RESOLUTION OF THE SUPREME ECONOMIC COURT OF UKRAINE

of July 11-24, 2002 No. 1/5/119

Compensation of the value added tax

On July 11-24, 2002 the board of judges of the Supreme Economic Court of Ukraine considered in open session the writ of appeal of limited liability company "the MASA of investment groups Company (further - the Company) on the resolution of the Dnipropetrovsk Economic Court of Appeal of May 27, 2002 on case N1/5/119 of economic court of the Zaporizhia region on the claim of the Company to the State tax authorities in Ordzhonikidzevsky district Zaporizhia (further - BEND in Ordzhonikidzevsky district) about recognition invalid decisions.

At the beginning of judicial session their rights and obligations are explained to the parties.

Removals of structure of court by the parties are not declared. By the beginning of consideration of the case in fact the claimant (Company) declared the following petitions:

- stop cassation conducting case in connection with provision by the Company to economic court of the Zaporizhia region of the statement for reconsideration of the case in connection with the new revealed circumstances;

- conduct technical fixing of legal procedure in cassation instance;

- attach to case papers of the copy of decisions of economic courts on similar cases,

BEND in Ordzhonikidzevsky district objected to all specified petitions.

Having considered the specified petitions in fact, the board of judges solved the following.

The petition for suspension of cassation conducting case in connection with provision by the Company to economic court of the Zaporizhia region of the statement for reconsideration of the case in connection with the new revealed circumstances is not subject to satisfaction as by the time of consideration of the case in judicial session of cassation instance the claimant did not prove acceptance by economic court of the Zaporizhia region of the specified statement to the production, in particular did not produce competent evidences of making of legal proceedings for fulfillment of requirements of article 113-1 HPK of Ukraine.

The petition for technical fixing of legal procedure and taking the minutes is rejected as, according to requirements of HPK of Ukraine, the cassation instance cannot establish the facts of the case, collect new proofs or in addition check proofs. To perform fixing of all statements and petitions of the parties and their assessment in the resolution of board of judges.

As for the petition for attaching to case papers of the copy of decisions of economic courts on similar cases, in view of provision by the claimant of this petition with considerable delay the board of judges obliged the Company to inform the defendant of this petition directly in judicial session, and also came to conclusion about possibility of accession of the corresponding materials for case, without giving them assessment as to new proofs.

Upon termination of consideration of the case in fact the claimant did not agree with announcement only of introductory and resolutive parts of the resolution of board of judges of the Supreme Economic Court of Ukraine. In this regard in the judicial session begun on July 11, 2002 the break till July 25, 2002 for preparation of the complete resolution was announced. Later the board of judges notified by telegrams the parties on continuation of meeting on July 24, 2002.

By the beginning of continuation of judicial session on July 23, 2002 in the Supreme Economic Court of Ukraine the petition of the Company for taking measures to providing the claim based on Articles 66, 67 HPK Ukraine and about the termination of enforcement proceeding of the decision of economic court of March 26, 2002 based on article 121-1 HPK of Ukraine arrived. Having considered the specified petition in fact, the board of judges does not see reasons for its satisfaction, considering that by the time of its receipt the court was already determined concerning results of consideration of the case in cassation instance, and having rummaged in judicial session appeared only for preparation of the complete text of the resolution.

According to the petition of the claimant in judicial session the complete resolution of board of judges of the Supreme Economic Court of Ukraine is announced on July 24, 2002.

The decision of economic court of the Zaporizhia region of March 26, 2002 (the judge Hutorny V. M.) claims of the Company about recognition invalid decisions BEND in Ordzhonikidzevsky district Zaporizhia of December 14, 2001 N664/26-02/25479096/27331 decisions are satisfied partially due to recognition invalid BEND regarding additional accrual of the income tax in the amount of 3290200 UAH, application of financial sanctions on the income tax in the amount of 800030 UAH, additional accrual of the value added tax in the amount of 241298158 UAH, application of financial sanctions on the value added tax in the amount of 486990 UAH, and together on the amount of 699020158 UAH.

In that part of the decision BEND in Ordzhonikidzevsky district of N1 of January 2, 2002 which is acknowledged not subject to execution, execution on case is stopped.

Making the decision, the court recognized that according to Item 6.2.1 of article 6 of the Law of Ukraine "About the value added tax" (further - the Law) properly the drawn-up cargo customs declaration certifies only the commodity exportation fact out of limits of customs area of Ukraine, but it does not identify person who performed this export. At the same time, by part 1 of Item 6.2.1 of article 6 of the above-stated Law it is accurately determined that the value added tax (further - the VAT) is estimated at the rate of 0% concerning transactions on sales of goods which were exported (are exported) by the taxpayer out of limits of customs area of Ukraine, but necessary proofs in case papers are absent.

The resolution of the Dnipropetrovsk Economic Court of Appeal of May 27, 2002 (board of judges in structure: chairman Yevstigneyev O. S., judges Tishchik I. V., Chimbar L. O.) the decision of economic court of the Zaporizhia region is left without changes on the ground that the cargo customs declarations which are drawn up by the claimant do not confirm the fact of export by the Company of goods out of limits of customs area of Ukraine.

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