Minister Finansów v Posnania Investment SA.

• Jurisdiction: European Union
• Celex Number: 62016CJ0036
• ECLI: ECLI:EU:C:2017:361
• Docket Number: C-36/16
• Court: Court of Justice (European Union)
• Procedure Type: Reference for a preliminary ruling
• Date: 11 May 2017

JUDGMENT OF THE COURT (Second Chamber)

11 May 2017 (*1 )

‛Reference for a preliminary ruling — Taxation — Common system of value added tax — Directive 2006/112/EC — Article 2(1)(a) — Article 14(1) — Taxable transactions — Meaning of ‘supply of goods for consideration’ — Transfer to the State or to a local authority of immovable property in order to settle a tax debt — Not included’

In Case C‑36/16,

REQUEST for a preliminary ruling under Article 267 TFEU from the Naczelny Sąd Administracyjny (Supreme Administrative Court, Poland), made by decision of 21 September 2015, received at the Court on 22 January 2016, in the proceedings

Minister Finansów

v

Posnania Investment SA,

THE COURT (Second Chamber),

composed of M. Ilešič, President of the Chamber, A. Prechal, A. Rosas, C. Toader (Rapporteur) and E. Jarašiūnas, Judges,

Advocate General: J. Kokott,

Registrar: A. Calot Escobar,

having regard to the written procedure,

after considering the observations submitted on behalf of:

— the Polish Government, by B. Majczyna, acting as Agent,

— the European Commission, by L. Lozano Palacios and M. Owsiany-Hornung, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 16 February 2017,

gives the following

Judgment

1 The present request for a preliminary ruling relates to the interpretation of Articles 2(1)(a) and 14(1) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1; ‘the VAT Directive’).

2 The request has been made in proceedings between the Minister Finansów (Minister for Finance, Poland; ‘the Minister’) and Posnania Investment SA (‘Posnania’), concerning the liability to value added tax (VAT) of a transaction in which that company transferred ownership of immovable property to a local authority in settlement of a tax debt.

Legal framework

EU law

3 Article 2(1) of the VAT Directive provides: ‘The following transactions shall be subject to VAT: (a) the supply of goods for consideration within the territory of a Member State by a taxable person acting as such; …’

4 Article 9(1) of that directive provides: ‘“Taxable person” shall mean any person who, independently, carries out in any place any economic activity, whatever the purpose or results of that activity. Any activity of producers, traders or persons supplying services, including mining and agricultural activities and activities of the professions, shall be regarded as “economic activity”. The exploitation of tangible or intangible property for the purposes of obtaining income therefrom on a continuing basis shall in particular be regarded as an economic activity.’

5 According to Article 14(1) of that directive, ‘supply of goods’ is to mean the transfer of the right to dispose of tangible property as owner.

6 Article 16 of the VAT Directive provides: ‘The application by a taxable person of goods forming part of his business assets for his private use or for that of his staff, or their disposal free of charge or, more generally, their application for purposes other than those of his business, shall be treated as a supply of goods for consideration, where the VAT on those goods or the component parts thereof was wholly or partly deductible. However, the application of goods for business use as samples or as gifts of small value shall not be treated as a supply of goods for consideration.’

Polish law

7 Article 2(6) of the ustawa o podatku od towarów i usług (Law on the tax on goods and services), of 11 March 2004, as amended (Dz. U. of 2011, no 177, item 1054; ‘the Law on VAT’), provides: ‘Wherever in the following provisions there is mention of “goods”, this shall be understood as objects or parts thereof and also any forms of energy.’

8 Article 5(1)(1) of that law is worded as follows: ‘The following are subject to the tax on goods and services: the supply of goods and services for consideration within the territory of the country.’

9 Article 7(1) of that law states: ‘The supply of goods referred to in Article 5(1)(1) shall mean the transfer of the right to dispose of the goods as owner. …’

10 Article 15(1) of that law provides: ‘Taxable persons are legal persons, organisational units without legal personality and natural persons pursuing an independent economic activity referred to in paragraph 2, regardless of the purpose or result of such activity.’

11 Article 15(2) of the Law on VAT provides: ‘Economic activities shall comprise all activities of producers, traders and service providers, including mining and agricultural activities and activities of the professions, or similar activities, even if the given activity was carried out only once but in circumstances indicating an intention to perform such activities on a continuing basis. Economic activity shall also include activities consisting in the exploitation of goods or intangible or legal assets on a continuing basis for the purpose of obtaining income therefrom.’

12 Article 66 of the ordynacja podatkowa of 29 August 1997 (Tax Code, Dz. U. of 2015, item 613) is worded as follows: ‘1. A particular instance of the discharge of a tax liability is the transfer of ownership of tangible property or property rights to: (1) the State Treasury — in settlement of tax arrears in respect of taxes constituting State budget revenues; (2) a municipality, district or regional authority — in settlement of tax arrears in respect of taxes constituting revenues accruing to their budget. 2. The transfer shall take place at the request of the taxable person: (1) in the case referred to in paragraph 1(1), on the basis of a contract concluded, with the consent of the relevant director of the tax or customs authority, between the district officer carrying out the tasks of the central administration and the taxable person; (2) in the case referred to in paragraph 1(2), on the basis of a contract concluded between the mayor, the town president, the district officer or the president of the region and the taxable person. … 4. In the cases mentioned in paragraph 1, the time at which the tax debt is discharged is the date on which the transfer of ownership of the tangible property or property rights occurs. …’

The dispute in the main proceedings and the question referred for a preliminary ruling

13 Posnania is a company governed by Polish law and is economically active in the field of property transactions. As such, it is subject to VAT. In order to discharge arrears for non-payment of a tax for which it was liable, the company applied to the municipality of Czerwonak (Poland; ‘the municipality’) with a view to concluding, pursuant to Article 66 of the Tax Code, a contract for the transfer of the ownership of unbuilt-on land held by it to the municipality.

14 That contract, concluded on 5 February 2013, resulted in the partial discharge of Posnania’s tax debt concurrently with the transfer of ownership of that immovable property to the municipality.

15 Posnania lodged an application for an individual tax ruling in order to determine whether, in such a situation, the transaction concluded with the municipality was subject to VAT and whether, as a result, it had to issue a corresponding invoice.

16 In its application, Posnania submitted that the transaction at issue ought not to be subject to VAT on the basis of the case-law of the referring court, the Naczelny Sąd...