United Kingdom VAT & Duties Tribunals (Excise) Decisions

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Cite as: [2004] UKVAT(Excise) E733, [2004] UKVAT(Excise) E00733

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Michael Mountain v Customs and Excise [2004] UKVAT(Excise) E00733 (27 May 2004)

EXCISE DUTY — non – restoration of seized vehicle – 28,000 cigarettes 2.5 kg hand rolling tobacco 3 litres spirits and 8.25 litres of wine – looking for property to buy – decided on Cyprus – not for own use – appeal dismissed

MANCHESTER TRIBUNAL CENTRE

MICHAEL MOUNTAIN Appellant

- and -

THE COMMISSIONERS OF CUSTOMS AND EXCISE Respondents

Tribunal: D S PORTER (Chairman)

Mrs M KOSTICK (Member)

Sitting in public in Manchester on 23 April 2004

The Appellant in person

Mr Joshua Shields of counsel instructed by Solicitors for Customs and Excise for the Respondents

DECISION

This is an appeal by Michael Mountain (the Appellant) against a decision not to restore excise goods and a vehicle belonging to the Appellant, which were seized by the respondents on 11th September 2002. The vehicle, a Ford Focus registration T 247 JRJ was seized at the Dover Hoverport on his return from France. The Appellant alleged that he had been to Adinkerke to look for a property to buy and bought the goods on the way back for his own use. The Respondents do not believe that the goods were for his own use but that he intended to sell them.

The Parties

Mr J Shield of counsel appeared for the Commissioners, called Mr I Brenton as a witness, and produced a bundle of documents for the Tribunal. The Appellant appeared in person.

Preliminaries.

This appeal had come before the tribunal on 12^th August 2003 and the Tribunal had ordered that, in view of the decision in the Hoverspeed case, the Commissioners should carry out a further review with particular reference to proportionality. The review was carried out and a letter dated 1st October 2003, which gave rise to this appeal, refused restoration. The Appellant produced to the Tribunal four letters written after the seizure by members of the family, confirming that the goods had been bought for them with their money. Mr Brenton had not seen these letters at the time of his review in October 2003

The Facts

The Appellant and his wife had been persuaded by his family to take a few days away from their young family and he and his wife had gone to France. They had been unable to find anywhere to stay and had slept in the car. They had then returned to England bringing with them 400 cigarettes. They had stayed with friends on the way home (and his niece and her husband had brought the children back to them). The Appellant had been abroad four times in the last twelve months

The Appellant had gone to Adinkerke in Belgium to look at property to buy and to purchase, cigarettes, tobacco and drink. He said that he had searched the internet for properties for sale, yet he had no details of individual properties to view and said that he had looked at only one property from the outside and made no further enquiries about it.

The Appellant said that he was intimidated by the Officers from customs, some ten in number, who had surrounded him. He had agreed to be interviewed (see pages 37 to 40 in the bundle). He confirmed that he had bought 5 boxes (it transpired that there was another half box). He stated that he had purchased one box for his wife, one for his sister-in-law and one for his son aged 19 yrs by his first marriage. He was unable to elaborate for personal reasons that he could not explain. He had not mentioned the Hand-rolling tobacco, which he had bought for his father-in-law.

At the interview he confirmed that he had not received any money for the goods and that he had spent about £3000. His income was approximately £200 per week as he had started a small computer business from a market store in Kirby, Liverpool. At the Tribunal the Appellant conceded that, the family had paid him for the goods and that he could not expect to get the goods back. As the purchase was for his family and he had made no profit out of the transaction it was disproportionate to take his vehicle off him. The car was worth between £6500 and £7500 and he had been advised by Customs that morning over the telephone that the duty would be calculated at the rate of £99.88 per thousand, amounting to £2749. He was unable to substantiate the calculation. Mr Brenton advised that the duty plus VAT was £5000.

The letters from the members of the family confirmed that the Appellant had travelled to France and that they had paid him for the goods which he had bought for them, the letters are from his Father-in-law, his sister-in-law, his son and his wife.

We find as fact the matters set out in paragraphs 4 to 8 above.

The Law

Excise Duties (Personal Reliefs) Order 1992 as amended at article 3 states: -

"Subject to the provisions of this Order a community traveller entering the United Kingdom shall be relieved from the payment of any duty of excise on excise goods which he has obtained for his own use in the course of cross-border shopping and which he has transported"

"Own Use" is defined in the Order as:-

"Own Use" includes use as a personal gift provided that if the person making the gift receives in consequence any money or money's worth (including any reimbursements of expenses incurred in connection with obtaining the goods in question) his use shall not be regarded as own use for the purpose of this Order."

The Commissioners may require the person to satisfy them that the goods are not being held for commercial purposes.

By virtue of The Customs and Excise Management Act 1979 any vehicle which has been used for the carriage of the goods is also liable to forfeiture, although the Commissioners may restore the vehicle on such terms as they think proper.

Paragraph 2 of Article 9 of the Council Directive 92/12/EEC provides the criteria which must be taken into account in establishing whether or not the products are intended for commercial use: -

The commercial status of the person holding the products, and his reason for holding them

The place where the products are located or, if appropriate, the mode of transport used

Any documents relating to the products

The nature of the products

The quantity of the products

Summing up

Mr Shield summed up by saying that the goods had been condemned and by virtue of the decision in Gora v Customs & Excise Commissioners [2003] EWCA 525 there was no question of them being restored. As far as the car was concerned it was necessary to establish whether the Appellant had acquired the goods on a not for credited basis, which was his best case. From the facts it was clear that his interview was riddled with inconsistencies. He had ostensible gone to Adinkerke to look for a property to buy. He had taken no details with him and was very vague as to the properties he had seen. He indicated that he was only looking at the district. He had, however, been to the area previously and must have already done that. He conceded at the hearing that his family had paid for the goods and that, although that it was a foolish act it was not smuggling. He produced to the tribunal several letters written by members of his family confirming that to be the case. The letters themselves were inconsistent with the earlier facts disclosed in his interview. He had been evasive in the interview and failed to identify a box half full of cigarettes and had not told the officers about the tobacco at all, but he now wished to say that he had bought it for his father-in-law. The appeal should be dismissed.

As to the return of the car on the basis of proportionality the Respondents had acted reasonably in refusing to restore it. On the Respondents figures the car was worth £6500 and the duty plus VAT £5000.

Mr Mountain submitted that he had been looking for a property to buy but had decided, with his wife, that they should purchase a property in Cyprus. The cigarettes were for the family and he accepted that he did not expect to get the goods back. He had not been evasive but nervous during the interview. He had been there for three hours and wanted to get home. He had suffered considerable hardship from the loss of his car. His daughter had been ill and he had had to take her to the hospital in the van. Her had worked hard all his life and never done anything wrong and was being treated badly. He now worked as a manager for KFC. It was unreasonable for the Respondents to refuse to restore his car.

The Decision

I am satisfied that the reviewing officer's decision not to restore the Appellant's goods and car was one a reasonable body of Commissioners could have arrived at. 28,000 cigarettes is a very large number. It is unlikely that a 19-year-old boy would or indeed should be smoking 30 to 40 per day. I do not believe that the Appellant went to Adinkerke to look at property. It is unlikely that a person would travel abroad without at least taking some brochures to view properties. 1 therefore dismiss the appeal.

The Appellant did not challenge the Commissioners seizure of the cigarettes and tobacco and by virtue of paragraph 5 of schedule 3 to the Customs and Excise Management Act 1979 they are deemed to be duly condemned as forfeit. The Appellant was therefore deprived of arguing that his goods were for his private use. 'Gora'. This does not, however, prevent him from arguing for the purposes of these proceedings that the goods were purchased for his own use in seeking a review of the Commissioners refusal to restore the goods to him. (See para 49 of the judgement of Peter Smith in CEC v Dickinson [2003] EWHC 2358 (Ch).

The Respondents did not ask for any cost so I award none.

D S PORTER

CHAIRMAN

Release Date:

MAN/03/8040