United Kingdom VAT & Duties Tribunals (Excise) Decisions

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URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2006/E00966.html
Cite as: [2006] UKVAT(Excise) E00966, [2006] UKVAT(Excise) E966

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Perthshire Fine Wines Ltd v Revenue & Customs [2006] UKVAT(Excise) E00966 (26 June 2006)

E00966

Excise Duty – excise warehouse – application for approval as Trade Facility Warehouse – premises to be partly used to store and mature wines – whether approved purpose – no; CEMA 92(1) Public Notice 197.

EDINBURGH TRIBUNAL CENTRE

PERTHSHIRE FINE WINES LTD Appellants

- and -

THE COMMISSIONERS FOR

HER MAJESTY'S REVENUE & CUSTOMS Respondents

Tribunal: (Chairman): T Gordon Coutts, QC

Sitting in Edinburgh on Tuesday 20 June 2006

for the Appellants I Scott

for the Respondents Andrew Scott, Shepherd & Wedderburn, WS

© CROWN COPYRIGHT 2006.


 


DECISION

This is an appeal against a Decision of the Commissioners conveyed by a letter dated 7 November 2005 refusing the Appellants application for approval as a trade facility warehouse premises at 202 High Street, Auchterarder, Perthshire.

When an application for approval of a tax warehouse is refused, the applicant is entitled to a review of the decision. If the decision is upheld he is then entitled to appeal against the decision in terms of paragraph 2.1(n) of Schedule 5 of the Finance Act 1994 which reads:

"(n) any decision for the purposes of section 92 (approval of warehouses) -

(i) as to whether or not, any approval is to be given - to any place as a warehouse or any consent is to be given to any alteration in or addition to any warehouse;

(ii) as to the conditions subject to which any approval or consent is given for the purposes of this section;

(iii) for the withdrawal of any such approval or consent."

Section 16(4) Finance Act 1994, provides, in relation to the jurisdiction of the Tribunal

"(4) in relation to any decision as to an ancillary matter, or any decision on the review of such a decision, the powers of an appeal tribunal under this section shall be confined to a power, where the tribunal are satisfied that the Commissioners or other person making that decision could not reasonably have arrived at it, to do one or more of the following, that is to say -

(a) to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the tribunal may direct;

(b) to require the Commissioners to conduct, in accordance with directions of the tribunal, a further review of the original decision.

Since the decision was an ancillary matter falling under Finance Act 1994 Schedule 5 paragraph 2(n) my jurisdiction lies under Section 16(4) and I can only exercise the powers given to this Tribunal by that Section if I am satisfied that the Commissioners or other person making the decision could not reasonably have arrived at it. The approach was summarised by Lord Lane in Customs and Excise Commissioners v J H Corbitt (numismatists) Ltd [1980] STC 231 at page 239. Referring to the tribunal's review powers he said:-

"It could only properly (review the discretion) if it were shown that the Commissioners had acted in a way in which no reasonable panel of Commissioners could have acted; if they had taken into account some irrelevant matter or disregarded something to which they should have given weight."

The Commissioners failed to comply with the provisions relating to review timeously and accordingly the appeal required to proceed on the basis of a deemed confirmation of the original letter. However by letter dated 14 February the reviewing officer did issue a decision which parties were agreed could constitute the basis for the appeal before this Tribunal.

The contentions of the Commissioners in relation to their refusal were in part in relation to the premises being allegedly insecure and unsafe and that there were equally health and safety considerations arising from the condition of the premises.

It was apparent from the correspondence produced and the evidence of Officer Stewart that no proper or adequate consideration had been made of the material provided by the Appellant in relation to these matters in correspondence commencing before the issue of the Decision in question and in particular the statement by the Appellant as to the alterations and improvements to the premises visited by the Commissioners' Officers in September 2005. No effort was made to ascertain the effect of these alterations on the basis for the decision.

It is sufficient in relation to those matters to say at this stage that had these been the only grounds for refusal of a trade facility warehouse licence I would have held that no reasonable Commissioners could have adopted that view on the whole material available to the reviewing officer, and sent the matter back.

However Officer Stewart explained in evidence that the primary consideration affecting her was that the purpose of the use of the premises did not fulfil the criteria for approval as a trade facility warehouse.

The evidence in relation to the use of the premises was that in relation to the matters the Commissioners specified must be established as necessary for their approval in Public Notice 197 and in particular paragraphs 22.1 i.e. a trade facility warehouse is only one where goods may be stored in duty suspension for inter alia performing an operation on the goods, which also must be an allowable operation.

Allowable operation is defined in paragraphs 50.1 and 50.5 and include bottling, adjusting and repacking cased goods, dividing cased goods, relabelling bottles and remarking or renumbering packages. There was evidence from the Appellant's Mr McCallum, a Director, that all these operations took place.

However there was also evidence that in addition wines and in particular fine wines were to be stored and also, in relation to champagne, turned to prevent oxidation all to be held for retail sale.

These factors, said the Commissioners, meant that trade facility warehouse approval was not available.

Decision

The conditions for approval of a trade facility warehouse are clear and have statutory force by virtue of Public Notice 197 which derives authority from paragraph 7 of the Excise Warehousing (etc) Regulations 1988. It was argued to us and we think correctly that the purpose of the trade facility warehouse was to preserve the tax status of goods which might be removed from one warehouse to another for a specific purpose. They entered the facility warehouse tax unpaid and they were returned tax unpaid to their origin. There is no authority for the storing of wine for maturation purposes duty unpaid.

Since a substantial if not the primary purpose of the warehouse is to be for storage of wine for maturation, in particular en primeur wines, it follows that the premises cannot be, in terms of the regulations, a trade facility warehouse.

The appeal is accordingly dismissed.

T GORDON COUTTS, QC

CHAIRMAN

RELEASED: 26 JUNE 2006

EDN/06/8003