CEDH · CASELAW;DECISIONS;ADMISSIBILITYCOM;ENG — 6 février 2024

.s800EAC49 { font-size:12pt } .sFE10DC93 { margin-top:0pt; margin-bottom:0pt; text-align:center } .sBB9EE52A { font-family:Arial } .s2EF17D91 { margin-top:0pt; margin-bottom:0pt; text-align:center; font-size:2pt } .s5E1364CA { margin-top:0pt; margin-bottom:12pt; text-align:center; page-break-inside:avoid; page-break-after:avoid; font-size:14pt } .s339D85E6 { margin-top:0pt; margin-bottom:14pt; text-align:center; page-break-inside:avoid; page-break-after:avoid } .s5FFF0A77 { margin-top:0pt; margin-bottom:0pt; font-size:1pt } .s10950C61 { margin-top:0pt; margin-bottom:0pt; text-indent:14.2pt; text-align:justify } .s32563E28 { margin-top:0pt; margin-bottom:0pt } .sB9D5CABB { width:28.35pt; display:inline-block } .sA36B60A1 { font-family:Arial; font-style:italic } .s3AAE10DF { margin-top:14pt; margin-bottom:12pt; text-align:justify; page-break-inside:avoid; page-break-after:avoid; font-size:14pt } .s3CA22BA { font-family:Arial; text-transform:uppercase } .s448F0C15 { margin-top:14pt; margin-left:18pt; margin-bottom:12pt; text-indent:-18pt; text-align:justify; page-break-inside:avoid; page-break-after:avoid; font-size:14pt } .s434D37A9 { margin-top:0pt; margin-bottom:0pt; text-indent:14.2pt; text-align:justify; page-break-inside:avoid; page-break-after:avoid } .s2D9C6089 { margin-top:12pt; margin-bottom:12pt; text-indent:14.2pt; text-align:justify; page-break-inside:avoid; page-break-after:avoid } .s84651E4E { margin-top:14pt; margin-left:14.2pt; margin-bottom:3pt; text-align:justify } .s69DCC830 { margin-top:36pt; margin-bottom:0pt } .sC986E16F { font-family:Arial; color:#ffffff } .s8E0918A8 { width:37.55pt; display:inline-block } .sF64F4F6C { width:139.77pt; display:inline-block } .sA3D40E95 { width:52.56pt; display:inline-block } .sA8847899 { width:93.07pt; display:inline-block }     FIRST SECTION DECISION Application no. 13928/15 Mahammad MAMMADOV against Azerbaijan   The European Court of Human Rights (First Section), sitting on 6   February 2024 as a Committee composed of:   Krzysztof Wojtyczek , President ,   Lətif Hüseynov,   Ivana Jelić , judges , and Attila Teplan, Acting Deputy Section Registrar, Having regard to: the application (no.   13928/15) against the Republic of Azerbaijan lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) on 10 March 2015 by an Azerbaijani national, Mr Mahammad Hamid oglu Mammadov ( Məhəmməd Həmid oğlu Məmmədov - “the applicant”), who was born in 1952 and lives in Baku and who was represented by Mr K. Bagirov, a lawyer based in Azerbaijan; the decision to give notice of the complaint under Article 1 of Protocol No.   1 to the Convention to the Azerbaijani Government (“the Government”), represented by their Agent, Mr Ç. Əsgərov, and to declare inadmissible the remainder of the application; the parties’ observations; Having deliberated, decides as follows: SUBJECT MATTER OF THE CASE 1.     The application concerns the applicant’s complaint about the calculation of value-added tax (VAT) levied on his car. 2 .     In November 2012 the applicant bought a car in Georgia and imported it to Azerbaijan. According to the sale contract approved in Georgia, the price of the car was 5,000 United States dollars (USD). The applicant paid 4,165.35 Azerbaijani manats (AZN – approximately 4,152 euros (EUR) at the relevant time) as customs fees, including, among other things, VAT. 3.     In October 2013, that is almost one year later, the applicant brought proceedings against the State Customs Committee (“the SCC”) before Baku Administrative-Economic Court No. 1, claiming that the customs authorities had used the wrong method of calculation in determining the customs value of his car for the purposes of VAT. The first-instance court dismissed the applicant’s claim. Following the applicant’s appeal, the Baku Court of Appeal declared the claim inadmissible as the applicant had failed to apply to the SCC before initiating the court proceedings as required under domestic law. On 4 December 2014 the Supreme Court upheld that decision. 4 .     After having complied with the above-mentioned condition, in March 2015 the applicant lodged a new claim against the SCC. He complained that the VAT imposed on his car had been wrongly calculated by the SCC and that, as a result, he had paid AZN 1,091.45 (approximately EUR 1,088 at the relevant time) more than what he actually had to pay as customs fees. He argued that the VAT should have been calculated on the basis of the purchase price of the car as indicated in the documents issued to him in Georgia (see paragraph 2 above), which was the principal method of calculation of the customs value of imported goods under domestic law. He therefore asked the court to find that the levying by the SCC of AZN 1,091.45 had been unlawful, and to award him that sum. 5.     The SCC filed a written objection arguing that the customs value of the applicant’s car had been determined at USD 12,000 based on the sale price of same type of cars previously imported to Azerbaijan and that the calculation of VAT (based on the total amount of the customs value and relevant fees), at a rate of 18 %, had been correct. 6 .     On 3 July 2015 Baku Administrative-Economic Court No. 1 dismissed the applicant’s claim. Relying on the relevant provisions of domestic law, the court held that the customs authorities were authorised to verify and determine independently the customs value of imported goods based on the price catalogues or other sources in their possession, and that the applicant’s complaint about the alleged unlawfulness of the levying of the relevant sum was unsubstantiated. 7 .     On 8 October 2015 the Baku Court of Appeal dismissed the applicant’s appeal reiterating the lower court’s reasoning. By a final judgment of 28   January 2016, the Supreme Court upheld that judgment. 8.     The applicant complained under Article 1 of Protocol No. 1 to the Convention that the domestic authorities interfered with his right to property by levying the above-mentioned amount which had not allegedly been determined in accordance with the relevant domestic provisions. THE COURT’S ASSESSMENT 9.     The Government argued that the applicant had failed to exhaust domestic remedies. The applicant disagreed. 10.     The Court observes that while the applicant’s initial claim was declared inadmissible by the domestic courts for the failure to follow a procedural rule, the applicant subsequently lodged a new claim which was examined on the merits by the domestic courts. It therefore dismisses the Government’s objection in this regard. 11.     The Government further argued that the applicant had suffered no significant disadvantage. The applicant disagreed. 12.     The Court does not find it necessary to examine this objection, because the complaint is, in any event, inadmissible for the following reasons. 13.     The Court notes that the taxation of the applicant’s car constituted an interference with his right to the peaceful enjoyment of his possessions within the meaning of Article 1 of Protocol No. 1 to the Convention, which falls to be examined under the second paragraph of that provision (see, for instance, Euromak Metal Doo v. the former Yugoslav Republic of Macedonia , no.   68039/14, § 42, 14 June 2018). 14.     It is clear from the case file and not disputed by the parties that, under domestic law, the applicant’s car was subject to customs fees, including VAT. Therefore, the interference with the applicant’s rights guaranteed under Article 1 of Protocol No. 1 to the Convention had a basis in domestic law. 15.     The Court considers that the domestic authorities’ decisions pursued an aim that was in the general interest – that is to say, to secure the payment of taxes or other contributions, as envisaged by legislation ( compare Bežanić and Baškarad v. Croatia , nos. 16140/15 and 13322/16, § 75, 19 May 2022). 16 .     According to the Court’s well-established case-law, an interference, including one resulting from a measure to secure payment of taxes, must strike a “fair balance” between the demands of the general interest of the community and the requirements of the protection of the individual’s fundamental rights. The concern to achieve this balance is reflected in the structure of Article 1 as a whole, including the second paragraph: there must be a reasonable relationship of proportionality between the means employed and the aims pursued. The question to be answered is whether, in the applicant’s specific circumstances, the application of the tax law imposed an unreasonable burden on him or her or fundamentally undermined his or her financial situation – and thereby failed to strike a fair balance between the various interests involved (see N.K.M. v. Hungary , no. 66529/11, § 42, 14   May 2013, with further references). 17.     In the present case, the applicant complained that the SCC had used the wrong method for determining the customs value of his car which resulted in him being levied more than what he actually had to pay for VAT (see paragraph 4 above). The domestic authorities dismissed his complaint finding mainly that under domestic law the customs authorities were authorised to verify and determine independently the customs value of imported goods (see paragraphs 6-7 above). 18.     The Court reiterates that it is primarily for the national authorities, notably the courts to interpret and apply domestic law (see   Ibrahimbeyov and Others v. Azerbaijan , no. 32380/13, § 47, 16 February 2023). Having examined the case file, the Court finds no grounds to question the conclusion reached by the domestic courts. Furthermore, there is nothing to indicate, nor has it been argued by the applicant either in his appeals before the domestic courts or in his application before the Court, that the levying of the relevant sum in VAT fundamentally undermined his financial situation (compare Sotiriadis v. Greece (dec.), no.   73489/17, § 19, 8 November 2022). 19.     The Court further observes that the applicant was able to dispute the customs authority’s decision before the courts exercising jurisdiction in administrative matters and did not claim that that procedure had failed to meet the requisite procedural standards (compare Christian Religious Organization of Jehovah’s Witnesses v. Armenia (dec.), no. 73601/14, § 54, 29 September 2020). 20.     In view of the foregoing and taking into account the wide margin of appreciation which the States enjoy in taxation matters (see, for example, Iofil AE v. Greece (dec.), no. 50598/13, §§ 36 and 49, 7 September 2021), the Court considers that the manner in which the amount of VAT due was determined, did not upset the balance which must be struck between the protection of the applicant’s rights and the public interest in securing the payment of taxes or other contributions (compare Christian Religious Organization of Jehovah’s Witnesses , cited above, § 55) . 21.     Accordingly, the complaint is manifestly ill ‑ founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention. For these reasons, the Court, unanimously, Declares the application inadmissible. Done in English and notified in writing on 7 March 2024.     Attila Teplan   Krzysztof Wojtyczek   Acting Deputy Registrar   President