit by the revenue agency’s charities directorate that flagged concerns about six initiatives.

The suspension has now expired, but HCI is still pursuing the matter in court, saying it has significant repercussions for the charitable sector as a whole.

In its application seeking a hearing in the Supreme Court, HCI says the rule of law in Canada will be “significantly diminished” if the court does not step in.

The charity argues federal agencies will be empowered to impose penalties before an airing of the issues _ and prior to a determination of guilt.

“Justice will be denied to innocent parties, as government agencies will be free to extract punishments from citizens, even where the punishment cannot be reversed in the event bureaucratic error is identified at trial.”

Any other charities going through a revenue agency audit “will live in this fear of suspension,” HCI executive director Mahmuda Khan said in an interview. “And they’ll also feel like, OK, we have nowhere to go, or there’s no way to hold CRA accountable. And that’s not the position we want to have for charities in Canada.”