R (Glenn & Company Essex Ltd) v Commissioners of HM Revenue and Customs
| Jurisdiction | England & Wales |
| Judge | Mr Justice Simon,Lord Justice Laws |
| Judgment Date | 16 November 2011 |
| Neutral Citation | [2010] EWHC 1469 (Admin),[2011] EWHC 2998 (Admin) |
| Docket Number | Case No: CO/4200/2009,Case No: CO/8856/2011 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 16 November 2011 |
[2010] EWHC 1469 (Admin)
Before: The Hon. Mr. Justice Lloyd Jones
Case No: CO/4200/2009
IN THE HIGH COURT OF JUSTICE
Royal Courts of Justice
Strand, London, WC2A 2LL
David Southern (instructed by Anami Solicitors) for the Claimant
Ben Collins (instructed by Solicitors for HMRC) for the Defendant
Hearing date: 26 th May 2010
Crown copyright©
The Hon. Mr. Justice Lloyd Jones :
1. By this application for judicial review Glenn & Co (Essex) Limited (“the Claimant”) seeks to challenge the legality of the conduct of the Defendant's authorised representatives in removing computers from the Claimant's premises.
2. The facts can be stated relatively briefly. The Claimant deals in excise goods and was at the relevant time registered as a revenue trader. At 10.00 am on 4 th February 2009 several revenue officers entered the Claimant's business premises unannounced and without having obtained a warrant. The purpose of the operation was to conduct interviews and to inspect business records, including computers. While at the Claimant's premises the revenue officers disconnected and removed a computer server and nineteen computers which were standing on desks. The purpose of removing the computers was to interrogate the hard disks of the computers. All but one of the computers were returned the next day 5 th February 2009. The remaining computer and server were returned on the 6 th February 2009.
3. In the case of excise goods the powers of the Defendant in relation to inspection, information and search are contained in Customs and Excise Management Act 1979 (“CEMA”). The inspection power is contained in section 118C(1) which provides:
“118C(1) For the purpose of exercising any powers under the customs and excise Acts an officer may at any reasonable time enter premises used in connection with the carrying on of a business.”
4. The information power is contained in section 118B which provides in relevant part:
“(1) Every revenue trader shall—
(a) furnish to the Commissioners, within such time and in such form as they may reasonably require, such information relating to—
(i) any goods or services supplied by or to him in the course or furtherance of a business, or
(ii) any goods in the importation or exportation of which he is concerned in the course or furtherance of a business, or
(iii) any transaction or activity effected or taking place in the course or furtherance of a business,
as they may reasonably specify; and
(b) upon demand made by an officer, produce or cause to be produced for inspection by that officer—
(i) at the principal place of business of the revenue trader or at such other place as the officer may reasonably require, and
(ii) at such time as the officer may reasonably require,
any documents relating to the goods or services or to the supply, importation or exportation or to the transaction or activity.
…
(4) An officer may take copies of, or make extracts from, any document produced under subsection ( 1) or (2) above.
(5) If it appears to an officer to be necessary to do so, he may, at a reasonable time and for a reasonable period, remove any document produced under subsection ( 1) or (2) above and shall, on request, provide a receipt for any document so removed.
(7) Where a document removed by an officer under subsection (5) above is reasonably required for the proper conduct of a business he shall, as soon as practicable, provide a copy of the document, free of charge, to the person by whom it was produced or caused to be produced.”
5. This power to obtain information is to be distinguished from the search power, which can be exercised only pursuant to a warrant. The search power is contained in section 118C (3) and (4):
“(3) If a justice of the peace … is satisfied on information on oath—
(a) that there is reasonable ground for suspecting that a fraud offence which appears to be of a serious nature is being, has been or is about to be committed on any premises, or
(b) that evidence of the commission of such an offence is to be found there, or
(c) that there is reasonable ground for suspecting—
…
he may issue a warrant in writing authorising, subject to subsections (6) and (7) below, any officer to enter those premises, if necessary by force, at any time within the period of one month beginning with the date of the issue of the warrant and search them.
(4) Any officer who enters premises under the authority of a warrant under subsection (3) above may—
(a) take with him such other persons as appear to him to be necessary;
(b) seize and remove any documents or other things whatsoever found on the premises which he has reasonable cause to believe may be required as evidence for the purposes of proceedings in respect of a fraud offence which appears to him to be of a serious nature …; and
(c) search or cause to be searched any person found on the premises whom he has reasonable cause to believe to be in possession of any such documents or other things; …”
6. Section 114, Finance Act 2008 (“ FA 2008”) applies to sections 118B and 118C:
“(1) This section applies to any enactment that, in connection with an HMRC matter—
(a) requires a person to produce a document or cause a document to be produced,
(b) requires a person to permit the Commissioners or an officer of Revenue and Customs—
(i) to inspect a document, or
(ii) to make or take copies of or extracts from or remove a document,
(c) makes provision about penalties or offences in connection with the production or inspection of documents, including in connection with the falsification of or failure to produce or permit the inspection of documents, or
(d) makes any other provision in connection with a requirement mentioned in paragraph (a) or (b).
(2) An enactment to which this section applies has effect as if—
(a) any reference in the enactment to a document were a reference to anything in which information of any description is recorded, and
(b) any reference in the enactment to a copy of a document were a reference to anything onto which information recorded in the document has been copied, by whatever means and whether directly or indirectly.
(3) An authorised person may, at any reasonable time, obtain access to, and inspect and check the operation of, any computer and any associated apparatus or material which is or has been used in connection with a relevant document.
(4) In subsection (3) “relevant document” means a document that a person has been, or may be, required pursuant to an enactment to which this section applies—
(a) to produce or cause to be produced, or
(b) to permit the Commissioners or an officer of Revenue and Customs to inspect, to make or take copies of or extracts from or to remove.”
7. By its claim form issued on 1 st May 2009 the Claimant sought permission to apply for judicial review on two grounds. The first proposed ground contended that the Defendant, in fact, carried out a search of the Claimant's premises without the authority of a warrant. The second proposed ground contended that the powers confirmed by section 118B did not permit the removal of the computers because they are not documents within section 118B(1).
8. On 28 th July 2009 Mr. Justice Burton refused permission on both grounds.
9. On a renewed application 19 th October 2009 Mr. Justice Cranston granted permission on the second ground only.
Application to rely on a further ground.
10. At the hearing before me the Claimant sought permission under CPR 54.15 to rely on an additional ground, namely that the revenue officers had failed to make any demand for the production of documents prior to the removal of the computers. I refused permission for the following reasons. First, there was no reason why the point could not have been raised earlier. Secondly, this is an issue which, if properly raised, should be addressed in the evidence. The point is not dealt with in the evidence filed on behalf of the Claimant. The point not having been raised before the application notice dated 29 th April 2010, it was not dealt with in the evidence of Mr. Mark Fisher on behalf of the Defendant. Moreover, if permission had been granted, it was the intention of Mr. Southern, who appeared on behalf of the Claimant, to seek disclosure in relation to this issue. Thirdly, and most fundamentally, this proposed ground turns largely on questions of fact for which the judicial review procedure is not appropriate. If so advised, the Claimant may seek to pursue this as a private law claim in proceedings where witnesses can be heard and cross examined.
The effect of section 114.
11. On behalf of the Claimant Mr. Southern submits that notwithstanding the enlarging effect of section 114, FA 2008, section 118B, CEMA does not apply to computers. Mr. Collins, who appears for the Defendant, maintains that section 118B read in the light of section 114, FA authorises the conduct of which complaint is made in relation to the computers.
12. Section 114(2)(a) is not strictly a definition of “document”; rather it extends the application of a provision to which it applies by giving it effect as if a reference to a document were a reference to anything in which information of any description is recorded. In his submissions on behalf of the Claimant Mr. Southern suggested that the provision in section 114(2)(a), FA 2008 may have its origins in the Civil Evidence Act 1995 which itself was the product of a Law Commission Report and a draft bill prepared by the Law...
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