The Constitutional Court establishes the evidentiary value of deeds in the Tax on the Increase of the Value of Urban Land.

The Plenum of the Constitutional Court has declared that the judge, before sentencing, must assess all the evidence provided by taxpayers, in order not to violate their right to effective judicial protection.


The recent ruling of 30th of September 2019 issued by the Constitutional Court has its origin in the case of a taxpayer against the City Council of Torrelodones (Madrid) demanding the return of the payment of the Tax on the Increase of the Value of Urban Land (hereinafter IIVTNU by its Spanish initials).

The taxpayer submitted a request for the return of unlawful income for the amount paid for of 8,570.26 euros that had been charged by the City Council. The taxpayer provided as evidence the deeds in which it was evidenced that the sale value (289,000 euros) was lower than the purchase value (455,000 euros). However, the City Council dismissed the request, so the taxpayer filed an appeal before “Juzgado de lo Contencioso Administrativo de Madrid”. This Court dismissed the evidence presented by the taxpayer consisted in the deeds of sale and purchase that showed the loss in the purchase of the property.

It is important to consider the previous sentence of May 11th, 2017 from this Court, establishing that the payment of the IIVTNU is not suitable in cases of sale or transmission of a property that involves losses.

Therefore, the taxpayer decided to file an appeal before the Constitutional Court alleging an infringement of Article 24.2 of the Constitution, for not evaluating the evidence presented (the deed of transmission) and dismissing expert evidence (the statement of a real estate agent). The evidence, consisting on the deeds of purchase and sale, reflected that the taxable event had not occurred, which is not taken into account in the resolution of the Court.

The Constitution Court in its resolution warns of the constitutional significance for being an issue of procedural public policy with social and economic impact. The right to provide evidence and its evaluation is infringed, taking into account the rules of healthy criticism contemplated in Article 24.2 of the Constitution and the right to a congruent judgment of Article 24.1.

However, the right to effective legal protection in relation to the dismissal of the expert evidence is not violated. It is considered by the Constitutional Court that the evidence was inadmissible because it was not requested in the established manner and moment. To be considered as an infringement of the right, it is required that the evidence not admitted or not assessed, has been requested in the legally established manner and moment, and whenever it is relevant evidence, in order to be examined by the relevant judicial body.

The denial of the provided evidence must be motivated by the judicial bodies, and the fundamental right may be violated when relevant evidence is dismissed in the final resolution  without motivation or with insufficient motivation, or when said dismissal is the result of an arbitrary or unreasonable interpretation. The constitutional guarantee of Article 24.2 does not cover any irregularity or procedural omission, but only those cases in which the evidence is decisive in terms of defense. Article 24 prevents the judicial bodies from denying an evidence and subsequently founding their decision in the absence of accreditation of the facts, which demonstration was intended through the evidence that could not be performed.

In conclusion, in this case the violation of art. 24.1 is based on the lack of valuation of the deeds of sale, which were also not examined by the city council. Their valuation by the judicial body was in this case unavoidable. The Constitutional Court declares the annulment of the sentence and orders the retroactivity of proceedings until the moment immediately before the sentence was issued. Thus, “Juzgado de lo Contencioso-Administrativo” will have to issue another resolution that recognizes the content of the evidence provided (the deeds of acquisition and transfer).


B Law & Tax
International Tax & Legal Advisors.

“En B LAW&TAX somos especialistas en asesoramiento fiscal internacional tanto a empresas como para particulares. Si desea ampliar la presente información, estaremos encantados de poder atenderle en el 917817194 o en This email address is being protected from spambots. You need JavaScript enabled to view it.