15 billion rubles won back

The Supreme Arbitration Court published the statement of the triumvirate of judges – the Presidium of SAC is not going to consider the claim of Interregional Inspection of Federal Tax Service No 1 against the award of the cassation instance which acknowledge the fact of additional charging  “RussNeft”  with excises, penalty and surcharge in the amount  0f 3.43 million rubles for October 2005.

The inspectors denied reimbursement of excise tax for export deliveries of oil products because of the standard phrase captains of tankers se in B/Ls: “Weight, quantity and quality are unknown to me” thus showing that they are unaware of the type, quantity and terms of transportation  of the goods which were loaded on board of their ships.

“RussNeft” won the case in the court of original jurisdiction , lost the appellation, but successfully contested it in cassation instance. Russia joined the Convention  of Bill of Lading permitting the above mentioned  remark and the captain’s statement did not evidence that the oil products had not been exported, the cassation instance decided.

The Convention permits this kind of remark and the company submitted to the inspection a complete set of documents – so, there were no grounds to deny reimbursement of VAT, the triumvirate state.

For the same reason tax officials had monthly denied the company reimbursement of excises since October 2005 and export VAT – since December (See enclosure). After the statement of the SAC they stopped doing that,  a representative of “RussNeft” noticed. The FTS gave no comments.

“Tomskneft” was the object of similar claims, says the lawyer of “Tax Assistance” Alexei Maslov: the tax people claimed that originals and not copies road bills should be submitted. The company objected: transport conventions permits copies, only the consignee receives the original.   “Tomskneft” kept winning the cases, the tax people kept charging additional sums for a year.

It is a rare thing that a case should go as far as the SAC, says Maslov, usually tax people don’t go farther than cassation. In spite of the SAC award, inspectors may use the same reason for denying reimbursement until FTS issues the instruction for internal use. Inspectors prefer to lose cases but not to explain to their superiors that the case is hopeless, Maslov adds.

Tax officials must execute judgments after appellation, but until all the stages are passed they avoid doing so, noticed the lawyer from the law firm “Peplayev, Golzblat and Partners”, Yuri Vorobiov. For the beginning of October the budget returned to “RussNeft” more than 1 billion rubles, partly  in monetary value and partly as offset.

Now, for non-reimbursement of VAT and excises “RussNeft” may claim interest on the basis of refinancing rate ( as of the end of 2005 – 13%, at present – 10%). The interest will accrue if the tax officials didn’t reimburse the money three months after the tax return was submitted, Maslov says.

A representative of the company says that it takes about eighteen months to reimburse the financial means. But it is very difficult to get the interest: the oil officials may say that these costs should have been  mentioned in the Budget Law.

But “RussNeft” lost the appellation for two decisions of Moscow Arbitration Court for 20,5 billion rubles. The court agreed with the reasons of tax officials that in 2003-2005 the company was buying oil not directly from producing subsidiaries, but through traders with extra charge and in this connection was short with tax payment.

The tax officials may start recovery if the appellation instance removes provisional measures, says the General Director of “Tax Assistance” Sergei Shapovalov. Usually it happens after the judgment of appellation, but sometimes only after cassation. Vorobiov remarks.

And the case of  collection of the shares of “RussNeft” to the budget  due to the fact that they were sold too cheap is now under consideration at the court of original jurisdiction.

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How much was not reimbursed
As of the beginning of October the budget owed to “RussNeft” about 15 billion rubles, says a representative of the company. During the last year FTS monthly denied the company reimbursement of excises in average for the sum of 300 million rubles and export Vat for 600 million rubles. “RussNeft” has won the cases for 7,5 million rubles of the 8.5 million rubles contested. The balance of 6.5 million rubles are contested out-of-court.