First-tier Tribunal (Tax)

[2010] UKFTT 427 (TC)

TC00694

Appeal number: TC/2010/00817

Appeal against HMRC decision not to restore cigarettes – abuse of process – reasonableness of decision not to restore

FIRST-TIER TRIBUNAL

TAX

MR. JOSEPH HORAN Appellant

- and -

THE COMMISSIONERS FOR HER MAJESTY’S

REVENUE AND CUSTOMS Respondents

TRIBUNAL: Ms J. Blewitt (TRIBUNAL JUDGE) Ms. A. Christian (MEMBER)

Sitting in public in Manchester on 27 August 2010

Mr C. Mills, Counsel, instructed by the General Counsel and Solicitor to HM Revenue and Customs, for the Respondents

© CROWN COPYRIGHT 2010

DECISION

1.       This is an appeal against HMRC’s decision contained within correspondence between the parties dated 29 November 2009 not to restore 6,400 cigarettes and 11 kilograms of hand rolling tobacco seized detained on 22 May 2009 and seized on 12 July 2009.

2.       The Appellant notified the Tribunal by letter received on 23 August 2010 that he would be unable to attend the hearing but did not seek an adjournment of proceedings. The Tribunal proceeded to hear the appeal in the Appellant’s absence, taking into account all correspondence setting out the basis of the Appellant’s contentions.

3.       By way of background, on 22 May 2009 the Appellant and his family were travelling on a Siesta coach from Spain and were stopped at the UK Customs controls at Eastern Docks Dover Kent. The Appellant’s wife and child passed through Customs Control before the Appellant, who was stopped and found to be carrying 3,600 cigarettes and 3.5 kilograms of hand rolling tobacco in one suitcase and 2,000 cigarettes and 5 kilograms of hand rolling tobacco in another. The Appellant’s wife returned to the control point, and examination of her holdall recovered 200 cigarettes and 2.5 kilograms of hand rolling tobacco. A further 600 cigarettes were found n another bag belonging to the Appellant’s wife. Initial comments by the Appellant asserted that the goods were for personal use to be shared between himself and his wife. The Appellant declined to stay for interview, stating that the coach in which he was travelling was due to leave and he could not remain.

4.       The Appellant was subsequently contacted by an officer of HMRC on 18 June 2009 to arrange an interview; however the Appellant was unable to fix a date at that point. The Officer again contacted the Appellant on 24 June 2009 and a provisional date was fixed for 28 July 2009, to be confirmed when the Appellant could ascertain his wife’s availability. On 12 July 2009 the Appellant contacted HMRC to inform them that his wife could not attend for interview. Consequently HMRC seized the goods.

5.       The Appellant appealed the seizure of the goods to the Magistrates’ Court and asked for restoration of the goods by letter dated 4 August 2009. Subsequently the Appellant withdrew the appeal to the Magistrates’ Court by letter received by HMRC on 25 August 2009. The Tribunal had the benefit of reading this letter which gave no reasons for the withdrawal of the appeal.

6.       The Appellant appealed to this Tribunal for restoration of the cigarettes and hand rolling tobacco by Notice received by the Tribunal on 23 December 2009. The grounds of appeal state that the decision is wrong because it sets out a one-sided version of events. The Appellant takes offence at the implication that he is a smuggler and explains that his wife went through customs controls before him as he was the youngest male on the coach party and so was helping others with their luggage. The Appellant states that the bus driver was hurrying the party in order to keep to his schedule. The Appellant contends that he can buy as much tobacco as he wants so long as it is for personal use and therefore disputes HMRC’s contention that he was over the limit. The Appellant states he is a hard working man who has worked 6 days a week for Royal Mail for 22 years and he only brought in such a large quantity of tobacco to save money. The Appellant states his son is a policeman and he would never cause any embarrassment to him. The Notice of Appeal goes on to state that the answers noted by the officer for HMRC in his pocket notebook are not accurate in relation to the Appellant stating one pouch of tobacco makes 20 to 30 roll-up cigarettes, that the goods were destroyed before the appeal therefore prejudging the issue and that the tobacco bought would provide a reserve supply. 

7.       The Tribunal also had the benefit of correspondence from the Appellant to HMRC dated 4 August 2009, undated but received by HMRC 19 August 2009, undated but received by HMRC on 21 October 2009 and a letter to the Tribunal received on 23 August 2010. The Tribunal carefully considered the contents of all of the correspondence which helpfully reiterated the contentions of the Appellant as set out at within the Notice of Appeal.

8.       The first issue before the Tribunal, as raised in HMRC’s statement of case, is whether it is an abuse of process for this Tribunal to consider the appeal in light of the withdrawal by the Appellant from proceedings at the Magistrates’ Court and given that the basis of the appeal is that the goods were for personal use. The Tribunal considered the guidance given by the courts on this issue in the cases of Gora and Others v Customs and Excise Commissioners (2004) QB 93, Dickinson v Customs and Excise Commissioners (2004) 1 WLR 1160, Gascoyne v Customs and Excise Commissioners (2005) Ch 215, Customs and Excise Commissioners v Albert Charles Smith (unreported) and HMRC v Dawkin [2008] EWCH 1972 (ch).

9.       The Tribunal found as a fact that the Appellant had sufficient understanding of the distinction between proceedings in the Magistrates’ Court and those before this Tribunal to lead him to initially appeal the legality of seizure to the Magistrates’ Court. No explanation was given for the subsequent withdrawal from proceedings in the Magistrates’ Court and consequently the goods were lawfully forfeited. Having deliberately declined the opportunity to challenge the legality of seizure the Tribunal found, in the absence of any or sufficient reasons for the withdrawal, that it would be an abuse of process for the Appellant to seek restoration on the grounds of personal use before this Tribunal. In essence to allow the Appellant to do so would give the Appellant a second opportunity in circumstances where this Tribunal was not persuaded that there were good reasons for bypassing his first opportunity at the Magistrates’ Court.

10.    That said, the Tribunal nevertheless, for the sake of completeness, went on to consider the merits of the Appellant’s case and all of the information provided by him contained within the correspondence set out at paragraph 7.

11.    The Tribunal also heard from the Officer for HMRC, Mr Aston, who confirmed that, taking into account information provided by the Appellant, his decision remained the same; that the goods should not be restored.

12.    The Tribunal considered the circumstances of the seizure; the fact that the Appellant and his wife went through the control point separately, that they elected not to stay for interview and subsequently declined further offers of interview and the limited information provided by the Appellant at the time the goods were detained. The Tribunal balanced against these points the assertions by the Appellant in his Notice of Appeal and correspondence to HMRC and the Tribunal.

13.    The question for the Tribunal is whether the decision not to restore the goods was reasonable and proportionate and whether any exceptional circumstances exist which might lead this Tribunal to conclude that the decision was not one which could have been reasonable arrived at.

14.    The Tribunal did not have the benefit of hearing the Appellant and his wife give evidence. On the facts known to the Tribunal and taking into account all written submissions provided by the Appellant, this Tribunal did not find the Officer’s decision to be disproportionate or unreasonable. The Officer clearly took account of all information provided to him by the Appellant in reaching his decision not to restore the goods and the Tribunal could find no exceptional circumstances in this case which could lead it to a different conclusion.

15.    The appeal is dismissed.

16.    This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party.  The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice.

TRIBUNAL JUDGE

RELEASE DATE: 8 September 2010