GTE Spacenet Corp. v. New York State Department of Taxation & Finance

Appellate Division of the Supreme Court of New York

GTE Spacenet Corp. v. New York State Department of Taxation & Finance

201 A.D.2d 429, 607 N.Y.S.2d 677

Appellate Division of the Supreme Court of the State of New York·Decided February 24, 1994·Published·Cited by 4 cases

Opinion

Order, Supreme Court, New York County (Shirley Fingerhood, J.), entered on or about August 27, 1993, which granted plaintiff’s motion for a preliminary injunction restraining defendants from conducting an administrative hearing con[430] cerning plaintiffs claimed tax deficiencies, unanimously affirmed, without costs.

Where the taxpayer claims that a tax statute is wholly inapplicable, it may bring a declaratory judgment action without exhausting administrative remedies (see, Xerox Corp. v Department of Taxation & Fin., 140 AD2d 945, 946, lv denied 72 NY2d 809). Plaintiff in this action for a declaratory judgment has sufficiently demonstrated that it is likely to succeed on the merits of its challenges to Tax Law §§ 183, 184, 186-a and 186-c, all of which are to be narrowly construed in favor of the taxpayer (Debevoise & Plimpton v New York State Dept. of Taxation & Fin., 80 NY2d 657, 661), to satisfy the initial criterion to entitle it to a preliminary injunction of the administrative hearing on its tax liabilities. Moreover, without an injunction, plaintiff would be forced to defend the administrative proceeding to its conclusion even though a judgment in the within action has the potential to render the administrative proceeding unnecessary. Under the circumstances, the IAS Court’s conclusion that plaintiff faced irreparable harm and was favored by a balancing of the equities was not an abuse of discretion (see, Gambar Enters. v Kelly Servs., 69 AD2d 297, 306).

We have considered defendants’ remaining arguments and find them to be without merit. Concur — Carro, J. P., Ellerin, Rubin, Nardelli and Tom, JJ.

Free access — add to your briefcase to read the full text and ask questions with AI

Order, Supreme Court, New York County (Shirley Fingerhood, J.), entered on or about August 27, 1993, which granted plaintiff’s motion for a preliminary injunction restraining defendants from conducting an administrative hearing con[430] cerning plaintiffs claimed tax deficiencies, unanimously affirmed, without costs.

Where the taxpayer claims that a tax statute is wholly inapplicable, it may bring a declaratory judgment action without exhausting administrative remedies (see, Xerox Corp. v Department of Taxation & Fin., 140 AD2d 945, 946, lv denied 72 NY2d 809). Plaintiff in this action for a declaratory judgment has sufficiently demonstrated that it is likely to succeed on the merits of its challenges to Tax Law §§ 183, 184, 186-a and 186-c, all of which are to be narrowly construed in favor of the taxpayer (Debevoise & Plimpton v New York State Dept. of Taxation & Fin., 80 NY2d 657, 661), to satisfy the initial criterion to entitle it to a preliminary injunction of the administrative hearing on its tax liabilities. Moreover, without an injunction, plaintiff would be forced to defend the administrative proceeding to its conclusion even though a judgment in the within action has the potential to render the administrative proceeding unnecessary. Under the circumstances, the IAS Court’s conclusion that plaintiff faced irreparable harm and was favored by a balancing of the equities was not an abuse of discretion (see, Gambar Enters. v Kelly Servs., 69 AD2d 297, 306).

We have considered defendants’ remaining arguments and find them to be without merit. Concur — Carro, J. P., Ellerin, Rubin, Nardelli and Tom, JJ.

GTE Spacenet Corp. v. New York State Department of Taxation & Finance, 201 A.D.2d 429, 607 N.Y.S.2d 677 (N.Y. Ct. App. 1994).

Pincite

201 A.D.2d 429 (GTE Spacenet Corp. v. New York State Department of Taxation & Finance) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Opinion

Related