By Márcio Martins Bonilha Filho
A timely initiative by Brazilian notary officer Carlos Roberto Setonye de Campos – from Bebedouro, in the state of São Paulo, Brazil – in filing an ordinary rite lawsuit against the Union, claiming no incidence of tax on values received by notarial protest offices and passed on to creditors, given that the former are to be considered income, in the solution of Consultation 94/2020 by Brazil’s Federal Revenue Agency’s General Taxation Coordination (Coordenação Geral de Tributação da Receita Federal do Brasil/Cosit), has led to a convincing and unquestionably successful judicial definition concerning the matter, through fair application of the Law.
The issue and the resulting jurisdictional definition have been very well resolved, based on appropriate legal principles and on a perceptive examination of the topic, in the light of the legal rules and tax guidelines in force within the administrative and tax spheres, through force de conviction, thus unveiling the correct direction and path of notary officers’ work in the performance of their duties.
This jurisdictional understanding is superimposed on the mistaken interpretation of revenue within the described framework, and deserves recognition for the effectiveness emanating from its fair and legal deliberation.
Notary protest officers of bills and bonds, as public power delegates whose competence is established by article 11 of Brazil’s Federal Law 8.935, of November 18, 1994, and the duties included therein, are subject to the income tax payment regime due to the fees they receive.
The values received as fees are included in the legal concept of income, considering that they are remuneration for acts pursuant to article 14, of Law 6,015/73 (Public Records Law/Lei dos Registros Públicos), especially in the values corresponding to the costs of deeds, certificates, searches, annotations and registrations of any nature.
Activities carried out by notary protest officers also involve, by force of law (Federal Law 9,492/97, which regulated the protest), work that is consistent with receiving payment of bonds and other debt documents.
That is to say that payment of a bond or debt document presented for protest can be made directly to the notary office, in the value declared by the applicant, resting assured that, at payment, the notary office will grant respective acquittance – and the due value will be made available to the submitter on the first business day following receipt.
Strictly speaking, protest notary offices act as intermediaries by law between debtors and creditors (presenters of bonds), including provision for receiving values, acquitting and promoting transfer by the first following business day.
It is crucial to recognize that the values received are not available to the notary office, and do not become new wealth or patrimony.
Since this is intuitive, there is no need to consider an increase in equity because of the transfer of payments to creditors, although notary offices are obliged to grant formal discharge, acting, in this case, as regular representatives of creditors, specifically to this end.
In their relations with the tax authority, they are subject to the bookkeeping of the Cash Book and the monthly collection of federal tax by the Carnê Leão Cash Book, under the functional discipline of Brazil’s Justice Control Agency (Corregedoria Geral da Justiça), which outlines the respective administrative orientation.
In this scenario, it is crucial to clarify that these notary offices do not earn any profits from the transfer of values to creditors, nor do they benefit from an equity advantage in this regard.
Thus, Brazil’s Federal Tax Authorities’ decision seems rather insensitive in the judicially contested resolution (Consultation 94/2020), establishing guidance for the bookkeeping of resources arising from securities under protest, through the mistaken understanding that these values must be considered as income within Cash Books.
As mere transferors of credits, notary officers will be unable to bear this obligation, unless in the case of an inadmissible breach of rules and general principles of Law.
The careful sentence handed down by the substitute federal judge of the 38th Judiciary Subsection of the Federal Justice (Subseção Judiciária da Justiça Federal) in Barretos (state of São Paulo), and confirmed by the unanimous decision of the 3rd Region (Civil Appeal 500010-39.2021.4.03.6138), reported by eminent federal judge Nery da Costa Júnior on July 15, 2022, with correct reasoning, are both (sentence and judgment) manifestations of the Judiciary that deserve favorable reception within the legal sphere, since they represent the correct distribution of Justice.
Márcio Martins Bonilha Filho is a retired judge at the São Paulo Court of Justice (Tribunal de Justiça de São Paulo/TJ-SP); a partner at Barcellos Tucunduva in the field of public records; and member of the advisory board of the Brazilian Institute of Real Estate Law (Instituto Brasileiro de Direito Imobiliário/Ibradim).
Source: Conjur Magazine