Tax Adversarial Proceedings following On-Site Inspection: Standstill Period and Nullity
Abstract
The procedural framework governing tax adversarial proceedings following an on-site inspection is grounded in Article 12, paragraph 7, of Law no. 212/2000, which establishes an ex ante statutory assessment in favor of the taxpayer. In ruling no. 27370 of 20 October 2026, the Civil Court of Cassation reaffirmed that issuing a tax assessment prior to the expiration of the sixty-day standstill period results in absolute nullity, without requiring any resistance test, even with regard to harmonized taxes such as VAT. The judgment further clarifies that the subsequent filing of a settlement proposal does not cure the procedural defect, while striking down for apparent reasoning the appellate judgment that uncritically upheld the disallowance of business deductions.
Key Legal Takeaways
- Ex ante statutory evaluation: Physical entry into business premises automatically triggers the sixty-day mandatory standstill period on pain of nullity of the tax assessment notice.
- Irrelevance of the resistance test: For both harmonized and non-harmonized taxes, failure to observe the sixty-day standstill period results in incurable nullity without the taxpayer having to prove a potentially different outcome.
- No retroactive cure via subsequent settlement: Filing an application for tax settlement after service of the notice cannot cure the procedural defect arising from premature issuance ( ante tempus ).
- Judicial review of deductible expenses: An appellate decision upholding the disallowance of business costs without specifically addressing the taxpayer's defensive arguments is null and void for merely apparent reasoning.
