Court upheld position of tax authorities regarding issued tax notifications-decisions for 50 million UAH

Press service of the State Tax Service of Ukraine, published 10 September 2021 at 11:34 Chapter: News

Cassation Court within the Supreme Court confirmed legality of the tax notifications-decisions issued by Main Directorate of the STS in Odessa region for the total amount of 50 million UAH.

Court upheld position of Main Directorate of the STS in Odessa region and concluded that the business entity has not proved storage of inventory in the entity’s warehouses, as well as the receipt of funds on its accounts, which incurs the VAT liabilities that have not been declared. As follows, a plaintiff has no right to receive amount of budgetary compensation.

The panel of judges noted that Paragraph 44.5 Article 44 of the Tax Code of Ukraine (edition in force at the audit time) stipulates that in case of loss, damage or premature destruction of documents specified in Paragraphs 44.1 and 44.3 of Article 44, the taxpayer must within five days from the date of such case to notify the controlling body in writing form (with provision of documents according to the law confirming the case that led to such loss, damage or premature destruction of documents) at the registration place in manner prescribed by the Tax Code for submission of tax reporting and to notify the supervisory authority which conducted customs clearance of relevant customs declaration, granted authorization according to the Customs Code of Ukraine or permission to apply special simplifications (including transit).

Cassation Court took into account similar conclusion set out in Decision of the Supreme Court as of 13.05.2021 that the loss of relevant documents is not an unconditional reason for postponing the audit. Obligatory reason for postponing the deadline of audit is impossibility of conducting audit in the absence of documents lost by taxpayer according to Paragraph 44.5 Article 44 of the Tax Code of Ukraine.

In addition, the panel of judges paid attention to the fact that entity’s argumentations that all necessary primary documents were provided to the Court of first instance, the Court does not take into account, as the case file contains only copies of customs declarations and payment orders for payment of customs clearance. These copies, in turn, are made from copies and are not properly certified.

Therefore, the Supreme Court summarized that argumentations of the LLC “Vialax” set forth in the cassation appeal were ungrounded and refuted by the case file. The Appellate Court correctly applied norms of the substantive law to circumstances established in the case, given that there are no grounds for revoking Decision of the Appellate Court.

Administrative Cassation Court within the Supreme Court dismissed cassation appeal of the LLC “Vialax” and left unchanged the refusal Decision of the Appellate Court, which denied satisfaction of administrative claim of the LLC “Vialax” regarding cancellation of tax notifications-decisions and recognition of actions as illegal in relation to requirements for the inventory of fixed assets.

Communicate with the State Tax Service remotely using the “InfoTAX” service