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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 >> Innocent Ekperuoh v Revenue & Customs [2007] UKVAT(Excise) E01064 (11 September 2007)
URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2007/E01064.html
Cite as: [2007] UKVAT(Excise) E1064, [2007] UKVAT(Excise) E01064
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- This appeal concerns a decision made by the commissioners on 8 December 2006 by which they reviewed and upheld their earlier decision of 6 October 2006 not to restore to the appellant 604 litres of beer and a Ford Transit vehicle which had been seized from him on 8 September 2006 at the UK Control Zone, Coquelles, France.
- For the avoidance of doubt we note that the correct spelling of the appellant's name, taken from his own correspondence, is Ekperuoh. He did not attend the hearing and we decided to proceed in his absence in accordance with rule 26(2) of the VAT Tribunal Rules.
- The beer was seized as liable to forfeiture under section 49(1)(a) of the Customs and Excise Management Act 1979 and under regulation 16 of the Excise Goods (Holding, Movement and REDS) Regulations 1992. The van was seized as liable to forfeiture under section 141 of the 1979 Act as having been a vehicle used to carry a thing liable to forfeiture (the beer). The appellant did not contest the seizure by requiring the commissioners to commence condemnation proceedings and the goods and the van therefore were duly condemned as forfeit under paragraph 5 of Schedule 3 to the 1979 Act.
- The decision under appeal concerns an "ancillary matter" as defined in section 16(8) of the Finance Act 1994 and is a decision falling within paragraph 2(1)(r) of Schedule 5 to that Act. The decision under review relates to the commissioners' discretionary power provided by section 152 of the Customs and Excise Management Act 1979 to restore goods after seizure. It seems from a letter accompanying the Notice of Appeal that Mr Ekperuoh may only wish to appeal about the van but in absence of actual confirmation of that we will regard the decisions about both the beer and the van as being under appeal.
- The effect of section 16(4) of the Finance Act 1994 is that the Tribunal can only allow an appeal in a case like this if it is satisfied that the commissioners' decision was one that they could not reasonably have arrived at.
- It is established by authority that the Tribunal can make findings of fact and determine the issue of reasonableness in light of those facts as well as examining the basis on which the commissioners acted.
- Where, as here, goods have been seized and have been condemned as forfeit because there have been no condemnation proceedings the Tribunal cannot re-examine the question of forfeiture as such but where the question whether the goods were for the importer's own use is in issue the Tribunal can examine that issue and make findings about it as long as to do so would not be an abuse of process or something akin to that. Mr Singh agreed that the commissioners' Statement of Case would have overstated the position by saying that it "would be" an abuse of process for the appellant to raise the question of own use if that had meant that it would always be an abuse but contended that the Statement of Case meant that it would be an abuse on the facts of this case.
- In this case the issue of own use was raised on the papers but in light of our findings about it we need not decide whether there would be an abuse of process if we had allowed the issue of forfeiture to be re-opened to the extent that it can be.
- Council Directive 92/12/EC, dealing, amongst other things, with the general arrangements for products subject to excise duties, provides that where such products are imported for their own use by private individuals into a Member State the duty should be charged in the Member State where the goods were acquired. In other words Mr Ekperuoh was entitled to import as much beer as he liked from France if it was imported by him as a private individual and was for his own use and the French duty had been paid. However, the Directive lays down that Member States must take into account, amongst other things, the amount of beer imported when deciding if it is for the importer's own use and allows Member States to set a limit as a guide only and solely as a form of evidence above which the amount will be relevant to the question of own use. Member States are allowed to set that limit no lower than 110 litres in the case of beer and the United Kingdom has set the limit at 110 litres by regulation 15 of the Beer Regulations 1993 and regulation 4 of the Excise Goods (Holding, Movement and REDS) Regulations 1992 (as amended).
- We must therefore decide the issue of own use on the basis that Mr Ekperuoh was entitled to import any quantity of beer for his own use but that we must regard it as relevant, though not a determining factor, that the amount exceeded 110 litres. No grounds for challenging the Commissioners' decision or the review has been advanced other than that the beer was for the appellant's own use. In the case of the van he contended that it was intended to be sold to Nigerian customers and so its seizure will affect his financial position.
- The burden of proof lies upon the appellant in a case like this and we heard no evidence from him but we have read and considered all the documents placed before us including his letters and Notice of Appeal and the note of the interview with him at Coquelles. We find the facts to be as follows.
- Mr Ekperuoh bought the beer in Calais and the van in Belgium and intended to export the van from the UK to Nigeria where he has a business selling second hand vehicles. He paid 600 Euros for the van and £600 for the beer. The duty on the beer in the UK would be £630.11. He had had a lift to Belgium to buy the van and the trip had started on Wednesday 6 September and by midnight on Thursday 7 September he was being questioned at Coquelles. The goods were seized in the early hours of Friday 8 September.
- Mr Ekperuoh first claimed when he was questioned that the beer was for "a party". Later he said it was for his son's ninth birthday party and that it would be in a hall with 300 guests of whom 200 would be adults. Later still he said it would be for about 300 people and then 300-400 and lastly 400 of whom 95% would be adults. He also claimed in the interview that there would be a party for his son during the afternoon and a separate all night party in the hall for the adults.
- He said that his son's birthday was in June and that he had not held the party at that time because he had been in Lagos. He admitted that the hall had not yet been booked on 8 September 2006.
- Apart from a brief mention of a party at Christmas we are quite satisfied that Mr Ekperuoh was putting forward the story that he had bought the beer for his son's birthday party. Although we quite accept that such a party might be extended to friends and family we find that Mr Ekperuoh's contradictory statements grossly exaggerated the numbers of adults involved even if such a party was to be held at all, about which we entertain considerable doubt.
- In addition to the beer in question Mr Ekperuoh said that he would be buying 20 cases of Guinness and 20 bottles of spirits for the party. Such quantities would be quite extraordinary for a child's party unless the numbers of guests involved really would be 300 or 400. Without further evidence or corroboration we simply do not accept the account given in interview.
- Mr Ekperuoh was asked specifically in interview whether he was "fit and well to be interviewed" and he replied "Yes, I am OK". Subsequently he wrote an undated letter which accompanied the Notice of Appeal saying that he had been tired from the journey and lifting the beer and that he was also hungry. He said that this had "contributed to the non co-ordination of my answers". He said that he had told the Customs Officer the truth and that he would have "sourced the money from families to pay the duty". He added: "I have a large family in England and when we celebrate, birthdays, wedding, death etc., we all combine to help each other". He had by then a transcript of the interview and it is referred to in the letter. We note that he said that he had told the truth and so it appears he was standing by his story about the son's birthday and the reference to other parties was a reference to other members of the family contributing to the costs.
- Subsequently, Mr Ekperuoh wrote another letter to HMRC saying "on this very trip I decided to ship two vans from London and to take advantage to purchase alcohol due to the on coming three family celebrations – my son's graduation and birthday – my daughter's sixteenth birthday – two of my nephews christening ceremonies – the rest if not consumed as anticipated would have been shipped with the buses". We find it to be entirely implausible that these other parties would not have been mentioned in the interview if they were the true reason for the purchase of the beer and that their being mentioned in the later letter is a dishonest attempt to persuade HMRC to restore the goods. That, of course, also strengthens the case for saying that Mr Ekperuoh had also been lying when interviewed. Asking ourselves why he might have lied in interview and in that letter leads only to the conclusion that it was because the beer was not for his own use.
- In addition to the above, the figures given in interview by Mr Ekperuoh for his income and expenditure (which involved the maintenance of homes in London and Lagos) make it most unlikely that he would have been able to afford to spend the amount he proposed to spend on the birthday party.
- We find that the beer was not for the appellant's own use and that therefore it was entirely reasonable for HMRC to refuse to restore it. The refusal to restore the van was also entirely reasonable as it had cost less than the duty on the beer. Anyone who risks using a vehicle to attempt to import goods without payment of duty also risks losing the vehicle and usually that rule will reasonably apply even if the value of the vehicle exceeds the duty and the value of the goods. There is nothing disproportionate about refusing to restore the vehicle in the circumstances of this case.
- The appeal is dismissed.
- In view of the appellant's non-appearance Mr Singh sought an award of costs in the sum of £250. This is a case where an award is appropriate because of that non-attendance and the sum sought clearly falls far short of the actual costs incurred by HMRC. We award £250 costs payable to HMRC by the appellant.
E01064
EXCISE DUTY – restoration of goods – beer – own use? – no – appeal dismissed.
EXCISE DUTY RESTORATION OF VEHICLE – forfeited for carriage of excise goods not for own use – reasonableness of non-restoration decision – appeal dismissed.
LONDON TRIBUNAL CENTRE
INNOCENT EKPERUOH Appellant
HER MAJESTY'S REVENUE AND CUSTOMS Respondents
Tribunal: Richard Barlow (Chairman)
Shahwar Sadeque
Sitting in public in London on 27 July 2007.
The Appellant did not appear.
Sarabjit Singh of counsel for the Respondents.
LON/07/8006