This looks like a very complicated case/dispute. A few years ago, Canadian Government introduced new rules allowing companies to roll their corporately-sponsored RRSP holdings into financial investment vehicles called mutual fund trusts (MFT) avoiding tax payable consequences of selling and redeeming securities held in RRSP accounts. The ruling was especially beneficial to diversified family-owned corporations that had held profits in those RRSP accounts for various family members in various affiliated companies (or limited partnerships). In March 2011, the Government abruptly changed the rules citing some unintended loopholes of MFT rollovers created as a result of the original legislation. In other words, the tax savings realized by companies converting RRSP accounts into MFTs were much higher than originally anticipated.
From what scant information available in the article, it appears that Cardel got caught in between the initial and changed rules and, as a result, got assessed huge penalties that are, in some cases, way above the 100% of the tax payable. The aggravation and stress caused on the company by the $220M assessment is understandable. They are a big company, of course, but not even remotely THAT big.
