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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 >> Cameron (t/a Carwise v Revenue & Customs [2008] UKVAT(Excise) E01104 (04 April 2008)
URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2008/E01104.html
Cite as: [2008] UKVAT(Excise) E1104, [2008] UKVAT(Excise) E01104
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- "This was not the only vehicle found fuelled with rebated fuel. 2 other vehicles in his yard were found fuelled with rebated fuel.
- He stated that [he] receives rebated fuel from an Irish guy who he cannot contact and who just turns up. He pays for this in cash and does not receive any documentation, even though he spends £110 for 300 litres. He does not record these purchases in his books. This would suggest that he was knowingly obtaining this gas oil unlawfully. As 3 of his vehicles were found fuelled with rebated fuel, I must conclude that he fuelled the vehicles from this source.
- The vehicle was owned by Mr Cameron. It was his responsibility to ensure his vehicles were lawfully fuelled. Rebated fuel was found in his vehicle and he keeps a supply of rebated fuel on his premises.
- When interviewed and in his letter of appeal he states that the vehicle had not been used since he obtained it. In his letter of appeal he states that when he obtained the vehicle it had been driven 68,467 miles. However, when Customs checked the odometer on 23 February 2007, this read 68,476 miles. The vehicle had therefore been driven a total of 9 miles while in his possession".
E01104
Excise duty: vehicle containing some rebated fuel on Appellant's garage premises – whether "fuelled" or "used", circumstances in which neither held to be correct: time of appeal, "one month" restricted to calendar month: whether in circumstances review officer had the appearance of impartiality, having had previous acquaintance with facts in the case; whether "charge" for removal and storage justified or established: Appeal allowed.
EDINBURGH TRIBUNAL CENTRE
ALAN CAMERON
T/A CARWISE Appellant
- and -
THE COMMISSIONERS FOR
HER MAJESTY'S REVENUE & CUSTOMS Respondents
Tribunal: (Chairman): T Gordon Coutts, QC
(Member): Miss Karen Bruce Lockhart, WS
for the Appellant Mr Alan Cameron
for the Respondents Mr Nigel Clive
© CROWN COPYRIGHT 2008.
Introductory
This appeal is against a review of a decision by a review officer conducted under Section 14 of the Finance Act 1994 in relation to the restoration terms demanded for the Appellants vehicle V914 HGD (erroneously described as KY1 2NW in the Statement of Case). That review was partially successful but only in respect that the Appellant had illegitimately been asked for £960 whereas the maximum components of the fee according to customs policy, as explained to us, was £940.
The Appellant gave evidence, producing a written account of his various points and complaints and the review officer also gave evidence, he was Mr Ian Sked. Mr Sked had produced a witness statement but nothing turned on that because he gave physical evidence before the Tribunal. The Appellant suffered the obvious disadvantage of appearing as a party litigant and being opposed by an English Barrister. However the Tribunal were satisfied that the Appellant had provided them with all the points which could be made on the facts albeit his understanding of the law and his approach to advocacy in that regard was somewhat deficient.
The Facts
The Respondents, we were told, received an anonymous piece of information which according to the Statement of Case, and Mr Sked's statement, claimed that the Appellant was fuelling customers cars with red diesel for £35 per 50 litres and offering this service to all customers who buy diesel cars. What was not disclosed in the Statement of Case was that the anonymous information also claimed that the Appellant was trading in tobacco products from those premises. The Tribunal did not receive a note detailing the information or its date but it resulted in a full-scale 'raid' on the premises of the Appellant. Those premises were within a small industrial estate. The Appellants address there was 61R St Clair Street, Kirkcaldy.
The Respondents arrived at the industrial estate with 3 vans and 6 officers. Two of those officers were attached to the Road Fuel Unit at Dundee the others originated from what was described in the officers notebook, produced, as Edinburgh MTF. Having blocked off the entry to the estate the MTF Team searched the Appellants premises and the vehicles therein. They found no bootleg goods. In relation to rebated fuel were directed by the Appellant to what was described as a 1000 litre container by the Respondents and as a 900 litre plastic tank by the Appellant. That tank was described by the officer in his notebook as "near empty" and as having about 1 litre in it by the Appellant. The contents of that tank were never tested.
The officers were described in Mr Sked's statement as challenging 3 vehicles on the premises. That was inaccurate. They challenged 7 diesel vehicles 4 of which were innocent of any rebated fuel, 2 others which were exempt, (one of those was erroneously described as being registered R211 7KP an impossible registration number) and the Peugeot Vehicle V914 HGD. It did not bear a tax disc and in it traces of euromarker were found but in an insufficient quantity of fuel to test for the chemical markers.
In addition the officers continued their investigating activities testing various vehicles entering the premises. These were all negative.
It appears that officer Abercrombie then consulted with superior officers and the result of that consultation was that he was instructed to uplift the Peugeot Vehicle. No satisfactory reason was given to the Tribunal as to why that uplift was considered to be necessary in the whole circumstances.
Mr Cameron, who was much incensed by the whole proceedings, regarded that and the subsequent conduct of the Respondents hereafter noted as being motivated by their disappointment at finding no evidence that the Appellant was trading in either diesel fuel or bootleg goods contrary to the anonymous information. In the light of subsequent events there is colourable support for that view of Mr Cameron's.
The Appellant was asked to produce his records, which he did the next working day at Dundee. His vehicle was removed, he thought, to Paisley.
The Appellant when seeking the return of his vehicle achieved nothing and on 23 March 2007 wrote to Mr Sked, with whose name he had obviously been supplied seeking to appeal the seizure of the vehicle. That letter of appeal narrates the various circumstances the Appellant was founding upon at that time. That letter was not however received by the Respondents until 28 March more than one month after the seizure on 23 February.
By letter dated 13 April 2007 Mr Sked refused the appeal as being out of time but proceeded to expatiate upon the circumstances of the event and, of course, had read the Appellant's appeal letter. Mr Sked in that letter, read fairly, expressed a view that the vehicle was liable to forfeiture and had been fuelled with rebated fuel.
The Appellant considered that his letter was not out of time in that he had sent it off within 30 days of the seizure, his interpretation of the word 'month' in the legislation. The matter however is quite clear. Although 'month' is used in several circumstances reference to a month in a statute is to be understood as a calendar month. Lord Diplock in Dodd v Walker [1981] 2AER 609 at 610 said "it is well established that when the relevant period is a month after the giving of a notice the general rule is that the period ends on the corresponding date in the appropriate subsequent month i.e. the day of that month that bears the same number as the day of the earlier month on which the notice was given". Unfortunately for him therefore Mr Cameron missed the deadline and his appeal was correctly rejected as out of time.
The letter from Mr Sked promised that the Appellant would be contacted about restoration of the vehicle "shortly".
Documents were produced to the Tribunal, late, on the morning of the continued hearing. These contained fuel receipts but for sales to a different trader at the same industrial estate. They would appear to be for rebated fuel bought from "Brogan fuels". There was also, however, produced a letter from the Appellant to the Respondents' Mr Villiers at the Central Excise District, Grangemouth relating to an assessment of £4909 purporting to relate to the Peugeot Vehicle, 'and associated vehicles' over a period in which Mr Cameron did not own the Peugeot motor car in any event. Such a demand added colour to Mr Cameron's view that the Respondents were motivated by pique. Unsurprisingly the Appellant sought a review. This we infer did not take place. Instead the Appellant was contacted with an offer of restoration but not until 2 July 2007. On 10 July 2007 he requested the review above mentioned.
Before entering upon the detail of that review and a consideration of its merits, it is appropriate to note that the Appellant at the time objected to Mr Sked dealing with the review on the ground that he was not "impartial". He founded upon the said letter of 13 April with its addendum which indicated that, at least, Mr Sked had material detail in connection with the case before him prior to his undertaking the review. Mr Sked said he was independent of the act of seizure or the offer of restoration and while that may be so in relation to the seizure it has been often stressed that impartiality requires to be considered as a matter of appearance as well as of fact. Having had previous contact with detail of the case as it was then outlined by the Appellant and having expressed views on the applicability of the legislation and its effect Mr Sked did not in the opinion of this Tribunal have the necessary appearance of impartiality. It also requires to be borne in mind that the whole of the review procedure under the statute takes place before employees of the Respondent and therefore might in any event be argued to suffer from the defect of apparent bias as an inherent fault of the whole procedure. It is in the view of this Tribunal necessary that a review officer should be entirely independent of previous contact with the case. This appearance of a lack of impartiality tends to be reinforced by the way in which the review was conducted and the factors disclosed to have been taken into account of which see below.
Matters founded upon by review officer
It should be noted before embarking on a discussion of these matters that the Tribunal was given no evidence as to fact from the Respondents apart from the production of notebooks and the Appellants own documents. In particular they did not hear from Mr Abercrombie or any other officer despite the fact that there was a clear conflict of evidence to be resolved before the Tribunal in relation to the mileage covered by the vehicle.
It requires to be noted that on a previous occasion this appeal required to be postponed because of the non-attendance of any representative of the Respondents capable of conducting the case. It was apparent to the Tribunal then that the above conflict of evidence required to be resolved and a note was issued to all parties in the following terms:
"This appeal which was set down for 7 January 2008 at 10am convened and the Appellant attended. Also in attendance were Mr Sked and Mr Anderson and Ms Samson of the Respondents. One hour prior to the commencement of the Hearing the Tribunal received by telephone from Manchester intimation that the Respondents representative was unable to attend, he having been admitted to hospital. In the event there was no person who was able to conduct the appeal for the Respondents.
The Tribunal is concerned that this is a result of the Respondents practice in Excise Appeals of instructing English Barristers to appear in Edinburgh instead of the locally available network. Had the Respondents instructed their usual representatives here the diet might have been saved. The Respondents are, of course, entitled to instruct whom they will but it is necessary for them to consider the default situation. If a Barrister is instructed to appear a Solicitor is customarily instructed with him. In the result the Tribunal was unable to deal with the matter on the day.
The Hearing is accordingly adjourned to a date to be fixed at which the Respondents should ascertain that they can be represented, even if the only function of a representative is to ask for a discharge of the Hearing.
The matter of expenses in the whole circumstances is expressly reserved. It is not the fault of the Appellant that his appeal has not been able to proceed.
Taking advantage of the presence of the Appellant the Tribunal sought clarification of the discrepancy in recorded mileages on the vehicle in question. The Appellant clarified his position. He was adamant that his figure of 68467 miles was correct and that the figure provided by the Respondents of 68476 was an error, perhaps a transposition of the final two figures. That matter will have to be clarified at the subsequent Hearing".
The Appellant's evidence
The Appellant has all along contended and stressed that the vehicle had been obtained by him as a trade-in, at a price of £2000, that it had been placed in his yard; that it had not been moved; that it carried no tax disc and that by the end of January had no MoT Certificate. He said that he had not put any fuel of any kind in the tank of the car that there was virtually no fuel in it in any event, and that the vehicle had not been used after it had been placed in his premises. He did not know that there was any rebated fuel in it but in any event did not appear to be particularly concerned because he thought, erroneously, that if the vehicle could not legally be driven on the road it should be considered as excepted.
The only evidence in relation to the taking in of fuel consisted in the presence of the fuel when tested. There was no evidence whatsoever of any actual taking in of fuel. Similarly there was no direct evidence which the Tribunal could accept that the vehicle had been used whether on the road or elsewhere by the Appellant.
After overall consideration the Tribunal was not prepared to hold that the Appellant was incredible and can, generally, accept his evidence.
Matters founded upon by the Respondent at the Tribunal
When summarising his response to the Appellant's claim that he had a reasonable excuse in that he did not fuel the vehicle with rebated fuel and was the victim of "somebody else's dirty deed" and that the vehicle had not been used since it came into his possession the officer concluded in writing,
In addition officer Sked before the Tribunal, but not disclosed in his letter or Statement of Case, referred to the Brogan receipts for fuel. He also produced parts of a notebook and a schedule of seizure showing the condition of the Peugeot Vehicle and containing with a view to demonstrating the odometer reading of 68476. Such evidence though admissible, is hearsay and despite the warning of the critical difference in the readings noted by the Tribunal, no direct evidence was led on that matter. The only direct evidence was the Appellant's.
Mr Sked's evidence in relation to the challenged charges was merely to repeat what he said was "customs policy" which, he said applied in this case to "commercial" cases. That distinction did not seem a relevant consideration to the Tribunal, whatever it may mean. No other attempt was made to justify any of the charges levied in the matter.
Findings and Decision
The Tribunal found that the only result of a massive exercise sparked off by anonymous information was that the Peugeot Vehicle was found to have a small quantity of rebated fuel in its tank. The vehicle had a few days of excise licence still valid which licence was not in fact displayed. Its MoT Certificate had expired.
There was no evidence acceptable to the Tribunal to establish that the Appellant had either fuelled or used the Peugeot Vehicle with rebated fuel.
The vehicle was taken in to his garage but the fuel tank was not checked by the Appellant. His plan was to clean out the fuel system and check it prior to a sale as he normally did. Without an MoT Certificate (and in a matter of days a valid licence) the vehicle could not be used, legally, on the road. Indeed there would be no opportunity for any test drive of the vehicle at the date of the seizure since it was not the subject of a valid MoT Certificate.
We find that there was no urgent necessity, if indeed any necessity at all for the removal of the vehicle. It would have been reasonable to offer any restoration opportunity without requiring to incur the charges which were subsequently levied. Indeed if the uplift and the length of time the vehicle was allegedly stored were, as maintained, a limited claim, then there must have been substantial storage costs incurred by the Respondents prior to restoration.
The Tribunal found little satisfactory evidence, indeed from either side in the matter and considered whether the Respondents should win as a matter of onus of proof. However since the Appellant did not appear to the Tribunal to be dishonest in his evidence they felt that he had done sufficient to discharge any onus upon him.
With reference to the various matters discussed and founded upon by the Respondent's Mr Sked in his correspondence the Tribunal were of the view that he had had regard to matters which were not relevant in forming his view. In particular it is not relevant that other vehicles in the garage were or might have been found to have rebated fuel. They were entitled to do so as exempt vehicles. No inference can properly be drawn from that. In addition Mr Sked failed to take account of the fact that there were other vehicles tested, and did not mention that in his statement, which were wholly innocent of rebated fuel. Further whether or not some other concern obtained rebated fuel in the same industrial estate as the Appellant cannot give rise to any inference. Moreover the presence of rebated fuel in the Appellants premises does not lead to a necessary inference that it was used to fuel road vehicles.
Accordingly the Tribunal finds the decision in the review letter to be insufficiently supported.
In addition they found no evidence to support the use of the vehicle or indeed any actual fuelling by the Appellant.
In these circumstances given that the Appellant was a garage that dealt in second-hand vehicles that such vehicles could have rebated fuel in the tanks at some stage without the Appellant having put it there affords the reasonable excuse envisaged by Section 10 of the Finance Act 1994.
The matter does not however end there because the Tribunal were given no satisfactory evidence of the charges for removal if it had been justified or the storage the charge for which was wholly unsupported both as to amount and length of time. The matter of charges is not one which transfers onus onto the Appellant and if charges are to be made they in view of this Tribunal require to be justified and supported. "Customs policy" does not support a charge based as it is on specific events, lengths of time and alleged costs.
Since the proceedings before the Tribunal must be regarded as "ancillary matters" in terms of the Finance Act 1994 Section 16(4) the Tribunal have to be and are satisfied that the Commissioners could not reasonably have arrived at the decision under scrutiny. Since the decision has been made and payment made thereunder it is not appropriate to direct that it cease to have effect under sub paragraph (a) and accordingly the Tribunal can only in terms of (b) require the Commissioners to conduct a further review of the original decision but that review requires to be conducted in accordance with the Tribunals directions which are:
that the Appellant had reasonable excuse for the presence of rebated fuel in the vehicle V914 HGD. Accordingly none of the charges or fines would be applicable;
the Tribunal also directs, so far as it is necessary to do so, that the storage and removal charges were not sufficiently supported to entitle their recovery and further, on their findings of fact that a £250 restoration fee alleged to be commensurate with the fine for using the vehicle is inappropriate.
On the whole matter therefore the appeal succeeds.
The Appellant sought expenses. Since he appeared as a party only out of pocket expenses are appropriate. We fix an award of £100 in that regard utilising the power conferred by Rule 29(1)(a). That sum represents £50 in respect of each Hearing.
EDN/07/8013