RDCO Scheme – Revaluation of previous approval for RDCO trading – appeal against decision to review – appeal dismissed
GAVIN VALLELY Appellant
- and -
Sitting in public in Belfast on 15th June 2007
Mr. C. Gibson BL for the Appellant
Mr J. Puzey, BL for the Respondents
"As an approved Registered Dealer in Controlled Oil you are required to submit a completed and signed H05 Return to the Mineral Oils Relief Centre by the 21st day of the month following the end of the return period."
- no RDCO sales records / till rolls had been retained by the business;
- the figures declared on the RDCO returns submitted for the monthly periods November 2003 to October 2004 could not therefore be verified;
- a marked gas oil pump on the service station at Seacon had not been subject to checks at the time of supply to ensure eligible sales.
- to various degrees controlled oils were sold from each service station. It was confirmed that no till rolls were retained as part of the business records;
- the staff at each site had no knowledge of the RDCO Scheme or the records to be maintained / information to be recorded for it to be properly implemented;
- in relation to the Seacon Service Station, the MGO pump was a self-service pump with no checks being undertaken at the time of supply to ensure eligible sales;
- in addition, various fuel payments were noted through the bank statements for Seacon Service Station, for which no apparent purchase invoices could be associated.
"Mr. Vallely is non-compliant and has made no attempt to implement any aspect of the RDCO Scheme. Breaches of the conditions of RDCO approval and the history of fuel seized from the sites operated by Mr. Vallely would question as to whether Mr. Vallely is a suitable person to remain within the RDCO Scheme, and would indicate that Mr. Vallely is a high risk excise trader."
17. At this point it is probably sensible to set out the occasions on which seizures of fuel had been undertaken at the Appellant's trading premises:
- on the 30th September 2003, 5,900 litres of unleaded petrol had been seized from Seacon Service Station;
- on the 9th December 2004, 3,250 litres of DERV had been detained from Millisle Service Station;
- on the 5th January 2005, 5,000 litres of unleaded petrol had been detained from Millisle Service Station;
- on the 5th January 2005, 1,220 litres of DERV and 6,600 of unleaded petrol had been detained from Craigantlet Service Station;
- on the 28th January 2005, 1,800 litres of unleaded petrol had been detained from Newry Street Service Station.
18. The basis of each seizure was the lack of availability of purchase invoices to substantiate each supply.
19. The Tribunal was furnished with copies of the notices served under Section 51 of the Customs and Excise Management Act 1979 ("CEMA") and the subsequent notices of seizure issued under Section 139(6) of CEMA in relation to the seizures. In addition, the Respondents called evidence from the officers concerned who had both attended at the premises and subsequently issued both the Section 51 Notices and the subsequent Notices of Seizure.
- failure to register for approval as a RDCO before commencing dealing in controlled oils;
- failure to maintain and retain business records;
- failure to render complete and accurate returns by the due date;
- failure to pay civil penalties issued for the non-submission of returns;
- failure to respond to requests from officers of HM Customs and Excise to arrange visits to his trading premises for the purposes of inspecting books and records contrary to section 188B of CEMA; and
- failure to ensure that his staff was aware of the checks that should be carried out before making a supply of controlled oils.
In addition, Mr. Frew cited the seizures which are referred to above.
22. On the 4th April 2005 Tara Walsh, solicitor on behalf of the Appellant, wrote a letter to the Mineral Oils Relief Centre seeking a review. That letter appears to have been misplaced and a subsequent letter was sent on the 3rd June 2005 enclosing a copy of her original request.
- the Appellant's failure to apply for registration when he became owner of the Seacon Service Station;
- failure to submit monthly returns as required under the RDCO Scheme;
- failure to maintain or provide sufficient business records;
- the fact that there had been a number of seizures of fuel on the basis a failure to supply evidence of supplier / purchase invoices.
The Appeal Notice
"The 6 reasons specified in the initial refusal are incorrect. The appropriate returns were completed and lodged with relevant office. Records were maintained and inspected by C&E. During said inspection my client was informed that he need not concern himself with any civil penalties issues."
During the pre-trial stages, no other documentation was lodged in support of the Appellant's case.
The Respondent's Case
The Appellant's Case
- the total quantity supplied during the period of the return (in litres);
- the number of customers supplied.
Unless that very basic information was available, the Appellant could never have accurately made a return. In short, the Tribunal was of the view that the Appellant must have known what information was required to make a return, had clearly made the eleven returns from the period from November 03 to October 04 on a questionable basis, and that the Respondents had, therefore, been entirely reasonable in being sceptical as to the accuracy or veracity of those returns when they had undertaken the December 04 inspection.
- because the Respondents were unaware of the delivery of the returns on the 8th November 2004, it was logical that they would issue a civil penalty;
- it accepted the evidence of the Respondents that it was normal practice that the civil penalty be held in abeyance until they had determined whether or not the returns stood up to verification;
- that the Appellant had at all times the right to either appeal the civil penalty notice or to pay it in accordance with its terms – in the knowledge that if he had complied with Customs requirements that it would be refunded to him in due course;
- in the present circumstances the Appellant chose to do nothing and that disregard was something which the Commissioners could properly take into account, because it was consistent with his attitude to other business dealings and records generally.
On that basis, the Appeal is dismissed.
No order as to costs.