Philip Neil Riley v The Commissioners of Customs & Excise, E 00560
| Jurisdiction | UK Non-devolved |
| Judge | Dr A Nuala BRICE |
| Judgment Date | 19 December 2003 |
| Respondent | The Commissioners of Customs & Excise |
| Appellant | Philip Neil Riley |
| Reference | E 00560 |
| Court | First-tier Tribunal (Tax Chamber) |
E00560
EXCISE DUTY - appeal against decision to restore vehicle subject to the condition of payment of a sum equal to the excise duty involved (£1,177.39) - Appellant appeared at, and was unsuccessful in, condemnation proceedings in Magistrates' Court and in Crown Court who found that the excise goods carried in the vehicle were held for commercial use - whether Tribunal now has jurisdiction to find, in the context of the appeal against a decision to restore subject to a condition, that the excise goods carried in the vehicle were held for personal use or for not-for-profit commercial use - yes - if so, whether the excise goods were for held for personal use - no - or for not-for profit commercial use - yes - whether Tribunal satisfied that the person making the decision could not reasonably have arrived at it - no - if so, what action the Tribunal should take - appeal dismissed - Council Directive (EEC) No 92/12 Arts 8 and 9; FA 1994 S 16(4)
PHILIP NEIL RILEY Appellant
- and -
Tribunal: DR NUALA BRICE (Chairman)
MR R L JENNINGS FCA FTII
Sitting in public in London on 31 October 2003
The Appellant in person
Mr Sarabjit Singh of Counsel, instructed by the Solicitor for the Customs and Excise, for the Respondents
© CROWN COPYRIGHT 2003
DECISION
The appeal
1. Mr Philip Neil Riley (the Appellant) appeals against a decision on review dated 6 May 2003 which was to restore the Appellant's vehicle to him on condition of the payment of a sum equal to that of the excise duty involved. We were informed that £1,177.39 was a sum equal to the amount of excise duty involved.
The legislation relating to the issues in the appeal
2. Section 152(b) of the Customs and Excise Management Act 1979 provides:
"The Commissioners may, as they see fit- …
(b) restore, subject to such conditions (if any) as they think proper, any thing forfeited or seized under [the customs and excise] Acts … ."
3. Section 16 of the Finance Act 1994 (the 1994 Act) provides that an appeal shall lie to the Tribunal against a decision on review under section 15. Section 15 provides for the review of decisions which come within section 14. Section 14(1)(d) includes any decision specified in Schedule 5. Paragraph 2(1)(r) of Schedule 5 specifies any decision under section 152(b) "as to whether or not anything forfeited or seized under the customs and excise Acts is to be restored to any person or as to the conditions subject to which any such thing is so restored."
4. Thus, although section 152(b) gives Customs and Excise a discretion as to whether or not to restore seized vehicles or goods, sections 14 to 16 of the Finance Act 1994 give a right of appeal to the Tribunal against a refusal to restore or the conditions of restoration. However, section 16 limits the jurisdiction of the Tribunal in respect of ancillary matters. Section 16(8) defines ancillary matters as those specified in Schedule 5. As a refusal to restore and the conditions of restoration are specified in Schedule 5 they are, therefore, ancillary matters. The relevant parts of section 16(4) provide:
"16(4) In relation to any decision as to an ancillary matter, or any decision on the review of such a decision, the powers of an appeal Tribunal on an appeal under this section shall be confined to a power, where the Tribunal are satisfied that the Commissioners or other person making that decision could not reasonably have arrived at it, 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) in the case of a decision which has already been acted on or taken effect and cannot be remedied by a further review to declare the decision to have been unreasonable and to give directions to the Commissioners as to the steps to be taken for securing that repetitions of the unreasonableness do not occur when comparable circumstances arise in the future."
The issues
5. Customs and Excise imposed the condition on the restoration of the vehicle because they were of the view that excise goods had been carried in the vehicle and that those excise goods had been held for commercial purposes with the intention of making a profit. They also argued that, because the issue had been determined by both the Magistrates' Court and the Crown Court, the Tribunal had no jurisdiction to decide it again. The Appellant argued that the excise goods carried in the vehicle had been held by him for his personal use and so the refusal to restore the vehicle without conditions was unreasonable.
6. Thus the issues for determination in the appeal were:
(1) whether, in the light of the fact that the Magistrates' Court and the Crown Court had already decided that the excise goods carried in the vehicle were held for commercial purposes, the Tribunal had jurisdiction to find that they were held for personal use; if so
(2) whether the excise goods were held for personal use;
(3) whether, in the light of the conclusions on the first two issues, the Tribunal was satisfied that the person making the decision to restore the vehicle subject to a condition could not reasonably have arrived at that decision within the meaning of section 16(4); and, if so
(4) what action the Tribunal should take under section 16(4).
The wider legislative framework
7. Before summarising the evidence and finding the facts we outline the wider legislative framework as this assists in understanding the facts in the appeal.
8 Article 99 of the Treaty of Rome (now Article 93 EC) provides that the Council of Ministers of the European Community should adopt provisions for the harmonisation of legislation concerning excise duties. The main excise duty directive was adopted on 25 February 1992 and is Council Directive (EEC) No. 92/12 on "the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products". The directive applies to mineral oils, alcohol and tobacco. The principles are set out in the recitals to the Directive and the sixth and seventh recitals provide:
"Whereas in the case of products subject to excise duty acquired by private individuals for their own use and transported by them, the duty must be charged in the country where they were acquired;
Whereas to establish that products subject to excise duty are not held for private but for commercial purposes, Member States must take account of a number of criteria."
9. Article 7 of the directive provides that, where excise goods are released for consumption in one member state but held for commercial purposes in another, then excise duty is chargeable in the member state in which the goods are held. Article 8 provides that, as regards products acquired by private individuals for their own use and transported by them, excise duty is charged in the member state in which they are acquired. Article 9 provides that, without prejudice to Articles 6, 7 and 8, excise duty is chargeable where products for consumption in one member state are held for commercial purposes in another member state; duty is due in the member state in which the products are held and the holder of the products is chargeable with the duty.
10. Thus the scheme of the directive is that where excise goods are acquired by private individuals for their own use and transported by them excise duty is charged in the member state in which they are acquired. If any excise goods are held for commercial purposes in another member state then duty is due in that state from the holder of the goods.
11 Article 9.2 of the directive provides that, in order to establish whether goods transported by private individuals are intended for commercial purposes, member states must take account of certain criteria including: the commercial status of the holder...
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