European Court of Justice VAT cases 2006-3 - empcom.gov.in

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Case C-434/03 14 July 2005 P. Charles and T.S. Charles-Tijmens – Staatssecretaris van Financiën Article 6(2) and Article 17(2) and (6) of the Sixth Directive [...], as amended by Directive 95/7/EC [...], must be interpreted as precluding national legislation such as that at issue in the main proceedings, adopted before that Directive came into force, which does not make it possible for a taxable person to allocate capital goods used in part for business purposes and in part for purposes other than those of his business wholly to his business and, where appropriate, to deduct immediately and in full the VAT due on the acquisition of those goods. [2005] ECR I-7037 Case C-435/03 14 July 2005 British American Tobacco International Ltd and Newman Shipping & Agency Company NV – Belgian State 1. The theft of goods does not constitute a supply of goods for consideration within the meaning of Article 2 of the Sixth Directive [...], and therefore cannot as such be subject to VAT. The circumstance that goods are, like those at issue in the main proceedings, subject to excise duty does not affect that conclusion. 2. The authorisation to apply measures facilitating monitoring of the charging of VAT, granted to a Member State on the basis of Article 27(5) of the Sixth Directive [...], does not empower that State to subject transactions to that tax other than those set out in Article 2 of the Directive. Such an authorisation thus cannot provide a legal basis for national subjecting to VAT the theft of goods from a tax warehouse. [2005] ECR I-7077 Case C-58/04 15 September 2005 Antje Köhler – Finanzamt Düsseldorf-Nord Stops made by a ship in the ports of a third country during which passengers may leave the ship, even for a short period, are ‘stops in a third territory’ within the meaning of Article 8(1)(c) of Sixth Directive [...], as amended by Directive 92/111/EEC [...]. [2005] ECR I-8219 Case C-204/03 6 October 2005 Commission of the European Communities – Kingdom of Spain 1. By providing for a deductible proportion of VAT for taxable persons who carry out only taxable transactions, and by laying down a special rule which limits the right to deduct VAT on the purchase of goods and services which are subsidised, the Kingdom of Spain has failed to fulfil its obligations under Community law, and, in particular, Articles 17(2) and (5) and 19 of the Sixth Directive [...], as amended by Directive 95/7/EC [...]; 2. The Kingdom of Spain is ordered to pay the costs. [2005] ECR I-8389 Case C-243/03 6 October 2005 Commission of the European Communities – French Republic 1. By introducing a special rule limiting the deductibility of VAT on the purchase of capital goods where they were financed by subsidies, the French Republic has failed to fulfil its obligations under Community law, in particular under Articles 17 and 19 of the Sixth Directive [...], as amended by Directive 95/7/EC [...]; 2. The Republic of France is ordered to pay the costs; 3. The Kingdom of Spain is ordered to pay its own costs. [2005] ECR I-8411 Case C-291/03 6 October 2005 MyTravel plc – Commissioners of Customs & Excise 1. A travel agent or a tour operator who has completed his VAT Judgments of the Court of Justice – 32 © 2006 IBFD return for a tax period using the method laid down by the national rules which transpose into domestic law the Sixth Directive [...] may recalculate his VAT liability in accordance with the method held by the Court to comply with Community law, under the conditions laid down by national law, which have to observe the principles of equivalence and effectiveness. 2. Article 26 of the Sixth Directive [...] must be interpreted as meaning that a travel agent or tour operator who, in return for a package price, supplies to a traveller services bought in from third parties and in-house services must, in principle, identify the part of the package corresponding to his in-house services on the basis of their market value where that value can be established. In such a case, a taxable person may use the criterion of actual costs only if he proves that this criterion accurately reflects the actual structure of the package. Application of the criterion of market value is not subject to the condition that it must be simpler than application of the actual cost method or to the condition that it must produce a VAT liability identical or close to that which would result from using the actual cost method. Accordingly: – a travel agent or tour operator may not use the market value method at his own discretion and – that method is applicable to in-house services whose market value may be established even if, in the same tax period, the value of certain in-house components of the package cannot be established inasmuch as the taxable person does not sell similar services on a non-package basis. 3. It is for the national tribunal to establish, in the light of the circumstances of the main proceedings, the market value of the flights supplied in the main proceedings as part of package holidays. The national tribunal may establish this market value from average values. In this context, the market based on seats sold to other tour operators may constitute the most appropriate market. [2005] ECR I-8477 Case C-200/04 13 October 2005 ISt internationale Sprach- und Studienreisen GmbH – Finanzamt Heidelberg Article 26 of the Sixth Directive [...], should be interpreted as meaning that it applies to a trader who offers services such as the 'High School' and 'College' programmes involving the organisation of language and study trips abroad and which, in consideration of the payment of an all-inclusive sum, provides in its own name to its customers a stay abroad of three to 10 months and buys in services from other taxable persons for that purpose. [2005] ECR I-8691 Case C-41/04 27 October 2005 Levob Verzekeringen BV, OV Bank NV – Staatssecretaris van Financiën 1. Article 2(1) of the Sixth Directive [...] must be interpreted as meaning that where two or more elements or acts supplied by a taxable person to a customer, being a typical consumer, are so closely linked that they form objectively, from an economic point of view, a whole transaction, which it would be artificial to split, all those elements or acts constitute a single supply for purposes of the application of VAT; 2. This is true of a transaction by which a taxable person supplies to a consumer standard software previously developed, put on the market and recorded on a carrier and subsequently customises that software to that purchaser’s specific requirements, even where separate prices are paid; 3. Article 6(1) of the Sixth Directive [...] must be interpreted as meaning that a single supply such as that referred to in paragraph 2 of this operative part is to be classified as a 'supply of services' where it is apparent that the customisation in question is neither minor nor ancillary but, on the contrary, predominates; such is the case in particular where in the light of factors such as its extent, cost or duration the customisation is of decisive importance in enabling the pur-
chaser to use the customised software; 4. Article 9(2)(e), third indent, of the Sixth Directive [...] must be interpreted as meaning that it applies to a single supply of services such as that referred to in paragraph 3 of this operative part performed for a taxable person established in the Community but not in the same country as the supplier. [2005] ECR I-9433 Cases C-394/04 and C-395/04 1 December 2005 Diagnostiko & Therapeftiko Kentro Athinon-Ygeia AE – Ipourgos Ikonomikon 1. The supply of telephone services and the hiring out of televisions to in-patients by persons covered by Article 13(A)(1)(b) of the Sixth Directive [...], and the supply by those persons of beds and meals to people accompanying in-patients do not amount, as a general rule, to activities closely related to hospital and medical care within the meaning of that provision. It can be otherwise only if those supplies are essential to achieve the therapeutic objectives sought by the hospital and medical care and their basic purpose is not to obtain additional income for the supplier by carrying out transactions which are in direct competition with those of commercial enterprises liable for value added tax. 2. It is for the referring court, taking account of all of the specific facts in the litigation before it and, if appropriate, of the content of the medical prescriptions drawn up for the patients concerned, to determine whether the services supplied satisfy those conditions. [2005] ECR I-10373 Case C-280/04 8 December 2005 Jyske Finans A/S – Skatteministeriet 1. The provisions of Article 13(B)(c) of the Sixth Directive […], as amended by Directive 94/5/EC […] are to be construed as meaning that they do not preclude a national law which imposes VAT on transactions by which a taxable person, after having used them for the purposes of its business, resells goods on the acquisition of which, by virtue of Article 17(6), VAT did not become deductible, even where that acquisition, made from taxable persons who could not declare VAT, did not, for that reason, give rise to a right to deduct. 2. Article 26a(A)(e) of the Sixth Directive […], as amended by Directive 94/5, is to be construed as meaning that an undertaking which, in the normal course of its business, resells cars which it had purchased second-hand with a view to using them for the purposes of its business of sale and leaseback and for which the resale is not, at the time of the purchase of the second-hand goods, the principal objective but only its secondary objective, ancillary to that of leasing, can be considered to be a 'taxable dealer' within the meaning of that provision. [2005] ECR I-10683 Case C-63/04 15 December 2005 Centralan Property Ltd – Commissioners of Customs & Excise Article 20(3) of the Sixth Directive [...], as amended by Council Directive 95/7/EC [...], is to be interpreted as meaning that, where a 999-year lease over capital goods is granted to a person against the payment of a substantial premium and the freehold reversion in that property is transferred three days later to another person at a much lower price, and where those two transactions – are inextricably linked, and – consist of a first transaction which is exempt and a second transaction which is taxable, – and if those transactions, owing to the transfer of the right to dispose of those capital goods as owner, constitute supplies within the meaning of Article 5(1) of that Directive, the goods in question are regarded, until the expiry of the period of adjustment, as having been used in business activities which are presumed to be partly taxable and partly exempt in proportion to the respective values of the two transactions. [2005] ECR I-11087 Judgments of the Court of Justice – 33 © 2006 IBFD Joined Cases C-354/03, C-355/03 and C-484/03 12 January 2006 Optigen Ltd, Fulcrum Electronics Ltd and Bond House Systems Ltd – Commissioners of Customs & Excise 1) Transactions such as those at issue in the main proceedings , which are not themselves vitiated by VAT fraud, constitute supplies of goods or services effected by a taxable person acting as such and an economic activity within the meaning of Articles 2(1), 4 and 5(1) of the Sixth Directive [...], as amended by Directive 95/7/EC [...], where they fulfil the objective criteria on which the definitions of those terms are based, regardless of the intention of a trader other than the taxable person concerned involved in the same chain of supply and/or the possible fraudulent nature of another transaction in the chain, prior or subsequent to the transaction carried out by that taxable person, of which that taxable person had no knowledge and no means of knowledge. The right to deduct input VAT of a taxable person who carries out such transactions cannot be affected by the fact that in the chain of supply of which those transactions form part another prior or subsequent transaction is vitiated by value added tax fraud, without that taxable person knowing or having any means of knowing. [2006] ECR I-483 1) At the material time, Optigen, Fulcrum and Bond House essentially carried on the business of buying CPUs from companies established in the United Kingdom and selling them to purchasers established in another Member State. The transactions in question formed part of a chain of supply which, without the applicants in the main proceedings being aware of it, involved a defaulting trader, that is to say, a trader who incurred liability to VAT but went missing without discharging that liability with the tax authorities, or a trader using a 'hijacked' VAT number, that is to say, a trader using a VAT number belonging to someone else, and thus, according to the Commissioners, constituted a carousel fraud. Case C-246/04 12 January 2006 Turn- und Sportunion Waldburg – Finanzlandesdirektion für Oberösterreich 1. Member States, when giving their taxable persons the right to opt for taxation under Article 13(C) of the Sixth Directive [...], may make a distinction by reference to types of transactions or groups of taxable persons provided that they observe the general objectives and principles of the Sixth Directive, in particular the principle of fiscal neutrality and the requirement of correct, straightforward and uniform application of the exemptions provided for. 2. It is for the national court to determine whether national legislation which, by exempting generally the transactions of non-profit-making sports clubs, restricts their right to opt for taxation of leasing and letting transactions exceeds the discretion conferred on the Member States, having regard in particular to the principle of fiscal neutrality and the requirement of correct, straightforward and uniform application of the exemptions provided for. [2006] ECR I-589 Case C-90/05 19 January 2006 Commission of the European Communities – Grand- Duchy of Luxembourg 1. By not observing the six-month time-limit for the refund of VAT to taxable persons not established in the territory of the country, the Grand-Duchy of Luxembourg has failed to fulfil its obligations under Article 7(4) of the Eighth Directive [...]; 2. The Grand-Duchy of Luxembourg is ordered to pay the costs. [2006] ECR I-14* Case C-305/03 9 February 2006 Commission of the European Communities – United Kingdom of Great Britain and Northern Ireland 1. By applying a reduced rate of VAT to the commission received by auctioneers on sales by auction of works of art, antiques and collectors' items imported under the arrangements for temporary importation, the United Kingdom of Great Britain and Northern Ireland has failed to fulfil its obligations under Articles 2(1), 5(4)(c), 12(3) and 16(1) of the Sixth Directive […], as amended by Council Directive 1999/49/EC […];
Page 1 and 2: International VAT Monitor European
Page 3 and 4: Table of Contents - 1 Case Date Par
Page 13 and 14: Cases 9/70, 20/70 and 23/70 6 Octob
Page 15 and 16: proposed to construct are specifica
Page 17 and 18: EEC Treaty; 1) 2. For the rest , th
Page 19 and 20: movable property for another purpos
Page 21 and 22: from the outset to remove the conse
Page 23 and 24: transport of those products from a
Page 25 and 26: and c. a customer purchases such an
Page 27 and 28: court the validity of provisions in
Page 29 and 30: not been adopted. [1998] ECR I-8153
Page 31 and 32: S they grant taxable persons establ
Page 33 and 34: Case T-36/00 7 February 2001 Sonia
Page 35 and 36: ply of goods' of the grant, transfe
Page 37 and 38: ules incompatible with that provisi
Page 39 and 40: the main proceedings and which sati
Page 41 and 42: ment of deductions made in respect
Page 43: person, and is thus entitled to mak
Page 47 and 48: within the category of services ref
Page 49 and 50: able to force majeure or to an acci
Page 51 and 52: Taxable persons Index of Topics - 1
Page 53 and 54: Place of supply Index of Topics - 3
Page 55 and 56: Tax rates Index of Topics - 5 (Arti
Page 57 and 58: Exemptions - Miscellaneous exemptio
Page 59 and 60: Refund of input tax Index of Topics
Page 61 and 62: Charges characterized as turnover t
Page 63 and 64: Preliminary Questions: Abbey Nation
Page 65 and 66: Société Monte Dei Paschi Di Siena

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