Gascoyne v Commissioners of Customs and Excise

JurisdictionEngland & Wales
JudgeMr Justice Neuberger
Judgment Date21 February 2003
Neutral Citation[2003] EWHC 257 (Ch)
Docket NumberCase No: CH/2002/APP/0743
CourtChancery Division
Date21 February 2003

[2003] EWHC 257 (Ch)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

The Honourable Mr Justice Neuberger

Case No: CH/2002/APP/0743

Between:
Barry Gascoyne
Appellant
and
(1) Customs and Excise Commissioners
(2) The Chairman of the Vat and Duties Tribunal
Respondents

Miss Jessica Simor (instructed by Messrs Nelsons, of Nottingham) for the Appellant.

Mr James Puzey (instructed by The Solicitor for H M Customs and Excise) for the Respondents.

Hearing dates: 30, 31 January 2003

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.

Mr. Justice Neuberger

Mr Justice Neuberger

INTRODUCTORY

1

On 15th April 2001, Mr Barry Gascoyne returned to Dover from a short trip to Europe in his Land Rover, together with his partner Ms Gifford. They were found by Customs Officers to be carrying 10,000 cigarettes and 32 kilograms of hand-rolling tobacco ("the goods"). The Customs Officers seized the goods and the Land Rover, purportedly under sections 139 and 141 of the Customs and Excise Management Act 1979 ("CEMA") respectively, on the grounds that they were not satisfied that the goods were for the personal use of Mr Gascoyne and Ms Gifford, as they had alleged. In other words, the Customs Officers considered that Mr Gascoyne was trying to smuggle the goods into this country.

2

On 17th April 2001, Mr Gascoyne sent a letter to the Customs and Excise Commissioners ("the Commissioners"), which they understood to be a request for restoration of the Land Rover pursuant to their powers under section 152 of CEMA. On 3rd May 2001, an officer of the Commissioners considered and refused the request for restoration. He held that there were "no exceptional circumstances" which would "justify a departure" from the Commissioners' "normal policy…to refuse to restore seized goods", because restoration "would thoroughly undermine the… objective of reducing the incidence of fraud, failure to pay excise duty that is due and irregularities".

3

On 9th May 2001, Mr Gascoyne requested a review, which was effected by Officer Tooke, on behalf of the Commissioners, pursuant to section 15 of the Finance Act 1994 ("the 1994 Act"). In a detailed letter dated 27th June 2001, Officer Tooke concluded that the decision to seize the goods and the Land Rover, and the decision not to restore them, were justified.

4

On 19th July 2001, pursuant to section 16 of the 1994 Act, Mr Gascoyne appealed this decision to the VAT and Duties Tribunal ("the Tribunal"), who heard the appeal on 2nd July 2002. Mr Gascoyne appeared in person, and the Commissioners were represented by counsel. On 29th July 2002, the Tribunal, chaired by Mr I E Vellins, rejected Mr Gascoyne's appeal. Mr Gascoyne now appeals to this court.

5

The points raised on Mr Gascoyne's behalf may be summarised as follows:

i) His letter of 17th April 2001 ("the April letter") amounted to a claim that the goods and Land Rover were not liable to forfeiture, and, as the Commissioners have failed to "take proceedings for their condemnation", they cannot now be forfeited, and they therefore should be returned;

ii) The terms of the Excise Duties (Personal Reliefs) Order 1992 (S.I. 1992/3 155) ("the PRO") are incompatible with EC Directive 92/12/EC ("the 1992 Directive") and/or are insufficiently precise, and the PRO was therefore unenforceable against Mr Gascoyne;

iii) The Commissioners' policy of almost always retaining vehicles seized under section 141 of CEMA constitutes an unlawful fetter on their discretion, was an infringement of Mr Gascoyne's rights under the European Convention on Human Rights ("the Convention") and/or was disproportionate, and therefore the refusal to restore the Land Rover is invalid;

iv) The decision of the Tribunal against Mr Gascoyne was ineffective in light of the 1992 Directive and/or the Convention because the Tribunal wrongly proceeded on the basis that the burden of proof was on Mr Gascoyne and/or that the standard of proof on the Commissioners was too low, because the Tribunal was limited to a narrow review, because there was inequality of arms, and/or because the Tribunal did not have the power to quash the decision of the Commissioners.

6

I shall consider these various points in turn, after a review of the relevant legislation, and a more detailed analysis of the history of the matter.

THE RELEVANT DOMESTIC AND EUROPEAN LEGISLATION

Introductory

7

In 1979, the legislature enacted a number of Statutes concerned with excise duty and the powers of Customs and Excise. These included CEMA, The Tobacco Products Duty Act 1979 ("the Tobacco Act") and the Customs and Excise (General Reliefs) Act 1979 ("the General Reliefs Act"). Inevitably, there was subsequent primary and secondary legislation, much of which was enacted to comply with the United Kingdom's obligation under the EC Treaty. In particular, following the establishment of the single market on 1st January 1993, to which the 1992 Directive was directed, domestic law required significant changes; hence the PRO.

CEMA and the 1994 Act

8

CEMA, as its name suggests, is concerned with, inter alia, procedures and powers relating to Customs and Excise. Section 49(1) provides that "goods shall… be liable to forfeiture" where, inter alia, they are:

"Imported goods, being goods chargeable on their importation with customs or excise duty [and] are, without payment of that duty —(i)…unshipped in any port"

9

Section 139(1) provides:

"Any thing liable to forfeiture … may be seized or detained by any officer…"

10

Section 141(1) of CEMA provides that:

"… [W]here any thing has become liable to forfeiture… any ship, aircraft, vehicle, animal, container… or other thing whatsoever which has been used for the carriage, handling, deposit or concealment of the thing so liable to forfeiture… shall also be liable to forfeiture."

11

Section 152 provides:

"The Commissioners may, as they see fit -

(a) …

(b) restore, subject to such conditions (if any) as they think proper, any thing forfeited or seized,……"

12

Schedule 3 to CEMA contains "Provisions Relating To Forfeiture". Paragraph 1 requires the Commissioners to give notice to the owner "of the seizure of any thing as liable to forfeiture", subject to certain exceptions. I must set out paragraphs 3, 5 and 6 of the Schedule, which provide as follows:

"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 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… no such notice has been given to the Commissioners…, the thing in question shall be deemed to have been duly condemned as forfeited.

6. Where a notice of claim in respect of any thing is duly given in accordance with paragraph 3… 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."

13

Paragraph 8 of Schedule 3 provides that proceedings for condemnation should be civil proceedings which may be instituted, in England and Wales, either in the High Court or in the Magistrates Court.

14

Paragraph 16 of Schedule 3 to CEMA provides:

"Where any thing has been seized as liable to forfeiture the Commissioners may at any time if they see fit and notwithstanding that the thing has not yet been condemned, or is not yet deemed to have been condemned, as forfeited… deliver it up to any claimant upon his paying to the Commissioners such sum as they think is proper, being a sum not exceeding that which in their opinion represents a value of the thing…"

15

The 1994 Act introduced review and appeal procedures in relation to the exercise of many of the Commissioners' functions, including the power of review conferred by section 152(b) of CEMA —see paragraph 2(r) of Schedule 5 to the 1994 Act. Section 14(2) of the 1994 Act requires the Commissioners "to review any decision", provided that "notice requiring the review is given before the end of the period of 45 days beginning with the day on which written notification of the decision, or of the assessment containing the decision, was first given to the person requiring the review". On such a review, the Commissioners are required by section 15 of the 1994 Act either to "confirm" or to "withdraw or vary" the decision, and, if they take the latter course, they must "take such further steps (if any)… as they may consider appropriate".

16

By virtue of section 16 of the 1994 Act, an appeal to the VAT and Duties Tribunal ("the Tribunal") may be made in respect of "any decision by the Commissioners on a review under section 15 above". The powers of the Tribunal on such an appeal are set out in section 16(4) of the 1994 Act which provides that:

"[T]he powers of an appeal Tribunal… shall be confined to a power, where the Tribunal are satisfied that the Commissioners… could not reasonably have arrived at [their decision], to do one or more of the following, that is to say:

(a) to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the Tribunal may direct;

(b) to require the Commissioners to conduct, in accordance with the directions of the Tribunal, a further review of the original decision; and

(c) …"

17

Section 16(6) of the 1994 Act provides that, subject to certain specific exceptions:

"On an appeal under [section 16] the burden of proof as to [certain issues not germane...

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