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Slovakia / Regional Court of Košice / 7S/215/2012

GALAFRUIT & CO, s.r.o v Financial Authority of the Slovak Republic

Policy area:
Deciding Body type:
National Court/Tribunal
Deciding Body:
Slovakia / Regional Court of Košice
Decision date:

Key facts of the case:

In his motion, the Complainant demanded cancelling a decision by which the Defendant had confirmed an additional tax demand note issued by the Trebišov Tax Office. The additional tax demand note had been issued based on the results of an inspection performed by the Tax Authority of the Slovak Republic that examined justification of the Complainant’s claim to value added tax refunds. The tax administrator observed that the Complainant had failed to corroborate his claim to value added tax refunds with respect to the transactions in question and demonstrate the use of the goods and services in question for his own purposes as a value-added taxpayer by which he had breached the law. Tax authorities called on the Complainant to submit documents that would justify his claim to value added tax refunds. Since the Complainant failed to produce the required evidence, tax inspectors reviewed the files of some of the subjects whose names were stated on examined documents as contractors. Based on their files, the tax administrator established that these subjects had been repeatedly called on to provide explanation and produce evidence with respect to the examined invoices made out to the Complainant but did not react to them. The Complainant objected to the violation of the proportionality principle and inadequate burden of proof required of an inspected taxpayer. In its ruling, the Regional Court of Košice found in favour of the tax administrator who had concluded that the Complainant’s trading companies did not do business in a standard manner and merely simulated business activity in order to gain financial profit in the form of value added tax refunds. The Complainant could have refuted the accusations by the tax administrator and the Defendant by producing evidence that would demonstrate the real nature of the transactions in question. The case deals with a tax law and and falls within the scope of EU law.