United Kingdom VAT & Duties Tribunals (Excise) Decisions

You are here: BAILII >> Databases >> United Kingdom VAT & Duties Tribunals Decisions >> United Kingdom VAT & Duties Tribunals (Excise) Decisions >> Dyson v Customs & Excise [2005] UKVAT(Excise) E00887 (06 June 2005)
URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2005/E00887.html
Cite as: [2005] UKVAT(Excise) E887, [2005] UKVAT(Excise) E00887

[New search] [Printable RTF version] [Help]

Dyson v Customs & Excise [2005] UKVAT(Excise) E00887 (06 June 2005)

E00887

REBATED FUEL (RED DIESEL) — on review penalty paid reduced to value of vehicle — appeal pursued — no reasonable excuse — appeal dismissed

MANCHESTER TRIBUNAL CENTRE

STUART JAMES DYSON Appellant

- and -

HER MAJESTY'S REVENUE AND CUSTOMS Respondents

Tribunal: Elsie Gilliland (Chairman)

J T Brian Strangward

Sitting in public in Birmingham on 21 March 2005

The Appellant did not appear and was not represented

Ian Speed, counsel, instructed by the Acting Solicitor for HM Revenue and Customs for the Respondents

DECISION

The appeal before the tribunal was that of Stuart James Dyson (the Appellant) against a decision of Customs on a review dated 10 November 2003 to vary the amount of the restoration fee payable on a vehicle, which had been seized from the Appellant in respect of an unauthorised use of rebated fuel. The Appellant did not attend the hearing and the tribunal proceeded under Rule 26 (2) of the Value Added Tax Tribunals Rules 1986. The officer who conducted the review David Michael Harris attended and gave evidence.

Counsel for the Respondents outlined the background of the matter. The Appellant had been stopped on 19 August 2003 when driving a Ford Escort Estate registration number L224 KCW. A fuel sample was taken by an officer and proved to be rebated heavy oil known as red diesel. The rebate is not allowed on fuel for road vehicles (section12 of the Hydrocarbon Oil Duties Act 1979). The Appellant was interviewed and a copy of the manuscript record of the interview signed as accurate by the Appellant was in the bundle of documents produced to the tribunal by the Respondents. At that time the Appellant stated that whilst the vehicle was his it had been stolen and subsequently recovered. He had been using it only for two days had not re-fuelled it and had not known what was in the tank. When questioned he said that he did not know that there was a price difference between white and red diesel. He had recovered the vehicle from a garage Star Autos. Notes in the bundle record also that the Respondents' officers were contacted by Star Autos at 13.35 on the same day and it was confirmed that they had recovered the vehicle on 7 July 2003 and it was returned to the Appellant on 19 July 2003. The mileage of the vehicle on its return was quoted by the garage as 02117. The officer imposed a £500 penalty (two civil penalties of £250 each), which was paid by the Appellant and the vehicle restored with the appropriate paperwork. We have noted also in the bundle correspondence from the garage confirming the information they had given.

In his evidence the review officer confirmed to us that he had looked at the matter afresh and on the basis that he had the power under legislation to confirm vary or withdraw the original decision. In the review letter he had set out the policy of the Respondents on the misuse of rebated fuels. The penalty on a first offence was 100% of the revenue evaded or the value of the vehicle if lower. He had considered the Appellant's assertion that the vehicle had been stolen and abandoned. He had not been able to find evidence that the police had been told of the theft and he had found it implausible that the stolen vehicle would have been left fully fuelled; equally he found an unexplained discrepancy in that the vehicle was recorded as having travelled a distance of 277 miles in the two days of use to which the Appellant had referred. He was accordingly satisfied that there had been an offence but was prepared to accept the value which at the interview the Appellant had himself placed on the vehicle; hence the reduction to £300.

This was not acceptable to the Appellant who submitted a Notice of Appeal to the tribunal on 10 December 2003. His grounds were as follows:

"The vehicle that I was stopped in had been recovered professionally by a local firm after being found abandoned on false plates and dumped on the public highway. The vehicle had been stolen and missing since May 2003. It was found 17:07:03 and then I left it on my drive. As I pointed out to the customs officer I was only using the car as the clutch had gone in my usual transport (which I can prove). There are many other factors which have to be taken into consideration which I feel have not been looked at."

Section 10 of the Finance Act 1994 provides:

"Subject to… any express provision to the contrary made in relation to any conduct to which [FA 1994], s. 9 [the penalty section for contravention of statutory requirements] applies, such conduct shall not give rise to any liability to a penalty under that section if the person whose conduct it is satisfies [Customs] or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct".

Whilst what constitutes a reasonable excuse is not defined in the legislation it has been established by case law that it requires there to have been the exercise of foresight and diligence in the conduct of the person appealing.

Having considered the written evidence in the papers produced including letters addressed to the Respondents by the Appellant and the oral testimony of the review officer we are satisfied that the officer looked independently at all relevant material giving due weight to the same. He concluded that a penalty was still appropriate under the legislative provisions but was prepared to accept the value put on the vehicle by the Appellant and used it as a substituted figure in applying the restoration policy of the Respondents. This to our mind was a proper exercise of the power vested in him. We have looked at the written evidence of the Appellant and do not find any reasonable excuse for his actions giving rise to the penalty. We do not find his account as to how he came to be using the vehicle credible nor do we see any explanation given as to the substantial mileage incurred in two days of use. We note also that there is no case report or confirmation as to the circumstances from either the police or the Appellant's insurers. The review officer in his evidence stated that he had contacted Dudley police but there was nothing from his checks to indicate that the vehicle had been stolen. We have looked too at the circumstances in light of the need for proportionality and are satisfied that there were no excessive measures taken on the part of the Respondents.

We dismiss the appeal.

In view of the non-attendance of the Appellant, the Respondents asked for costs which they placed at £500 to cover counsel's fees and expenses relating to the attendance of their witness. The Respondents are entitled to costs as they have been successful in the appeal. We direct that costs if not agreed shall be assessed by a chairman sitting alone.

ELSIE GILLILAND

CHAIRMAN
Release Date: 6 June 2005

MAN/03/8195

About BAILII - FAQ - Copyright Policy - Disclaimers - Privacy Policy amended on 25/11/2010