1. The subject of the dispute is the appeal against the tax assessment notice by which Avers Sold LLC was denied VAT refund from the budget, and the obligation of the State Tax Service to enter data into the Register of VAT Refund Applications.
2. The court of cassation agreed with the conclusions of the courts of previous instances, which established that Avers Sold LLC lawfully included in the tax credit the VAT amounts for transactions with counterparties, since these transactions were confirmed by proper primary documents, actual changes occurred in the property status of the taxpayer, and business transactions caused changes in the structure of assets and liabilities of the taxpayer, and contributed to the receipt of income. The court also took into account that the State Tax Service did not provide sufficient evidence of the absence of actual performance of business transactions or awareness of Avers Sold LLC of possible illegal actions of suppliers. The Supreme Court emphasized that the taxpayer should not be liable for violations of tax discipline by its counterparties if it acted in good faith and with due diligence. The Court noted that the Grand Chamber of the Supreme Court departed from the conclusion that the status of a fictitious enterprise is incompatible with legal activity, and emphasized the need for the controlling body to prove unreasonableness, bad faith or lack of due diligence of the taxpayer when using primary documents.
3. The Supreme Court upheld the decisions of the courts of previous instances on partial satisfaction of the claim of Avers Sold LLC, canceling the tax assessment notice and obliging the State Tax Service to enter the necessary data into the Register of VAT Refund Applications.
