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United Kingdom Upper Tribunal (Tax and Chancery Chamber) |
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You are here: BAILII >> Databases >> United Kingdom Upper Tribunal (Tax and Chancery Chamber) >> Ali v Commissioners for His Majesty's Revenue and Customs (EXCISE DUTY - assessment in respect of duty unpaid tobacco) [2024] UKUT 176 (TCC) (18 June 2024) URL: http://www.bailii.org/uk/cases/UKUT/TCC/2024/176.html Cite as: [2024] UKUT 176 (TCC) |
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(Tax and Chancery Chamber)
Judgment Date: 18 June 2024 |
B e f o r e :
JUDGE MARK BALDWIN
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QAIS MAJEED ALI |
Appellant |
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- and - |
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THE COMMISSIONERS FOR HIS MAJESTY'S REVENUE AND CUSTOMS |
Respondents |
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For the Appellant: Mr Ali, the Appellant
For the Respondents: Rupert Davies, Counsel, instructed by the General Counsel and Solicitor to His Majesty's Revenue and Customs
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Crown Copyright ©
EXCISE DUTY – assessment in respect of duty unpaid tobacco – whether FTT erred in relation to whether earlier duty point could be established – yes but error immaterial as insufficient evidence in respect of which identity of person liable to duty could be established - whether FTT erred in concluding Appellant "holding" the tobacco and in failing to give sufficient reasons – no – appeal dismissed
Introduction
Law
"6(1) Excise goods are released for consumption in the United Kingdom at the time when the goods-
…
(b) are held outside a duty suspension arrangement and UK excise duty on those goods has not been paid, relieved, remitted or deferred under a duty deferment arrangement;
…"
"(1) The person liable to pay the duty when excise goods are released for consumption by virtue of regulation 6(1)(b) (holding of excise goods outside a duty suspension arrangement) is the person holding the excise goods at that time. "
Case-law
Assessment of earlier duty point
(1) Who had physical possession at the time the alleged earlier excise duty point occurred?
(2) Who is the person alleged to have de facto or legal control over the goods who it is said should be assessed rather than the subsequent holder and how that person is said to have such control and the basis on which it was being exercised?
(3) The time at which the excise duty point arose. (The Upper Tribunal's view was that the date of an invoice was not sufficient in itself without establishing who was in possession of the goods at some identified point or points in time.)
(4) Where the goods were being held at the relevant time.
Meaning of "holding" in the Regulations?
"…a person who transports, on behalf of others, excise goods to another Member State, and who is in physical possession of those goods at the moment when they have become chargeable to the corresponding excise duty, is liable for that excise duty, under that provision, even if that person has no right to or interest in those goods and is not aware that they are subject to excise duty or, if so aware, is not aware that they have become chargeable to the corresponding excise duty."
FTT Decision and background
"The current business at those premises has been in occupation only since February 2017; the previous occupant is no longer in the UK."
"The appellant did not dispute that he had physical possession of the tobacco, both with regard to the tobacco in the unit and in the van. Although the appellant argued in the hearing that he was simply a driver for Palm Palace, he also agreed in the hearing that he was responsible for the lock up unit and van and that he had purchased the tobacco which was stored in the unit, some of which he was transferring to the van at the time of the seizure."
"31. We considered the possibility that there might have been an earlier point in the supply chain of the tobacco which could be established, where a different person might be liable for the duty. The only entity which can be identified earlier in the supply chain from the evidence provided is the trader which provided the three receipts, "The Price 30" in Queensway. That trader is no longer in business.
32. Following the decision in B & M Retail ([2016] UKUT 0429 (TC), at §155-157), we consider that it is clear that the fact that earlier excise duty points must have occurred does not preclude HMRC from assessing the appellant to excise duty, as it is unable to assess any person involved in such earlier excise duty points."
Grounds of Appeal
Ground 1 – FTT should have found that an assessment could only be made against The Price 30.
Discussion
Error of law?
Does the error mean the FTT's decision should be set aside?
Ground 2 – Palm Palace Limited, not Mr Ali, had sufficient control in order to be "holding" for the purposes of Regulation 10(1) of the Regulations.
Ground 3 – the FTT failed to give sufficient reasons for the conclusion that Mr Ali was "holding" tobacco for Regulation 10(1) purposes
Conclusion
Note 1 The gap in this appeal not being heard until 2024 arose mainly due to a stay of proceedings the Upper Tribunal ordered in 2019 behind the Court of Appeal’s decision inDavison & Robinson Ltd v HMRC, however that appeal did not go to hearing but was withdrawn by the appellant and dismissed on 2 March 2023 pursuant to a consent order.
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