ECJ C-746/22 (Slovenske Energeticke Strojarne) – Questions – Examining Legal Remedies and Procedural Restrictions in VAT Refund Cases

The ECJ released the facts and question in the case C-746/22 (Slovenske Energeticke Strojarne).

Context: VAT refund; procedure; remedies; ban on supplying nova

Article in the EU VAT Directive

Articles 1, 20(1) and (2), 21, 23(1) and (2), 26 and Article 29(1) and (2) of Directive 2008/9.

Facts

Slovenské Energetické Strojárne AS (hereinafter: SES) is an economic operator under Slovak law who, in the capacity of a taxable person established in another EU Member State, has applied for a refund of VAT in Hungary. The Hungarian tax authorities issued a decision requesting additional information from SES, as it was unable to make a well-founded decision on the request for a VAT refund based on the information available. The decision has been sent to the email address of SES. The Hungarian tax authorities have terminated the procedure initiated in response to the request for VAT refund because SES had not complied with its obligation to provide additional information. SES has objected to this decision and at the same time provided the additional information. On appeal, the Hungarian tax authorities confirmed the primary decision, because Hungarian law stipulates that no new facts or new evidence may be adduced in the notice of appeal and in the proceedings initiated following the notice of appeal, except for grounds for invalidity, which the applicant had already known before the determination was aware of the primary decision, but which he did not adduce or submit despite the request to that effect from the tax authorities (hereinafter: the prohibition on submitting nova). The dispute eventually reached the referring court. no new facts or new evidence can be adduced of which the applicant was already aware before the adoption of the primary decision, but which he failed to adduce or submit despite the request to that effect from the tax authorities (hereinafter: the prohibition on invoking nova) . The dispute eventually reached the referring court. no new facts or new evidence can be adduced of which the applicant was already aware before the adoption of the primary decision, but which he failed to adduce or submit despite the request to that effect from the tax authorities (hereinafter: the prohibition on invoking nova) . The dispute eventually reached the referring court.

Consideration:

The referring court first of all wishes to know from the Court of Justice whether the aforementioned prohibition on the supply of nova leads to a substantive restriction that goes beyond the conditions laid down in Article 23(2) of Directive 2008/9/EC with regarding legal remedies. Secondly, the referring court wishes to know whether the one-month period laid down in Article 20(2) of Directive 2008/9 constitutes an expiry period. Finally, the referring court wants to know from the EU Court whether a national regulation under which the tax authorities terminate the procedure if the taxpayer applying for a refund does not comply with its obligation to provide additional information and the request for VAT refund cannot be assessed in the absence thereof,

Questions

1. Should Article 23(2) of Council Directive 2008/9/EC laying down detailed rules for the refund of value added tax provided for in Directive 2006/112/EC to taxable persons not resident in the Member State of refund but are established in another Member State (hereinafter ‘Directive 2008/9’) must be interpreted as meaning that the conditions for bringing legal remedies laid down in that directive do not preclude national legislation — namely, Paragraph 124(3) of Law CLI of 2017 on tax procedure (hereinafter: ‘Law CLI of 2017’) – which, when assessing applications for VAT refunds pursuant to Council Directive 2006/112/EC on the common system of value added tax ( after this:‘VAT Directive’) does not allow the submission of new facts or new evidence at the objection stage which the applicant was aware of before the adoption of the primary decision, but which he has failed to adduce or submit despite a request from the tax authorities , which constitutes a substantive restriction that goes beyond the conditions laid down by Directive 2008/9 with regard to form and time-limit?

2. Does an affirmative answer to the first question mean that the one-month period laid down in Article 20(2) of Directive 2008/9 can be regarded as an expiry period? Does this practice comply with the right to an effective remedy and to a fair trial enshrined in Article 47 of the Charter of Fundamental Rights of the European Union (‘the Charter’), Articles 167, 169 and 170 and Article 171(1) of the VAT Directive and with the principles of fiscal neutrality, effectiveness and proportionality developed by the Court of Justice of the European Union?

3. Must the provisions of Article 23(1) of Directive 2008/9 concerning the total or partial rejection of the refund application be interpreted as not precluding national legislation — namely, Paragraph 49(1) under b) of Act CLI of 2017 – whereby the tax authorities terminate the procedure if the taxpayer requesting a refund does not comply with its obligation to provide additional information despite the request to that effect from the tax authorities, the request cannot be assessed in the absence thereof and there is no ex officio continuation of the procedure?

AG Opinion

Decision

Summary

Source