United Kingdom VAT & Duties Tribunals (Excise) Decisions

Rodovasco Transportes E Terraplanagens v Revenue and Customs [2005] UKVAT(Excise) E00925 (31 October 2005)

E00925

EXCISE – Restoration refusal – Overseas Haulier carrying beer with no evidence that duty paid and inadequate documentation – Appellant did not attend – Hearing in absence – No checks made by Appellant as to load – Excise duty £7,792 – Value of vehicle and trailer £10,700 – Refusal not disproportionate – Appeal dismissed

LONDON TRIBUNAL CENTRE

RODOVASCO TRANSPORTES E TERRAPLANAGENS Appellant

and –

THE COMMISSIONERS FOR HER MAJESTY'S REVENUE & CUSTOMS Respondents

Tribunal: THEODORE WALLACE (Chairman)

MRS S SADEQUE MBCS

Sitting in public in London on 14 October 2005

The Appellant did not appear and was not represented

Alan Bates, counsel, instructed by the Acting Solicitor for the Respondents

© CROWN COPYRIGHT 2005


 


DECISION

1. This appeal is against a review decision confirming the refusal to restore a tractor and trailer detained at Dover on 12 November 2003 and subsequently seized. The trailer was carrying 11,974 litres of beer on which duty had not been paid and which was not accompanied by the necessary documents.
2. The notice of this hearing was sent to the Appellant on 9 September at the address in Portugal given on a letter from the Appellant dated 8 April 2005. An earlier hearing notice posted to the address given on the notice of appeal was returned by the Portuguese postal authorities. This notice was not returned; there is no reason to believe that it was not received. In any event it was sent to the last known address within Rule 32(3).
3. We decided to consider the appeal in the Appellant's absence under Rule 26(2). The Appellant is entitled to apply within 14 days of the release of the decision for it to be set aside under Rule 26(3). Any application should state the reason for non-attendance at this hearing.
4. Brian Anthony Rayden, the Review Officer, gave evidence and produced a bundle of documents. Five other witness statements had been served under Rule 21.
5. The facts are as follows.
6. At 2325 hours on 11 November 2003 the Appellant's Volvo FH12 tractor unit with a curtain sided trailer was stopped at Coquelles Freight Terminal, France. The Customs officer spoke to the driver, who did not speak English, in Spanish. He noted the driver as saying that it was his first trip through the tunnel, that the load was beer loaded in Portugal, that the trailer was not sealed and that the driver did not see it loaded. The driver handed the documentation to the officer who passed it to another officer.
7. The documents consisted of three Simplified Administrative Accompanying Documents (SAAD), three CMR notes and two invoices. The documents showed the following: 12 pallets with 5987 litres of beer consigned by Elos Cash e Carry in Portugal to Carl Simsonsen, 190 Kilburn Lane W10; 12 pallets with 5987 litres of beer consigned by Elos Cash e Carry to Nuno Miguel Duarte, 213 High Street, Harlesden W10 and 26 pallets with 11975 litres of beer consigned by GCT Dist Alim SA from a different address to Cabavi International, Falkirk, which was not accompanied by an invoice.
8. The documents did not carry excise warehouse numbers as required for duty suspension between warehouses, or registered excise dealer numbers. There was no occasional import licence.
9. The vehicles and goods were detained for further inquiries. The beer was tallied as 5488.56 litres of Cerveja Super Bock on 11 pallets, 5987.52 litres of Cerveja Sangres on 12 pallets and 249.48 litres of stout Super Bock on 1 pallet (later retallied to 498.56 litres).
10. At the request of Customs, the driver filled in a standard foreign driver questionnaire in Portuguese. His answers included that he was given the loading papers which he checked, that the load was loaded when he collected it and that he had not collected loads from there before; he was due to deliver the goods to London.
11. The vehicle and trailer were secured and detained for further inquiries.
12. On 27 November 2003 officers visited High Street, Harlesden which is in NW10 as opposed to W10. The street numbers only went up to 201C so that 219 did not exist. They then visited 190 Kilburn Lane which is in NW10 where an elderly gentleman who opened the door stated that he had never heard of Mr Simonsen; there is no Kilburn Lane in W10.
13. Around a month earlier another tractor and trailer owned by the Appellant had been detained and subsequently seized at Dover with a consignment of 11,975 litres of beer, 981 litres of wine and 126 litres of spirits consigned to Cabavi International, Falkirk, on which no duty had been paid. The Appellant had requested restoration in a letter dated 27 October 2003. The tractor and trailer were offered for restoration on 14 November, which was after the initial detention in this present case.
14. The Appellant was informed of the seizure in the present case on 29 November 2003 and in a fax dated 11 December requested the return of the tractor and trailer. This stated, among other matters,

"If something is wrong with the goods or papers is not our responsibility, because we cannot control this."

Restoration was refused in a letter dated 22 January 2004. Solicitors for the Appellant requested a review contending that it was not involved in any wrongful act, and that if there was some fault attributable to the carrier the restoration fee should be proportionate.

15. Mr Rayden who conducted the review which is the subject of the appeal gave evidence that the total excise duty on the 11,974 litres of beer seized was £7,792.33. We observe that the amount of beer actually on the trailer was only half that shown on the SAADs. He accepted that since the consignment was intercepted before entering the UK there is no suggestion that the shortfall was diverted in the UK.
16. He said that the value of the tractor in Glass' Guide was £6,550 and that the value of the trailer was £4,150. Both were relatively old.
17. Mr Rayden said that he would expect the driver of a consignment of goods to inspect the goods before carrying them into the UK. The driver should have realised the discrepancy as to the amounts.
18. He said that warehouse approvals are registered on a database which the haulier could have checked by telephoning a number in Glasgow. There was no REDS number on the SAADs and no occasional import licence.
19. Mr Rayden said that he had not approached the case on the footing that the driver or haulier were knowingly involved in smuggling but rather on the footing that they had not carried out basic reasonable checks. The tractor and trailer had been restored free of charge on the earlier occasion. It was not policy to restore on the second occasion. He had looked at all the circumstances and there was no reason to depart from the normal policy.

Submissions

20. Mr Bates said that under regulation 20 of the Excise Goods (Accompanying Documents) Regulations 2002 the Appellant or its driver were obliged to produce any SAAD and any certificate of payment required to accompany the goods. The Appellant had been put on notice of this by the fact of the earlier seizure.
21. He said that a haulier has the responsibility of making sure that the goods carried corresponded with the documents including the CMR document, see Article 8 of the Convention on the Contract for the International Carriage of Goods by Road which was implemented by the Carriage of Goods by Road Act 1965. He said that where a consignment consists of excise goods a haulier is to be expected to know the excise requirements and to check that those requirements are satisfied.
22. He submitted that the decision was proportionate. Billions of pounds of duty are lost annually by smuggling. Here almost £8,000 of excise duty was involved. The value of the vehicle and trailer were not much greater. A haulier who does not want to carry out checks must weigh the risks. Customs are entitled to take the action necessary to deter evasion on this scale. He accepted that no dishonesty by the Appellant was suggested, however the Appellant had failed to ensure that basic checks were carried out. He submitted that the decision to refuse restoration was clearly open to Mr Rayden, the Review officer.

Conclusions

23. In an appeal under section 16 of the Finance Act 1994 the Tribunal must consider whether the decision was reasonably arrived at. In order to be reasonably arrived at it must be based on correct facts and on correct principles. Provided the factual basis was sound and the correct principles were applied including the requirement of proportionality the decision will stand. The discretion lies with Customs rather than the Tribunal.
24. The burden of proof as to facts rests on the Appellant. Here there is no real dispute as to the facts.
25. It is clear that the quantity of beer on the trailer were substantially less than that on the documents. Usually any such discrepancy is the other way round. In fact the beer seized does appear to have been covered by the SAADs.
26. Apart from that discrepancy there are three further problems. The first is that the consignee of part of the load was unknown at the address on the documents and that the delivery address for another part was non-existent. The next is that the requirements for importation of excise goods were not complied with, in that there were no warehouse or REDS registration numbers and no occasional import licence. The third is that a lorry and trailer with excise goods for Cabavi International had been seized from the Appellant only weeks earlier and had not been returned.
27. Mr Bates relied on Article 8.1 of the CMR Convention which requires a carrier on taking over goods to check,

"(a) the accuracy of the statements in the consignment note as to the number of packages and their marks and numbers."

28. The driver clearly did not do this. However it should be remembered that Article 8.1 is not a regulatory requirement but a contractual obligation between the parties to the contract. By accepting a cargo which did not tally with the CMR note the Appellant risked a claim for the shortfall.
29. There was no evidence and no suggestion that the Appellant was aware of the problem with the London delivery addresses. No doubt if the Appellant had attended questions might have been put to any witness as to what arrangements had been made for delivery. However the problem with the addresses was not known when the driver was questioned and did not then arise.
30. We do not consider that there is a general duty on any overseas haulier carrying excise goods to this country to verify for himself the destination and excise status of the consignee.
31. However this Appellant was a Community haulier knowingly carrying excise goods and should have been aware of the fact that there are rules governing the movement of excise goods between Member States for commercial purposes. The Excise Directive (EEC) No.92/12 covers movements of excise goods and Regulation 2719/92/EEC prescribes the administrative accompanying document or AAD.
32. In the present case the Simplified AADs carried no excise registration or warehouse numbers, there was no occasional licence and no certificate that duty had been paid.
33. These defects were apparent on the face of the documents. It was not a case where incorrect details were filled in which were not obviously false. There were no registration numbers at all and the quantity was wrong. The Appellant apparently made no check on the paperwork considering that this was not its responsibility. This was misguided. Furthermore the Appellant has given no indication whatsoever of what instructions were given to the driver. In so far as the driver checked the papers he did not do so properly.
34. In addition to the defective paperwork, part of the consignment was destined for the same customer, Cabavi International, as a consignment of beer recently seized only weeks before with another tractor and trailer of the Appellant. This should clearly have put the Appellant on enquiry.
35. In the present case the duty involved while not of the order normally involved with the commercial importation of cigarettes or tobacco was not insubstantial, being £7,792, compared with the value of the trailer and tractor estimated at £10,700.
36. Having considered all the circumstances we consider that the decision to refuse restoration of the trailer and tractor was neither disproportionate nor unreasonable. The appeal is dismissed.
37. Mr Bates applied for costs because of the Appellant's failure to attend. In all the circumstances, however, including the fact that the Appellant would have had to travel from Portugal, we make no order as to costs.

THEODORE WALLACE

CHAIRMAN

RELEASED: 31 October 2005

LON/04/8045