Bathgate Leisure Ltd
| Jurisdiction | UK Non-devolved |
| Judgment Date | 16 October 2012 |
| Neutral Citation | [2012] UKFTT 637 (TC) |
| Date | 16 October 2012 |
| Court | First-tier Tribunal (Tax Chamber) |
[2012] UKFTT 637 (TC)
Judge Gretta Pritchard, BL, MBA, WS
Nigel Gibbon appeared for the Appellant
Kim Tilling, instructed by the General Counsel and Solicitor to HM Revenue and Customs, appeared for the Respondents
VAT - Application under r. 20 The Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 (SI 2009/273) for an extension of 3 years and 11 months of time to appeal - Application refused
1.Bathgate Leisure Ltd operated a gaming machine amusement centre at Leisureland, 7/9 Whitburn Road, Bathgate. Their current address is 13 George Place, Bathgate. One of its directors is Mr Derek Codona. They have one request for an extension of time for lodging an appeal under para. 4(a) of Rule 20 The Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 (for ease of understanding and in conformity with other case law these requests are referred to as applications) before the Tribunal.
2.There are three other separate similar applications by separate parties, namely Xs and Os Amusements, Xs and Os Paisley Cross Ltd and Kirkern Limited in respect of which three other separate decisions are issued.
3.All of the applications made are for the extension of time for admission of notice of appeals not lodged in time in respect of appeals against refusals by HMRC for repayment of VAT in respect of gaming machine income.
4.HMRC objected to this application by way of an application for strike out.
5.The evidence for all four cases was taken together at the request of all parties. No oral evidence was given by the persons or by directors of the bodies making the applications.
6.Because at the submission stage the arguments became clouded by more recent case law relating to the potential outcome on the merits of any appeal the Tribunal requested written submissions. These were made with a request from HMRC that in the event of considering refusal on the paper submissions a further opportunity should be given for oral submissions.
7.The judge quite independently had some queries relating to the submissions and without taking account of the suggestion by HMRC wished to have further information.
8.As will be seen from the later findings in fact the potential for success on the merits of both the application and the potential appeal appeared to the Appellants' agent Mr Gibbon to have strengthened in the period between the first hearing and the final hearing on submissions, which was correct.
9.As will be seen again from the findings in fact and the reasons the Tribunal may consider many factors in the exercise of its discretion and the advantage seen by the Appellants to be gained from the delay cannot be given so much weight as the Appellants may have wished.
10.The Appellants have made a valiant attempt to come in to the potential claim they may have had, but unfortunately made no attempt to overcome the original rejection letter dated 8 December 2006, which advised that an appeal was available and should be lodged within 30 days of the date of that letter. From all the Tribunal has considered it has come to the conclusion this application cannot be granted.
11.There were three hearings. The first was on 13 October 2011, the second on 16 April 2012 which did not proceed due to the Appellants representative taking ill, and the third on 4 September 2012. At the first hearing there was written evidence consisting of Bundles 1 and 2 described below. There was oral evidence from Mr John O'Hara, Chartered Accountant of O'Hara's Chartered Accountants, the Appellants accountant. No oral evidence was given by the Appellants. The Tribunal requested written submissions for some clarification of the position of both parties particularly with regard to the delay, given the very long delay in this matter. Submissions were made and found in Bundles 3-7 (relating to all four cases of which only those described below as relevant relate to this application).
12.However the second hearing did not proceed. At the third hearing both parties made further unsolicited submissions (Bundles 8 and 9).
13.The Appellants final Bundle 9 contained fresh evidence which the Appellants sought to have admitted and to which HMRC objected and which is dealt with below. These further submissions were made as the law on the merits had moved on in the interim and the Appellants in particular wished account to be taken of the merits of the potential appeal and HMRC's attitude to other claims. They also appeared to attempt to strengthen their reasons for lateness by lodging a written statement by one of the Appellants and anonymised correspondence to overcome what appeared to the Tribunal to be a perceived lack of substance in the available evidence. Again this is dealt with later.
14.The Bundles relate to four cases altogether which were heard together but in respect of which it was requested four decisions be issued. For ease of reference the bundles are identified as follows:-
Bundle 1 - Appellants' documents. These relate also to three other applications not conjoined with this case but all with the same purpose on the same topic which have material in Bundle 1, Parts 1-5. Only Part 1 and Part 2 relate to this decision.
Bundle 2 - HMRC's documents in numbered sections 1-16.
Bundle 3 - The Appellants first written submissions prior to the ECJ decision in R & C Commrs v Rank Group plcECASECAS (Joined Cases C-259/10 and C-260/10) [2011] BVC 389 issued on 20 November 2011 (more fully explained later).
Bundle 4 - HMRC Skeleton Argument for John and Elaine Graham t/a Xs and Os Amusements.
Bundle 5 - HMRC's Skeleton Arguments for Xs and Os Paisley Cross Ltd.
Bundle 6 - HMRC's Skeleton Arguments for this application.
Bundle 7 - HMRC's Skeleton Argument for Kirkern Ltd.
Bundle 8 - HMRC's unsolicited final submissions.
Bundle 9 - Appellant's further unsolicited evidence and final submissions.
Bundle 10 - Further cases referred to on the final day of the hearings.
Where reference is made to any page or section of any Bundle it should be treated as repeated here.
15.At the outset of the third hearing intended to be on the submissions (Bundles 8 & 9) lodged prior to the hearing Ms Tilling for HMRC objected to the fresh written evidence lodged by the Appellants (Bundle 9 Annex C, D and E).
First Decision: Bundle 9 Annex C consisted of two anonymised letters from HMRC both dated 30 March 2007 and which the Tribunal was advised were addressed to representatives of unidentified taxpayers who made claims in respect of refunds of VAT paid on gaming machine income following the case of Finanzamt Gladbeck v LinneweberECAS (C-453/02) [2007] BVC 227 (Linneweber) in ECJ, and during the early stage of what are now referred to as the Rank cases. Both of the taxpayers had had letters of rejection but had subsequently requested reconsideration. As a result they were offered the proposition that their reconsideration be held over till the result of R & C Commrs v Rank Group plcECASECAS (Joined Cases C-259/10 and C-260/10) [2011] BVC 389 (Rank) was known. The Appellants sought to have the anonymised letters admitted as relevant material to show HMRC's practice in 2007.
The anonymised letters are admitted.
As found below the Appellants had not asked for a review or reconsideration of HMRC's decision so the file was closed so far as HMRC was concerned. They were still following the business-brief 20/06BB 20/06 guidance, and the original refusal letter predated the anonymised letters. The anonymised letters did not therefore assist.
Second decision: At Bundle 9, Appendix D are three statements, one from each of the Appellants in the four cases referred to above. One which relates to this claim is from the Appellants' director Derek Codona. His letter advises that they always understood their accountants O'Hara's were dealing with the case on their behalf. They had telephoned and regularly asked at meetings about their case. They were advised their case would be decided when the lead case with Rank was decided. Bundle 9 Appendix DP1 is the relevant letter in respect of this application. The Statement is admitted. It does as it stands add some strength to the late admission application. Mr Codona may well have believed what he was advised. However, the Tribunal finds it hard to accept and to understand how a businessman could believe that his claim was open and ongoing when all he knew was that it had been rejected. The correspondence was addressed to the business. The reason for this is that the operator of a gaming machine amusement centre is regulated on many fronts. Time limits apply in licensing of betting and gaming operations, in business tax matters and personal tax matters. Mr Codona describes the length of his working life in the centre. He received the first letter of refusal. It is clear in its terms. It is always necessary to respond to HMRC time limits. Every taxpayer must meet them or face the consequences. In addition no oral evidence was given on behalf of the Appellants by Mr Codona so as to be tested in cross examination. The attitude conveyed by the written evidence suggests unusual and careless behaviour. The Tribunal considered refusing the admission of the statement but in the spirit of the overriding objectives of tribunals considered it fairer to explain the lack of strength of the evidence.
Third Decision: Bundle 9 Appendix E contains material handed in on the morning of the hearing with a request for inclusion as evidence. It was numbered Pages 3-9, and P14 & 15. It was agreed Pages 6 and 7 were not relevant and should be excluded.
Pages 3, 4 and 5 consisted of another anonymised letter which assisted HMRC in that it gave a clear picture of refusal of reconsideration in circumstances where HMRC appear to the taxpayer to have "stood over" the decision. The correspondence referred to in that letter is not enclosed nor the date...
To continue reading
Request your trial
-
Chisholm Bookmakers Ltd
...She cited Eltham Hill Club and InstituteTAX[2012] TC 02164 (in which the period of delay was over 4 years) and Bathgate Leisure LtdTAX[2012] TC 02314 (in which the period of delay was some three years eleven months. She did not take us to any particular passages in those decisions, relying ......
-
Heald Green Social Club and Institute Ltd
...Europe LtdTAX[2011] TC 01399•Eltham Hill Club and InstituteTAX[2012] TC 02164•Jem Leisure LtdTAX[2011] TC 01612•Bathgate Leisure LtdTAX[2012] TC 02314•Kirkern LtdTAX[2012] TC 02313•Data Select Ltd v R & C CommrsVAT[2012] BVC 1743•Graham (t/a Xs & Os Amusements (formerly t/a Satellite Amusem......