ECHR ruling of May 4, 2017 in the case of "Chap Ltd." company (Chap Ltd.) against Armenia "(application No. 15485/09).
In 2009, the applicants were assisted in preparing the application. The application was subsequently communicated to Armenia.
The case was successfully considered a complaint against the decision of the tax authority to recover from the applicant a tax, fine and fine, based on the testimony of witnesses who were not summoned to the court for interrogation. There has been a violation of Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms.
CIRCUMSTANCES OF THE CASE
The applicant company is a licensed television broadcaster. In 2007, the tax authorities presented an opinion in which it was established that the applicant company had lowered its tax obligations by concealing advertising revenue. The tax authorities, in particular, referred to the documents they requested from the head of the National Commission on Television and Radio (NTRC) and the testimony of witnesses who claimed that they did not receive confirmation of payments made after the advertisement was placed on television.
Subsequently, the administrative court ordered the applicant company to pay the unpaid tax, a 60 percent fine and a fine for late payment. In the conventional proceedings, the applicant company complained under paragraph 1 and subparagraph (d) of paragraph 3 of Article 6 of the Convention that the administrative court did not allow it to question the head of the NTRC or other witnesses in the proceedings.
ISSUES OF LAW
Concerning compliance with article 6, paragraph 1, of the Convention, in conjunction with article 6, paragraph 3 (d), of the Convention. The applicant company was given significant sanctions, fines and penalties amounting to more than 60% of the amount of the tax due. Thus, Article 6 of the Convention was applicable in its criminal law aspect. Although the way in which the guarantees of Article 6 of the Convention can be applied in the context of tax sanctions proceedings in certain cases may differ from those applied strictly in criminal law, in the present case the applicant company challenged the actual findings of tax authorities that were based on testimonies not supported by the relevant documentation.
Without considering whether there were valid reasons for not appearing, the administrative court refused to provide the applicant company with a witness challenge, because it considered that their testimony was irrelevant. However, the documents submitted by one of the witnesses (the head of the NTRC) and the testimony of the other witnesses were taken as evidence against the applicant company, and although they were not the only ones against it, they could be considered crucial for determining tax sanctions. There were no procedural guarantees that compensated the applicant company's limitations because of the impossibility of questioning these witnesses. Accordingly, the applicant company was unreasonably limited in its right to question witnesses in the proceedings against her.
The violation of the requirements of Article 6 of the Convention (unanimously) was committed.
In the application of Article 41 of the Convention. The Court awarded the applicant company EUR 2,400 in respect of non-pecuniary damage, the claim for compensation for pecuniary damage was rejected.