Augean Plc v The Commisioners of HM Revenue and Customs
| Jurisdiction | England & Wales |
| Judge | The Hon Mr Justice David Richards,MR JUSTICE DAVID RICHARDS |
| Judgment Date | 15 August 2008 |
| Neutral Citation | [2008] EWHC 2026 (Ch) |
| Docket Number | Case No: CH/2008/APP/0270 |
| Court | Chancery Division |
| Date | 15 August 2008 |
[2008] EWHC 2026 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
ON APPEAL FROM THE VAT AND DUTIES TRIBUNAL
Royal Courts of Justice
Strand,
London, WC2A 2LL
The Hon Mr Justice David Richards
Case No: CH/2008/APP/0270
Maurice Sheridan (instructed by Walker Morris) for the Appellant
James Puzey (instructed by The Solicitors to HM Revenue and Customs) for the Respondents
Hearing date: 11 August 2008
APPROVED JUDGMENT
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic
Augean plc appeals against the decision dated 27 February 2008 of the VAT and Duties Tribunal (David Demack). The Tribunal dismissed Augean's appeal against a decision on review by the Commissioners for HM Revenue and Customs (“HMRC”) upholding an earlier decision to refuse a certificate of exemption for landfill tax in respect of “the Site”, which is a separate and identifiable part of Thornhaugh Quarry, Wansford, near Peterborough.
Landfill tax is chargeable by virtue of Part III of the Finance Act 1996. It is chargeable on a disposal of material as waste made by way of landfill at a landfill site on or after 1 October 1966 (section 40). The tax is payable by the landfill site operator (section 41) at a current rate of £32 per tonne, unless it is inactive or inert and listed for the purposes of section 42 in which case the tax is chargeable at the rate of £2.50 per tonne.
Part III contains provisions for various exemptions from the tax, of which the provisions relevant to the present appeal are sections 43A and 43B, added by the Landfill Tax (Contaminated Land) Order 1996 (SI 1996/1529). Broadly stated, they exempt disposals of material from contaminated land subject to a number of conditions. One of the conditions is that the material has been removed from land in relation to which a certificate has been issued under section 43B and remains in force. It is the refusal by HMRC to issue a certificate under section 43B in relation to the Site which was the subject of the appeal to the Tribunal.
The issue is whether, as required by section 43B (8) (c) “all relevant activities have ceased” in relation to the Site. An activity is relevant if it has at any time resulted in the presence of pollutants in, on or under the land in question. It is common ground that the deposit of waste as landfill at the Site resulted in the presence of pollutants in, on or under the Site, that the landfill activity stopped in 1993 and that there has been no further landfill deposits at the Site since then. Augean now proposes, as part of a plan for the reclamation of the Site, to extract all the present contaminating landfill waste amounting to some 920,000 tonnes, to construct a modern containment feature on the Site and to deposit, as landfill, hazardous waste material. Once filled, the Site will be returned to agricultural use. In these circumstances, the issue is whether, in the light of Augean's proposals, it can be said that all relevant activities have ceased at the Site for the purposes of section 43B.
It is necessary to set out section 43B.
“(1) Subject to subsection (2) below, the Commissioners shall issue a certificate in relation to any land where–
(a) an application in writing is made by a person carrying out, or intending to carry out, reclamation of that land (the applicant);
(b) the applicant provides to them such information as they may direct, whether generally or as regards that particular case;
(c) the application is made not less than 30 days before the date from which the certificate is to take effect; and
(d) the reclamation qualifies under subsection (7) below.
(2) The Commissioners shall not refuse an application for a certificate in a case where the conditions specified in subsection (1) (a) to (d) above are satisfied unless it appears to them–
(a) necessary to do so for the protection of the revenue; or
(b) except where the applicant is one of the bodies mentioned in subsection (5) of section 43A above, that all or part of the reclamation of land to which the application relates is required in order to comply with a notice or order mentioned in subsection (4) of that section.
(3) The Commissioners may make a certificate subject to such conditions set out in the certificate as they think fit, including (but not restricted to) conditions–
(a) that the certificate is to be in force only in relation to a particular quantity of material;
(b) that the certificate is to be in force only in relation to disposals made at a particular landfill site or sites;
(c) that the certificate is to be in force in relation to part only of the land to which the application relates.
(4) A certificate issued under this section–
(a) shall have effect from the date it is issued to the applicant or such later date as the Commissioners may specify in the certificate; and
(b) shall cease to have effect on such date as the Commissioners may set out in the certificate, but in any event no later than the day on which the person to whom the certificate was issued ceases to have the intention to carry out any activity involving reclamation of the land in relation to which the certificate was issued.
(5) Where a certificate has been issued to a person, the Commissioners–
(a) may vary it by issuing a further certificate to that person; or
(b) may withdraw it by giving notice in writing to that person; but this is subject to subsection (6) below.
(6) The Commissioners shall not withdraw a certificate unless it appears to them–
(a) necessary to do so for the protection of the revenue;
(b) that the reclamation did not in fact qualify under subsection (7) below or no longer so qualifies;
(c) that there will not by any or any more disposals within section 42A (2) above of material from the land to which the certificate relates; or
(d) except where the person to whom the certificate was issued is one of the bodies mentioned in subsection (5) of section 43A above, that the removal of material from the land to which the certificate relates is required in order to comply with a notice or order mentioned in subsection (4) of that section.
(7) A reclamation qualifies under this subsection if–
(a) it is, or is to be, carried out with the object of facilitating development, conservation, the provision of a public park or other amenity, or the use of the land for agriculture or forestry; or
(b) in a case other than one within paragraph (a) above, it is, or is to be, carried out with the object of reducing or removing the potential of pollutants to cause harm,
and, in either case, the conditions specified in subsection (8) below are satisfied.
(8) The conditions mentioned in subsection (7) above are–
(a) that the reclamation constitutes or includes clearing the land of pollutants which are causing harm or have the potential for causing harm;
(b) that, in a case within subsection (7)(a) above, those pollutants would (unless cleared) prevent the object concerned being fulfilled; and
(c) that all relevant activities have ceased or have ceased to give rise to any pollutants in relation to that land.
(9) For the purposes of subsection (8) above the clearing of pollutants–
(a) need not be such that all pollutants are removed;
(b) need not be such that pollutants are removed from every part of the land in which they are present;
(c) may involve their being cleared from one part of the land and disposed of on another part of the same land.
(10) For the purposes of subsection (8)(c) above an activity is relevant if–
(a) it has at any time resulted in the presence of pollutants in, on or under the land in question otherwise than–
(i) without the consent of the person who was the occupier of the land at the time, or
(ii) by allowing pollutants to be carried onto the land by air or water, and
(b) at that time it was carried out–
(i) by the applicant or a person connected with him, or
(ii) by any person on the land in question.
(11) For the purposes of subsection (10) above–
(a) any question whether a person is connected with another shall be determined in accordance with section 839 of the Taxes Act 1988;
(b) the occupier of land that is not in fact occupied is the person entitled to occupy it.
(12) In this section “land” has the meaning given by section 43A(6) above.”
The relevant facts may be summarised as follows. Landfill started at the Site in 1984 and continued until 1993. A wide range of commercial and industrial waste, together with domestic waste, was deposited and these deposits produced leachate. The landfill was carried out in accordance with what was then the industry standard practice of “disperse and attenuate” allowing contaminants such as leachate to seep into the underlying and surrounding area. More recently, landfill practice has developed on the principle of containment in lined and capped voids so as to prevent or reduce the incidence of seepage.
In April 1997 a consolidated planning permission was granted for the quarry, including the Site, replacing a number of earlier mineral and landfill planning permissions. It provided for the continuing extraction of minerals and the restoration of the quarry to agriculture and nature conservation use by infilling. The permission expires on 31 December 2013 “at which time the operation authorised by this permission shall cease and the land reinstated to a condition suitable for the resumption of agricultural use to the satisfaction of the Mineral Planning Authority”.
The Tribunal found that “in or about 1993 the then owner of the quarry simply stopped the landfilling of waste at the Site. Its restoration profile had not achieved the contours...
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