Words and Phrases - "reasonable expectation of profit"

The taxpayer, which sold ATMs to the gaming industry, and specialized keyboards and price scanners to retail stores, in January 2006 acquired a corporation ("Telepanel") that had been carrying on a business of selling electronic price display modules to retail stores. C. Miller J. found that s. 111(5)(a) precluded the taxpayer from using Telepanel's losses in the taxpayer's taxation year ending on September 30, 2007, as the business was not carried on for profit or with a reasonable expectation of profit in that year. The business was "dormant" in that year: the only third-party business activity identified was the receipt of a small licence fee, and explaining to a customer how to replace batteries. Furthermore, if the former Telepanel business nonetheless was still being carried on, it was not being carried on with a view to profit, having regard to the objective factors listed in Tonn. In particular, the business had persistent and substantial losses, and the taxpayer had no plan, and made no effort, to turn the business around, and instead used the Telepanel technology in its gaming business, which was not the same or a similar business.