United Kingdom VAT & Duties Tribunals (Excise) Decisions

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URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2009/E01163.html
Cite as: [2009] UKVAT(Excise) E01163, [2009] UKVAT(Excise) E1163

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Mr and Mrs W Tucker v Revenue & Customs [2009] UKVAT(Excise) E01163 (16 January 2009)

E01163

EXCISE DUTY- appellants brought in 11.5 kilos of hand rolling tobacco (assorted brands) and 1200 cigarettes – deemed forfeiture – smuggling "not for profit"- appellants own home in Spain – travel by Hymer Motorhome - visits in December, January, February and March - conflicting evidence at interview –– smuggling - respondents acted reasonably - case dismissed.

MANCHESTER TRIBUNAL CENTRE

MR AND MRS W TUCKER Appellants

- and -

THE COMMISSIONERS FOR

HER MAJESTY'S REVENUE AND CUSTOMS Respondents

Tribunal: David S Porter Chairman

Robert G Grice Member

Sitting in public in Birmingham on 12 November 2008

Appellants appeared in person

Mr Vinesh Mandalia of counsel instructed by the acting solicitor for the Commissioners for H M Revenue and Customs, for the Commissioners

DECISION

Mr and Mrs Tucker appeal against the review by Mrs Deborah Hodge contained in a letter dated 10 June 2008 refusing to return the Appellants' goods. The Appellants say that the goods were purchased for their own and their families' use. The Respondents say that as the goods had been declared forfeit under section 139(6) and Schedule 3 of The Customs and Excise Management Act 1979, the Appellants could not claim that the goods were for their own use and as a result the goods should not be returned

Mr Vinesh Mandalia of counsel instructed by the acting solicitor for the Commissioners for H M Revenue and Customs appeared for the Respondents and produced a bundle of documents to the tribunal and called Mrs Deborah Hodge as a witness. The Appellants appeared in person but were represented by their son Jeffrey Tucker.

The facts

Mr Tucker senior and Mrs Hodge both gave evidence under oath. Mr Tucker suffers from angina and the tribunal adjourned half way through the hearing to allow him to recover during the questioning by Mr Mandalia. The Appellants, who are 75 and 70 years old respectively, have a holiday home in Spain, which they visit frequently. Mr Tucker has a pension and £4000 per month from properties that he owns. When in Spain, they stay for 2 to 3 weeks and sometimes longer and they have the use of a Hymer Motorhome which usually they leave in Spain, but appear to travel to and from the United Kingdom in it from time to time. The Appellants were stopped at Portsmouth on 23 March 2008 when they were returning in their Hymer Motorhome from Spain. They declared 11.5 Kilo's of hand rolling tobacco and 1200 cigarettes. In his interview Mr Tucker said that he smoked 10 to 15 cigarettes a day. He had brought in an assorted selection of tobacco as he was going to give it to his family. At the tribunal he alleged that he had bought the cheapest hand rolling tobacco, although it appears that "Amberleaf" is the cheapest brand and this had not been purchased. The evidence given at the interviews was inconstant. In his interview Mr Tucker indicated that his wife would smoke any brand of tobacco but he did not know how many. He was also confused as to the number of times he had been to Spain. At interview his wife said that she did not smoke, she had bought the embassy cigarettes for her daughter-in-law but she did not know who her husband had bought the drum for. She also indicated that her husband did not smoke much and that he was not allowed to smoke in the house. Mrs Tucker had given greater detail of their various trips and Mr Tucker's son produced to the tribunal a list of the visits as follows:-

Date Sailing Vehicle Ferry Time

i. 21/07/2005 Dover to Calais Hymer Motorhome 0600 Hrs

ii. 16/01/2007 Dover to Dunkirk Hymer Motorhome 04.16 Hrs

iii. 29/03/2007 Dover to Dunkirk Citroen Picasso 0600 Hrs

iv. 29/03/2007 Dunkirk to Dover Citroen Picasso 1600 Hrs

v. 29/03/2007 Calais to Dover Hymer Motorhome 2100 Hrs

vi. 09/08/2007 Portsmouth to Bilbao Hymer Motorhome 2115 Hrs

vii. 27/08/2007 Dunkirk to Dover Hymer Motorhome 0156 Hrs

viii. 01/10/2007 Dover to Calais Hymer Motorhome 0640 Hrs

ix. 02/10/2007 Calais to Dover Hymer Motorhome 1830 Hrs

x. 08/10/2007 Calais to Dover Citroen Picasso 1735 Hrs

xi. 20/10/2007 Portsmouth to Bilbao Hymer Motorhome 2115 Hrs

xii. 04/12/2007 Portsmouth to Bilbao Hymer Motorhome 1315 Hrs

xiii. 22/032/2008Portsmouth to Bilbao Hymer Motorhome 1315 Hrs

Mr Tucker could not recall on how many occasions he had been stopped by Customs and Excise but he agreed he was stopped on 29/03/2007. He said that he did not consider he was "stopped" then as he was allowed to continue without any difficulty. On 29/03/2007 he had travelled to Belgium to pick up the new Hymer Motorhome, hence the use of his friends' Citroen. It transpired at the hearing that the Appellants had also travelled to Spain in December 2007, January, February and March 2008. Upon their arrival in Portsmouth on 23 March 2008 the Appellants' Hymer Motorhome and goods were seized. The Hymer Motorhome was subsequently returned to the Appellants when they paid a restoration fee of £1,349. Mr Manadlia called Mrs Hodge and confirmed that her witness statement setting out the facts in her review letter should stand as her evidence in chief.

The Law

Condemnation proceedings

Section 139(6) of the Customs and Excise Management Act 1979

Schedule 3 to this Act shall have effect for the purpose of forfeitures, and of proceedings for the condemnation of any thing as being forfeited, under the customs and excise Acts.

Schedule 3

3. Any person claiming that any thing seized as liable to forfeiture is not so liable shall, within one month of the date of the notice of seizure or, where no such notice has been served on him, within one month of the date of the seizure, give notice of his/her claim in writing to the Commissioners at any office of customs and excise.

5. If on the expiration of the relevant period under paragraph 3 above for the giving of notice of claim in respect of any thing no such notice has been given to the Commissioners, or if, in the case of any such notice given, any requirement of paragraph 4 above is not complied with, the thing in question shall be deemed to have been duly condemned as forfeited.

6. Where notice of claim in respect of any thing is duly given in accordance with paragraphs 3 and 4 above, the Commissioners shall take proceedings for the condemnation of that thing by the court, and if the court finds that the thing was at the time of seizure liable to forfeiture the court shall condemn it as forfeited.

7. Where any thing is in accordance with either of paragraphs 5 or 6 above condemned or deemed to have been condemned as forfeited, then, without prejudice to any delivery up or sale of the thing by the Commissioners under paragraph 16 below, the forfeiture shall have effect as from the date when the liability to forfeiture arose.

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.

Section 170 CEMA 1979 provides that

"(1) Without prejudice to any other provision of the Customs and Excise Acts 1979, if any person-

(a) knowingly acquires possession of any of the following goods, that is to say –

i. goods which have been unlawfully removed from a warehouse or Queen's warehouse

ii. goods which are chargeable with a duty which has not been paid

iii. goods with respect to the importation or exportation of which any prohibition or restriction is for the time being in force under or by virtue of any enactment: or

(b) is in any way knowingly concerned in carrying, removing, depositing, harbouring, keeping or concealing or in any manner dealing with any such goods

and does so with intent to defraud her Majesty of any duty payable on the goods or to evade such prohibitions or restrictions with respect to the goods shall be guilty of an offence under this section and may be [arrested]

(2) ..if any person is, in relation to any goods, in any way knowingly concerned in any fraudulent evasion or attempt at evasion-

(a) of any duty chargeable on the goods

49 (b) of any prohibition or restriction for the time being in force with respect to the goods…; or

(c) of any provision of the Customs and Excise Acts to the goods,

He shall be guilty of an offence…"

Submissions

Mr Manadalia told the tribunal that the Appellants had been given a Customs booklet entitled " What you can do if things are seized by Customs" and Mr Tucker had requested that the matter be referred to the Magistrates Court. He had subsequently withdrawn his request for a hearing on the basis that he and his wife were too infirm and upset to attend a hearing presumably to be held in Portsmouth. We do not accept that the Appellants had a reasonable reason for not pursuing their request to the Magistrates Court. The Appellants appear to be able to travel in their Hymer Motorhome to and from Spain without any great hardship. No evidence was produced as to the hearing at the Magistrates' Court nor of any the judgment and we therefore assume it did not take place. Mr Mandalia submitted that as the application to the Magistrates Court was not pursued by the Appellants the goods were deemed to be forfeited under section 139(6) (5) and it was no longer possible for the Appellants to allege that the goods were purchased for their own use. Whether the case was heard or not the legislation requires us to accept that the goods are deemed forfeit and it is therefore not open to the Appellants to allege that the goods were purchased for their own use. Mr Mandalia pointed out that there were several inconsistencies in the interviews. Neither party appeared to know how much the other smoked; Mr Tucker was unclear how often he travelled to Spain but even on his own evidence it was at least once a month; it was not unreasonable to assume that as the Appellants had brought back a variety of tobacco they must have done so to sell it. If, as they stated, they merely intended to buy the cheapest tobacco available, they would have y brought back only one brand. As the car had been restored to them on payment of £1349 and the goods were deemed forfeited the reviewing officer had acted reasonably.

Mr Tucker submitted that as they had owned the house in Spain for over 30 years and that they had many friends there. They went out frequently as they could afford to do so. He took exception to the suggestion that they were smugglers. If they flew back they only had a limited space. When they did buy tobacco and cigarettes it was so that they could share them round the family. The reviewing Officer had acted unreasonably and the vehicle should have been returned to them together with the goods without any penalty.

The decision

We have considered the facts and the law and we are satisfied that the Reviewing Officer acted reasonably and proportionately in returning the Hymer Motorhome on the payment of £1395 and in not returning the goods. The evidence given by Mr Tucker was contradictory and unsatisfactory. We consider that it is unlikely that he would purchase such a large quantity of assorted brands of tobacco if he was to supply them only to his family. Mr and Mrs Tucker travelled to Spain on a regular basis and have returned with a substantial quantity of tobacco on 23 March 2008. It is not unreasonable for the Reviewing Officer to take the view that it is likely that similar amounts of tobacco have been brought in on other occasions. This is particularly so due to the frequency of the visits and the size of vehicle involved. It is, however, proportionate that Mr and Mrs Tucker should have to pay the equivalent of the lost duty for the return of the Hymer Motorhome. The Hymer Motorhome is valued at £65,000 and the duty at £1395. This is an appropriate response under the policy of Customs and Excise as to the returning of vehicles.

Mr Mandalia produced to the tribunal a copy dated April 2006 of Notice 12 A, whilst, he indicated that the notice was clear, we cannot agree. In any event we believe that the notice has been updated and that the notice shown to the tribunal is the wrong one. Comment has been made in the past by Chairmen as to the content of the notice. This is not least because it has to be read by a variety of people at a time of stress. It seems to us that in adopting (perhaps of necessity) the words "seized" and "restoration" the pamphlet still leads to confusion.

Chairmen have in the past taken the view that where there has been a failure on the part of an Appellant to apply to the Magistrates' Court and there has been no court hearing so that the goods are "deemed forfeit" then the Tribunal can consider all the facts, including whether the goods have been purchased for the Appellant's own use. This has been on the basis that such evidence has not been ventilated and can be properly ventilated before the tribunal. Mr Justice Richards in the Commissioners of Her Majesty's Revenue and Customs v David Mansel Dawkin CH/2007/APP/0323) states:

" In my judgment, this (the failure to take into account evidence as to the purchase of the goods for his own use) discloses a significant misapprehension on the part of the Tribunal. The prima facie position of HMRC is the same as that of the Tribunal. They are bound by the deeming effect of section 5 of schedule 3 of CEMA. However, where it would be an abuse of process for the importer to raise the issue as to whether he imported the goods for his own use, HMRC like the Tribunal is bound to consider it. Unless it would be an abuse of process it cannot be a ground of criticism of HMRC or a factoring favour of permitting the importer to raise the issue before the Tribunal that HMRC did not consider it on the review. There may be exceptional cases, such as the existence of incontrovertible evidence that the goods were for the importers own use, which would require the reviewing officer to consider the issue, but this is not the present case."

As a result we accept Mr Mandalia's submission that it is not open to the Tribunal to hear evidence as to "own use". The consequence of that is that the goods cannot be returned to the Appellants as they are deemed forfeit. The only basis on which the vehicle can be returned is t on proportionality. It would be disproportionate for a vehicle worth £65,000 to be retained by Customs when the duty evaded is only £1395. We therefore find that the Reeviewing Officer acted reasonably in not restoring the goods and in restoring the vehicle on payment of £1395 and we dismiss the appeal.

As the Respondents made no request for costs none are awarded.

DAVID S. PORTER

CHAIRMAN
Release Date: 16 January 2009

MAN/08/8080