Gill Nadel, Adv.
Cases with difficult circumstances can produce interesting decisions, too, and such was the decision of the Supreme Court on the case 10316/06 which was recently issued, in which the importer was represented by the author of this article, Adv. Gill Nadel, and Adv. Rotem Virnik of his office.
As we know, according to the instructions of Article 154 to the Customs Code, an importer who makes customs payments under protest must file an action for refund within three months. This case involves an action that was filed after a stretch of two or three years from the payment of the tax.
Together with filing the suit, the importer filed a request for the extension of the period of three months. The request was discussed and rejected by the magistrate's court, and then by the district court, and finally, without any deliberations, by the Supreme Court as well (in an intermediary decision). But 'on the way', the Supreme Court said a few things that a sharp-eyed reader (including the Customs Authority and the Ministry of Justice) should note.
Firstly,the Supreme Court agreed, albeit not decisively, that the period of limitation of Article 154 is not substantive and can be extended, in accordance with the circumstances of each case:
"Even under the assumption that the instructions of Article 154(b) regarding the period of three months are procedural and can be extended, and that the point is strengthened by the importance of a liberal interpretation of a clause of this sort that establishes a period of limitation that is short in real practical terms- even under the assumption that Regulation 528 can be applied in these circumstances, the two earlier courts have already ruled that the appellant did not illustrate special reasons for the period to be extended.”
Secondly, and no less importantly,the court was aware of the problematic nature of the three month period of Article 154, and called on the legislator to amend the Article, for reasons of fairness to the importer:
"The length, or more precisely the shortness, of the limited period prescribed in the Article does indeed raise questions regarding its pertinence to our time, and maybe the legislator will think about this, in an effort to achieve fairness towards all”... “if one can think that there is a place for a wider timetable, and I am not far from that thought, that is the work of the legislator.”
We will wait and see if anyone in Jerusalem raises the gauntlet. We will also track how the courts apply this ruling.
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