January 2025

Interim Order of the Single Judge of the Court of First Instance of Chania on the suspension of the freezing of bank accounts

A Temporary Order of the President of the Single Administrative Court of First Instance of Chania was published, which ordered the release of our client's bank accounts in all four systemic banks.

We submitted the relevant request for a Provisional Order in the context of an application for an Interlocutory Appeal under Article 217 of the Code of Administrative Procedure and an Application for Suspension under Article 228 of the Code of Administrative Procedure against the State, which committed the following irregularities in the procedure for the establishment and collection of its alleged tax claims.

A) In breach of the constitutional right to legal protection, before the bank accounts were seized, the competent tax office did not, as it should have done, serve our client with an individual notice of default. This, despite the fact that the State, in accordance with Art. 46 of the Tax Code and according to the established case law of our Courts, the State is unable to carry out any enforcement action before 30 days have elapsed since the service of the relevant individual notice.

B) Furthermore, the competent tax office rushed to carry out the account seizures in question before the deadline for lodging an appeal under Article 63 and already Article 72 of the Tax Code by our client against the legal title, i.e. against the act of the State by which the tax or fine is imposed. However, according to the most recent case law of our Courts (PPrThessal 4380/2024), before the expiry of the 30 days, within which the governed party may bring an appeal, the State is unable to serve an individual notice, let alone an enforcement action, as in this case in the case of account seizures (! ) Moreover, if an action is brought (as our client did in this case), even if the State serves an individual notice, it is unable to carry out any enforcement action until the legal proceedings are completed; and, either the time limit for bringing an appeal before the ordinary administrative courts has expired without action having been taken, or such an appeal has been brought, but not followed by an application for a stay of execution, or such an application has been rejected by the administrative judge. The justification for the foregoing is: first, to ensure that the person concerned is not deprived of legal protection and, secondly, to ensure that the courts provide effective protection, which will only happen if the legality of the State's recovery order is decided by the judge hearing the appeal and clearly not by the judge hearing the application, who has no jurisdiction, and who can only review defects in enforcement.

Clearly, the Court took into account the risk of our client's business ceasing to operate, since with seized accounts he would be unable to satisfy his employees and suppliers, as well as to meet his arrangements with the State.