Review of judicial acts in cassation upon the protest of the Prosecutor General
The KGP, under the right of economic management of the Akimat of Almaty, filed a lawsuit against the LLP for recognition as an unscrupulous participant in public procurement and termination of the contract. The claim was satisfied by the decision of the specialized interdistrict Economic Court of Almaty dated February 1, 2017, which was left unchanged by the decision of the judicial board of the Almaty City Court dated April 19, 2017. The Partnership has been recognized as an unscrupulous participant in public procurement. The public procurement contract has been terminated. In satisfying the claims of the enterprise, the courts of the first and appellate instances proceeded from the established fact that the Partnership violated the terms of the contract, the requirements of Article 272 of the Civil Code on the fulfillment of obligations properly in accordance with the terms of the obligation and the requirements of the law.
Review of judicial acts in cassation upon the protest of the Prosecutor General
The Judicial Board of the Supreme Court disagreed with the conclusions of the local courts and, having annulled the judicial acts, issued a new decision in the case to dismiss the claim. Rejecting the claim, the court of cassation concluded that the Partnership had not violated its obligations under the contract, since the deadline had not yet arrived, and the company's reference to the impossibility of integrating technical equipment was premature and based on assumptions. However, these conclusions of the Court of cassation are based on a reassessment of the evidence presented by the parties. During the consideration of the case, it was reliably established that the Partnership refused to perform duties on the installation and integration of the on-board alarm system and intends to supply electric trains, the on-board system of which is obviously incompatible with the existing alarm system. Considering that the use of electric rolling stock from other manufacturers is impossible with the existing Automatic Train Traffic Control System (ASUDP). At the protest of the Prosecutor General, the decision of the judicial board was canceled, while the judicial acts issued in the case remained in force. Another example. The State Institution filed a lawsuit against the JSC to recover the amount of unjustified enrichment. By the decision of the specialized inter-district Economic Court of Astana dated May 5, 2016, which was left unchanged by the decision of the Judicial Board for Civil Cases of the Astana City Court dated July 20, 2016, the claim of the Department was satisfied. The amount of unjustified enrichment in the amount of 899,179,680 tenge and the state duty in the amount of 26,975,390 tenge were collected from JSC to the state income. The conclusions of the courts are motivated by the fact that receiving money from JSC for budgetary reasons is unjustified, since construction and installation work for this amount was not carried out. No changes were made to the public procurement contract in terms of price increases, and there were no legal grounds for transferring budget funds. The Judicial Board of the Supreme Court agreed with the conclusions of the local courts. At the protest of the Prosecutor General, the cassation instance of the Supreme Court changed the judicial acts. The amount of unjustified enrichment collected from JSC to the state revenue has been reduced to KZT 390,523,463. The following circumstances served as the legal basis for satisfying the protest. The final verdict of the district court No. 2 of the Saryarkinsky district of Astana dated November 20, 2015 against the former deputy head of the department, S., established the difference between the cost of the company's facilities and LLP declared at the budget commission in the total amount of 802,384,700 tenge and the actual value of 508,201,917 tenge. According to the conclusion of the forensic economic examination dated June 30, 2015, the difference between the amount of compensation paid and the actual value of the seized property was determined at 294,182,783 tenge. For the specified amount, the court verdict established the damage to the state caused as a result of the forced purchase of property from the owners at an inflated cost. Therefore, the amount of unjustified enrichment is 294,182,783 tenge, which must be reimbursed to the budget of the JSC. The Court of cassation also recognized the arguments of the protest that 96,340,680 tenge received by JSC for VAT payment, at the rate of 12% of the total value of the seized objects in the amount of 802,839,000 tenge, are subject to refund. There is no VAT-deductible turnover in this case. The inclusion of the VAT amount in the invoice and its further payment became possible only due to the transfer of funds from the treasury for budgetary specifics related to the performance of construction and installation works in the amount of 802,839,000 tenge, which were not actually carried out. JSC, as well as Management, reliably knew about the illegality of such actions. However, the amount to be paid was intentionally attributed to the taxable turnover. In such circumstances, the cassation instance of the Supreme Court concluded that the arguments of the protest were justified.
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