We had a pleasure to represent  the company in a case in which the Supreme Administrative Court stated that a taxpayer may be deprived of the deductibility of VAT only after a comprehensive evidence processing  and the legality examination of the decision of the tax authorities by the court.

In the above mentioned case, the Head of the Tax Office decided that the scrap was not delivered so the company issued blank invoices that did not document the actual transactions and challenged the right to deduct VAT by this company.

The Court of First Instance was only confined to drawing conclusions from one transaction and decided  that the company had not taken due diligence to verify its counterparties. The Supreme Administrative Court did not share the findings of the first instance court and concluded that the tax authorities could not extend the conclusions of one transaction to another. In order to deprive a taxpayer of the right to deduct VAT by assuming that he has not maintained due diligence in verifying the reliability of his contractors, the analysis of the evidence and the decision issued by the tax authority is necessary.