On challenging inaction on the request for restoration of the additional declaration

No. 6001-22-00-6ap/1565 dated 02/21/2023

Plaintiff: LLP "A"

Respondent: Russian State Institution "Department of State Revenue for the Kyzylorda region of the State Revenue Committee of the Ministry of Finance of the Republic of Kazakhstan"

The subject of the dispute: on challenging inaction on the request for restoration of the additional declaration

Review of the defendant's cassation appeal. PLOT:

The additional VAT declaration for the 4th quarter of 2015, submitted by the Partnership on March 26, 2016, was withdrawn by the Department at the initiative of the Department.

The reason for the withdrawal of the additional declaration was the decision of the Department No. 358312115944902447 dated November 11, 2016, since changes and additions to the tax reporting of the audited period are not allowed during the tax audit.

By the decision of the Council of Economic and Social Council of the Kyzylorda region dated February 2, 2017, the notification on the results of the tax audit No. 218 dated November 11, 2016 was canceled.

On July 4, 2017, the plaintiff filed application No. 675 with the Department and the Office for the restoration of the revoked additional declaration.

The Department forwarded this application to the Management for execution by letter dated July 13, 2017, but it was left unanswered.

Judicial acts:

1st instance: the claim is satisfied.

Appeal: the decision remains unchanged.

Cassation: judicial acts were changed in terms of imposing obligations on the Department and Management to take actions to restore the additional VAT declaration for the 4th quarter of 2015, judicial acts were canceled with the issuance of a new decision to dismiss the claim of LLP "A".

Conclusions:

The courts concluded that the Department had failed to consider the merits of the plaintiff's appeal dated July 4, 2017, which the defendants did not deny. The procedure for revocation of tax reports by the tax authority was carried out in violation of the legislation.

No notification was issued on the elimination of violations of tax legislation in accordance with Article 69 of the Tax Code and was not sent to the plaintiff. The decision of the tax authority to revoke tax reports in a special form approved by the Order of the Ministry of Finance of the Republic of Kazakhstan dated December 30, 2008

No. 637 "On certain issues of tax administration", has not been submitted to the court by the tax authority.

The legal consequence of the court's consideration of a claim to challenge the inaction of the defendants for not considering the merits of the plaintiff's appeal is that they are required to consider the appeal and provide a reasoned response within the time limits established by law.

Since the additional tax return was submitted by the plaintiff in violation of the above provision during the tax audit, the tax reporting was revoked by the tax authority on the basis of paragraph 6 of Article 69 of the Tax Code by sending a notification in the form established by the authorized body.

Notification of the elimination of violations of tax legislation was not required due to the impossibility of its execution by the taxpayer himself due to the prohibition established by subparagraph 1) paragraph 5 of Article 69 of the Tax Code.

The tax legislation does not provide for provisions on the restoration of previously withdrawn tax reports by the tax authority itself, since such actions are regarded as illegal state interference in the affairs of business entities and are the exclusive prerogative of the taxpayer, who has the right to re-submit an additional declaration within the limitation period, taking into account the results of the tax audit.

The plaintiff had the right to provide an additional declaration for the 4th quarter of 2015 from the date of entry into force of the court's decision of February 2, 2017 on the cancellation of the notification of the results of the audit No. 218 dated November 11, 2016, but did not exercise this right.

In addition, the board found that the disputed amount of VAT on the withdrawn additional declaration was accrued to the budget on the basis of notification of the results of the tax audit No. 160 dated May 06, 2019, the legality of which in this part was confirmed by a judicial act that entered into force.

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