Ruling by the Lyon Administrative Court of Appeal regarding the validity of claims for compensation filed withadministration
Last week, the Lyon Administrative Court of Appeal issued an interesting ruling regarding claims for compensation against the Minister and the requirement that there must be“deficiencies or omissions of any kind identified in the tax base or the calculation of the tax during the review of the claim”(LPF, Art. L.203).
In this case, the Minister had requested before the Court that the legal basis for the tax assessment be changed from Article 111(c) of the General Tax Code to Article 109(1)(2), on the grounds of unjustified credit entries in the partner’s checking account.
The Court finds that this request is not a request to substitute the legal basis but rather a request for compensation.
However, the Court notes that "administration [...] had all the information necessary to determine the additional taxes owed by Mr. C... for the year in question before he filed his claim." It therefore held that "the failure to tax this separate taxable item must be regarded as resulting from a deliberate decision byadministration made prior to the claim and cannot therefore be regarded as a deficiency or omission discovered during the investigation of the claim." It therefore rejected the Minister’s request for compensation.