On March 20, 1998 , Yerevan resident Henrik Mkhitaryan bought BMW-318 in Germany , for 1,400 Marks (about $840 at the time). On his return, Armenian customs officers were skeptical about the price listed on the contract, and valued the car at the local market price, $2,700. According to Mkhitaryan, they then demanded that he pay $1,400 in customs duty. Unable to pay the duty - much higher than he expected - Mkhitaryan offered the car instead. But while he was trying to sell the car to pay the duty, it was confiscated by the Aragatsotn police department and taken to the penalty parking lot, where it remained for a year. Meanwhile fines had accrued, and at the end of the year, the Ministry of State Revenues sued Mkhitaryan for the money.

On May 1, 2000, the court of first instance of the Achapnyak and Davidashen districts ruled in favor of the Ministry and decided to confiscate 690,102 Drams (about $1,230) for the state budget, and 13,802 Drams (about $25) for legal expenses. Mkhitaryan wasn't even present at the hearing. "I went to the court at 11 a.m. the day of the hearing, waited till 1 p.m. , and was told by an officer that the judge wouldn't be in that day and that I should come back the next day. So I went the next day and was told that the judgment had already been rendered. I didn't have money to appeal and, besides, the lawyers said it would be useless," Mkhitaryan told us. Since the decision neglected to define the original duty vs. the fines accrued, he doesn't understand how it was calculated that he owed 690,102 Drams - less than what customs originally demanded, let alone the additional fines.

Court executors put the car up for auction at a starting price of 1,200,000 Drams (about $2,150). Eventually, the car was sold for 254,000 Drams (about $440). We can only speculate as to what led the executors to quote a starting price much lower than the one mentioned in the customs department's invoice - 1,573,650 drams-or why in the end they sold it for a symbolic price.

With all this, Henrik Mkhitaryan has yet to actually pay the Ministry of State Revenues the customs duty or the accrued fines. Out of the 299,000 drams Mkhitaryan made by selling the car and his family's TV set, the court transferred 265,343 Drams to the state budget as VAT deducted from an individual, and used the rest for legal expenses and organizing the auction. Mkhitaryan is to pay the remainder of his debt to the state with his personal assets. His family's other belongings - the piano, the furniture - were put up for auction as well but have yet to be sold.

When he realized that even by giving up his car he couldn't rid himself of his debt, Henrik Mkhitaryan decided to take matters into his own hands, and went to President Kocharyan's Office of Supervision for an explanation for the ongoing robbery. In response to a subsequent inquiry by the Office of Supervision, the chief court executor of the republic, A. Avagyan, presented the Office with the allocation of money made from the auction and explained, "The actions aimed at the execution of the court decision are proceeding." In the end, the confiscation was extended to 50% of Mkhitaryan's pension. "I worked as a teacher for 40 years and I receive 8,000 Drams (about $14) in pension," he says, "and now it turns out that as long as I live, I have to pay the state half of it."