The State, as the owner of the rights in the land, is entitled to transfer to the appellant certain rights, including the right or obligation, to transfer to the occupants more extensive rights than it itself received, and for this purpose the appellant received a notarized power of attorney in order to sign the lease contracts with the ILA on behalf of the tenants. In any case, the tenants sign lease contracts directly with the ILA, which remains the owner and lessee of the land.
- Therefore, the ILA was and remains the owner and lease of the land. The fact that a lease right was registered in the Land Registry in the name of the appellant does not change the conclusion that the engagement between the State and the appellant did not amount to the sale of a "right in real estate" as defined in the law, which requires the payment of purchase tax.
- There is no basis for the argument raised by the respondent that equality between the contractors competing in the "Buyer's Price" tenders will be violated if the appellant's position is accepted. Each bidder in the tender acted at his discretion and was entitled to consult with a tax expert in order to weigh any possibility or claim in relation to the tax liability arising from the tender. The appellant did not undertake to pay tax in the framework of the tender in one amount or another, but in accordance with the law.
- The appellant submitted an expert opinion on its behalf, by Shmuel Marko, CPA, who explained the manner in which "Buyer's Price" projects are classified in the appellant's financial statements, and that accepting the appellant's position in the appeals in this case will not change the manner in which the financial statements are classified. Therefore, the respondent is fundamentally wrong in his argument that the appellant's arguments should be rejected since that it classified the projects of "Buyer's Price" as a "building inventory for sale" type and not as a service.
The Respondent did not submit an expert counter-opinion on its behalf, and the arguments in this regard were raised in the framework of the affidavit of Mr. Barak on behalf of the Respondent, who is not an accountant by education and does not deal with accounting standards and auditing. This is sufficient to reject his arguments in this matter.
- The respondent's argument that because the appellant mortgaged her rights following the winning of the tender, in order to receive financing from the banks, she testified that she had purchased rights in the land.
The respondent is not very precise, does not bring the necessary evidence to substantiate such a claim, and does not create the necessary distinction between the acquisition of a "right in real estate" in the meaning of the Real Estate Taxation Law, and a right in real estate in the proprietary sense.