Legal Protection for Good Faith Buyers Against "Not Found" Confirmation Status: PT. TI VAT Dispute

The VAT dispute between PT. TI and the Directorate General of Taxes (DGT) serves as a vital precedent regarding legal protection for "good faith" buyers in Input Tax disputes. The core conflict arose from the Respondent's correction of Input Tax amounting to IDR 90,810,908.00 due to a "Not Found" response (clarification code "E") from the tax office regarding the supplier's Tax Invoice. The DGT maintained that without the seller reporting the tax, the validity of the Input Tax could not be verified and thus was non-deductible for the Petitioner.

However

However, PT. TI presented a compelling argument by emphasizing the substance-over-form principle through tangible evidence of cash and goods flow. The Petitioner asserted they had fulfilled their VAT payment obligations via bank transfer to the supplier and maintained comprehensive supporting documentation. Citing the principle of joint and several liability under Article 33 of the KUP Law, the Petitioner argued that administrative failures by the seller should not strip away the rights of a buyer who has already paid the tax.

The Board

The Board of Judges agreed in their legal considerations that a "Not Found" confirmation status is merely an administrative indicator and does not automatically invalidate the right to credit Input Tax, provided the transaction is materially proven. After conducting a verification of Purchase Orders, Invoices, Delivery Notes, and bank transfer slips, the Board concluded the transaction was authentic. This decision reaffirms that material truth (flow of money and goods) prevails over formal tax confirmation procedures.

The

The implication of this ruling is crucial for taxpayers: maintaining robust supporting documents and clear proof of payment is the primary defense against tax corrections caused by third-party negligence. This decision serves as a reminder that the Indonesian tax system upholds justice for taxpayers acting in good faith.