Report from the Court

At the outset of the day's proceedings, Judge Irina Kolesnikova announced the inclusion in the court's daily record of a decision by the Moscow City Court that had been forwarded to the Meshchansky Court in relation to the current case. The Moscow City Court rejected an appeal filed by lawyers representing Platon Lebedev against the extension of the defendant's term of detention through December 26. The Moscow City Court also concluded that, since Mr. Lebedev's health is adequate according to officials from the Matrosskaya Tishina prison, and he is able to participate in the legal proceedings, there is no justification for the court to uphold a request for his release.
Defense lawyer Vladimir Krasnov followed Judge Kolesnikova's announcement with a statement in which he asked the court to expand upon the brief explanation of Platon Lebedev's "acceptable" state of health that was given by officials from the Matrosskaya Tishina prison. Mr. Krasnov noted that it was not clear exactly who at the prison had determined that Mr. Lebedev's health was adequate for his continued participation in the case proceedings.
Judge Kolesnikova chose not to respond to Mr. Krasnov's statement.
Lead prosecutor Dmitry Shokhin called Svetlana Kuchinskaya, currently Deputy Chief of the Tax Inspection Office No. 2 of the City of Moscow, as the first witness. During the period in question, Ms. Kuchinskaya worked in the same office as she currently does. She first met Mikhail Khodorkovsky in 1997 when he paid a visit to the Tax Inspection Office No. 2 to pay the balance of his taxes that were due at the end of the year.
Ms. Kuchinskaya testified that Mr. Khodorkovsky filed his taxes in 1997 as a private individual, whereas from 1998-2000, he filed as a sole proprietor, which qualified him for the simplified tax system. As a result of his qualification for use of the simplified tax system, his tax burden was greatly reduced. During each of the three years Mr. Khodorkovsky qualified for the simplified system, he paid approximately 4,000 rubles in taxes. As a matter of policy, tax officials review the individual's income each year to see if it fell under the 10 million-ruble ceiling, above which the use of the simplified tax system was prohibited. In 2001, Tax Inspection Office No. 2 rejected the defendant's simplified tax return because he had earned more than the maximum 10 million rubles allowed.
Ms. Kuchinskaya explained that she was involved in processing Mr. Khodorkovsky's tax returns because his income came largely from consulting fees paid by foreign registered firms. She worked specifically on tax returns for individuals with earnings from foreign companies. The witness confirmed that the information included in Mr. Khodorkovsky's tax returns for the years she was involved in reviewing those documents was entirely accurate and correct, and complied with the requirements of the law as they existed at that time.
In order to clarify the situation, Mikhail Khodorkovsky asked the witness a number of questions regarding his ability to qualify for the use of the simplified tax system. In answer to his questions, the witness explained that, as a sole proprietor, he was granted a "patent", or the authority, to provide both consultative and managerial services to companies. Only those individuals who had received such qualifications were eligible to use the simplified tax system.
Prosecutor Shokhin again noted "significant contradictions" in Ms. Kuchinskaya's testimony, but only asked one follow-up question after reading a passage from her pre-trial testimony.
With the exception of Ms. Kuchinskaya's testimony, the day proved extremely tedious. Following the conclusion of her testimony, the prosecution called Muradin Kunov, Managing Director of the Tax Service of the Republic of Adygeya in southern Russia. His testimony was relatively short and related exclusively to charges involving Andrei Krainov.
The prosecution then called three witnesses also from the Republic of Adygeya, only to ask them two or three questions each that focused on where they lived during the period of time in question. These witnesses included Nikolai Markin, Margarita Serykh, and Fatima Skakumidova.
After the last witness was dismissed from the courtroom at approximately 16:00, Prosecutor Dmitry Shokhin requested permission to read 30 volumes from the case material before the court. Every document from his selection of documents from these volumes had already been entered into the record. For over two hours, the court was held captive while the prosecution finished every last document, at which point Judge Kolesnikova did not hesitate to dismiss the court.
The proceedings will continue at 11:00 on Friday, October 15.

(From M.Khodorkovsky's Press Center)