This ruling is a wake up call for CRA. They can not operate outside the law and with unfettered power.

Dan White

Tax Court Suggests CRA Be More Responsible in Evaluating Diligence Defences
Source: Blake, Cassels & Graydon LLP - The recent decision in Home Depot of Canada Inc. v. Her Majesty the Queen dealt with the common law defence of due diligence, as opposed to one of the statutory defenses available to directors under subsection 323(3) of the Excise Tax Act (the ETA) or subsection 227.1(3) of the Income Tax Act. It serves to demonstrate the function of the common law due diligence defence in connection with strict liability administrative penalties and suggests that the Canada Revenue Agency (CRA) should apply commercial common sense before dismissing a taxpayer’s defence of due diligence.