Court supported the tax authority's position regarding legality of adopted tax notification-decision

Press service of the State Tax Service of Ukraine, published 18 October 2024 at 09:29 Chapter: News

Cassation court supported the controlling authority's position regarding legality of adopted tax notification-decision applied to the payer through improperly registered registrar of settlement operations (RRO), whose registration was canceled due to the expiration of operation period.

In the Court's opinion, the main issue for solving this case is to determine whether there is a violation of Paragraphs 1, 2 Article 3 of the Law of Ukraine № 265/95-VR as of 06.07.1995 "On the use of registrars of settlement operations in trade, public catering and services" (with changes) (hereinafter – Law № 265/95-VR) regarding the fact of carrying out settlement operations and issuing settlement documents formed by the RRO, registration of which has been canceled.

The Courts established that the controlling authority canceled registration of registrar of settlement operations belonging to the Company due to expiration of its operation period defined by the law, about which the controlling authority created a certificate and placed it in the plaintiff’s Electronic cabinet.

At the same time, the plaintiff continued to use RRO in its activities, registration of which was canceled, which was established by the Courts, is confirmed by the case materials and was not denied by the Company.

The Court considers that in case of the RRO’s registration cancellation, it cannot be used by the business entity for settlement operations, since settlement operations for the full amount of purchase (provision of service) must be carried out exclusively through registered, sealed in the prescribed manner and transferred to the fiscal operation mode RRO, and after registration cancellation, such PRO is not considered registered according to legislative requirements. Accordingly, settlement document that is printed on such RRO is not considered as a settlement document in sense of the Law № 265/95-VR, that is, it is not a document of the prescribed form, and therefore providing a person with a settlement document printed on unregistered RRO cannot be considered as fulfillment of obligation, defined by Paragraph 2 Article 3 of the Law № 265/95-VR.

Taking into account above-specified, legal regulation of the Supreme Court comes to the conclusion that conduction of settlement operations through the RRO, registration of which has been canceled, and issuance of settlement documents formed (printed) by the RRO, registration of which has been canceled, is a violation of requirements of Paragraphs 1 and 2 Article 3 of the Law № 265/95-VR.

Therefore, the Supreme Court agrees with conclusions of the Court of first instance that the plaintiff violated requirements of Paragraphs 1 and 2 Article 3 of the Law № 265/95-VR, settlement operations were not conducted through registered RRO and settlement documents of the prescribed form were not provided (issued). Settlement document that is printed on unregistered RRO is not considered as a settlement document in sense of the Law № 265/95-VR, that is, it is not a document of the established form.

By the decision of the Supreme Court as a part of the Cassation Administrative Court as of 02.10.2024 in case № 280/9850/23, cassation appeal of Main Directorate of the State Tax Service in Zaporizhzhia region was satisfied. Decision of the Third Administrative Court of Appeal as of 24.07.2024 was canceled and decision of the Zaporizhzhya District Administrative Court as of 15.04.2024 was upheld.