United Kingdom VAT & Duties Tribunals (Excise) Decisions

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Cite as: [2005] UKVAT(Excise) E853, [2005] UKVAT(Excise) E00853

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Marriott v Customs and Excise [2005] UKVAT(Excise) E00853 (24 February 2005)

E00853

EXCISE DUTIES — excise goods and vehicle seized from travellers entering UK from France — conclusion that importation of goods commercial or partly commercial reasonable — refusal to restore goods upheld — failure to consider proportionality of refusal to restore vehicle — review decision not reasonably arrived at — appeal allowed in part and further review directed

MANCHESTER TRIBUNAL CENTRE

MALCOLM MARRIOTT Appellant

- and -

THE COMMISSIONERS OF CUSTOMS AND EXCISE Respondents

Tribunal: Colin Bishopp (Chairman)

John Lapthorne

Sitting in public in Birmingham on 4 January 2005

Kenneth Rogers, counsel, instructed by Rickards & Cleaver, solicitors, for the Appellant

Zaheer Afzal, counsel, instructed by the Solicitor for the Customs and Excise, for the Respondents

© CROWN COPYRIGHT 2005

DECISION

In this appeal Malcolm Marriott challenges the Respondents' refusal to restore various excise goods and a motor car seized from him at Dover on 29 June 2001 when he and his travelling companion, Trevor Harrison, arrived on a ferry from France. Mr Marriott and Mr Harrison were unable to satisfy the Customs officers who (for reasons of which we are unaware) intercepted them that the goods were for their own use, and it was for that reason that the goods and the car were seized. Mr Marriott asked that they be restored to him, but his request was refused, and the refusal was upheld on review. He now appeals against that review decision.
We heard evidence from Mr Marriott and also from Mr Harrison, but the Respondents led no oral evidence. We had a bundle of relevant documents and were referred by counsel for the parties—Kenneth Rogers for Mr Marriott and Zaheer Afzal for the Respondents—to a number of decisions of the tribunal and of the higher courts.
Mr Marriott told us that he and Mr Harrison travelled to France and Belgium, in part to enjoy a day out and in part in order to buy cigarettes, tobacco and alcoholic drink. He bought 4800 cigarettes and Mr Harrison 4000, and they had 1 kg of tobacco each. Their purchases of alcoholic drinks were modest, and immaterial for present purposes. The goods were for their own use, and Mr Marriott expected his share of the cigarettes and tobacco to last about six months. He had been to France only once before, several years earlier. The car was his, purchased new, and was about 14 months old when seized. He described the officer who intercepted them as "abrupt", and complained that he had not been allowed to answer questions properly. Mr Harrison's evidence was to the same effect, save that he told us that his share of the tobacco was to be given to his brother-in-law, from whom he was expecting no payment.
Although we had no oral evidence from Customs, we did have an unchallenged statement made by the officer who conducted the review, Bernard Wills, as well as the letter he wrote to Mr Marriott following his review, and copies of the intercepting officers' notebooks, recording the interviews of Mr Marriott and Mr Harrison which followed their interception, and the officers' reasons for seizing the goods and the car. From these it was apparent that the officers, once they had established that Mr Marriott and Mr Harrison had brought in more than the guideline quantities of cigarettes which might be regarded as a reasonable quantity for their own use—at the time 800 cigarettes per traveller—they had been required to satisfy the officers that the goods were in fact for their own use, but had failed to do so. In particular, the officers considered that they had failed to make a complete declaration of the goods they had with them when first asked, but instead had attempted to mislead them; that Mr Harrison's claimed consumption rate did not match the time for which he said the goods would last; and that there was no evidence that either of the travellers had smoked in the car, a fact which cast doubt on their claim to be smokers.
Though he did not concede that the notebooks accurately recorded all that had been said at Dover (despite his having signed them as a true record), Mr Marriott accepted, as he gave his evidence, that the goods had not been fully declared at the outset, but he blamed the intercepting officer's abruptness for his failure to disclose all the purchases. Both he and Mr Harrison commented that it would have been foolish to attempt to conceal the goods when it was obvious to them that the officers intended to search the car. We are nevertheless satisfied, not only from the notebooks but also from what Mr Marriott and Mr Harrison told us in their evidence, that there was an inexplicable failure on their part to answer the officers' questions correctly. It might be understandable that a traveller, asked what goods he had bought, should begin to list them and be cut off by an interviewing officer before he could complete the answer. It is not, in our view, understandable that travellers who had, only hours earlier, bought 4000 or more cigarettes each, should (as they both told us) have forgotten the quantity. The notebooks indicate that 1000 cigarettes each were declared when the question was first put, and that the two travellers, when further questioned, claimed that they were confused, a contention they repeated in their evidence. They also told us that they thought they were being asked only about quantities which were not readily visible on the back seat of the car, an explanation which we find implausible.
Mr Afzal did not pursue the further point, that the Respondents doubted the travellers' claim to be smokers and their claimed rates of consumption, and we leave those matters out of account.
The tribunal's jurisdiction is conferred on it by section 16(4) of the Finance Act 1994. It is a restricted jurisdiction; we may allow the appeal only if we are satisfied that the decision in question—here, Mr Wills' decision on review not to offer restoration—was one at which he could not reasonably arrive. If Mr Wills concluded, or ought to have concluded, that the goods and the car were not liable to be seized at all (because the goods were clearly for the travellers' own use) he would inevitably be driven to offer them for restoration. Mr Wills plainly did not come to that conclusion, and we are not persuaded that he ought to have done so. We are, instead, satisfied that there was an attempt by them to conceal the true quantities of the goods they had when Mr Marriott and Mr Harrison were intercepted, and we reject the explanations they gave us of their replies.
It does not necessarily follow that an attempt by a traveller to conceal the quantities of excise goods he has with him is indicative of a commercial purpose—he may simply fear that the intercepting officer will not believe that he will smoke all the goods he has, even though that is genuinely his intention, and he may attempt to conceal the true quantity for that reason—but that is not the test. It is, in our view, impossible to say that the conclusion that goods are not entirely for the traveller's own use when he has attempted to conceal the true quantity is not one at which the Respondents could reasonably arrive.
That does not, however, dispose of the matter. Even if the goods were properly seized, and even if they have become, by order of a court or by effluxion of time, forfeit to the Crown, Customs have a discretion to restore them and, in practice, it is only in a case where the goods have become forfeit that the question of restoration arises. The discretion must, axiomatically, be exercised fairly and in the light of the facts of the individual case. There are, as we perceive the matter, three errors in Mr Wills' approach as it is revealed in his letter.
First, he has applied the requirement, imposed by the Excise Duties (Personal Reliefs) Order 1992, that it is for the traveller to satisfy Customs that excise goods, in excess of prescribed quantities, brought by him into the United Kingdom are for his own use. That test, which does not comply with the requirements of European law, has since been repealed and it is accepted, following R (Hoverspeed and others) v Customs and Excise Commissioners [2003] STC 1273, that it should never have been the test. In this case, however, we have concluded that if Mr Wills had applied the correct test, he could reasonably have come to the same answer, namely that the goods were not, or not entirely, for the travellers' own use. As we have indicated, we are satisfied that it is a reasonable conclusion, and that it is one which may be arrived at however one looks at the evidence. Second, his letter reveals that he has misunderstood his role as a reviewing officer. He has indicated that he is required to consider whether the decision not to restore is one at which the Commissioners could reasonably arrive, but that is not and never has been a reviewing officer's task. He must consider the entire matter afresh. Even so, we cannot say that Mr Wills' misunderstanding leads us to the conclusion that he could not reasonably have arrived at his decision not to offer restoration.
It is the third of the three errors which is, in our judgment, sufficiently serious that it is appropriate that we allow the appeal in part. It is clear from Mr Wills' letter that he has not taken the question of proportionality into account. We accept that, at the time he reached his decision, proportionality was not a factor which the Respondents considered relevant but, as several decisions of the courts show, it is and should always have been a relevant factor. The cases we have in mind, in addition to the Hoverspeed appeal to which we have already referred, are, in particular, Lindsay v Customs and Excise Commissioners [2002] STC 588 and Customs and Excise Commissioners v Newbury [2003] 1 WLR 2131; there are several others. Although we were not provided with values, it was evident to us that the amount of UK duty which might have been due on the goods in Mr Marriott's and Mr Harrison's possession would be modest, and in all probability very much less than the value of Mr Marriott's car. While we cannot say it was unreasonable to refuse to restore the goods (see, particularly, Lindsay), we have concluded, in the light of the law as it is now understood, that the failure to consider the question of proportionality when deciding whether to restore the car and, if so, on what terms, renders the decision on review unreasonable.
For those reasons we allow the appeal, so far as it relates to the car, and direct that the Commissioners undertake a further review, taking proportionality into account. The review is to be carried out within six weeks of the release of this decision, and by an officer who has had no prior involvement in the case. Though we can do no more than direct a review, and cannot dictate its outcome, it may help if we comment that we are satisfied that, if this was an illicit importation, it was a small first offence; we would consider it appropriate to offer restoration of the car in exchange for the value of the UK duty to which the goods were liable. We recognise that it may no longer be in the Commissioners' power to restore the car itself, and they may need to offer compensation instead.
We must, finally, mention Mr Rogers' argument that the Respondents had not correctly understood Mr Marriott's letters and had not, as he requested, instigated condemnation proceedings in the magistrates' court. This is an issue which was dealt with by the Court of Appeal in Gascoyne v Customs and Excise Commissioners [2005] 2 WLR 222. It will be a matter of fact in each case whether the person concerned has properly made a request that condemnation proceedings be instigated, but that issue of fact is not one for this tribunal, whose jurisdiction is limited to the question of restoration. We have, of necessity, to recognise that the goods and the car have become forfeit to the Crown by effluxion of time but we read nothing more into that fact. In particular we do not need to speculate what a magistrates' court, seized of condemnation proceedings, might have concluded, and we have not done so. We have instead considered whether the Commissioners could reasonably have concluded that this was an illicit importation and, as we have recorded, have answered that question in the affirmative.

COLIN BISHOPP

CHAIRMAN

RELEASE DATE: 24 February 2005

MAN/03/8004