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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 >> Mr Robert Sanczyk v Revenue & Customs [2006] UKVAT(Excise) E00972 (20 July 2006)
URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2006/E00972.html
Cite as: [2006] UKVAT(Excise) E972, [2006] UKVAT(Excise) E00972
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- and –
- The appeal is against the upholding on review of a decision by the Commissioners dated 13 July 2005 to refuse to restore the Appellant's vehicle. The vehicle in question is a Mercedes sprinter van which was seized, together with 10,780 cigarettes, at Dover Eastern Docks on 7 April 2005. There is no appeal against the failure to restore the cigarettes.
- The Appellant (Mr Sanczyk) is a Polish national who lives in a small village in a remote part of Poland near the Russian border. The nearest town is 10-15 kilometres away. He speaks virtually no English and an interpreter was necessary throughout the course of the hearing.
- The facts are that Mr Sanczyk and two Polish friends set out together from Poland on about 5 April 2005 in Mr Sanczyk's Mercedes. This vehicle had been acquired by Mr Sanczyk on 15 February 2005. It was a nine-seater van. Prior to leaving Poland the three men had acquired the cigarettes which were subsequently found in the van. They were travelling to England in order to do some building work.
- Mr Sanczyk and his companions were stopped at 10.20am at Dover. The officer, who did not give evidence before us, made a note as follows:
- A second officer who has been present and who searched the Mercedes van noted inter alia as follows:
- Mr Sanczyk was given Notice 12A, but it was written in English. Mr Sanczyk's English was almost non-existent. His evidence to us was that neither of his travelling companions spoke more than the minimum, and he disputed that Dariusz Toczydlowski spoke or understood English, beyond a few words.
- An undated letter with a fax date of 12 April 2005 at the top of the page was sent to the Commissioners. This letter is written in English, having been written on the Appellant's behalf by his cousin. It states inter alia that:
- This letter was treated by the Commissioners as a request for restoration of the vehicle, and by a letter dated 5 May 2005 Mr Sanczyk was informed that his vehicle would not be restored because it was used to carry excise goods liable to forfeiture. The officer's reasons were stated to be:
- The Appellant subsequently wrote a letter dated 25 May 2005 in which he sets out problems arising from the loss of the vehicle as follows:
- By a letter dated 13 July 2005 Mr David Leavesley, a Customs review officer, undertook the review of the decision not to restore Mr Sanczyk's vehicle. In that letter he stated inter alia that Mr Sanczyk had not provided him with any details of exceptional circumstances that would result in his deciding to restore the vehicle to him. He took account of what he considered to be the Appellant's failure to answer questions truthfully and to disclose the full quantities of any excise goods carried in the van. He continued:
- The Appellant's subsequent notice of appeal was out of time. He applied for an extension of time in which to appeal, which was subsequently granted. His grounds of appeal were:
- With his application for leave to appeal out of time Mr Sanczyk submitted a statement in which he said inter alia that he was the only one who worked in his family and that he had a wife and daughter; he was self-employed and owned a transport business in Poland, which required him to travel to different countries in Europe. He stated that neither he nor the two passengers in the car spoke English at all. The cigarettes had been bought in Poland for their own consumption, they had planned to work in the United Kingdom for a few months doing work arranged by friends. They wanted to give the cigarettes to their friends as gifts. All three of them had equal shares in the cigarettes.
- In the same statement Mr Sanczyk said that the compartment beneath the driver seat was built in as part of the car's design, and it had been there when he bought it. It was only his second visit to the United Kingdom and he did not know that he could not bring in that quantity of cigarettes. He denied having placed any tape around the compartment, but said that a black bin bag had been placed over the passenger's seat to prevent the cigarettes from falling over the floor of the car.
- Mr Sanczyk referred again to the fact that he and his companions had little knowledge of English and that when stopped they had asked for an interpreter, but were told that they could not be supplied with one; consequently they could not understand the questions. They had not wanted to sign any of the documents because they did not understand the contents.
- Mr Sanczyk then referred to the fact that he needed the car for his job, and without it could not earn enough to support his wife and child. He put the value of the car at about £11,000, although in the hearing we were presented with the receipt of purchase which showed that in February 2005 he had actually paid 65,000 zloty for it and, as we were informed that there were 5 zloty to the £, the value of the vehicle shortly before it was seized was therefore some £13,000. He stated that the refusal to restore the car was disproportionate. The statement was signed and dated 5 January 2006.
- At the hearing of the appeal Mr Sanczyk's evidence was much in line with that statement but in addition he stated that the cigarettes had not been deliberately concealed, and that he himself, not the officer, had taken out the screw so that the seat could be removed to take the cigarettes out. He denied that there had been any tape over the hole, but confirmed that there was a black rubbish sack on the floor.
- Mr Sanczyk said that at the time of being stopped he had wanted to telephone a Polish friend to help him out, but he was not allowed to do so. He and his friends had then returned to Poland. Some time later he received a letter in English, which he had not understood. There were no interpreters in the small village in which he lived, which consisted of only 250 houses. He lived some distance from the nearest town and was unable to find a lawyer at that time. His cousin, who had translated his first letter, did not speak English very well and had made a mistake in saying the cigarettes were for "clients", and it should have been "friends". He was under the impression that he had had a letter from Customs and Excise saying the car might be returned on payment of about £1,500. That letter was not produced to the Tribunal, and was not in the bundle provided by the Commissioners. He had not properly understood the letters he did receive.
- With regard to the tool kit which had been beside the seat, he said this was simply the normal tool kit that any car carried. Furthermore, there was a hole in the side of the seat, and the cigarettes could have been taken through that hole as well as being removed by removing the seat. He had at no point been trying to hide the cigarettes. The black rubbish sack was simply used to put rubbish in. He completely denied trying to smuggle in the cigarettes to sell for a profit. He told the Tribunal that he had kept cigarettes under the seat in the van so they would not get stolen. The only other possessions he and his companion had with them were their work clothes. The cigarettes were for him and his friends to smoke when they came to work in the United Kingdom. They did in fact belonged to the three of them in equal shares. He also denied ever having been given an explanatory note for seizures in Polish, as had been claimed by the officer in his notebook.
- Initially in cross-examination Mr Sanczyk was challenged on his evidence that he had bought the car on 15 February 2005 and that he had not been to England in it on any previous occasion. It was put to him that he had driven it to the United Kingdom on 3 February 2005. He accepted that he had been to the United Kingdom prior to 15 February, but said that was only when he had come with friends to look for work and was not in the same vehicle. When the Tribunal looked at the document which counsel had suggested showed that the Appellant had previously visited the UK in that same car, we saw that it showed that the registration number was in fact different, and therefore there was no evidence that he had previously visited the United Kingdom in that car. Mr Singh quite properly then withdrew the suggestion that that had been the case.
- It was Mr Sanczyk's evidence, which we accept, that he had assumed that since Poland was now in the EU he could bring in the greater allowance of cigarettes, as could other EU nationals, and he was not aware that he was only permitted 200 cigarettes. He denied that any of them had told the officer that they had 2 x 200 cigarettes and said this was impossible, since none of them spoke sufficient English.
- With regard to hardship, Mr Sanczyk had a two-year old daughter and a three year old son. Since his car had been taken he had to travel by bike some 20 to 30 kilometres for work, or he could help on farms nearby. The money to purchase the car initially had come both from savings, and also from his father and his wife's parents. At the time of the hearing he had no further savings available because the procedure itself had cost him a lot of money.
- Mr Sanczyk had been unable to obtain a solicitor where he lived, and it was only when he saw an advertisement for a solicitor in a Polish newspaper earlier in 2006 that he was able to get any representation. By this time it was too late for him to appeal to the Magistrates Court as well as to the Tribunal. In addition at the time the car was seized he did not have enough money to pay for a solicitor. He knew nobody who might be able to help him.
- The Commissioners called no witnesses, the reviewing officer apparently no longer being available.
- Tobacco products are chargeable with excise duty upon importation into the United Kingdom. The Tobacco products Duty Act 1979 provides:
- The Excise Goods, Beer and Tobacco Products (Amendment) Regulations 2002:
- Poland is subject to restrictions on the amount of cigarettes that can be imported into the UK. The Customs and Excise Duties (Travellers' Allowance and personal Reliefs) (New Member States) Order 2004 provides:
- Conditions of relief
- Period in which article 3 shall have effect
- By Regulation 16 of the Excise Goods (Holding, Movement Warehousing and REDS) Regulations 1992 (SI 1992/3135) excise goods, in respect of which duty has not been paid, shall be liable to forfeiture where there has been a breach of regulations.
- Section 49(1)(a) of the Customs and Excise management Act 1979 ("CEMA") provides:
- Section 49(1)(f) of CEMA 1979 provides:
- Section 139 CEMA 1979 provides:
- Section 141 CEMA 1979 provides as follows:
- Section 152(b) CEMA 1979 provides that the Commissioners may as they see fit, restore, subject to such conditions (if any) as they think proper, anything forfeited or seized. Section 152 CEMA 1979 provides that:
- The jurisdiction of the Tribunal is pursuant to the Finance Act 1994, section 16(1), 16(4) and Schedule 5. This matter falls to be an ancillary matter as defined in Schedule 5 to the Act and the Tribunal, if it finds that the Respondents have acted unreasonably in not restoring the thing seized, can made an order under the Finance Act 1994, section 16(4):
- It was initially contended on behalf of the Respondents that it would be an abuse of process for the Appellant to advance any argument relating to personal use. This proposition was not pursued by Mr Singh before the Tribunal, however he did request the Tribunal to make a formal record in accordance with paragraph 55 of Gascoyne which is in the following terms:
- The Commissioners at no point considered whether or not Mr Sanczyk himself could speak English, or understood any of the questions that were put to him and his companions on 7 April. There is no record in the officer's notebook of an interpreter having been requested, however we have no doubt that one was asked for at the time of the seizure because we accept that Mr Sanczyk and his companions understood very little English indeed. Whilst we accept that Notice 12A was given to Mr Sanczyk, we accept his evidence that he was unable to find anybody with sufficient knowledge of English to translate it to him in the weeks immediately following the seizure. As stated above, he comes from a small village in a remote part of Poland, far from Warsaw. Even had there been somebody with sufficient knowledge of English to translate Notice 12A, we very much doubt whether the full implications of the failure to appeal to the Magistrates Court would have been understood. In our experience many intelligent people whose first language is English fail to grasp its full significance and the implications of failing to appeal to the magistrates court. In this case there are several additional factors. The principal fact is that it is clear to us that Mr Sanczyk did not understand either why the goods were seized at the time, because of his lack of English, nor did he have any immediate opportunity to consider whether he should appeal to the magistrates court because Notice 12A was provided to him in English. Furthermore he had no access to proper or any legal advice at the relevant time, and was misled by the seizing officer as to the nature of any appeal, being told only that he could apply for restoration. In addition, the officer told Mr Toczydlowski (who almost certainly did not understand what was said) that 'they' must write in one month 'to request goods back'. There is no mention of making a challenge to the seizure or where, or how this should be done. Even had Mr Sanczyk understood the necessity to appeal to the magistrates court to contest the issue of personal use, it would have been an expensive and difficult matter for him to have returned to this country, and it is our experience that in the past the Commissioners seek heavy costs in the magistrates court, which they rarely do in front of the tribunal.
- For the foregoing reasons we consider that Mr Sanczyk did not have a realistic opportunity to invoke the condemnation procedure, and for that reason alone we find that we do have jurisdiction with regard to the issue of personal use, although of course it was only the restoration of the car which was in issue before us. With regard to the facts of the case in relation to the same issue, we found Mr Sanczyk to be a comparatively straightforward witness, and we accept his evidence that the cigarettes were not hidden underneath the driver's seat to avoid detection by Customs, but were simply put there. The evidence apart from Mr Sanczyk's own shows that the cigarettes were not in fact concealed from view because the officer actually notes that he saw the cigarettes under the seat. The black tape which he described having found was simply to cover a 3 x 3 inch hole visible from the rear sitting area. Unfortunately we have not been given in any legible form the names of the officers whose notes we have seen. We notice from the first notebook that an officer called Hooker informed the first officer that "he could see a number of cigarettes". Mr Hooker may or may not be the same officer who in his notes states: "I detected a quantity of cigarettes within a natural box section space" and who later goes on to describe the black sticky tape. Without the benefit of hearing from either of these officers, we accept the evidence of Mr Sanczyk that there was no black sticky tape, there was simply a sack containing rubbish which was placed near the 3 inch hole in the back. Any apparent concealment of the cigarettes we find was due to the fact that Mr Sanczyk and his companions were travelling for two days from Poland with the cigarettes in the van and that there was no other place where they could reasonably be kept out of the way and out of immediate sight, and it was clearly a natural precaution to put the cigarettes in the only available place where they would not be readily visible to the naked eye, and thus likely to attract thieves. We do not accept that the cigarettes were deliberately concealed in order to avoid detection by Customs officers.
- The second principle issue in this appeal is the proportionality of the seizing of the Appellant's vehicle. The reasons relied on by the Respondents for saying that the cigarettes were not imported for own use were:
- In respect of proportionality Mr Singh set out various matters as follows:
- On behalf of the Appellant it was submitted that the Respondents had failed to inform the Appellant as to the nature of the matter against him in a language which he could understand, and the decision was therefore wrong in law and should be set aside.
- It was submitted by Mr Nusrat that the decision was in breach of Article 6 of the European Convention on Human Rights in that the confiscation Order should be regarded as punitive. It was further submitted that the decision had been reached in breach of the provisions of section 6 of the Human Rights Act 1998 and the Appellant had had no proper opportunity to contest the legality of the seizure.
- For the reasons fully set out above in response to the Respondents' case, we find that, on the balance of probabilities, the Appellant was entitled to argue the matter of own use before us and he has satisfied us that he was not bringing in the cigarettes for a commercial purpose. We have dealt with this issue in terms of the decision in Weller, however we would in any event have concluded that our jurisdiction did extend to finding the facts of the importation and considering the question of own use, following the decision of the Court of Appeal in the case of Golobiewska v Commissioners of Customs and Excise [2005] V&DR 267. This case was not cited to us, but in it the Court of Appeal unanimously decided that, in order to determine whether a decision is reasonable for the purposes of section 16(4) of the Finance Act 1994, the Tribunal must find the relevant facts and decide whether the decision by the review officer was or was not one that he could reasonably have arrived at and whether it was soundly based factually.
- We accept that our jurisdiction is limited to referring the matter back to the Commissioners in circumstances where we find that they have taken account of matters which they ought not to have done and failed to take account of matters which they should have done. In that regard we find that no account whatsoever was taken of the Appellant's inability to speak English. No questions were put to him at all at the time of the seizure, and no effort was made to find out the limits of his comprehension, albeit we accept the Respondents' evidence that he was provided with a Polish version of the notice of seizure. However, no effort was made by the officers at Dover to ensure that the one man present in the vehicle who was alleged to speak English translated to Mr Sanczyk, and no interpreter was provided. Whilst we do not find that there is an obligation on the Commissioners to provide an interpreter themselves, we do find that there is an obligation on them to ensure that the owner of the vehicle they intend seizing fully understands what is being said and his rights of appeal. How this is done is not a matter for us to decide.
- The review decision itself refers to the fact that at the time the Appellant was stopped by Customs officer in uniform he "must have known that he was expected both to answer questions truthfully and to disclose the full quantities of any excise goods carried with him in the van". There is no evidence whatsoever that Mr Sanczyk ever spoke to the Customs officer other than his evidence to us that he requested an interpreter. There is no evidence that the Appellant himself answered any questions untruthfully. There is no evidence that he personally failed to disclose all the excise goods and was misleading the officer in this regard. Indeed the evidence of the officers themselves is that the cigarettes were in fact visible from the front, the alleged black sticky tape being to cover a hole at the rear.
- Mr Sanczyk was said to be importing more than three times the normal guide level of 3,200 cigarettes that applied to imports from fully integrated EU member states. This was not strictly correct, because there were three people in the vehicle, and each would be allowed to bring in for his own personal use up to the guide level of 3,200 cigarettes if he were from a fully integrated EU member state. It is wrong to ascribe the ownership of all the cigarettes to Mr Sanczyk, particularly in view of the fact that it was one of the passengers and not he who stated that he had 2 x 200 cigarettes.
- The reviewing officer states: "The fact that you only declared 400 cigarettes between three travellers indicates to me that you did have prior knowledge of the allowances for your country and by declaring 400 you attempted to mislead the officer as to the quantities in your possession." He then refers to him changing his story by claiming in a letter that 1,000 cigarettes were for his own use and the remainder were for Polish clients. There was no change of story by Mr Sanczyk himself in the circumstances, as he had not made the initial declaration. We do accept that there was a change by Mr Sanczyk in his account to us of the ownership and intended destination of he cigarettes, and that set out in the letter sent on his behalf referred to above. This, however, was unknown to the review officer. We accept Mr Sanczyk's evidence to us with regard to their being for own use.
- The reviewing officer took account of the fact that access to the space in question could only be made by undoing the seat securing bolts. We accept Mr Sanczyk evidence that this was not in fact the case, and the cigarettes could have been got out without removing the seat, but it was easier to get them out by removing the seat. We also accept that it was Mr Sanczyk who actually removed the seat, and in any event there was good reason for the cigarettes being where they were.
- All these matters we consider are ones which should not have been taken into account by the reviewing officer. In addition he ought to have taken account of the Appellant's inability to speak the language and the fact that not any of the questions were in fact answered by him. We regard the review decision as gravely flawed because of the above matters.
- In addition, as stated above, we consider that the seizure of the car was disproportionate in all the circumstances, particularly given the value of the car and the fact that the quantity of cigarettes was only marginally over the allowance for UK travellers, accepting, as we do, that Mr Sanczyk made a mistake as to the allowance for Polish people being different, albeit we accept that ignorance of the law is not an excuse and there was a duty on Mr Sanczyk to make himself aware of the correct allowance. Nonetheless, ignorance of the law cannot convert an innocent attempt to bring in cigarettes for other than a commercial purpose into an attempt to bring them in for a commercial purpose. We do not consider the fact that he had travelled to the United Kingdom on a previous occasion is sufficient evidence of his knowledge of the quantity of cigarettes that Poles are entitled to import. There is no evidence that Mr Sanczyk had been stopped on the occasion of his previous visit with an excess quantity of cigarettes.
- We have not addressed Mr Nusrat's submissions with regard to the Human Rights Act directly, as we do not consider it necessary to do so for the purposes of deciding this appeal.
- In the circumstances this appeal is allowed to the extent that it is remitted to the Commissioners for further consideration taking account of the facts that we have found.
- The Respondents to pay the Appellant's costs of and relating to this appeal.
E00972
EXCISE – Restoration of vehicle – No application in Magistrates Court – Whether Appellant can argue issue of own use – Weller considered – Appellant did not speak English – No interpreter provided – Whether seizure of vehicle proportionate
LONDON TRIBUNAL CENTRE
MR ROBERT SANCZYK Appellant
THE COMMISSIONERS FOR HER MAJESTY'S REVENUE & CUSTOMS Respondents
Tribunal: MISS J C GORT (Chairman)
MR T A MARSH
Sitting in public in London on 9 June 2006
Mr M Nusrat of counsel for the Appellant
Mr Singh of counsel for the Respondents
© CROWN COPYRIGHT 2006
DECISION
"Occupants stated they had 2 x 200 cigarettes. Upon search of vehicle I was notified by D Hooker that he could see a number of cigarettes concealed in the space under the passenger front seat. A natural cut out in the space had been taped over from the inside to prevent detection. … Explained that because the cigarettes were concealed the van was seized. DT (Dariusz Toczydlowski) spoke enough English to understand and all refused to sign paperwork. Paperwork issued explained to DT. RS (Robert Sanczyk) given explanatory note to seizures in Polish. … Explained that they must write in within one month to request goods back and that they must leave the Customs Controls."
"I detected a quantity of cigarettes within a natural box section space which the driver's seat is bolted to. I removed three bolts attaching the seat, with socket set found under the passenger seat by officer Green. Within this box section was 11,180 cigarettes (this was an error by this officer, the actual number was 10,780) of Polish origin. … Within this space black sticky tape had been placed to cover a 3 x 3 inch hole, visible from the near seating area. …"
This officer did not appear before us to give evidence either.
"… only 1,000 of those cigarettes belongs to me. The rest is the property of Polish clients who wanted to send them to their relatives in England. Thus it was the parcel to other people. I thought that since Poland joined the European Union we could bring the cigarettes to your country. … I would like to ask you to return my car as it is necessary for doing my work."
"In respect of the vehicle I have given consideration to the Commissioners' policy and have concluded that the quantity of cigarettes involved and the method of concealment persuades me of your involvement in a commercial venture."
"I would like to explain my difficult position. As I am the only person who is employed in my family including my wife and two children, I need this vehicle to continue my work very badly. As I should also emphasise that the carrying of people is the only job I have got. Therefore, I would like you to ask for the restoration of my vehicle as soon as possible. As I have my family to support financially our situation is really traumatic."
This letter was treated by the Commissioners as a request for a formal departmental review of the decision.
"You failed to disclose all of your excise goods, thus misleading the officer about the true quantity of them. If you had nothing to hide there was no need to mislead the officer, and, on those grounds alone, I have good reason to doubt your credibility."
The officer then continued to set out the quantity of cigarettes the Appellant was importing, and continued:
"With 10,800 cigarettes you were importing more than three times the normal guide level of 3,200 that applies to import from fully integrated EU Member States. Poland is subject to accession rate restrictions on the amount of cigarettes that can be imported into the UK.
Under the schedule to the Customs and Excise Duties (Travellers' Allowances and Personal Release) (new Member States) Order 2004, you are afforded relief on only 200 cigarettes. Thus the vehicle was specifically used to import goods far in excess of the allowance.
As a foreign national you are not exempt from knowing and understanding of the law that is applicable to imports of excise goods. The fact that you only declared 400 cigarettes between three travellers indicates to me that you did have prior knowledge of the allowance as to your country and by declaring 400 you attempted to mislead the officer as to the quantities in your possession.
Indeed, even when you faxed this department on 12 April 2005, you changed your story and claimed that only 1,000 cigarettes are for your own use and the remaining 9,800 were from Polish clients to be delivered to relatives in this country.
…
Whatever version of events you wish to rely upon matters little when one considers that the vast majority of the cigarettes were deliberately hidden within the fabric of the vehicle. Access to the space in question could only be made by undoing the seat securing bolts. A suitable wrench set was found next to the passenger seat and was used to remove the bolts and gain access to the cigarettes.
The premeditated nature of your actions was confirmed by the fact that the only opening to the box section (which would have provided visual evidence of the contents) was taped over to conceal the contents. …
In your letter of 25 May 2005, you have explained how you need the vehicle to continue working and to support your family. Whenever a vehicle is seized there is a degree of hardship involved. I have no evidence whatsoever of the hardship you now claim to be suffering from and can only go by the evidence before me.
You have not challenged the legality of the seizure and the vehicle is deemed as forfeit by the passage of time."
"Customs Review Officer in deciding that the seized Mercedes … should not be restored to its lawful owner .. erred in law and fact in that:
(a) he failed to have regard or otherwise if taken into consideration (sic) failed to give due weight to:
(i) the fact that the offending cigarettes amounting to 10,780 (53 cartons (sic) approx.) were not only of the belonged to (sic) the Appellant but in addition belonged to two passengers, namely W Waskiowicz and D Toczydlowski who were carrying them for their private and personal use;
(ii) the quantity and the value of the offending goods is significantly disproportionate for that of the vehicle, namely Mercedes Benz Sprinter denied restoration;
(iii) that the refusal to restore would be depriving of the Appellant his living.
(b) the Appellant was denied a full and fair hearing in not granting them an independent interpreter and making individual of separate inquires (sic).
(c) that the decision in all the circumstances is Wednesbury unreasonable.
Legislative provisions
"1. Tobacco products
(1) In this Act `tobacco products' means any of the following products, namely:-
(a) cigarettes;
(b) cigars;
(c) hand-rolling tobacco;
(d) other smoking tobacco; and
(e) chewing tobacco;
which are manufactured wholly or partly from tobacco or any substance used as a substitute for tobacco, but does not include herbal smoking products.
(2) Subject to subsection (3) below, in this Act `hand-rolling tobacco' means tobacco –
(a) which is sold or advertised by the importer or manufacturer as suitable for making into cigarettes; or
(aa) which is of a kind used for making into cigarettes; or
(b) of which more than 25 per cent by weight of the tobacco particles have a width of less than 1mm.
2. Charge and remission or repayment of tobacco products duty
(1) There shall be charged on tobacco products imported into or manufactured in the United Kingdom a duty of excise at the rates shown, […] in the Table in Schedule 1 to this Act.
(3) …"
The Tobacco products Regulations 2001 state:
"4-(1) Amend the Tobacco Products Regulations 2001[8] as follows:
(2) In the definition of "duty" in regulation 3(1) before the word "means" insert -
"except in regulation 12(1B) 9d) below,"
(3) In regulation 12, after paragraph (1) insert –
"(1A) In the case of tobacco products acquired by a person in another member State for his own use and transported by him to the United Kingdom, the excise duty point is the time when those goods are held or used for a commercial purpose by any person."
(1B) For the purposes of paragraph (1A) above –
(b) "own use" includes use as a personal gift,
(c) if the goods in question are –
(i) transferred to another person for money or money's worth (including any reimbursement of expenses incurred in connection with obtaining them), or
(ii) the person holding them intends to make such a transfer, those goods are to be regarded as being held for a commercial purpose,
(e) without prejudice to sub-paragraphs ( c) and (d) above, in determining whether excise goods are held or used for a commercial purpose by any person regard shall be taken of –
(i) that person's reasons for having possession or control of those products,
(ii) whether or not that person is a revenue trader (as defined in section 1(1) of the Customs and Excise Management Act 1979),
(iii) that person's conduct, including his intended use of those goods or any refusal to disclose his intended use of those products,.
(iv) the location of those products,
(v) the mode of transport used to convey those products,
(vi) any document or other information whatsoever relating to those products,
(vii) the nature of those products including the nature and condition of any package or container,
(viii) the quantity of those products, and in particular, whether the quantity exceeds any of the following quantities-
3,200 cigarettes
400 cigarillos (cigars weighing no more than 3
grammes each)
200 cigars
3 kilogrammes of any other tobacco products
(ix) whether that person personally financed the purchase of those products,
(x) any other circumstance that appears to be relevant,
(4) In regulation 23(1), after paragraph (a), insert-
"(aa) they were acquired by a person in another member state for his own use and transported by him to the United Kingdom."
"3. Relief from duty of excise
Subject to the following provisions of this Order, a person who has travelled from a specified country shall, on entering the United Kingdom, be relieved from payment of excise duty on relevant tobacco products acquired in that country and which he has transported.
(1) The reliefs afforded under this Order are subject to the condition that the goods in question, as indicated by their nature or quantity or otherwise, are not held for a commercial purpose nor are used for such purpose; and if that condition is not complied with in relation to any goods, those goods shall, unless the non-compliance was sanctioned by the Commissioners, be liable to forfeiture.
(2) If the goods in question are not duty and tax paid in the specified country at the time of acquisition, or the duty and tax that was paid will be or has been reimbursed, refunded or otherwise dispenses with, those goods are to be regarded as being held for a commercial purpose.
Article 3 shall have effect in relation to a specified country on or before the date shown opposite the country in Column 3 of the Schedule."
SCHEDULE
Articles 3 and 5
| (1) | (2) | (3) |
| Specified Country | Relevant Tobacco Products |
Date on or before which Order shall have effect |
| Poland | 200 Cigarettes | 31 December 2008 |
"1. Where –
(a) except as provided by or under the Customs and Excise Acts 1979, any imported goods, being goods chargeable o their importation with customs or excise duty, are, without payment of duty -
(i) unshipped in any port,
(ii) unloaded from any aircraft in the United Kingdom,
(iii) unloaded from any vehicle in, or otherwise brought across the boundary, into, Northern Ireland, or
(iv) removed from their place of importation or from any approved wharf, examination station or transit shed;
… those goods shall … be liable to forfeiture."
"1. Where –
(f) any imported goods are concealed or packed in a manner appearing to be intended to deceive an officer, those goods shall … be liable to forfeiture."
"(1) Anything liable to forfeiture under the customs and excise Acts may be seized or detained by any officer or constable or any member of Her Majesty's armed forces or coastguard."
"(1) … where anything has become liable to forfeiture under the Customs and Excise Acts –
any ship, aircraft, vehicle … which has been used for the carriage, handling, deposit … of the thing so liable to forfeiture … and
… any other thing mixed, packed or found with the thing so liable, shall also be liable to forfeiture."
"The Commissioners may, as they see fit –
(a) …
(b) restore, subject to such conditions (if any) as they think proper, any thing forfeited or seized under the Customs and Excise Acts."
"…
(a) to direct that the decision, so far as it remains in force, is to cease to have effect from such a time as the tribunal may direct;
(b) to require the Commissioners to conduct, in accordance with the directions of the tribunal, a further review of the original decision, and
(c) in the case of a decision which has already been acted on or taken effect and cannot be remedied by a further review, to declare the decision to have been unreasonable and to given direction to the Commissioners as to the steps to be taken for securing that repetitions of the unreasonableness do not occur when comparable circumstances arise in future."
The Respondents' case
"In my view, therefore, in a case were the deeming provisions under paragraph 5 are applied, the tribunal can re-open those issues: though the tribunal will always have very well in mind, considerations of, or similar to, abuse of process in considering whether such issues should in fact be ventilated before it."
Mr Singh continued that he wanted the Tribunal to state the reasons why it believed there were exceptional circumstances which permitted it to consider the issue of own use. Mr Singh referred us inter alia to the case of C C E v Weller [2006] EWHC 237 in which Evans-Lombe J set out the tribunal's function as being to consider
"… whether or not an importer, having suffered a deemed forfeiture under paragraph 5 Schedule 3, is able to raise the validity of the forfeiture on a review by the Commissioners and on appeal from them to the tribunal, depends on two questions, first, did the importer have a realistic opportunity to invoke the condemnation procedure and, secondly, if he did, are there nonetheless reasons, disclosed by the facts of the case which should persuade the Commissioners or the Tribunal to permit him to re-open the question of the validity of the original seizure on an application for return of the goods."
Any reference to this case was notably absent from the statement of case in which both the cases of Gascoyne v Customs and Excise Commissioners (2005) Ch 215 and the case of Johnstone, for which no reference was given, were referred to as being authority for the Commissioners' opinion that it was an abuse of process for the Tribunal to re-open the issue of the legality of the seizure where the appellant has had the opportunity to challenge the legality of seizure through condemnation proceedings.
(a) The supposed fact that when initially intercepted "the Appellant and his two passengers" declared 2 x 200 cigarettes between them when in fact they were actually carrying 10,780 cigarettes.
This was construed as an attempt to mislead the intercepting officer as to the true quantity of goods being imported into the UK. With regard to this, there is simply no evidence that the Appellant himself was complicit in this alleged deception. Only one of the three people in the car was said to speak English, and it is perfectly clear that at no time did the officer ask that passenger to interpret to the Appellant, who after all was the owner of the vehicle, what was being said. Therefore this answer cannot be ascribed to the Appellant.
(b) People travelling from Poland to the UK were only entitled to relief of payment of UK excise duty on 200 cigarettes, and the Appellant had over fifty-three times this amount.
There was no question put to the Appellant at the time of the seizure as to his understanding of the quantity of cigarettes which he would have been allowed to bring in for personal use. His evidence to us was that he thought that as Poland was a member of the EU they would be entitled to the same quantity of cigarettes for personal use as other members of the EU. We accept that evidence.
(c) Mr Singh concluded from the fact that there was an initial declaration of 2 x 200 cigarettes that "they" were aware of the relevant allowances for travellers from Poland and were attempting to deceive the interviewing officer.
Again, this is a matter of one of the passengers, and not the Appellant. There is no evidence that the Appellant himself concurred with this.
(d) Mr Singh relied on the fact that the cigarettes were concealed within the fabric of the Appellant's vehicle. He also referred to the fact that the cigarettes could only be accessed by removing the bolts attached to the driver's seat. In addition he stated "the only visual opening to the space had been concealed with black tape". He stated that this represented a careful and deliberate attempt to smuggle cigarettes within the vehicle.
We do not accept any of this for the reasons set out above with regard to the officer's notes and the matter of the black tape.
(e) The Respondents relied on the fact that in correspondence the Appellant had stated that only 1,000 cigarettes were for his own use, and the remaining 9,800 belonged to Polish clients who wanted to send the cigarettes to their relatives in England. In his subsequent statement the Appellant claimed: "the three of us had equal shares in the cigarettes", there was no mention of Polish clients. It was submitted that the Appellant had not therefore presented a consistent account as to whom the cigarettes belonged which undermined his credibility.
This matter was not one which was known to the reviewing officer when he made his decision, and, whilst the overall credibility of the Appellant is a matter which the Tribunal has to consider, it is not a matter which could have influenced the reviewing officer. Before us the Appellant explained that he had not been aware that his cousin had translated the word "friends" as "clients". We accept that there was a linguistic confusion here.
(a) The goods were dutiable and the Appellant failed to pay duty or guarantee payment of duty on the goods in advance as commercial import as excise goods are required to do.
This presupposes that they were introduced for a commercial purpose. It has nothing to do with proportionality.
(b) Supply of such goods on the UK market would damage legitimate trade and the protection of the revenue.
Again this is an issue which goes to a matter other than that of proportionality.
(c) Once it was established that the Appellant was in breach of the statutory requirements, there had to be some penalty for this breach, as otherwise the statutory requirements would be rendered meaningless and inoperable.
"Some penalty" does not mean that a vehicle, whose value it is now established to some £13,000, is suitable penalty in the circumstances.
(d) This appears to be an amalgam of the above, and states inter alia that travellers would be encouraged to purchase goods to be sold for profit if caught they would only have to pay the duty they should have paid in any event. This would increase the likelihood that the interests of legitimate trade would be harmed and the protection of the revenue would be damaged.
Again this does not address the matter of the value of the car.
(e) The tribunal was referred to the case Lindsay v Customs and Excise Commissioners (2002) 1 WLR 1766 at paragraph 63 where the Court of Appeal said:
"Those who deliberately use their cars to further fraudulent commercial ventures in the knowledge that if they are caught their cars would be rendered liable to forfeiture cannot reasonably be heard to complain if they lose their vehicles. Nor does it seem to me that, in such circumstances, the value of the car used need to be taken into consideration. Those circumstances will normally take the case beyond the threshold where that factor can carry significant weight in the balance. Cases of exceptional hardship must always, of course, be given due consideration."
With regard to the matter of proportionality, we do not find that the Appellant was bringing in the cigarettes for a commercial purpose, therefore the case of Lindsay is not applicable. In any event if we are wrong so to find, nonetheless we think the amount of the duty evaded, which in this case some £1,647.12, is totally disproportionate to the value of the car of some £13,000, albeit it was thought at the time to be worth some £11,000. Furthermore we do consider that in the Appellant's particular circumstances there is evidence of exceptional hardship. The Commissioners very readily dismissed the contents of the Appellant's letter stating that he was the only earner and that his business was transporting people in his car. There was evidence to the Tribunal in the form of a business card that he had had printed showing details of that business. Mr Sanczyk does live in a remote area and the only work that he can get other than driving is farm work, other than when he can get transport to England to do building work. For a man living in a remote part of Poland with two small children to bring up, we find that loss of his car does create exceptional hardship, depriving him as it does of all reasonable prospects of making a proper living for his family.
The Appellant's case
Further Reasons for decision
MISS J C GORT
CHAIRMAN
RELEASED: 20 July 2006
LON/05/8103