Nyszczota v Customs & Excise [2003] UKVAT(Excise) E00571 (08 December 2003)

EXCISE DUTIES — travellers bringing large quantities of tobacco to UK from Belgium — goods and vehicle used for transport seized — restoration refused —whether refusal reasonable — yes — appeal dismissed

MANCHESTER TRIBUNAL CENTRE

stepan nyszczota
Appellant
- and -

THE COMMISSIONERS OF CUSTOMS AND EXCISE
Respondents

			Tribunal: 	Colin Bishopp (Chairman)

				
Sitting in public in Birmingham on 26 November 2003.

The appellant in person
William Baker of counsel, instructed by their solicitor’s office, for the respondents

© CROWN COPYRIGHT 2003

DECISION

1	In early April 2001 the appellant, Stepan Nyszczota, travelled to France and Belgium with a friend. They each bought 15 kg of hand rolling tobacco, with which they returned to the United Kingdom. On arrival, they were stopped by Customs officers who allowed them to proceed with their tobacco (on which they were not required to pay UK duty) but they were issued with Customs’ “Notice 1”, explaining their policy in respect of large importations of excise goods, and warned that if they were found bringing such a quantity of tobacco into the country in the near future it was likely that Customs would conclude that they were doing so for a commercial purpose.
2	Mr Nyszczota, who represented himself at the hearing, said in his evidence that after he returned home to Leicester he mentioned his trip to his estranged wife and her sister. An arrangement was made that he would take them to Belgium in order that they too could buy some tobacco. Mr Nyszczota booked and paid for the tunnel ticket and they set off in the early hours of 27 April 2001 to make the return trip to Belgium. They duly made their purchases—tobacco goods in Belgium and alcoholic drinks in France. When they arrived at the French end of the tunnel, at Coquelles, in order to start the return journey they were stopped and interviewed by Customs officers. They had with them 30 kg of hand rolling tobacco, 1,000 cigarettes, 100 cigarillos, 240 litres of beer and modest quantities of cider and wine. The officers concluded that the goods were not for the travellers’ own consumption and seized them and Mr Nyszczota’s car, a Citroen Xantia.
3	No challenge was made to the seizure by any of the travellers, but Mr Nyszczota asked that the car and his goods—which he said, at Coquelles and at the hearing, were the cigarettes, ten cases of beer and one case of wine—be restored to him. That request was refused, and the refusal was deemed to have been upheld when Mr Nyszczota requested a review, since the review was not carried out within the prescribed 45 days. Mr Nyszczota appealed to this tribunal. A further review was directed, to be conducted after the Court of Appeal gave judgment in R (Hoverspeed Ltd and others) v Customs & Excise Commissioners, reported at [2003] STC 1273. The further review was carried out by Gillian Hurrell, who also concluded, notwithstanding what had been said in Hoverspeed, that Mr Nyszczota’s request should be refused. Her decision, set out in a letter of 21 March 2003, is the subject of the present appeal.
4	Mr Nyszczota made a number of complaints about the manner in which he and his companions had been treated at Coquelles but, as I explained to him at the hearing, those are not matters with which the tribunal can deal. The tribunal’s jurisdiction is in fact very limited: I can allow the appeal only if I am satisfied—and it is for Mr Nyszczota to persuade me—that Mrs Hurrell’s decision is one at which she could not reasonably have arrived (see Finance Act 1994, section 16(4) and (6)).
5	Mr Nyszczota insisted that the hand rolling tobacco, 15 kg each, had been bought by his wife and by her sister for their own use, that he had taken them to Belgium because he enjoyed driving, that he had taken the opportunity of buying some alcoholic drinks and manufactured cigarettes for himself but had not bought tobacco because he still had most of what he had bought a few weeks beforehand, that none of the goods had been concealed in any way and that, if he been intending to smuggle, he would have used an old car of low value, rather than risk the car on which he relied. He gave the impression that he was quite indignant about having lost his car and his goods, and that he could not understand why he had been allowed to bring in 15 kg of tobacco a few weeks before, but his wife and her sister had been prevented from doing so on this occasion.
6	Mrs Hurrell, from whom I also heard evidence, had identified a number of inconsistencies, or apparent inconsistencies, between what the three travellers had said to the Customs officers who interviewed them separately at Coquelles, and some other factors which, she said, led her to the conclusion that this was a commercial importation, and she had found no exceptional circumstances which indicated that the Commissioners’ normal policy of refusing restoration is such circumstances should not be followed. She observed that while Mr Nyszczota said at Coquelles that his wife or her sister, Mrs Gascoigne, had asked that Mr Nyszczota take them to Belgium, they had indicated that the trip was made at his suggestion, that both Mrs Nyszczota and her sister had said that the tobacco had cost them £500 each, when the true cost was £612—a significant factor, Mrs Hurrell thought, since it was clear that neither of them had money to spare—that the manner in which Mrs Nyszczota claimed to have paid for the goods was strange, that the officer who first spoke to the travellers appeared to have had to ask several times before all the goods were declared, that none of the travellers claimed ownership of some of the beer, that Mrs Gascoigne did not appear to know how many cigarettes she could obtain from a pouch of hand rolling tobacco and had no smoking material in her possession and that if Mrs Nyszczota’s and Mrs Gascoigne’s claimed consumption rates were correct, the tobacco would last them three years or more. She was also aware (from what she had said at Coquelles) that Mrs Gascoigne and her husband had bought a significant amount of hand rolling tobacco only a month before.
7	For all those reasons Mrs Hurrell concluded that this was a commercial importation—in other words, the goods were being brought into the United Kingdom for the purpose of resale. In fact she went rather further, taking the view that Mr Nyszczota was the true owner of the tobacco, and that he had taken his wife and her sister with him in order that they could claim ownership of the tobacco, to conceal the fact that it was in reality his, thinking, because of his own recent experience, that first-time travellers (as he claimed that both his wife and her sister were) would be allowed to bring in 15 kg of tobacco each. Since this was, as she concluded, a commercial importation she applied the Commissioners’ normal policy that the goods, and vehicles used in such circumstances, should not be restored although, she said, she did consider whether that was a proportionate response. She could find no factors which indicated that it was not—she did not consider that Mr Nyszczota would be treated in any way more harshly than others in his position, and the difference between the duty evaded and the apparent value of the vehicle was not exceptional—and therefore declined to restore the car; likewise there was nothing which suggested that the goods should be returned.
8	There is some doubt whether it is open to the tribunal to examine the Commissioners’ conclusion that an importation is commercial when no condemnation proceedings have been brought, and seized goods are deemed to be condemned as forfeit: see Gora and others v Customs & Excise Commissioners [2003] EWCA Civ 525, paragraphs 54 to 58. However, Mrs Hurrell considered the issue at some length in her review and dealt with it in her evidence, and it seems to me appropriate, notwithstanding that doubt, that I should consider whether her conclusion that this was a commercial importation was reasonable, since it was plainly a significant factor in leading her to the further conclusion that the car and the goods should not be restored.
9	The test is not whether I agree with Mrs Hurrell, but whether Mr Nyszczota has satisfied me that her conclusion was not one at which she could reasonably have arrived. I have, however, no doubt that her conclusion was reasonable. 
10	I found Mr Nyszczota’s evidence quite implausible. I do not accept that he agreed to take his estranged wife—who by then, he said, had a new partner—and her sister to the continent, effectively out of the goodness of his heart. His evidence on that issue, and on the circumstances in which the arrangement had been made, was quite unconvincing. The point was made by Mrs Hurrell that Mrs Gascoigne appeared not to know how many cigarettes could be made from a pouch of tobacco; my clear impression from Mr Nyszczota’s evidence, and the evasive manner in which he gave it, was that he had no better idea himself. The most important feature of the case, however, appears to me to be the sheer improbability that two people of limited financial resources would decide to spend money which—at least in Mrs Nyszczota’s case—they could ill afford on buying sufficient tobacco to last them, if their claimed consumption rates were correct, three years or more. I think Mrs Hurrell was almost certainly right to conclude that, in truth, the tobacco was being imported for Mr Nyszczota’s benefit.
11	The Court of Appeal has stated, clearly, that the Commissioners’ policy of seizing and not restoring cars used for the illicit importation of excise goods is, in general terms, reasonable and that proportionality is usually not a material factor: see Lindsay v Customs & Excise Commissioners [2002] STC 588 (particularly paragraph 63), although exceptional hardship must be taken into account. I am quite sure that the loss of his car has caused Mr Nyszczota a good deal of inconvenience, in that he is no longer able to use it to take his children to school or to travel to work, but nothing he has put forward, either in his letters or at the hearing, could amount to exceptional hardship.
12	The appeal is dismissed.

colin bishopp
Chairman
Release date:
MAN/2001/8157