Dunnes Stores has lost its legal challenge to a €36.5m tax assessment arising from the use of plastic bags.

The company challenged the regulations imposing the plastic bag levy after the Revenue Commissioners served it with tax assessments covering 2004 to 2008.

The Revenue Commissioners say charges arising from the levy are uncollected and due.

Dunnes claimed in court that the definition of a plastic bag in the regulations was so uncertain as to render the regulations invalid.

It claimed the levy related to larger bags given to customers at the checkout to hold their shopping but that the tax assessments wrongly included other bags used for wrapping fruit, vegetables or other items for hygiene purposes.

Dunnes argued that the tax assessments amounted to an unlawful attempt to apply the levy to flimsy plastic bags supplied for the purpose of wrapping goods and supplied otherwise than at the point of sale.

It also claimed the Revenue Commissioners refused to provide them with information as to how it calculated the money that was allegedly due.

Mr Justice John Hedigan ruled against Dunnes on all points.

He found the levy was not limited to carrier bags as argued by the supermarket chain and said the point of the legislation was to reduce as much as possible the presence of discarded plastic bags littering our towns and countryside.

He said it would be most improbable that the legislature would exempt plastic bags that are supplied anywhere other than at a point of sale.

Such a provision would miss large numbers of plastic bags and diminish greatly the impact of the Act.

He said there was nothing unfair in the procedures followed by the Revenue Commissioners.

The regulations governing the plastic bag levy do allow an exemption for bags solely used to contain fresh fish, meat, poultry, fruit, nuts, vegetables, dairy products or cooked food provided the bags contain solely those products and are of a certain size.

The Revenue Commissioners argued the bags at issue were sufficiently big to carry an extensive range of groceries and goods supplied by supermarkets such as Dunnes.

The plastic bags are only exempt, under the legislation, if they are smaller than 225mm in width by 345mm in depth by 450mm in length.

The case will be back before the High Court on Tuesday when it is expected it will be indicated if Dunnes intends to appeal to the Supreme Court.

Dunnes Stores has an appeal outstanding with the Revenue Commissioners in relation to whether the bags they use for fruit, vegetables, meat and other products are exempt under the legislation.

That appeal was on hold pending the outcome of this case.

The case will be back before the High Court on Tuesday when it is expected it will be indicated if Dunnes intends to appeal to the Supreme Court.