Staatssecretaris van Financiën v Schoenimport ‘Italmoda’ Mariano Previti vof and Turbu.com BV and Turbu.com Mobile Phone’s BV v Staatssecretaris van Financiën.
Date: 2014-12-18
31. In that regard, it is appropriate to point out that, according to settled case-law, questions on the interpretation of EU law referred by a national court in the factual and legislative context which that court is responsible for defining, and the accuracy of which is not a matter for the Court to determine, enjoy a presumption of relevance. The Court may refuse to rule on a question referred by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (see, inter alia, judgments in Budějovický Budvar , C‑478/07, EU:C:2009:521, paragraph 63; Zanotti , C‑56/09, EU:C:2010:288, paragraph 15; and Melki and Abdeli , C‑188/10 and C‑189/10, EU:C:2010:363, paragraph 27).
42. In order to answer that question, it must be recalled, at the outset, that preventing possible tax evasion, avoidance and abuse is an objective recognised and encouraged by the Sixth Directive (see, inter alia, judgments in Halifax and Others , C‑255/02, EU:C:2006:121, paragraph 71; Kittel and Recolta Recycling , C‑439/04 and C‑440/04, EU:C:2006:446, paragraph 54; and Mahagében and Dávid , C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 41).
43. In this connection, the Court has repeatedly held that EU law cannot be relied on by individuals for abusive or fraudulent ends (see, inter alia, judgments in Kittel and Recolta Recycling , EU:C:2006:446, paragraph 54; Fini H , C‑32/03, EU:C:2005:128, paragraph 32; and Maks Pen , C‑18/13, EU:C:2014:69, paragraph 26).
44. The Court concluded from this, firstly, in the context of settled case-law on the right to deduct VAT laid down by the Sixth Directive, that it is for the national authorities and courts to refuse that right if it is shown, in the light of objective evidence, that that right is being relied on for fraudulent or abusive ends (see, inter alia, judgments in Kittel and Recolta Recycling , EU:C:2006:446, paragraph 55; Bonik , C‑285/11, EU:C:2012:774, paragraph 37; and Maks Pen , EU:C:2014:69, paragraph 26).
46. Thirdly, as the Advocate General stated in points 50 to 52 of his Opinion, in so far as any refusal of a right under the Sixth Directive reflects the general principle, mentioned in paragraph 43 of the present judgment, that no one may benefit from the rights stemming from the Union’s legal system for abusive or fraudulent ends, such a refusal is the responsibility, in general, of the national authorities and courts, irrespective of the VAT right affected by the fraud, including therefore the right to a VAT refund.
48. In this regard, it is appropriate to note that it follows from the case-law cited in paragraph 44 of the present judgment that the central function of the right of deduction provided for in Article 17(3) of the Sixth Directive, in the VAT mechanism designed to ensure complete neutrality of the tax, does not preclude that right from being refused to a taxable person in the event of participation in fraud (see to that effect, inter alia, judgments in Bonik , EU:C:2012:774, paragraphs 25 to 27 and 37, and Maks Pen , EU:C:2014:69, paragraphs 24 to 26). Similarly, the specific function of the right to a VAT refund, intended to ensure the neutrality of VAT, cannot preclude that right from being refused to a taxable person in such a situation.
49. In the light of the foregoing considerations, it is, in principle, the responsibility of the national authorities and courts to refuse the benefit of the rights laid down by the Sixth Directive when they are claimed fraudulently or abusively, irrespective of whether those rights are rights to a deduction, to an exemption or to a VAT refund in respect of intra-Community supplies, as at issue in the case in the main proceedings.
50. It must further be noted that, according to settled case-law, that is the position not only where tax evasion has been carried out by the taxable person itself but also where a taxable person knew, or should have known, that, by the transaction concerned, it was participating in a transaction involving evasion of VAT carried out by the supplier or by another trader acting upstream or downstream in the supply chain (see to that effect, inter alia, judgments in Kittel and Recolta Recycling , EU:C:2006:446, paragraphs 45, 46, 56 and 60, and Bonik , EU:C:2012:774, paragraphs 38 to 40).
52. In this respect, it must be recalled that it is for the national court to interpret the national law, so far as possible, in the light of the wording and the purpose of the directive concerned in order to achieve the result sought by the directive, which requires that national court to do whatever lies within its jurisdiction, taking the whole body of domestic law into consideration and applying the interpretative methods recognised by that law (see, to that effect, judgments in Adeneler and Others , C‑212/04, EU:C:2006:443, paragraph 111; Kofoed , C‑321/05, EU:C:2007:408, paragraph 45; and Maks Pen , EU:C:2014:69, paragraph 36).
54. However, should it transpire, in the second place, that, in this case, national law contains no such rules which may be interpreted in accordance with the requirements of EU law, it cannot nevertheless be inferred from this that the national authorities and courts would, in circumstances such as those at issue in the main proceedings, be prevented from satisfying those requirements and, accordingly, refusing a benefit derived from a right laid down by the Sixth Directive in the event of fraud.
55. First, even if it is true, as Italmoda has stated, that, according to settled case-law, a directive cannot of itself impose obligations on an individual and cannot therefore be relied on as such, by the Member State, against that individual (see, inter alia, judgments in Pfeiffer and Others , C‑397/01 to C‑403/01, EU:C:2004:584, paragraph 108, and Kücükdeveci , C‑555/07, EU:C:2010:21, paragraph 46), the refusal of the benefit of a right as a result of fraud, as in this case, is not covered by the situation envisaged by that case-law.
56. On the contrary, as has been pointed out in paragraphs 43 and 46 of the present judgment, that refusal addresses the principle that rules of EU law cannot be relied on for abusive or fraudulent ends as the application of those rules cannot be extended to cover abusive, let alone fraudulent, practices (see, to that effect, judgments in Halifax and Others , EU:C:2006:121, paragraphs 68 and 69, and Collée , C‑146/05, EU:C:2007:549, paragraph 38).
57. Accordingly, in so far as abusive or fraudulent acts cannot form the basis of a right under EU law, the refusal of a benefit under, in this case, the Sixth Directive does not amount to imposing an obligation on the individual concerned under that directive, but is merely the consequence of the finding that the objective conditions required for obtaining the advantage sought, under the directive as regards that right, have, in fact, not been satisfied (see, to that effect, inter alia, judgments in Kittel and Recolta Recycling , EU:C:2006:446, paragraph 53, and FIRIN , C‑107/13, EU:C:2014:151, paragraph 41).
60. Next, contrary to what Italmoda has claimed, a taxable person who has created the conditions for obtaining a right only by participating in fraudulent transactions is clearly not justified in invoking the principles of protection of legitimate expectations or legal certainty in order to oppose the refusal to grant the right in question (see, to that effect, judgments in Breitsohl , C‑400/98, EU:C:2000:304, paragraph 38, and Halifax and Others , EU:C:2006:121, paragraph 84).
62. In the light of all the foregoing considerations, the answer to the first question is that the Sixth Directive must be interpreted as meaning that it is for the national authorities and courts to refuse a taxable person, in the context of an intra-Community supply, the benefit of the rights to deduction of, exemption from or refund of VAT, even in the absence of provisions of national law providing for such refusal, if it is established, in the light of objective factors, that that taxable person knew, or should have known, that, by the transaction relied on as a basis for the right concerned, it was participating in VAT evasion committed in the context of a chain of supplies.
The second question