England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2A 2LL
		17th January 2012

1. LORD JUSTICE HOOPER: We are dismissing this appeal and the reasons will be given by Eady J.
2. MR JUSTICE EADY: On 13th December 2010, in the Crown Court at Croydon before His Honour Judge Tanzer, Mohammed Chaudhery, aged 36, and Abdul Butt, now aged 60, changed their pleas to guilty to cheating the public revenue contrary to common law. In respect of such offences there is no statutory maximum sentence, nor are there any Sentencing Guidelines Council guidelines. On 22nd March of last year, before the same judge, they were sentenced as follows: Mohammed Chaudhery, on count 2, cheating the revenue, seven years' imprisonment, and Abdul Butt, count 4, cheating the revenue, seven years' imprisonment, with a direction that certain time should count towards sentence. Both were disqualified under the Company Directors Disqualification Act for a period of seven years. Another count was ordered to remain on the file.
3. There were co-accused. Tariq Sarwar was convicted after trial of five counts of cheating the revenue and was sentenced to nine years' imprisonment. Kevin Davis changed his plea to guilty to one count of cheating the revenue and was sentenced to seven years. His application for leave to appeal was refused and has now lapsed. Andrew Hart was convicted after trial of one count of cheating the revenue and was sentenced to seven years and six months. It seems that a significant factor in mitigation in his case was evidence as to his health.
4. Mohammed Chaudhery now appeals against sentence by leave of the single judge.
5. The case involved a large scale manipulation of the VAT system and evasion of VAT liability. It was a "missing trader intra community" (MTIC) fraud, but in this case the missing traders (also referred to as "actors" and "defaulting traders") were visible to the Revenue and Customs. The defendants, apart from Sarwar, were the defaulting traders who operated import companies and amassed massive VAT liabilities which they defaulted on. The goods which they traded or purported to trade in were mobile telephones and computer processor units. The total sum of defaulted VAT liability came to £149 million.
6. The pattern has become well known. Chaudhery's company was called Greenview, and between 13th September 2005 and 10th October 2005 Greenview's turnover was £210 million with a VAT liability of £37.9 million. The VAT liability was not paid. Greenview operated from a garage in Slough, and in setting the company up as an importing trader Chaudhery entered into unrealistic levels of trading and did not handle any purchase or sales money and did not retain any proceeds to meet multi million pound VAT liability. Chaudhery received a number of visits from an HMRC officer to verify the company's legitimacy. He lied to the officer and provided fake tenders for contracts. One of the companies he said was providing the software development programme for was owned by Sarwar. He also produced forged letters from a firm of accountants. The officer issued VAT notices and Greenview's trading was brought to an end with Chaudhery's arrest.
7. The sole ground of appeal remaining before the court today, as argued by Mr Kayne, was that the sentence imposed did not reflect adequately the materials placed before the learned judge in mitigation.
8. In granting leave, the single judge gave the following reasons:

"You played a significant part in cheating the Revenue on a grand scale. The role of your company, as importer of the goods concerned, was central to the success of the dishonest enterprise. In a few weeks of dishonest trading you cheated the Revenue of VAT in the sum of nearly £38 million. It was an aggravating feature of your offending that you used forged documents to try to deceive an investigating officer of HMRC. Your plea was entered at a late stage, and could attract only limited credit. Having regard to previous decisions of the Court of Appeal, in particular Takkar, the judge's starting point of a range of 7-9 years after trial was in my view appropriate for your role. I see no merit in your submissions based on disparity. In Hart's case the judge had regard to matters personal to that defendant, and so reduced the sentence he would otherwise have passed. Sarwar might be thought fortunate to have received the sentence he did of 9 years, given that the judge had earlier indicated that the starting point in his case must be higher than the bracket which applied to you and other defendants. But even if that were the case, it would not make your sentence wrong. If those had been the only grounds of appeal, I would have refused leave. However, having read the material which was placed before the judge I think it is just arguable that the judge, whilst he did take it into account, failed to give it sufficient weight. I therefore grant your applications."

9. This court is of the view that taking into account all the matters that were placed before the judge, the monetary loss to the revenue was huge and there is no prospect of recovery. It is far greater than some of the other cases which have been cited. In those circumstances it may be said that, even following a plea of guilty and even taking into account all matters in mitigation, the sentence was on the low side, and indeed the case might very well have merited a sentence in double figures. We take the view that quite enough credit was given for all the matters advanced in mitigation, and accordingly this appeal is dismissed.