This was another restaurant case where Revenue Quebec estimated that the restaurant had under-reported its alcohol sales and the GST/QST collectible. The restaurant owner tried to attack RQ's assessment method but the burden is on the taxpayer or registrant to disprove the government's assumptions with a prima facie case.
"A prima facie case is one 'supported by evidence which raises such a degree of probability in its favour that it must be accepted if believed by the Court unless it is rebutted or the contrary is proved. It may be contrasted with conclusive evidence which excludes the possibility of the truth of any other conclusion than the one established by that evidence'”. Amiante Spec Inc. v. Canada, 2009 FCA at para. 23, (which Justice Favreau cited at his para. 33.)
The Tax Court didn't believe the restaurant's arguments; so the government's assumptions held:
" The accounting records given by the appellant for the financial year ending 31 October 2006 were considered by the auditor as being sufficiently reliable for purposes of establishing the ratio attributable to each litre of beer and wine sold. The quantities of litres of beer and wine bought during the entirety of the reporting periods forming part of the audit period were admitted by the appellant. The indirect verification method used by the Minister was approved by several decisions of our Court, among which are those made in 9100-8649 Québec Inc. c. La Reine, 2013 CCI 160 [affirmed by the Federal Court of Appeal 2014 CAF 20], Restaurant Place Romaine Inc. c. La Reine, 2010 CCI 347 and 9110-1568 Québec Inc. c. La Reine, 2009 CCI 554, and are not disputed by the appellant." [My informal translation.]
See 9120-1616 Québec Inc. c. La Reine, (2014 CCI Favreau)