Attorneys of the Law Firm “YUST” successfully represented ООО “SEVTEKHNOTRANS” in a Dispute with the Tax Authority

The award by the Moscow City Court of Arbitration of 26 October, 2009, and the ruling by the 9th Arbitration Court of Appeal of 18 January, 2010 on case No. А40-75872/09-90-462, where claims by ООО “SEVTEKHNOTRANS” were satisfied to hold invalid the resolution by the tax authority to bring to liability for the commitment of tax violation, the resolution on refusal to reimburse VAT and the order to pay a tax, levy, penalty, fine, remained unchanged by the resolution made by the Federal Moscow District Court of Arbitration of 09 March, 2010, No. КА-А40/1698-10.

Disputable resolutions issued are based on the conclusions made by the tax authority that ООО “SEVTEKHNOTRANS” (hereinafter – “the Taxpayer”) unjustifiably applied VAT tax deductions, inasmuch, according to the tax authority, the taxpayer’s operations, subject to credit liabilities and inflation, were economically inefficient and aimed at VAT reimbursement from the budget.

The courts held the disputable resolutions of the tax authority invalid, because the taxpayer had met all the statutory prerequisites to apply tax deductions declared and have VAT reimbursed. Facts referred to by the tax authority as grounds to refuse the Taxpayer to apply the deductions and reimburse the tax, namely: the use in business operations of borrowed funds, a number of transactions believed to be inefficient by the tax authorities, and assumed interrelationship among the company and some of their counterparties, - shall not have a legal effect in making decisions with regard to the confirmation of tax deductions, eligibility for the VAT amount applied to be reimbursed, and, hence, these facts cannot form a basis to bring to tax liability.

The taxpayer’s interest in this case at all the judicial levels of review was represented by Maxim Rovinsky, an attorney of the Law Firm “YUST”.