Petition for the Cancellation of Tax Penalties – TAX LAW

Petition for the Cancellation of Tax Penalties – TAX LAW

TO THE DUTY TAX COURT

ANKARA

 

PLAINTIFF: Ali DEMİR (Turkish Republic Identity Number: 12345678901)
Address: Karanfil Mah. 1204. Sok. No:10/3 Çankaya / ANKARA

REPRESENTATIVE: Attorney Irem Epçaçan (address)

DEFENDANT: Çankaya Tax Office Directorate – ANKARA

THE TAX AND PENALTY THAT ARE THE SUBJECT OF THE CASE

Type: Special Irregularity Penalty (violation of the obligation to submit e-declarations)

Amount: 8,000.00 TL

Period: January 2017

NOTIFICATION 

Date: Unpublished / Unnotified

Number: –

Notification Date: –

Payment Order
Date : 10/01/2024
Number : 2024/12345
Notification Date : 15/01/2024

SUBJECT OF THE CASE:The request is for the annulment of the payment order regarding the special irregularity penalty of 8,000.00 TL imposed for the January 2017 period, and for the cancellation of the said tax penalty due to statute of limitations and procedural irregularities.

EVENTS AND FINDINGS: 

1. The plaintiff operates a small stationery shop in Çankaya district of Ankara province and was registered as a VAT taxpayer throughout 2017.

2. The defendant tax office imposed a special irregularity penalty of 8,000.00 TL on the plaintiff for allegedly failing to submit the VAT return for January 2017 electronically on time , but did not serve any tax/penalty notice to the plaintiff regarding this penalty

3. The plaintiff wanted to find out whether they had any outstanding tax debts in order to obtain a loan from the bank in 2021; consequently, they submitted a written request for information to the defendant administration on March 5, 2021.

4. The defendant tax office, in its letter dated 15/03/2021 and numbered 2021/456, issued in response to this application , clearly stated that "the taxpayer has no outstanding debts registered with our tax office as of 15/03/2021 .

5. The plaintiff, approximately three years later, a payment order dated 10/01/2024 and numbered 2024/12345 ; upon notification of this payment order on 15/01/2024, he became aware of the special irregularity penalty of 8,000.00 TL relating to the January 2017 period.

6. Prior to the payment order, the plaintiff was not served with any tax/penalty notice , and the defendant administration's letter dated 15/03/2021 clearly stated that no debt was found registered in the plaintiff's name.

7. Therefore, it is understood that the penalty in question the assessment, notification, and accrual stages stipulated in the tax procedure legislation, and that it was first attempted to be notified via a payment order after the assessment statute of limitations had expired .

REASONS FOR OBJECTION:

1) The tax penalty in question has expired due to the statute of limitations

1. The incident subject to the special penalty for irregularities relating to the January 2017 period occurred within the 2017 calendar year. Article 114 of the Tax Procedure Law , the statute of limitations for assessment is "5 years from the beginning of the year following the calendar year in which the tax liability arose."

2. In this specific case, the statute of limitations is;

   • Start date: 01/01/2018

   • The deadline is 31/12/2022
     .

3. The plaintiff was not served with any penalty notice until December 31, 2022; the penalty was first brought to attention with a payment order dated January 10, 2024

4. Article 113 of the Tax Procedure Law defines statute of limitations "the extinguishment of a tax claim due to the passage of time ." Therefore, the administration's right to collect taxes and tax penalties that are not assessed and notified within the statute of limitations period is extinguished.

5. The special penalty for irregularities relating to the January 2017 period has become time-barred as of December 31, 2022 , and it is legally impossible to impose it on the taxpayer for the first time via a payment order in 2024. Therefore, the basis for the penalty in question no longer exists, and the payment order should be cancelled and the penalty written off.

2) Issuing a payment order directly without serving a tax/penalty notice is against procedure

1. For a tax receivable to reach the collection stage, it must first the assessment, notification, and accrual stages; and if a penalty is involved, the tax penalty be notified to the taxpayer via a penalty notice .

2. The plaintiff was not served with any tax/penalty notice regarding the special irregularity penalty for the January 2017 period , and the necessary legal process for exercising their rights to settlement, penalty reduction, or filing a lawsuit was not initiated.

3. Despite this, the defendant administration directly Article 55 of Law No. 6183 on the Collection Procedure of Public Receivables . By proceeding to the collection phase of the penalty without notifying the taxpayer and finalizing the penalty notice, the administration eliminated the plaintiff's rights to defense and appeal.

4. In this respect, the payment order in question clear violation of procedural rules and is unlawful both formally and substantively.

3) Issuing a payment order after the administration has issued a "No Debt" certificate is contrary to the principle of legal certainty

1. The plaintiff, in a petition dated 05/03/2021, inquired with the tax office whether they had any outstanding debts; the defendant administration, in its letter dated 15/03/2021 and numbered 2021/456 , officially informed the plaintiff that as of 15/03/2021, they had no outstanding debts

2. If the special penalty for irregularities related to January 2017 had been assessed and finalized at that time, this debt should have been mentioned in the aforementioned document. This situation indicates that either the penalty was never assessed, or it is not even visible in the administration's own records.

3. The fact that the administration sends a payment order for a penalty for the same period approximately three years after having issued a written statement declaring that there is "no debt" undermines trust in the administration and constitutes a violation of the principles of legal certainty and transparency

4. The administration's actions, which contradict its own official written directive, eliminate the taxpayer's predictability, and even in this case, it cannot be considered that the statute of limitations for collection has been interrupted or suspended.

LEGAL GROUNDS:

• Tax Procedure Law No. 213 (especially Articles 93 and subsequent articles, 112, 113, 114 et seq.)

• Law No. 6183 on the Procedure for the Collection of Public Receivables

• Law No. 2577 on Administrative Procedure

• Relevant secondary legislation, circulars, case law, and general legal principles.

EVIDENCE:

• Payment order dated 10/01/2024 and numbered 2024/12345

• Sample plaintiff's petition dated 05/03/2021

• Tax office letter dated 15/03/2021 and numbered 2021/456 stating "no debt"

• Debt statements obtained from the Revenue Administration system

• Taxpayer registration and inspection reports

• All types of legal evidence, and as needed, any witness testimony, expert opinions, and on-site investigation evidence

CONCLUSION AND REQUEST:

For the reasons stated and explained above, and for reasons that your Court may consider ex officio;

1. The payment order dated 10/01/2024 and numbered 2024/12345 , issued based on a special irregularity penalty of 8,000.00 TL for the period of January 2017, is hereby CANCELED .

2. The special penalty for procedural irregularities, which is the subject of the lawsuit, is hereby CANCELED due to the expiration of the statute of limitations and procedural irregularities .

3. The court costs and attorney fees are to be borne by the defendant administration

I respectfully request and demand that a decision be made.
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Plaintiff's Attorney

Attorney Irem EPÇAÇAN