Argentine Case Law
On November 20, 2025, the National Chamber of Appeals on Federal Administrative Litigation (the “Chamber”) rendered judgment (the “Judgment”) in the case “Nordelta SA (TF 26811-I) c/ Dirección General Impositiva (Federal Tax Authority) s/Recurso Directo de Organismo Externo (Direct Appeal from an External Agency)” (the “Case”), dismissing the application of deemed interest upon finding that the challenged credits were not granted for the benefit of third parties but rather were made for the benefit of the company itself.
Background
In order to carry out the activities required for the development of its project, Nordelta S.A. incorporated, on September 17, 1998, Nordelta Administradora Fiduciaria S.A., for the purpose of administering trusts, carrying out works and construction, and performing other activities related to the construction and real estate sectors. Nordelta S.A. held 99.98% of the share capital of the fiduciary company. The trust was intended to develop a real estate project on land contributed by Nordelta S.A.
During a tax audit, the Tax Authority noted that Nordelta S.A. had recorded, under the account “Other Current Assets Receivables” in its financial statements as of December 31, 1999, receivables in its favor against a company belonging to the same economic group, Nordelta Administradora Fiduciaria S.A. On this basis, the Tax Authority concluded that such receivables fell within the scope of the disposal of funds for the benefit of third parties, thereby accruing deemed interest. Consequently, the taxpayer included such amounts in its tax return as a positive adjustment to the accounting result for the fiscal year.
The expert evidence produced with respect to the accounts and supporting documentation demonstrated that the funds had been transferred to the fiduciary company so that, on behalf of Nordelta S.A., it would make the relevant contributions to the trust for the execution of the works necessary for the development of the real estate project known as “Ciudad Pueblo Nordelta.”
On this basis, the Tax Court concluded that the disposal of funds was related to the company’s ordinary course of business and generated a direct benefit for the company. It further noted that the entities involved were related parties forming part of the same economic group. Accordingly, it held that, notwithstanding the fact that each entity had its own separate legal personality, the relationship between them, together with the specific characteristics of the real estate project and the applicable legal framework, precluded a finding that the transfer of funds had been made for the benefit of third parties.
This decision was appealed by the Tax Authority before the Chamber.
Decision of the Chamber
The Chamber reaffirmed the existence of an economic relationship between the companies and found that the challenged receivables were related to the commercial activity of the claimant company and resulted in a benefit to it. It further specified that, for the deemed interest provided for under section 73 of the Argentine Income Tax Law (current section 76) to apply, the following requirements must be met cumulatively:
- The existence of a disposal of funds for the benefit of third parties;
- That such disposal be carried out by one of the subjects described in section 49(a) of the law in force at the time of the events (current section 53); and
- That the transaction does not correspond to operations carried out in the interest of the company.
Accordingly, the Chamber dismissed the appeal filed by the Tax Authority and upheld the decision of the court of first instance.
Finally, the Tax Authority filed an extraordinary federal appeal before the Supreme Court of Justice of the Nation, which remains pending. As a result, the judicial decision has not yet become final as of the date hereof.
