IUC Subjective Incidence: Who Is Liable for Vehicle Circulation Tax? CAAD 214/2015-T

ARBITRAL DECISION

I. - REPORT

A - PARTIES

A..., LDA, with registered office at..., Building..., Floor..., ... - ...-..., tax identification number..., hereinafter referred to as "Applicant", submitted a request for the constitution of an arbitral tribunal, pursuant to the provisions of subparagraph a) of article 2.1 and articles 10 et seq. of Decree-Law No. 10/2011, of 20 January (Legal Framework of Arbitration in Tax Matters, hereinafter referred to as "LFATM"), with a view to adjudication of the following claim opposing it to the Tax and Customs Authority (which succeeded, among others, the General Directorate of Taxation) hereinafter referred to as Respondent.

B - CLAIM

1 - The request for constitution of the arbitral tribunal was accepted by His Excellency the President of CAAD on 13 March 2015 and notified to the Tax Authority on 26 March 2015.

2 - The Applicant did not proceed with the appointment of an arbitrator, therefore, pursuant to the provisions of article 6.1 of the LFATM, the undersigned was appointed on 15-05-2015 by the Deontological Council of the Administrative Arbitration Center as arbitrator of a Singular Arbitral Tribunal, having accepted in the terms legally provided.

3 - The Parties were, on 15-05-2015, duly notified of this appointment and did not express a wish to refuse it, in accordance with the combined provisions of subparagraphs a) and b) of article 11.1, and articles 6 and 7 of the Deontological Code.

4 - In these circumstances, in accordance with the provisions of subparagraph c) of article 11.1 of Decree-Law No. 10/2011, of 20 January, as amended by article 228 of Law No. 66-B/2012, of 31 December, the arbitral tribunal was regularly constituted on 02-06-2015.

5 - On 28 January 2016, the Arbitral Tribunal considered dispensed the holding of the meeting provided for in article 18 of the LFATM, taking into account both the orders issued on this matter in the SGP, and the fact that the dispute relates fundamentally to matters of law, and the will of the parties to dispense with said meeting.

6 - The current Applicant requests that this Arbitral Tribunal:

a) - Declare the illegality and consequent annulment of both the assessment acts relating to the Unique Circulation Tax (hereinafter referred to as UCT), and the assessment acts of compensatory interest (CI) associated therewith, recorded in the assessment notifications referenced in the case, relating to the years 2013 and 2014, as identified in the record, concerning the vehicles, equally identified in the record, which are hereby taken as fully reproduced;

b) - Condemn the Tax Authority to reimburse the sum of € 4,005.04, corresponding to the total amount paid as UCT and CI, relating to the years and vehicles aforementioned.

c) - Condemn the Tax and Customs Authority to payment of compensatory interest for the payment of UCT and CI, improperly assessed and paid;

C - GROUNDS OF CLAIM

7 - The Applicant, in substantiating its request for arbitral adjudication, states, in summary, the following:

8 - That it is a commercial company whose activity is engaged in the rental of motor vehicles, and that at the end of these rental contracts, it proceeds several times to the sale of the vehicles to its customers.

9 - That the vehicles identified in Table I of the request for arbitral adjudication were sold, as used, to its customers, with whom it had concluded vehicle rental contracts, on dates prior to the date of obligation to assess the UCT.

10 - That the vehicles identified in Table II of the request for arbitral adjudication were subject to loss during the currency of the vehicle rental contracts, having, in these circumstances, been considered by the insurers as Total Loss.

11 - That, with respect to these vehicles, as soon as it received communications from the Insurers relating to such vehicles, it proceeded to deliver to the Insurers all legal documentation with a view to their cancellation of the corresponding registrations.

12 - That, in 2014, it was notified by the Tax Administration to exercise the right of prior hearing, relating to assessments of Unique Circulation Tax (UCT), relating to the years 2013 and 2014, relating to the vehicles identified in the aforementioned Tables I and II.

13 - That, following such procedure, it was notified of the aforementioned assessments, in the total amount of € 4,005.04, having, despite being convinced of their illegality, duly proceeded to payment of the Unique Circulation Tax and Compensatory Interest assessed.

14 - That the basis for said assessments relates to the fact that the vehicles in question were registered in its name, therefore, in light of the provisions of article 3.1 of the CIUC, the Tax Authority considered the Applicant as owner of the mentioned vehicles and, as such, taxpayer of the corresponding UCT.

15 - That article 3 of the CIUC establishes only a rebuttable legal presumption, allowing the person registered as owner of the vehicle to proceed to demonstrate that it alienated the vehicles in question on a date prior to the occurrence of the tax event in the years 2013 and 2014, circumstance in which the Applicant ceases to be considered as taxpayer of the tax.

16 - That the legal presumption established in article 3.1 of the CIUC is necessarily rebuttable, as the presumptions enshrined in tax law always admit contrary proof, in accordance with the provisions of article 73 of the General Tax Law.

17 - That the transfer of ownership of the vehicles occurs by mere effect of the contract, in accordance with articles 408 and 874 of the Civil Code, registration of ownership being no more than a presumption that the right exists and belongs to the registered holder, which being rebuttable admits contrary proof.

18 - That the ownership of the vehicles in question transferred to its customers by mere effect of the respective purchase and sale contracts, with their registration having no constitutive character.

19 - That from the date on which the Insurers' communications regarding Total Loss of the vehicles occurred, all responsibility for cancellation of the respective registrations fell upon such Insurers.

20 - That, as proof of the alienation of the vehicles in question, it joined to the record not only copies of invoices for the sale of the vehicles, but also invoices for the sale of the "salvage" and declarations of "Total Loss", as well as communications from the respective insurers, with dates prior to those of the occurrence of the tax events, in the years 2013 and 2014.

D - RESPONSE OF THE RESPONDENT

21 - The Respondent, Tax and Customs Authority (hereinafter referred to as Tax Authority), presented its Response on 03-07-2015, in which it considers that the allegations of the Applicant cannot, in any way, proceed, insofar as they make a notably erroneous interpretation and application of the legal norms applicable to the case, in that, firstly,

22 - They translate an understanding that incurs not only in a skewed reading of the letter of the law, but also in an interpretation that does not heed the systematic element, violating the unity of the regime enshrined in all of the CIUC and, more broadly, in the entire legal-fiscal system, further resulting from an interpretation that ignores the ratio of the regime enshrined in article 3.1 of the CIUC. (cfr. article 7 of the Response)

23 - It states that the tax legislator, in establishing, in article 3.1 of the CIUC, who are the taxpayers of the UCT, expressly and intentionally established that these are the owners (or in the situations provided for in article 2 the persons mentioned therein), being considered as such the persons in whose name they are registered. (cfr. article 11 of the Response)

24 - It emphasizes that the legislator did not use the expression "it is presumed" as it could have, for example, in the following terms: "the taxpayers of the tax are the owners of the vehicles, being presumed as such the natural or legal persons, of public or private law, in whose name they are registered". (cfr. article 12 of the Response)

25 - It considers that the wording of article 3 of the CIUC corresponds to a clear legislative policy choice adopted by the legislator, therefore to understand that a presumption is enshrined therein would unequivocally be to effect an interpretation contra legem. (cfr. articles 21 and 23 of the Response)

26 - It states that the aforementioned understanding has already been adopted by the jurisprudence of our courts, transcribing, for this purpose, part of the judgment of the Administrative and Tax Court of Penafiel, delivered in Case No. 210/13.OBEPNF. (cfr. article 24 of the Response)

27 - On the systematic element of interpretation, it considers that the solution proposed by the Applicant is intolerable, finding the understanding endorsed by it no legal support whatsoever. (cfr. article 34 of the Response)

28 - On the ignorance of the "ratio" of the regime, the Tax Authority considers that, in light of a teleological interpretation of the regime enshrined in all of the UCT Code, the interpretation proposed by the Applicant, in the sense that the taxpayer of the UCT is the effective owner regardless of not appearing in the vehicle register the registration of that quality, is manifestly erroneous, insofar as it is the very ratio of the regime enshrined in the CIUC that constitutes clear proof that what the fiscal legislator intended was to create a tax based on taxation of the vehicle owner, as recorded in the vehicle register. (cfr. articles 57 and 58 of the Response)

29 - It adds that the CIUC carried out a reform of the vehicle taxation regime in Portugal, substantially altering the vehicle taxation regime, with the taxpayers of the tax becoming the owners registered in the property register, regardless of the circulation of vehicles on public roads. (cfr. article 60 of the Response)

30 - The interpretation conveyed by the Applicant shows that there is a violation of the Constitution, insofar as it translates into violation of the constitutional principles of confidence and legal certainty, of the efficiency of the tax system and of proportionality. (cfr. articles 111 and 112 of the Response)

31 - It adds that the documents embodied in both the invoices and the notifications issued by the insurer entities, presented by the Applicant, as proof of sale of the vehicles, unaccompanied by any other elements, are not apt to prove the conclusion of a synallagmatic contract such as purchase and sale, adding that no further documents may be presented, in light of the provisions of article 423 of the Code of Civil Procedure and the preclusion of that right provided therein. (cfr. articles 89 to 94 of the Response)

32 - It also states that the Applicant did not attach copies of the official model for registration of vehicle ownership, which it should have done, and that the invoices presented cannot replace that document. (cfr. articles 80 and 84 of the Response)

33 - Finally, it states that it was not the Respondent who gave rise to the submission of the request for arbitral adjudication, but rather the Applicant, and should, consequently, be condemned as the Applicant in arbitral costs "in accordance with article 527.1 of the New Code of Civil Procedure ex vi article 29.1-e) of the LFATM", also emphasizing that the legal prerequisites for considering compensatory interest assessments illegal are not met, whose request was formulated by the Applicant.

34 - It considers, in conclusion, that, in light of all the arguments presented, the tax acts in dispute are valid and legal, and the request for arbitral adjudication underlying this case should be judged without merit, with the contested tax assessment acts remaining in the legal order, absolution of the Respondent entity being pronounced regarding the claim.

E - ISSUES TO BE DECIDED

35 - It is necessary, therefore, to appreciate and decide.

36 - In light of the foregoing, regarding the positions of the Parties and the arguments presented, the main issues to be decided are to know:

a) - Whether the norm of subjective incidence contained in article 3.1 of the CIUC establishes or does not establish a presumption.

b) - What is the legal value of vehicle registration in the economy of the CIUC, particularly for the purposes of the subjective incidence of this tax.

c) If, on the date of the occurrence of the tax event, the vehicle had already been previously alienated, although the right of ownership thereof continues to be registered in the name of its former owner, for the purposes of the provisions of article 3.1 of the CIUC, the taxpayer of the UCT is the former owner or the new owner.

F - PROCEDURAL PREREQUISITES

37 - The Arbitral Tribunal is regularly constituted and is materially competent, in accordance with subparagraph a) of article 2.1 of Decree-Law No. 10/2011, of 20 January.

38 - The Parties enjoy legal personality and capacity, are legitimate and are legally represented (cfr. article 4 and article 10.2 of Decree-Law No. 10/2011 and article 1 of Ordinance No. 112/2011, of 22 March).

39 - The case does not suffer from defects that would invalidate it.

40 - Taking into account the information recorded in the tax administrative proceeding, and the documentary evidence attached to the record, it is now necessary to present the factual matter relevant to understanding the decision, as established in the terms mentioned below.

II - GROUNDS

G - FACTUAL GROUNDS

41 - In matters of relevant fact, this tribunal considers established the following facts:

42 - The Applicant is a commercial company whose activity is engaged in the rental of motor vehicles, and that at the end of these rental contracts, it proceeds several times to the sale of the vehicles to its customers.

43 - The vehicles identified in Table I of the request for arbitral adjudication were sold, as used, to the Applicant's customers, on dates prior to the date of obligation to assess the UCT, with whom it had concluded vehicle rental contracts, on dates prior to the date of obligation to assess the UCT.

44 - The vehicles identified in Table II of the request for arbitral adjudication were subject to loss during the currency of the vehicle rental contracts, having, in these circumstances, been considered by the insurers as Total Loss.

45 - The Applicant was notified by the Tax Administration to exercise the right of prior hearing, relating to assessments of Unique Circulation Tax (UCT), relating to 2013 and 2014, relating to all vehicles identified in the aforementioned Tables I and II.

46 - Following such procedure, the Applicant was notified of the aforementioned assessments, in the total amount of € 4,005.04, having duly proceeded to payment of the Unique Circulation Tax and Compensatory Interest assessed.

47 - The basis for said assessments was based on the fact that the vehicles in question were registered in the name of the Applicant, having the latter, for this reason, been considered taxpayer of the corresponding UCT.

48 - As proof of the alienation of the vehicles in question, the Applicant attached to the record not only copies of invoices for the sale of the vehicles, but also invoices for the sale of the "salvage" and declarations of "Total Loss".

49 - At the time of the tax events and their exigibility, with reference to the years 2013 and 2014 and the vehicles identified in the record, the Applicant was no longer owner of these vehicles,

GROUNDS OF PROVEN FACTS

50- The facts deemed proven are based on the documents mentioned, in relation to each of them, insofar as their correspondence to reality was not questioned.

UNPROVEN FACTS

51 - In matters of fact with relevance to the decision, this tribunal considers as unproven the sale, prior to the exigibility of the tax, of the vehicles with the registrations ...-... -..., ...-... -..., ...-... -..., ...-... -..., ...-... -... and ...-... -...

H - LEGAL GROUNDS

52 - The factual matter is established, and it is now important to proceed with its legal subsumption and determine the Law applicable to the underlying facts, in accordance with the issues to be decided outlined in article 36.

53 - The decisive question in the present case, regarding which there are absolutely opposed understandings between the Applicant and the Tax Authority, translates into knowing whether the norm of subjective incidence contained in article 3.1 of the CIUC establishes or does not establish a rebuttable presumption.

54 - The positions of the parties are known. Indeed, for the Applicant, article 3 of the CIUC establishes only a rebuttable legal presumption, allowing the person registered in the register as owner of the vehicle to proceed to demonstrate that such ownership is inserted in the legal sphere of another person, to whom such ownership was transferred, who will thus become the taxpayer of the tax.

55 - The Respondent, for its part, considers that the tax legislator, in establishing, in article 3.1 of the CIUC, who are the taxpayers of the UCT, expressly and intentionally established that these are the owners (or in the situations provided for in article 2 the persons mentioned therein), being considered as such the persons in whose name they are registered.

I - INTERPRETATION OF THE NORM OF SUBJECTIVE INCIDENCE CONTAINED IN ARTICLE 3.1 OF THE CIUC

56 - On this question, namely, whether the norm of subjective incidence contained in article 3.1 of the CIUC, establishes a presumption, it should be noted that the jurisprudence established in CAAD points in the direction that said norm establishes a legal presumption. Indeed, from the first Decisions issued on this matter in 2013, among which may be mentioned those delivered in Cases Nos. 14/2013-T, 26/2013-T and 27/2013-T, to the most recent ones, such as the Decisions delivered in Cases Nos. 69/2015-T and 79/2015-T, passing through numerous Decisions issued in 2014, of which are mentioned, by way of mere example, the Decisions delivered in Cases Nos. 34/2014-T, 120/2014-T and 456/2014 - T, all point to the understanding that article 3.1 of the CIUC establishes a rebuttable legal presumption.

On this matter, consideration should also be given to the understanding set forth in the Judgment of the Central Administrative Court of the South, delivered on 19-03-2015, Case 08300/14, available at: www.dgsi.pt, which endorses the aforementioned jurisprudence, when it expressly states that article 3.1 of the CIUC "[…] establishes a legal presumption that the holder of vehicle registration is its owner, and such presumption is rebuttable by virtue of article 73 of the General Tax Law".

This is an understanding which we fully support and which is taken, without more, as valid and applicable in the present case, not being considered, therefore, necessary further developments, in light of the abundant grounds set forth in the aforementioned decisions and in the aforementioned Judgment.

57 - Being this the understanding which, regarding article 3.1 of the CIUC, is fully endorsed by this tribunal, it is important, nonetheless, to note the lack of merit in the position of the Respondent, when, in articles 111 and 112 of its response, it alleges that the interpretation in the sense of understanding that a rebuttable legal presumption is established in article 3.1 of the CIUC violates the constitutional principles of confidence and legal certainty, of the efficiency of the tax system and of proportionality.

Let us therefore address this question.

Let us consider,

• Regarding the principle of proportionality, it should first be noted that this principle, insofar as it is materially inherent to the regime of rights, freedoms and guarantees, inscribed in its defense, aims, essentially, to govern the action of Public Administration in order that its activity, in its relationship with citizens, be guided by the choice of measures more harmoniously adequate to the pursuit of the public interest.

As Professor Freitas do Amaral teaches, in Course of Administrative Law, Vol II, Almedina, 2002, pp. 127/128 et seq, the "principle of proportionality constitutes a constitutive manifestation of the principle of the Rule of Law", with "[…] the idea firmly anchored that, in a democratic Rule of Law state, measures of public powers should not exceed what is strictly necessary for the realization of the public interest".

The principle of proportionality, adds the aforementioned Professor, idem, p.129, means that "[…] the limitation of goods or private interests by acts of public powers must be adequate and necessary to the concrete ends that such acts pursue, as well as tolerable when confronted with those ends".

Regarding the principle of proportionality, it should also be noted, as J. J. Gomes Canotilho and Vital Moreira tell us, in CONSTITUTION OF THE PORTUGUESE REPUBLIC, ANNOTATED, VOLUME I, 4th Edition, 2007, Coimbra Publishing House, pp. 392/393, when they consider that the said principle is divisible into three sub-principles, namely: "[…] a) principle of adequacy (also called principle of suitability); b) principle of exigibility (also called principle of necessity or indispensability); c) principle of proportionality in the strict sense, which means that the legal restrictive means and the ends obtained must be in a "just measure", preventing the adoption of excessively restrictive, disproportionate legal measures in relation to the ends obtained […]".

The aforementioned sub-principles all have a common denominator, namely that of just equilibrium and permanent coherence between the purposes of the law and the means adopted to achieve such purposes, which, in the circumstances and attempting the transposition of said principle to the case at hand, will imply responding to the question of knowing what the adequate interpretation of article 3.1 is, with a view to the pursuit of the legal purposes provided for in article 1 of the CIUC, which translate into the fiscal burden of the effective owners of motor vehicles (and not, necessarily, of those recorded in the register) in the measure of the environmental and road cost they cause.

As Professor J. J. Gomes Canotilho states in Constitutional Law and Theory of the Constitution, Almedina - Coimbra, 1998, pp. 264 et seq, the most important field of application of the principle of proportionality or prohibition of excess, which has constitutional basis in articles 18.2 and 266.2 of the Portuguese Constitution, "[…] is that of the restriction of rights, freedoms and guarantees by acts of public powers. However, the logical field of application of the principle of proportionality extends to conflicts of legal goods of any kind." The administration, adds the aforementioned author, idem, "[…] must always observe, in each concrete case, the requirements of the prohibition of excess […]".

In this same sense points the jurisprudence, namely the judgment of the Supreme Administrative Court of 01-07-1997, Case No. 041177, available at: www.dgsi.pt, when it considers that the principle of proportionality in a broad sense comprises the congruence, adequacy or suitability of the means or measure to achieve the end legally proposed and, in the strict sense, encompasses the prohibition of excess.

The principle of proportionality is a corollary of the principle of justice, which means and implies that in its actions the Public Administration must harmonize the specific public interest that it has to pursue with the rights and legitimate interests of the citizens eventually affected by its acts, interests and rights which, in the case at hand, are reduced to the non-taxation in UCT of persons who are no longer owners of the vehicles and who, consequently, in no way contribute to the realization of any road and environmental cost.

What matters is to balance the legal purposes and the means to pursue them, and, within the framework of a balancing judgment, to identify the most adequate means for this effect, which, in the case, translate into the interpretation endorsed by the arbitral tribunal.

It will be said, moreover, that the understanding that article 3.1 of the CIUC establishes a rebuttable legal presumption corresponds to the only interpretation that coherently accords with the said principle of equivalence, and which is in line with the principles of justice and proportionality.

The interpretation that understands a rebuttable legal presumption to be established in article 3.1 of the CIUC is, therefore, the only one that allows assurance of the pursuit of the ends envisaged by the law - to burden the owners of motor vehicles in the measure of the environmental and road cost they cause, - as provided for in article 1 of the CIUC, which means that the taxpayers of the UCT are, presumptively, the persons in whose name the vehicles are registered, that is, the said taxpayers are, in principle, and only in principle, the persons in whose name such vehicles are registered, there being, therefore, no other interpretation capable of achieving the said legal purposes, only thus, it is reaffirmed, are the said principles of proportionality and justice fulfilled.

The contrary understanding, namely that considered by the Tax Authority, which interprets article 3.1 of the CIUC as not establishing a rebuttable legal presumption, understanding that the taxpayers of the UCT are, definitively, the persons in whose name the vehicles are registered, in the measure that it leads to the imposition of a tax burden on those who may no longer be the owner of the vehicle in question and who, thus, do not pollute, removing from tax subjection those who, in reality, are the effective causes of the environmental and road damage resulting from the use of the vehicles of which they are the true owners, makes evident that the legally prescribed purposes would not, in any way, be achieved, thus not respecting the principle of equivalence which, within the framework of the CIUC, has an absolutely structuring function. Such understanding, that one, does not show itself, in these circumstances, in harmony with the principle of proportionality.

The interpretation made by the tribunal, in the decision which is now reformed, took exactly into account the principle of proportionality when, contrary to what the Respondent intended, it has, duly noted, that definitive registration does not produce constitutive effect as it is destined to give publicity to the registered act, functioning only as a mere rebuttable presumption of the existence of the right and when, in honor of that principle, it heeds the principle of equivalence, as a fundamental element of the CIUC.

• As to the efficiency of the tax system, it will be said that the efficiency of the Administration in general, or of the Tax Authority in particular, in the current sense, corresponds to the capacity/work methodology oriented towards the optimization of the work executed or of the services rendered, which means producing the maximum, in quantity and quality, with the minimum of costs and means, having nothing to do with the observance of legally established principles and with respect for the rights of citizens, whether in the capacity of taxpayers or not.

In the technical sense, it will be said that the principle of efficiency of the tax system is commonly held, in the field of tax procedure, as a corollary of the principle of proportionality, which as is known, imposes an adequate proportion between the legal purposes and the means chosen to achieve those ends, or, as Diogo Leite Campos, Benjamim Silva Rodrigues and Jorge Lopes de Sousa state, in General Tax Law, Annotated and Commented, 4th Edition 2012, Writing Meeting, Ltd., Lisbon, p. 488, in the annotations to article 55 of the General Tax Law, it is a principle that obliges "[…] the tax administration to refrain from imposing on taxpayers obligations that are unnecessary to satisfy the purposes that it seeks to pursue".

In this framework, the said principle of efficiency of the tax system will mean the capacity to achieve the legally fixed objectives with the minimum of means, which will have nothing to do either with respect for the rights of citizens, nor with the need to observe other principles to which the tax administration must subordinate its activity, namely that of the inquisitorial and that of the discovery of material truth, the application of the mentioned principle of efficiency obviously not being able to be made, either with prejudice to the rights of citizens, or by the lack of observation of the legal purposes. [1]

• As to the principle of legal certainty and confidence, it should be noted, first, that this latter principle, that of confidence, is a concrete manifestation of the principle of good faith, which, having been established in our legal order since 1996, came to have express constitutional inscription, as appears in article 266.2 of the Portuguese Constitution, which provides that "Administrative organs and agents are subordinated to the Constitution and the law and must act, in the exercise of their functions, with respect for the principles of equality, proportionality, justice, impartiality and good faith". (emphasis added)

On good faith, it is worth noting what Professor Freitas do Amaral states, when, in Course of Administrative Law, Vol. II, Almedina, 2002, pp. 135/136, citing Professor V. Fausto de Quadros, tells us that "[…] Public Administration is obliged to obey good faith in its relations with citizens. More: it should even show, also there, the example to citizens of observance of good faith, in all its manifestations, as the essential nucleus of its ethical behavior. Without this, one can never affirm that the State (and with it other public entities) is a person of good character".

On the other hand, the principle of confidence is also held as a consequence of the principle of legal certainty, inseparable from the Rule of Law, which having to guarantee a minimum of certainty in the rights of persons and in the legal expectations created for them, generates confidence of citizens in the legal protection of Public Administration.

Regarding the principles of legal certainty and protection of confidence, Professor J. J. Gomes Canotilho tells us in Constitutional Law and Theory of the Constitution, Almedina - Coimbra, 1998, p. 250 et seq, that the said principles are closely associated, considering that "[…] legal certainty is connected with objective elements of the legal order - guarantee of legal stability, security of orientation and realization of law - while protection of confidence is more related to the subjective components of security, namely the calculability and predictability of individuals in relation to the legal effects of acts of public powers". In any case, adds the aforementioned Professor, idem, that the "[…] general principle of legal certainty in a broad sense (thus encompassing the idea of protection of confidence) can be formulated as follows: the individual has the right to be able to trust that to his acts or to public decisions affecting his rights, positions or legal relations founded on legal norms in force and valid, are attached the legal effects foreseen and prescribed by those same norms".

It follows from this doctrine that persons when alienating their vehicles must be confident that, should they proceed to sell the vehicles they own, and such vehicles not being registered in the name of the purchasers, the legal effects resulting therefrom will be those foreseen and resulting from the legal norms in force and their adequate interpretation in light of the legal purposes of those same norms, which, in this case, led the arbitral tribunal to consider the registration as a rebuttable presumption of the existence of the right and that only persons causing road and environmental costs should be taxed.

The best way to, in the case at hand, ensure legal certainty in a broad sense is, thus, that achieved through the interpretation made by the arbitral tribunal, when it considers that a rebuttable legal presumption is established in article 3.1 of the CIUC, allowing any citizen who proceeds to sell, to a third person, a motor vehicle, the possibility of demonstrating that, at the time of the exigibility of the UCT, they were no longer its owner nor responsible for payment of that tax.

• Beyond what has been stated above, it is further important to know whether the interpretation endorsed by the arbitral tribunal, besides not conflicting with any of the aforementioned principles, is directly and substantively inscribed in the context of the constitutional order.

On the interpretation of law in light of the Constitution, or of interpretation in conformity with the Constitution, Professor Jorge Miranda tells us, in Manual of Constitutional Law, TOME II, Introduction to Theory of the Constitution, 2nd edition, Coimbra Publishing House, 1987, p. 232 et seq, that what is involved, first and foremost, is "[…] to take into account, within the systematic element of interpretation, what relates to the Constitution. Indeed, each legal provision must not only be understood in the context of the provisions of the same law and each law in the context of the legislative order; it must also be considered in the context of the constitutional order [..]". (emphasis added)

The understanding that considers that a rebuttable legal presumption is established in article 3.1 of the CIUC is supported by several elements of interpretation, among which may be mentioned the systematic element, insofar as interpretation in conformity with the Constitution implies that within the systematic element of interpretation, account be taken of what relates to the Constitution.

On the aforementioned systematic element, the following should be noted:

a) In the understanding of BAPTISTA MACHADO, in Introduction to Law and Legitimating Discourse, p. 183, the systematic element "[…] comprises the consideration of the other provisions that form the complex of norms of the institute in which the norm to be interpreted is integrated, that is, which regulate the same matter (context of the law), as well as the consideration of legal provisions that regulate parallel normative problems or kindred institutes (parallel places). It also comprises the systematic place that corresponds to the norm to be interpreted in the global legal order, as well as its consonance with the spirit or intrinsic unity of the entire legal order".

b) It is known that a legal principle, in this case the principle of equivalence, does not exist in isolation, but rather is linked by an intimate nexus with other principles that integrate, at the more global level, the respective legal order, in this case, with the other principles embodied in the system inscribed in the CIUC, and with other constitutionally established principles. In that sense, each article of a given legal instrument, in this case the CIUC, will only be understandable if we situate it both in relation to the other articles that follow or precede it, and in relation to the constitutional order.

c) As regards the systematization of the CIUC, environmental concerns were decisive for the aforementioned principle of equivalence to be, from the outset, inscribed in the first article of the said Code, which necessarily leads to subsequent articles, insofar as they have foundation in such principle, being influenced by it. This occurred, namely, with the tax base, which came to be constituted by various elements, particularly those relating to pollution levels, and with the rates of the tax, established in articles 9 to 15, which were influenced by the environmental component, and, naturally, also with the subjective incidence itself, provided for in article 3 of the CIUC, which cannot escape the aforementioned influence.

d) The aforementioned principle of equivalence, as noted by Sérgio Vasques, in Special Consumption Taxes, Almedina, 2001, p. 122 et seq, implies that "[…] the tax must correspond to the benefit that the taxpayer derives from public activity; or to the cost that the taxpayer imputes to the collective by its own activity". Adds the aforementioned author, idem, that "Thus, a tax on automobiles based on a rule of equivalence will be just only if those who cause the same road wear and the same environmental cost pay the same tax; and those who cause different wear and environmental cost, pay different tax as well." Therefore, as also states the cited author, idem, the realization of the principle of equivalence dictates special requirements "[…] regarding the subjective incidence of the tax [..]."

The aforementioned principle which informs the current Unique Circulation Tax is inscribed in the environmental concerns provided for in article 66.2.a) of the Portuguese Constitution and in the need to, - with a view to ensuring the right to the environment, within the framework of sustainable development, - "Prevent and control pollution and its effects and harmful forms of erosion", concerns which are manifestly considered in the interpretation defended by the arbitral tribunal.

On the other hand, the provisions of article 66.2.h) of the Constitution, when it provides that, within the framework of sustainable development, it is incumbent upon the State to "ensure that fiscal policy makes development compatible with environmental protection and quality of life", as a corollary, carries the principle of the polluter - pays, which concretizes the idea inscribed therein, that whoever pollutes must, for that reason, pay, thus being the interpretation defended by the arbitral tribunal in perfect accord with the constitutional order.

e) It is also worth leaving a brief note, merely to raise the question of why the rules contained in article 9 of the Civil Code bind the interpreter of ordinary legislation, when it is certain that said Code occupies no prominent place in the legal system.

To this question Professor Jorge Miranda responds, ibidem, p. 230, when he considers that the "[…] conclusion to which one is inclined is that rules such as these are valid and effective, not because they are contained in the Civil Code - for this does not occupy any prominent place in the legal system - but directly, as such, as they translate a legislative will, not contradicted by any other provisions, with respect to the problem of interpretation (which are not merely technical-legal) of which they care."

Adds the aforementioned author, idem, that "rules on these matters can be considered substantially constitutional and it would not be repugnant even to see them elevated to the Constitution in formal sense."

On the problematic of interpretation and its rules, as emerges from Professor José de Oliveira Ascensão, in The Law, Introduction and General Theory, 2nd edition, Calouste Gulbenkian Foundation, 1980, pp. 352/353, emphasis should be placed on the imperative character of these rules, and their binding nature for the interpreter.

The interpretation that the arbitral tribunal makes of article 3.1 of the CIUC and the criteria that, for this purpose, it considered, as expressly mentioned in the Decision delivered in Case No. 196/2014-T, from the literal element, to the systematic element, passing through the historical and rational (or teleological) element, do not thus collide with any constitutional principles.

Article 9.1 of the Civil Code provides that the search for legislative thought should "[…] especially take into account […] the unity of the legal system, the circumstances in which the law was elaborated and the specific conditions of the time in which it is applied", circumstances and conditions which today more than ever are sensitive to the environment and respect for matters related to it, and which are inscribed in the constitutional order.

Thus, in light of what has been stated, it does not appear, with all due respect, that the Tax Authority has merit, insofar as the interpretation considered by the arbitral tribunal, as being the only one capable of respecting the legal purposes, does not violate any of the principles in question, that is, the principles of confidence and legal certainty, of the efficiency of the tax system and of proportionality, and, on the other hand, such interpretation is express and substantively in conformity with the principles inscribed in the Constitution.

Thus, it is not evident that the interpretation made by the tribunal on article 3.1 of the CIUC contends with any norms or constitutional principles in force.

J - ACQUISITION OF VEHICLE OWNERSHIP AND VALUE OF REGISTRATION

58 - First of all, it should be added, in light of what shall be explicitly stated below on the value of registration, that the purchasers of vehicles become owners of those same vehicles through the transfer of their ownership, with registration or without it.

59 - There are three articles of the Civil Code that are important to take into account regarding the acquisition of ownership of a motor vehicle. They are, first of all, article 874, which establishes the notion of purchase and sale contract as being "[…] the contract by which the ownership of a thing, or another right, is transferred, for a price"; article 879, in whose subparagraph a) is provided, as essential effects of the purchase and sale contract, "the transfer of ownership of the thing or the entitlement of the right" and article 408, which has as its heading real-effect contracts, and establishes in its article 1, that "the constitution or transfer of real rights over a determined thing occurs by mere effect of the contract, except for the exceptions provided for by law". (emphasis added)

We are, indeed, in the field of real-effect contracts, which means that their conclusion provokes the transfer of real rights, in this case, motor vehicles, determined by mere effect of the contract, as clearly follows from the aforementioned norm.

60 - Regarding the aforementioned real-effect contracts, it is worth noting the teachings of Pires de Lima and Antunes Varela, when, in annotations to article 408 of the Civil Code, they tell us that "From these contracts called real (quoad effectum), in that they have as an immediate effect the constitution, modification or extinction of a real right (and not merely the obligations tending to that result) are distinguished the so-called real contracts (quoad constitutionem), which require the delivery of the thing as an element of their formation (cfr. articles 1129, 1142 and 1185) ".

We are, therefore, before contracts in which the ownership of the sold thing is transferred, without more, from the seller to the buyer, having, as cause, the contract itself.

61 - Also from jurisprudence, namely from the Judgment of the Supreme Court of Justice No. 03B4369 of 19/02/2004, available at: www.dgsi.pt, it is derived that, in light of the provisions of article 408.1 of the Civil Code, "the constitution or transfer of real rights over a determined thing occurs by mere effect of the contract, except for the exceptions provided for by law". This is the case of the purchase and sale contract of a motor vehicle (articles 874° and 879.a) of the Civil Code), which does not depend on any special formality, being valid even when concluded in verbal form - conf. Judgment of the Supreme Court of Justice of 3-3-98, in CJSTJ, 1998, year VI, Volume I, p. 117". (emphasis added)

62 - Having the purchase and sale contract, in light of what has been stated, the nature of a real contract with the aforementioned consequences, account must also be taken of the legal value of vehicle registration that is the object of that contract, insofar as the transaction of the said good is subject to public registration.

63 - It is established, in effect, in article 1.1 of Decree-Law No. 54/75, of 12 February, relating to the registration of motor vehicles, that "The registration of vehicles has essentially as its purpose to give publicity to the legal situation of motor vehicles and respective trailers, with a view to the security of legal commerce". (emphasis added)

64 - Being clear, in light of the said norm, what the purpose of registration is, there is, however, no clarity, within the scope of the aforementioned Decree-Law, on the legal value of that registration, it being important to consider article 29 of the mentioned instrument, relating to the registration of vehicle ownership, when it is provided that "The provisions relating to real property registration are applicable, with the necessary adaptations, to the registration of automobiles […]". (emphasis added)

65 - In this framework, in order that we may achieve the sought knowledge about the legal value of motor vehicle registration, it is important to take into account what is established in the Real Property Registration Code, approved by Decree-Law No. 224/84, of 06 July, when it provides in its article 7 that "definitive registration constitutes a presumption that the right exists and belongs to the registered holder in the precise terms in which the registration defines it". (emphasis added)

66 - The combination of the provisions in the aforementioned articles, particularly that established in article 1.1 of Decree-Law No. 54/75, of 12 February and in article 7 of the Real Property Registration Code, allows one to consider, on the one hand, that the fundamental function of registration is to give publicity to the legal situation of vehicles, allowing, on the other hand, to presume that the right exists and that such right belongs to the holder in favor of whom it is registered, in the precise terms in which it is defined in the registration.

67 - Thus, definitive registration constitutes nothing more than a presumption that the right exists and belongs to the registered holder, in the exact terms of the registration, but a rebuttable presumption, admitting, therefore, contrary proof, as follows from the law and jurisprudence has been signaling, being able, in this regard, to see, among others, the Judgments of the Supreme Court of Justice Nos. 03B4369 and 07B4528, respectively, of 19/02/2004 and 29/01/2008, available at: www.dgsi.pt.

68 - The function legally reserved for registration is, therefore, on the one hand, to publicize the legal situation of the goods, in this case, of the vehicles and, on the other hand, to allow us to presume that the right exists over those vehicles and that the same belongs to the holder, as such inscribed in the registration, which means that registration does not have a constitutive nature in the right of ownership, but only declarative, hence registration does not constitute a condition of validity of the transfer of the vehicle from the seller to the buyer.

69 - Thus, if the purchasers of the vehicles, as their "new" owners, do not immediately promote the adequate registration of their right, it is presumed, for the purposes of article 7 of the Real Property Registration Code and of article 3.1 of the CIUC and that the vehicles continue to be the property of the person who remains registered in the register as their owner, such person being the taxpayer of the tax, with the certainty, however, that such presumptions are rebuttable, either by virtue of the provision in article 350.2 of the Civil Code, or in light of the provisions of article 73 of the General Tax Law. Hence, from the moment in which the aforementioned presumptions are set aside, by means of proof of the respective transfer, the Tax Authority may not persist in considering as the taxpayer of the UCT the transferor of the vehicle, who, in the register, continues to appear as its owner.

L - MEANS OF PROOF PRESENTED

70 - Written form not being legally required for the transfer of ownership of motor vehicles, proof of such transfer may be made by any means, namely by testimony or documentary evidence, in the latter including, in particular, invoice receipts relating to vehicle sales.

REGARDING THE SALE OF VEHICLES AS SALVAGE

71 - As a means of proof that the vehicles, identified in the record, sold as salvage, were not its property on the date of exigibility of the tax, the Applicant attached "Communications" from the Insurers relating to the vehicles in question and the corresponding indemnities for their Total Loss.

72 - Insurance companies, in accordance with article 8 of Decree-Law No. 94-B/98 of 17.04, «[…] are financial institutions whose exclusive purpose is the exercise of direct insurance or reinsurance activity, except in those branches or modalities that are legally reserved to certain types of insurers, and may also exercise activities connected with or complementary to insurance or reinsurance, namely as regards acts and contracts relating to salvage […]»; (emphasis added)

73 - The acquisition of salvage by insurance companies and their subsequent alienation, usually to scrap dealers, is a complementary activity of insurance operations, as results from the aforementioned norm, insofar as what is at issue is that in the context of situations resulting from claims, in which the Total Loss of vehicles is verified, such companies are obliged to indemnify the injured parties, monetarily, in accordance with the insurance contract they have concluded with them, when the vehicle is deemed non-repairable, taking, on the other hand, the damaged vehicles and proceeding, subsequently, to the sale of the same in the condition in which they acquired them.

74 - Indeed, within the framework of the Mandatory System of Motor Liability, contained in Decree-Law No. 291/2007 of 21 August, it is understood that a vehicle involved in an accident is considered in a situation of Total Loss, as provided in article 41.1 of the said instrument, when the obligation to indemnify is fulfilled in money and not through repair of the vehicle, whenever it is found that repair is materially impossible or technically inadvisable.

75 - In the case at hand, this is what occurred, in that, on the one hand, the Insurers after the corresponding surveys deemed it appropriate to regularize the situation of the damaged vehicles as Total Loss and, on the other, as results in particular from the documentation attached to the record relating to the exchange of information/documents between the Insurers and the Applicant, the salvage in question, by virtue of the motor insurance contract, entered into the patrimonial sphere of the insurance companies, having the Applicant, as the injured party, been indemnified.

76 - Regarding the payment of the amounts recorded in the "Communications" of the Insurers, relating to the vehicles in question, taking into account that the "vehicles" did not remain in the possession of their owner, it is important to highlight that such amounts are comprised of two components, namely: the value of the salvage and the value of the indemnity for Total Loss, which leaves no doubt about the transfer of ownership of the salvage from the Applicant to the insurance companies.

77 - The transfers of ownership of the salvage in question to the insurance companies occurred between 18-08-2004 (vehicle with registration ...-... -...) and 17-04-2013 (vehicle with registration ...-... -...), whereas the exigibility of the corresponding UCT relates to the years 2013 and 2014, it being important to note that, as regards the vehicle with registration ...-... -..., the exigibility of the UCT refers to 13-08-2013.

78 - Regarding the elements of information recorded in the aforementioned "Communications", it is also important to note that, in light of the presumption of veracity conferred upon them in article 75.1 of the General Tax Law, it would be incumbent upon the Tax Authority, having regard to the provisions of article 75.2 of the General Tax Law, within the framework of the well-founded and objective reasons it had, to demonstrate that the information recorded in those "Communications" does not correspond to reality.

79 - In these circumstances, with the Tax Authority requiring the UCT relating to the years 2013 and 2014, and the Applicant not being, in these years, owner of the said vehicles, it is considered that the aforementioned "Communications" of the Insurance Companies, combined with both the information/documents contained in the record and other documents, which are referred to below, are adequate and capable proof to rebut the presumptions in question in the record, that is, the presumption established in article 7 of the Real Property Registration Code and that enshrined in article 3.1 of the CIUC, which means that, in these cases, at the time the tax was exigible, the Applicant was not the taxpayer of the UCT.

REGARDING THE SALE OF VEHICLES AS USED

80 - As stated above, proof of the sale of motor vehicles may be made by any means, namely by invoice receipts.

81 - The Applicant, as a means of proof that it proceeded to the sale of the other vehicles, as used, as identified in this case, on a date prior to that of exigibility of the tax, attached copies of the invoices relating to said alleged sales.

82 - It should, moreover, be noted that nothing allows one to consider that the invoices presented, as support for the sales of the vehicles in question in the record, do not correspond to the sales that, allegedly, were executed.

83 - The invoices attached to the record, as proof of the alienation of the vehicles, taking into account the social purpose of the Applicant, embodied in the rental of motor vehicles, and that at the end of these rental contracts, it proceeds several times to the sale of the vehicles to its customers, are shown to be entirely consonant with the aforementioned business reality, being absolutely plausible the sale of the vehicles that the invoices presented aim to prove, with no identification whatsoever of elements that embody any simulated contract, rather they allow one to conclude that we are before invoices that reproduce the real and true sale of the vehicles to the persons mentioned therein.

84 - It will be said, indeed, that, in the case at hand, in light of the economic activity of the Applicant, as already mentioned, it will not be strange, quite the opposite, the transfer of ownership of the vehicles identified in the record.

85 - Having, however, in view the need to proceed with the determination of material truth regarding the facts, and considering, namely the provisions of article 13 of the Code of Tax Procedure and Process and article 99 of the General Tax Law, the arbitral tribunal promoted diligences in order that the documents aforementioned and presented as proof of the sales in question be complemented with other information, aiming, in particular, at the verification of the effective receipt of the values relating to the sales of the vehicles in question.

86 - With regard to the last of the mentioned articles, that is, article 99 of the General Tax Law, it is worth noting what, in annotations to this article, is signaled by Diogo Leite Campos, Benjamim Silva Rodrigues and Jorge Lopes de Sousa, in General Tax Law, Annotated and Commented, 4th Edition 2012, Writing Meeting, Ltd., Lisbon, p. 859, when, regarding the principle of the inquisitorial, they state that "It is asserted, without room for doubt, the principle of full inquisitorial of the tax tribunal in the field of tax procedure […]. The inquisitorial principle applies to all tax courts that know of matters of fact, justifying the rejection of application of those norms of civil procedure that establish certain moments for the presentation of documents (cf. Articles 523, 524 and 706 of the Code of Civil Procedure […]", articles which correspond, respectively, to the current articles 423 and 425 of the Code of Civil Procedure, article 706 being repealed.

87 - In this framework, it is important to recall the teachings of Jorge Lopes de Sousa, in Code of Tax Procedure and Process, Annotated and Commented, Volume I, 6th Edition, Áreas Publishing House, SA, Lisbon, 2011, p. 174, when, in annotations to article 13 of the mentioned Code, he states that "The limitation of the powers of cognition to the alleged facts, apart from those of official knowledge, has no clear justification in tax procedure nor can be understood in absolute terms. Indeed, although it is undeniable that there are some similarities between civil declaratory procedure and tax impugnation procedures […] it is also clear that there are substantial differences […]", which "shows that we are not before a procedure in which the principle of disposition prevails integrally".

88 - The Applicant, within the deadlines granted for this purpose, came to complement the said invoices, which applies, moreover, to the documents relating to the sale of vehicles as salvage, with other elements improving the proof, namely with the corresponding accounting statement excerpts, reinforced with the attachment of the maps of gains and losses, capable of proving that the values relating to the sales of the said vehicles were, by itself, effectively received, which demonstrates the transfers of ownership of those goods, occurred on dates prior to those of the exigibility of the UCT.

89 - The aforementioned documents, as indeed the invoices which complement them, relating to the sale of the vehicles, insofar as they enjoy the presumption of veracity conferred upon them in article 75.1 of the General Tax Law, it being incumbent upon the Tax Authority, having regard to the provisions of article 75.2 of the General Tax Law, within the framework of the well-founded and objective reasons it had, to demonstrate that the information recorded in them does not correspond to reality, allow it to be considered that such documentation constitutes sufficient means of proof to rebut the presumptions in question in the record, that is, the presumption established in article 7 of the Real Property Registration Code and that enshrined in article 3.1 of the CIUC, which means that, at the time the tax was exigible, the Applicant was not the owner of the vehicles in question, at the time to which the assessments of that tax refer.

90 - The combination of the invoices with the other complementary means of proof, as mentioned in article 88, allows the conclusion that the effective receipt, by the Applicant, of the price of the vehicles and its real transfer, except for the vehicles whose registrations are indicated below.

91 - Having arrived here, it is important to note that the aforementioned understanding is not valid for the vehicles with registrations ...-... -..., ...-... -..., ...-... -..., ...-... -..., ...-... -... and ...-... -..., for which documents were not presented that can be considered as capable of undoubtedly proving the transfer of ownership of those vehicles, at a moment prior to the dates of exigibility of the corresponding UCT.

92 - The total amount resulting from the assessments associated with the six aforementioned vehicles, that is, with the vehicles with registrations ...-... -..., ...-... -..., ...-... -..., ...-... -..., ...-... -... and ...-... -..., totals the sum of € 275.64.

93 - In these circumstances, except for the six vehicles aforementioned, taking into account that the presumption enshrined in article 3.1 of the CIUC has been rebutted, both as regards the salvage vehicles, referenced in this proceeding, which were alienated on dates prior to those of the exigibility of the tax, that is, at the moment at which the Tax Administration can demand the tax payment, as well as with respect to the other vehicles sold as used, it must be considered that the Applicant was not, at the date to which the assessments in question refer, the taxpayer of the tax in question.

94 - The Tax Authority, when it understands that the taxpayers of the UCT are, definitively, the persons in whose name the motor vehicles are registered, without considering that article 3.1 of the CIUC embodies a presumption, nor taking into account the evidence presented to it, as results, namely, from the tax administrative proceeding, is proceeding with the illegal assessment of the UCT, relating to the vehicles aforementioned, based on the erroneous interpretation and application of the norms of subjective incidence of the Unique Circulation Tax, contained in the said article 3 of the CIUC, which constitutes the practice of tax acts lacking in legality due to error over the factual and legal prerequisites, determining the annulment of the corresponding tax acts, by violation of law.

M - REIMBURSEMENT OF PAID AMOUNT AND COMPENSATORY INTEREST

95 - Pursuant to the provisions of subparagraph b) of article 24.1 of the LFATM, and in accordance with what is established therein, the arbitral decision on the merits of the claim that is not subject to appeal or challenge binds the tax administration from the end of the period provided for appeal or challenge, such administration having - in the exact terms of the decision being upheld in favor of the taxpayer and until the end of the period provided for spontaneous execution of judgments of judicial tax courts - "Restore the situation that would exist if the tax act that was the subject of the arbitral decision had not been carried out, adopting the acts and operations necessary for this effect." (emphasis added)

96 - These are legal commands which are in total harmony with the provisions of article 100 of the General Tax Law, applicable to the case by virtue of the provisions of subparagraph a) of article 29.1 of the LFATM, in which it is established that "The tax administration is obliged, in case of partial or total success of complaints or administrative appeals, or of judicial proceedings in favor of the taxpayer, to immediately and fully restore the situation that would exist if the illegality had not been committed, including payment of compensatory interest, in the terms and conditions provided for by law." (emphasis added)

97 - The case contained in the present record raises the manifest application of the aforementioned norms, in that, following the illegality of the assessment acts referenced in this proceeding, there must, by virtue of these norms, be reimbursement of the amounts paid, either for tax or compensatory interest, as a way to achieve the restoration of the situation that would exist if the illegality had not been committed, amounts which in the case at hand total € 3,729.40, resulting from the total amount € 4,005.04 that was paid, minus the sum of € 275.64 corresponding to the assessments relating to the six vehicles aforementioned.

98 - As to compensatory interest, it is manifest that, in light of what is established in article 61 of the Code of Tax Procedure and Process and satisfied that are the requirements for the right to compensatory interest, that is, verified the existence of error attributable to services resulting in payment of the tax debt in an amount greater than legally due, as provided for in article 43.1 of the General Tax Law, the Applicant has the right to compensatory interest at the legal rate, calculated on the sum of € 3,729.40.

CONCLUSION

99 - Within the circumstances that have been referred to, the Tax Authority, in carrying out the assessment acts that are the subject of this proceeding, based on the idea that article 3.1 of the CIUC does not establish a rebuttable presumption, makes erroneous interpretation and application of this norm, committing an error over the legal prerequisites, which constitutes violation of law.

100 - On the other hand, because the Tax Authority, on the date of the occurrence of the tax events, considered the Applicant owner of the vehicles referenced in this proceeding, considering it, as such, the taxpayer of the tax, when such ownership, with respect to the vehicles in question, no longer was inscribed in its legal sphere, basing itself, therefore, on factual matter divergent from the effective reality, commits an error over the factual prerequisites, and therefore violation of law.

III - DECISION

• Therefore, in light of all that has been stated, this Arbitral Tribunal decides:

• To judge partially upheld, as proven, on the grounds of violation of law, the request for arbitral adjudication insofar as it concerns the annulment of the assessment acts of UCT relating to the years 2013 and 2014, relating to the vehicles identified in the record;

• To annul, consequently, the assessment acts of UCT, relating to the years 2013 and 2014, relating to the vehicles aforementioned;

• To condemn the Tax Authority to reimburse the sum of € 3,729.40, obtained in the terms indicated above, in article 97, relating to the UCT and compensatory interest that were paid, relating to the years 2013 and 2014, and to payment of compensatory interest at the legal rate, counted from the date of payment of the said sum, until the full reimbursement thereof;

• To condemn the Applicant and the Respondent in costs, which are fixed, for each, in the proportion of 7% for the Applicant and 93% for the Respondent.

VALUE OF CASE

In accordance with the provisions of articles 306.2 of the Code of Civil Procedure (ex-315.2) and 97-A.1 of the Code of Tax Procedure and Process and article 3.2 of the Regulation of Costs in Tax Arbitration Proceedings, the value of the case is fixed at € 4,005.04.

COSTS

In accordance with the provisions of article 12.2, final part, in article 22.4, both of the LFATM, and in article 4 of the Regulation of Costs in Tax Arbitration Proceedings and Table I, which is attached thereto, the amount of total costs is fixed at € 612.00.

Notify.

Lisbon, 29 January 2016

The Arbitrator

António Correia Valente

(The text of this decision was prepared by computer, in accordance with article 131.5 of the Code of Civil Procedure (ex-138.5), applicable by reference from article 29.1.e) of Decree-Law No. 10/2011, of 20 January (LFATM), being governed in its drafting by the spelling prior to the Orthographic Agreement of 1990.)

[1] See the study on this matter, prepared by Prof. Carlos Pestana Barros, in Tax Science and Technique, 2005, No. 416, pp. 105-126