Avoiding taxes of 66.5 million drams: a criminal case filed on case of “Elite Group”

The Investigative Committee of Armenia has initiated a criminal case on the fact that Elite Group avoided maliciously paying taxes. This was based on the report submitted by “Veles” human rights NGO. The case may become a start of demolition of some major corruption “balls”. “Elite Group” closed joint-stock company (CJSC) constructs and sells residential and public elite complexes. The case initiated in the Investigative Committee of Armenia discloses definitely how the sale process takes place.

The basis of the initiation of the criminal case is the contract signed between “Elite Group” CJSC and one family. According to our information, there are a lot of such contracts, and other people who obtained apartments from Elite Group may also discover certain problems in their contracts in future.

Thus, according to the criminal case, in 2007, “Elite Group” CJSC and spouses Karlen Hovsepyan and Arusyak Sanasaryan agreed that the latter  could obtain 162 square meters of living space in a block of flats at  29 Rostom street in Yerevan and two parking spaces,  against 52 million 180 thousand drams. The consent reached between the parties was recorded in the preliminary contract, which, however, was not signed by “Elite Group” CJSC. We have copies of cashback orders confirming that in 2007-2008 the family paid “Elite Group” CJSC the sum of 52 million 180 thousand drams mentioned in the preliminary contract.

In 2009, when a contract between the parties was signed and certified by in notary, “Elit Group” CJSC did not mention the amount actually received, but 31 million drams which was less than 21 million 180 thousand drams of the real value of the apartment and parking lots.

According to the initiated criminal case, only in the frames of a contract with one family, “Elite Group” CJSC did not pay the state 3 million 530 thousand drams as VAT and more 3 million 529 thousand drams as profit tax, with this hiding the real amount received. The Investigative Committee has found out that Elite Group also concealed the real value of the apartments in the contracts with other residents of the same building, thus avoiding paying taxes of almost 66.5 million drams.

A criminal case has been instituted on the fact that the taxpayer illegally evaded to pay large-scale taxes (Part 2 of Article 205 of the Criminal Code of Armenia).

On December 18, we wanted to contact Armen Mkoyan, the president of “Elite Group” CJSC. His mobile phone was out of reach, and an employee of CJSC informed that he was not in the country. There was no one of the managers in the office that day. We left a phone number and asked to contact us so that we could know and present their point of view on the criminal case. So far we have not received any telephone calls from “Elite Group” CJSC.