United Kingdom VAT & Duties Tribunals (Excise) Decisions

Shaw & Anor v Revenue & Customs [2007] UKVAT(Excise) E01023 (06 March 2007)

E01023

Customs & Excise Management Act 1979 & Tobacco Products Duties Act 1979 - Appeal seeking restoration of cigarettes – Appellant had failed to pursue condemnation proceedings - Appellant now asserting "own use" as grounds of restoration - Appeal dismissed for want of jurisdiction and failure of Appellant to establish grounds for restoration

BELFAST TRIBUNAL CENTRE

GAVIN SHAW & ROISIN SHAW Appellant

and –

THE COMMISSIONERS FOR HER MAJESTY'S REVENUE & CUSTOMS Respondents

Tribunal: IAN W HUDDLESTON (Chairman)

MISS PATRICIA GORDON

Sitting in public in Belfast on 27 October 2006

The Appellant in person

Mr F Phillips, BL, instructed by the Solicitors Office of HM Revenue & Customs, for the Respondents

© CROWN COPYRIGHT 2007


 


DECISION

Grounds of Appeal

1. This Appeal is against the decision of the Respondents to uphold a decision not to restore 6,400 cigarettes ("the Goods") seized from Mr. Gavin Shaw and Mrs. Roisin Shaw ("the Appellants") at Belfast International Airport on the 6^th August 2005.
2. A request for restoration was made by the Appellants by a letter dated the 18^th August 2005. Restoration was refused in a letter which the Respondents sent dated 13^th December 2005. The Appellants requested a review of that decision which Customs received on the 25^th January 2006. Following a review, however, the decision not to restore the Goods was confirmed in a letter dated the 1^st March 2006 and it is that decision that is the subject of this Appeal.

Facts

3. The Appellants were stopped by Customs at Belfast International Airport on the 6^th August 2005, having just arrived from Malaga. After initial questioning, the Officer involved established that the Appellants had, in their possession, 800 Marlborough Light cigarettes, 2,000 Lambert & Butler cigarettes, and 3,400 Silk Cut cigarettes. Following that discovery the Officer read what is normally referred to as the "Commerciality Statement" to the Appellants in the following terms:

"You had excise goods in your possession (or control) that appeared not to have borne UK duty. Goods may be held without payment of excise duty if they have been acquired and are held for your own use. The Officer intended to ask you some questions to establish whether these goods were held for a commercial purpose. If no satisfactory explanation was forthcoming, or if you did not stay for questioning, the Office might be forced to conclude that the goods were held for a commercial purpose and your goods and vehicle might be seized as liable for forfeiture."

4. Both Appellants indicated that they understood and elected to stay for the interview. The following is a summary of the separate interviews that were held with both Mr. & Mrs. Shaw.

(a) Interview with Mr. Gavin Shaw

Mr. Shaw stated that he was employed in a bank. Mr. Shaw indicated that the Goods belonged to he and his wife and that they had been purchased in Torremelinos at a cost of approximately €850. Mr. Shaw then stated that he had retained only one of the receipts for the purchases, that he had paid for the goods from his savings, and that no-one had assisted in their purchase. When asked by the Officer about his smoking habits, Mr. Shaw stated that he was a smoker with a consumption rate of "about 20 a day", and that he "normally smoked Lambert & Butler primarily."

Mr. Shaw subsequently stated that the Marlborough Light cigarettes were also for him. When asked, he indicated that he did not have any smoking paraphernalia available for use, but that his wife did.

Following the interview, Mr. Shaw wrote the following in the Officer's notebook:

"I agree that the above is an accurate account of the conversation that took place"

and added his signature, date and time.

(b) Interview with Mrs. Roisin Shaw

Mrs. Shaw told the Officer who interviewed her that the tobacco goods belonged to she and her husband. When asked who they were for, Mrs. Shaw replied "myself, I am a smoker, and family". Mrs. Shaw stated that she was employed as a secretary, and no-one had assisted in the finance of the purchase. She indicated that she intended to smoke the cigarettes herself and that she smoked Silk Cut cigarettes.

Mrs. Shaw then stated that the Lambert & Butler cigarettes would be smoked by "one of Gavin's five sisters". The interview continued:

Officer: "Sorry, Gavin doesn't smoke?"

Mrs. Shaw: "Not really, no he doesn't"

Officer: "Who are the Marlborough for?"

Mrs. Shaw: "Michelle, one of Gavin's sisters, they are really for family and me"

Officer: "Will they all be giving you the money for the cigarettes?"

Mrs. Shaw: "I don't know, that's between Gavin and them"

In like manner, Mrs. Shaw wrote in the Officer's notebook, after the conclusion of the interview:

"I agree that the above is an accurate account of the conversation"

adding her signature, date and time.

5. Based on the interview, the Officer was satisfied that the Goods were not for "own use", and were held by the Appellants for a commercial purpose, and seized them under Section 139(1) of the Customs & Excise Management Act 1979 ("CEMA") as being liable to forfeiture under both Regulation 16 of the REDS Regulations, and Section 49(1)(A)(i) of CEMA. At that point Mr. & Mrs. Shaw were issued with a Seizure Information Notice (C156), a Customs Warning Notice (C162), and Customs Notice 12A ("Goods and/or Vehicles seized by Customs"). Customs Notice 12A explained that the Appellants could challenge the legality of the seizure in a Magistrates Court by sending Customs a notice of claim within one month from the date of seizure.
6. On the 18^th August 2005 Customs received a letter in which the Appellants asked for the Goods to be restored, and requesting that Customs instigate Condemnation Proceedings. That request was acknowledged by Customs on the 13^th September 2005. Following that, Customs received a letter on the 20^th September 2005 indicating that the Appellants wished Customs to instigate Condemnation Proceedings and challenge the legality of the seizure. On the 13^th December 2005, Customs replied to the Appellants refusing to restore the excise goods. In a letter dated the 6^th January 2006, the Appellants informed the Respondents that they wished to withdraw from the Condemnation Proceedings and not challenge the legality of the seizure. In a letter, however, received by Customs on the 25^th January 2006, the Appellants wrote asking for a review of the decision dated 13^th December 2005, reiterating the points which had been previously raised and asking for restoration of the Goods. That review was carried out by R. Brenton, Customs Review Officer, and culminated in a very detailed letter which was sent to the Appellants on the 1^st March 2006, in which the original decision was confirmed and it was concluded that the Goods would not be restored to the Appellants. It is that decision which is the subject of this Appeal.

Case before the Tribunal

7. Mr. Phillips of Counsel, instructed by the Respondents, appeared before the Tribunal. Mr. Shaw appeared in person. It appeared to the Tribunal that Mr. Shaw's case really condensed to a request for the Goods to be restored to him. When queried as to why he had withdrawn his request for Condemnation Proceedings, he indicated that his principal concern was the costs of instructing solicitors to act on his behalf. In any event, he acknowledged that the had been made fully aware of the potential routes of appeal open to him at the time the Goods were seized, and that he had voluntarily withdrawn his request for Condemnation Proceedings. As to the facts of the case, whilst it appeared that Mr. Shaw was certainly frustrated at the treatment he received by Customs in Belfast International Airport, his version of facts both in his evidence and in cross-examination did not differ from the facts which are set out above.
8. Mr. Phillips then addressed the Tribunal in relation to the jurisdiction of the Tribunal in relation to this case. He correctly indicated that Mr. Shaw was effectively arguing that the goods were for his "own use", and that they therefore should be restored to him. The problem, as Mr. Phillips rightly identified, was that by virtue of the provisions of paragraph 5, Schedule 3, CEMA, in the absence of Condemnation Proceedings, the goods had been deemed to have been duly condemned as forfeited, and therefore already had, by virtue of that deeming provision, become "commercial" in nature. In that circumstance, the Tribunal had no jurisdiction to re-open the legality of the original seizure (the case of Gascoyne –v- Customs & Excise Commissioners [2005] Ch 215 applied). The Tribunal concurred with that view and explained to Mr. Shaw that the proper course open to him (and which he had rejected) was to ask Customs to take Condemnation Proceedings through the Magistrates Court. When he withdrew his application in that regard, the deeming provision contained in Schedule 5 of CEMA operated against him and the Tribunal did not have power to re-examine the legality of the seizure, or to order a restoration of the goods.
9. Further, it appeared to the Tribunal that even if jurisdiction were not an issue, there did not appear to the Tribunal any grounds on which the Tribunal would, on the facts of this case, order restoration of the Goods.
10. Given that position the Appellant's Appeal would be dismissed. No order as to costs.
IAN HUDDLESTON CHAIRMAN RELEASED: 6 March 2007

LON/2006/8027