E00851

	EXCISE DUTY — non-restoration of seized vehicle and goods — 20.25 kg hand-rolling tobacco, 0.5kg pipe tobacco, 3200 cigarettes, 100 cigarillos and 1 litre of spirits — purchased with money supplied by family — appellants failed to attend hearing – not for own use — appeal dismissed

MANCHESTER TRIBUNAL CENTRE

 
 	GRAHAM CROCKER, PAMELA CROCKER and
	STEPHEN EVANS	Appellants

	- and -

	THE COMMISSIONERS OF CUSTOMS AND EXCISE	Respondents

				Tribunal:	 David S Porter (Chairman)
						 J T Brian Strangward	

Sitting in public in Birmingham on 5 January 2005

No one appeared for the Appellants

Ben Mills, of counsel, instructed by the Solicitor’s office for HM Customs and Excise for the Respondents 

	© CROWN COPYRIGHT 2005

DECISION

1.	This is an appeal by Graham Crocker, Pamela Crocker and Stephen Evans (the Appellants) against a decision of the Commissioners not to restore excise goods belonging to Graham Crocker and Stephen Evans and a vehicle belonging to Pamela Crocker, which were seized by the commissioners on 5 May 2001 at the Dover Eastern Docks Car Hall on their return from France. Mr Crocker and Mr Evans say that they had bought the goods for themselves and their families. The Respondents say that the goods were bought for commercial purposes because they had received payment from their family members.
2.	Ben Mills of counsel appeared for the Commissioners and was ready to call Mark Thursten, Kieron Villiers and Deborah Carole Gillespie as witnesses. He also produced a bundle of documents for the Tribunal.  As no one appeared for the Appellants, this Tribunal determined to proceed under rule 26(2) of the Value Added Tax Rules 1986 (as amended).

3.	On 8 May 2001, Graham Crocker and Stephen Evans wrote to the Commissioners requesting the return of their goods, that request was refused by a letter from the Commissioners dated 14 June 2001.  On 8 May 2001 Mrs Crocker also wrote to the Commissioners asking for a third party restoration of her car on the basis that she did not know that her husband intended to use her car to travel abroad believing instead that he was going in Stephen Evans’ car. That request was refused on 18 May 2001.  No further review was sought by her, but the Commissioners accepted an undated letter from Stephen Evans as a request for a review on her behalf.  That review was not carried out within the 45 day time limit and in consequence the decision not to restore the vehicle was deemed to be upheld as at 31 August 2001: see Finance Act 1994 section 15(2).  On 1 November 2002 the Commissioners were directed by the tribunal to carry out a further review in light of the decision in The Commissioners of Customs and Excise v Hoverspeed and others 2002 EWCA Civ 1015 and the Commissioners change in their policy arising there from.  On 1 March 2004 the Reviewing Officer refused to restore the goods but he varied the decision in relation to the vehicle on the basis that it would be restored on the payment of the excise duty of £2469.37.  Unfortunately the vehicle had been sold before the payment of the excise duty had been made.  It was therefore proposed that, as the value of the vehicle was £2775 at the time it was forfeited, the sum of £306 would be paid to Mrs Crocker as compensation, being the difference between the valuation and the excise duty payable.  The Appellants appealed that decision and the appeal was originally heard by the tribunal on 16 August 2004. At that hearing it was alleged by the Appellants that the Customs Officers had lied and had made false statements.  The appeal was therefore adjourned to today so that interviewing officers’ statements could be served on the Appellants and the interviewing officers could attend to be cross-examined.  As a result Mark Thursten and Kieron Villiers the interviewing officers, have travelled from Dover to attend the hearing.  Deborah Carole Gillespie the reviewing officer has travelled from Plymouth.  As the Appellants have failed to attend and given no reason for not appearing we are of the opinion that there is little point in asking the witnesses to give any evidence over and above what appears in their statements, which have been served on the Appellants.
4.	From the evidence in the interview notes the witness statements and the bundle produced by Ben Mills we find the following facts.  Graham Crocker and Stephen Evans went to France and Belgium in Pamela Crocker’s vehicle.  Graham Crocker and Stephen Evans returned on 5 May 2001 and were stopped at the Eastern Docks Car Hall.  As they were stopped, and before their formal interview, Kieron Villiers one of the interviewing officer, was told by Graham Crocker that he had bought the tobacco for his father-in-law, his brother and sister-in-law and himself.  His family had given him the appropriate monies for their share.  On the same occasion Stephen Evans confirmed that he had also purchased tobacco for his brothers, father, mother, aunt and that his family had also given him money. 
5.	They were told that they had the option to be interviewed in order to satisfy Kieren Villiers that the goods had been purchased for their personal use, however, they were reminded that they had already admitted that they had received monies towards the goods which was an offence.
6.	Kieron Villiers interviewed Graham Crocker (see pages 22 to 30 in the bundle), who was unsure whether he had purchased the goods in France or Belgium. He had bought 100 Golden Virginia, 100 Old Holborn, 1000 Benson and Hedges, 200 Sovereign, 5 packs of Drum but this time said that he had purchased the goods for his wife, sister-in-law, father in law, his brothers in law and himself.  He also insisted that his family had not paid for any of the goods. We are satisfied that he changed his mind with regard to the contribution made by his family because he had been told by Keiron Villiers earlier that in those circumstances the goods could not have been bought for his own use.  It should be noted that in his earlier statement he had made no mention that some of the goods were for his wife.  He indicated that he smoked 40 roll up cigarettes a day and that a pouch would last him 2 to 3 days.  He thought all his tobacco would last about 6 months. 
7.	Mark Thursten interviewed Stephen Evans (see pages 18 to 21 in the bundle), who had bought 100 pouches of Old Holborn, 100 pouches of Golden Virginia, 5 packs of Benson and Hedges, 5 packs of Embassy no1, 10 packs of Clan, and 1 box of cigars in Belgium. Most of the goods were for him but he intended to give some away as presents to his father and brothers.  We note that he made no mention of his mother and aunt to whom he had referred earlier.  He also changed his story as to the receipt of monies from his family, we believe when it had been brought to his notice that it was an offence to do so.  He confirmed that 3 packets of cigarettes would last him about two and a half weeks and about a pouch a week.
8.	Correspondence has passed between the parties and is contained in the bundle. Mr Crocker and Mr Evans wrote to the Commissioners on the 8 May 2001 (see page 62 of the “bundle”) In that letter they broke down the purchase price for the goods between the two of them. The division and costs are virtually the same. We find that surprising as they were allegedly buying the goods for different families. In that letter they also extended the list of the people for whom the goods were bought. Graham Crocker now includes his mother-in-law and friends.  Stephen Evans has added his mother. 
9.	Mr Evans wrote again on the 17 May 2001 and he praised the officers for doing an excellent job. We find this comment hardly consistent with their comment in their notice of appeal (see pages 1 and 2 of the bundle) to the effect that the customs officers had lied and made false statements. We understand that the reference to false statements related to the customs officers right to seize the goods and the vehicle. Customs officers are empowered to do so by virtue of sections 49(1), 139(1) and 141 of the Customs and Excise Management Act 1979.
10.	The Excise Duties (Personal Reliefs) Order 1992 as amended at article 3 states: -
	“Subject to the provisions of this Order a community traveller entering the United Kingdom shall be relieved from the payment of any duty of excise on excise goods which he has obtained for his own use in the course of cross-border shopping and which he has transported”
	“Own Use” is defined in the Order as:-
	“Own Use” includes use as a personal gift provided that if the person making the gift receives in consequence any money or money’s worth (including any reimbursements of expenses incurred in connection with obtaining the goods in question) his use shall not be regarded as own use for the purpose of this Order.”
The Commissioners may require the person to satisfy them that the goods are not being held for commercial purposes.
By virtue of The Customs and Excise Management Act 1979 any vehicle, which has been used for the carriage of the goods, is also liable to forfeiture, although the Commissioners may restore the vehicle on such terms as they think proper.

11.	Ben Mills produced a skeleton argument and he submitted that 
•	The initial answers given by Graham Crocker and Stephen Evans to the Customs Officer prior to the seizure to the effect that the families had contributed to the purchase price were the correct answers and the subsequent attempt to change them was based on the information received later.
•	The legislation makes it clear that where the goods are transferred to another person for money or monies worth …the goods are regarded as being held for commercial purposes. As a consequence, the vehicle is also to be forfeited as it was used to carry the goods. (see section 141 Customs and Excise Management Act 1979).
•	There are inconsistencies in the explanation given by Graham Crocker and Stephen Evans as to who the goods were for and where the goods were purchased. It is most unlikely that they were going to give most of the goods away given the quantities, which were 10 times the guideline limits for the hand rolling tobacco and 2 times the guideline limits for the cigarettes. Further, the tobacco would last very much longer than the appellants had alleged. 
•	The proposal that compensation would be paid for the vehicle was eminently reasonable and proportionate as the duty payable would have been £2469 and the vehicle was worth £2775.
In the circumstances the Commissioners had acted reasonably in refusing to restore the goods and requiring payment for the vehicle equivalent to the duty owed. 
12.	My Colleague and I are satisfied that the reviewing officer’s decisions not to restore Mr Crocker’s and Mr Evan’s goods, nor Pamela Crocker’s vehicle other than on the payment of the duty, were ones that a reasonable body of Commissioners could have arrived at.  It is not credible that Mr Crocker and Mr Evans would give so many of the goods away.  There are considerable inconsistencies as to whom the goods would be given.  We are also satisfied that the original answer stating that the families had paid for the goods was the correct answer.  As a result the goods are deemed to have been purchased for commercial purposes.  Further the quantity and variety of the goods are such that they could not have been consumed in the circumstances alleged.  As to the vehicle it is clearly proportional to offer £306 by way of compensation given that the vehicle was only worth £2775 and the duty amounted to £2469.37.
13.	Ben Mills advised that Mark Thurston and Kieron Villiers expenses for their train fare and over night stay amounted to £320.  Deborah Carole Gillespie expenses amounted to £73.  We are very surprised that the Appellants have not attended.  They were advised in a letter from the tribunal of 8 October 2004 that the appeal would be heard today at 12.30pm.  If they had not intended to come we would have expected them to have asked for the £306 for the vehicle.  As they have neither attended nor indicated why they have not done so, we award costs of £893 to the Commissioners made up of expenses of £393 and counsel’s fee of £500.

DAVID PORTER
CHAIRMAN
Release Date: 24 February 2005

MAN/04/8038