DUNNES Stores has brought a High Court challenge to a tax assessment of €36.4m arising out of the levy for plastic shopping bags.
The company claims that the Revenue Commissioners have served it with an assessment over a four-year accounting period for its use of bags which are not subject to the Government levy.
Dunnes was yesterday given permission by the High Court to bring judicial review proceedings against the Revenue, the Environment Minister, and the Attorney General.
The company wants the court to quash the assessment.
Mr Justice Michael Peart yesterday also made an order preventing the Revenue from taking any steps on foot of the assessments pending further proceedings.
He adjourned the matter until next month.
In its proceedings, Dunnes want to quash the assessments of the levy due for the accounting periods from July 2004 to June 2008, made under the Waste Management (Environmental Levy Plastic Bag) Regulations of 2001.
It seeks a number of declarations including that those 2001 regulations are invalid and of no legal effect.
It says the Revenue is acting in breach of natural justice and fair procedure by refusing to provide details for the basis of the assessment.
It is seeking a further declaration that any levy imposed under the 2001 Act can only apply to plastic bags which are suitable for use by customers at the point of sale, and not to other forms of plastic bags used for wrapping or hygiene.
The company is further seeking orders restraining Revenue from making any further assessments of any levy due by Dunnes in respect of any accounting period.
The court heard Dunnes had four assessments totalling €36.4m last November from Revenue, which had claimed that the levies due for plastic bags had not been collected.
Counsel said that the company did not accept these assessments because the plastic bags in question were used in the company's Northern Ireland stores and were also used for other purposes.