United Kingdom VAT & Duties Tribunals (Excise) Decisions

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Cite as: [2007] UKVAT(Excise) E01075, [2007] UKVAT(Excise) E1075

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Sayed Marjid Mashhadi Abbasi v Revenue & Customs [2007] UKVAT(Excise) E01075 (13 November 2007)

E01075

Customs and Excise –request for return of vehicle- 18,160 cigarettes– 27.69 litres of beer – 2.7 litres of spirits- failure to disclose when stopped – Iranian cigarettes – alleged purchase outside European Community – not agreed - appellant smuggling - request for review refused - appeal dismissed

MANCHESTER TRIBUNAL CENTRE

SAYED MARJID MASHHADI ABBASI Appellant

- and -

THE COMMISSIONERS FOR

HER MAJESTY'S REVENUE AND CUSTOMS Respondents

Tribunal: David S Porter (Chairman)

Mary C Ainsworth

Sitting in public in Manchester on 27 September 2007

The Appellant in person

Ms Katherine Jones of counsel, instructed by Acting Solicitor for HM Revenue and Customs for the Respondents

© CROWN COPYRIGHT 2007

DECISION

Sayed Majid Mashhadi Abassi ("the Appellant) requested a review of the decision of the Commissioners contained a letter dated 8 March 2007 in which they refused to restore his vehicle ("the vehicle") a "VW Passat" registration number MT 52 AZR. The Appellant alleges that the 18,160 cigarettes were for family and friends who would pay for them but with no profit to himself. Further, he was now suffering hardship as he was not able to take up a job as a taxi driver without his car. The Commissioners say that he was smuggling and they had acted reasonably in not restoring the vehicle.

The Appellant appeared in person and Mrs Katherine Jones appeared for the Commissioners and produced a bundle of documents for the Tribunal. She called Mrs Deborah Gillespie the reviewing officer

The Facts

The Appellant lives at Blackley Manchester and is not currently working. He is in receipt of benefit. He originally worked as a fabricator and welder. Whilst he was employed he borrowed £20,000 from the Bank. He bought his car, a VW Passat, for £10,000 and used the balance of the money to repay the debt to the bank and for his everyday living expenses until he was able to get another job. At the time of the hearing he still owed the Bank £15,000 approximately, he had stopped making his repayments as he could no longer afford them. He appeared to have an additional overdraft facility, which at the time of the hearing was £3,300. It was unclear whether this was part of the original loan or additional to it.

He was hoping to become a taxi driver and he had obtained a certificate to confirm that he could work as such but the firm he approached for employment would not employ him until he knew his way around the Manchester area. He said that he needed his car to finish that training. His evidence was far from clear. The Appellant said that he did not know his way round Manchester and that he would only be employed when he did. He produced a letter to the tribunal from his intended employer, which stated that he would be employed by them if he got his car back. This was inconsistent with his evidence that he had not finalised his training

On the occasion of the seizure the Appellant said that he went to London to see some people whom he had not seen for many years. He then drove from London to Dover on the same day and took the ferry across to Calais. He was going to buy some shampoo and tablets for his hair. It would appear that he spent 130 euros on those goods. On his way back from the Pharmacy the Appellant met a fellow Iranian. The man sold him 18,160 mixed Iranian brand cigarettes at a very favourable price. It is unclear where the sale took place but it would appear to have been on the street and not from a shop. At the hearing the Appellant alleged that he had bought the cigarettes for his family but he did not give any evidence as to who they were and how many people were involved.

Ms Jones submitted that as the cigarettes were Iranian, a country outside the European Community, and no duty had been paid, the European rules did not apply. The chairman conceded that it might well be that no duty had been paid on the cigarettes but unless evidence could be produced to that effect he would assume that French duty had been paid. The fact that they were cheap did not necessarily mean that they were contraband.

The Appellant also bought 27.60 Litres of beer at another supermarket on his way back from Calais. He spent in excess of £1500 including his fares. He drew cash from a machine in Calais on his credit card against his overdraft facility to pay for the goods whilst he was in Calais. When he returned to Dover he was stopped by Customs. He told them that he had bought some shampoo but did not declare the other goods. He said that he did not declare them because he knew he had too large a quantity. The goods and his car were seized and he was handed a copy of Notice 12A which told him what he should do if "Goods and/or vehicles are seized by Customs and Excise". He did not understand the booklet and went to the Citizens Advice Bureau for assistance. A letter was drafted for him, saying that he wanted his car back. The Citizens Advice Bureau did not understand the distinction between an application to the Magistrates Court in condemnation proceedings, and an application to this tribunal for a review. Suffice it to say that condemnation proceedings were not taken and as the Appellant had not applied for the same within one month the Commissioners took the view that the goods were condemned.

Deborah Gillespie, the reviewing office, gave evidence under oath. She confirmed that the other car at the Appellant's address belonged to the Appellant's brother. The Appellant's car was valued at £5,000 at the time of the seizure and the duty payable was £2,685.

The law

The Excise Goods, Beer and Tobacco Products (Amendment) Regulations 2002 and The Tobacco Products Regulations 2001:

"(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 commercial purpose by any person."

….

(a) "own use" includes as a personal gift,

(b) If the goods in question are-

transferred to another person for money or money's worth (including any reimbursement of expenses incurred in connection with obtaining them), or

the person holding them intends to make such a transfer,

those goods are regarded as being held for commercial purpose

(d) if the goods are not duty paid and tax paid in the member state at the item of acquisition, or the duty and tax that was paid will be or has been reimbursed, refunded or otherwise dispensed with, those goods are to be regarded as being held for commercial purposes

(c) without prejudice to sub-paragraphs (c) and (d) above, in determining whether excise goods are held or used for commercial purposes by any person regard shall be taken of –

that person's reasons for having possession or control of those products

whether or not that person is a revenue trader (as defined by section 1(1) of the customs and Excise Management Act 1979)

that person's conduct, including his intended use of the products,

the location of the products,

the mode of transport used to convey those products

any document or other information whatsoever relating to those products

the nature of those products including the nature and condition of any package or container

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 grams each)

200 cigars

3 Kilograms of any other tobacco product

(ix) whether that person personally financed the purchase of those products

(x) any other circumstance that appears to be relevant

Section 141 CEMA 1979 provides as follows:

"(1) … where anything has become liable to forfeiture under the Customs and Excise Acts –

(a) any ship, aircraft, vehicle…which has been used for the carriage handling , deposit … of the thing so liable for forfeiture … and

(b) … any other thing mixed, packed or found with the thing so liable shall also be liable to forfeiture.

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, any thing forfeited or seized.

The submissions

Ms Jones submitted that the cigarettes were an Iranian brand and, as they had been purchased outside of the European Community, there had been no requirement for the interviewing officer to read the commerciality statement, nor to check whether the goods had been bought by the Appellant for his own use. The cigarettes had been purchased in dubious circumstances. It is unlikely that the Appellant could have smoked them himself and in the light of his perilous financial circumstances he must have intended to sell them. He had lied to the officer when asked what he had purchased. It would appear from the evidence that the Appellant could not work as a taxi driver as he had not finished his training. The Appellant had been a welder and could obtain another job. When his car was seized he was given the appropriate booklet and consulted the Citizens Advice Bureau. He had not asked for condemnation proceedings and as a result the vehicle was deemed forfeited. The Commissioners had acted reasonably in not returning the vehicle and the case should be dismissed.

The Appellant, when questioned, insisted that he needed his car so that he could work as a taxi driver. He needed to work to pay off his loan to the Bank. He now knew his way around Manchester and on the return of the vehicle he would be able to work as a taxi driver.

The decision

We dismiss the appeal. We consider that the reviewing officer acted reasonably in not returning the vehicle. Ms Jones and the officer at Dover have taken the view that as the cigarettes were Iranian then the usual defences available to European travellers are not available to the Appellant because the goods come from outside the European Community. Whilst we have some sympathy with that view, we are unable to agree as no evidence was deduced as to whether French duty had been paid the cigarettes. Without that evidence we have to assume that they had been properly imported in to France. We are therefore of the opinion that we can consider whether the goods were purchased for the Appellant's own use. The Magistrates Court never heard the condemnation proceedings, so that the Appellant's evidence as to the purchase for his own use was never ventilated, as the seizure was deemed to have occurred. This does not, however, help the Appellant. We found his evidence unsatisfactory. We cannot believe that an individual in his financial position (and on benefit) could possible go to Calais to buy a large quantity of cigarettes for any other reason than to sell them, particularly as he omitted to declare the purchase initially. The Appellant gave no evidence as to his smoking habits, nor could he give us any of the names of the relatives for whom he had ostensibly purchased the cigarettes. His evidence as to his taxi training was far from clear. We do not believe that if he recovered his car he would then have obtained a job as a taxi driver. Not only did he not appear to know his way around Manchester, but he could not even recall the address he went to in London. An unusual admission from someone who believes he is qualified to be a taxi driver. There is no hardship in our view as the Appellant apparently has skills as a welder and fabricator and could therefore return to this trade if he chose to. We do not require a further review for the return of the vehicle. Its value was £5,000 at the time of the seizure and the duty avoided was £2,685. In those circumstances the seizure would be proportionate. We therefore dismiss the appeal but award no costs as the Commissioners required none.

DAVID S PORTER

CHAIRMAN
Release Date: 13 November 2007

MAN/07/8030