19293

Disclosure of documents – Rule 20(3) VAT Tribunal Rules 1986 – Application refused

LONDON TRIBUNAL CENTRE

KINGPIN EUROPEAN LIMITED
Appellants

and

THE COMMISSIONERS FOR REVENUE AND CUSTOMS 
Respondents

Tribunal:  DR K KHAN (Chairman)

Sitting in public in London on 18 August 2005

Mr Eamon McNicholas, Counsel,  for the Appellant

Mr Kieron Beal, Counsel, instructed by the Solicitor for the Revenue and Customs, for the Respondents

© CROWN COPYRIGHT 2005
APPEAL

1	This is an application by the Appellant for a direction that:
“under Tribunal Rules 20(3) the Respondents within 42 days do disclose and copy to the Appellant all the Respondents’ records relating to this matter and the related criminal investigation by the Respondents called “Operation Galleon” excluding items exclusively relating to a third party (being neither the Appellant nor anyone associated with it).”
2	The Appellant says that there is a need for full and open disclosure of documents by the Respondents for three important reasons:
(a)	The Appellant’s right to a fair appeal;
(b)	Pleas of fraud and tax evasion raised in the Statement of Case, in particular paragraphs 39 and 42(b); and
(c)	Whether the Respondents’ actions are, perhaps, invalidated by possible illegal or criminal actions by the Respondents, so as to vitiate their reliance on VATA s.24 - 25 and VAT Regs. (29 see Statement of Case paragraphs 28 – 32).
In short, the Appellant believes that there is a need for full disclosure of all relevant information in order to obtain a fair hearing.
3	The Respondents object to this application on the grounds that the information requested is not relevant.  They say that they would be willing to provide particular itemised information if these are requested by the Appellant and provided with a list of documents.  They also point out that there were previous unsuccessful applications by the Appellant to obtain information.
4	In support of their application, the Appellant provided the following information:
(a)	Letter from the Economic Secretary to the Treasury, John Healey to John McFall dated 29 September 2004, concerning “Operation Gestalt” involving Customs and Excise handling of a series of excise diversion frauds focusing on London City Bond in the mid-1990s.
(b)	An internal memorandum from Mrs M Dunn to Mr J Flood both at the Solicitors Office, Customs and Excise dated 2 February 1999.
(c)	Customs and Excise internal memorandum from the Chief Investigator (Terry Byrne) to the Solicitors Office dated 3 March 2000.
(d)	Customs and Excise letter to Barker Gillette, Solicitors, dated 9 May 2000.
(e)	Article from the Tax Journal of 4 July 2005 titled “Another Abuse of Process”.
(f)	Article from the Sunday Times dated 24 July 2005 on Thames Valley Police Investigation into “Operation Virtue”
5	Mr Eamon McNicholas appeared for the Appellant and Kieron Beal for the Respondents.
6	Mr McNicholas was concerned about “Operation Gestalt” which involved Customs and Excise handling of a series of excise diversion frauds.  The case involved the smuggling of duty free alcohol from a bonded warehouse in East London, London City Bond.  Several customs officials were under investigation and it was found that there was a major failing in the handling of the case which involved the evasion of more than £600 million of duty.  Mr McNicholas felt that there should be disclosure of the information requested since it would establish the way in which Customs and Excise dealt with excise diversion fraud and the modus operandi of Customs and Excise which would be relevant to the present case.  He said that since issues of fraud and tax evasion were involved in excise diversion fraud the information requested would be helpful in establishing his client’s position.  He wanted, as it were, “all the cards on the table” in order to establish his client’s case.  He referred to the position of Colin Ridgewell, a Director of Kingpin, against whom there was an allegation of fraud.
7	Mr Beal explained that this was a third time an application had been made to obtain information of this type.  Mr Beal categorised this application as a “fishing expedition” by the Appellant and pointed out that not only had the charges against Mr Ridgewell had been dropped but also the same firm involved in this case was involved in a separate High Court matter involving Operation Galleon and so would have access to the relevant information.  He did not see the Appellants’ position as being prejudiced if the application was refused.

DECISION
1	The application is refused.  It has not been established by the Appellant that the information requested was necessary for a fair trial and in any event the Respondents have indicated that they will be providing documents in their possession which support their case and would be willing to accommodate any particular requests from the Appellant to produce relevant documents.
2	It is evident that a substantial amount of information relating to excise diversion fraud and London City Bond is in the public domain.  The matter has been the subject of a review by the government and the findings of that review have been published and been the subject of press releases.  
3	The requests made in this case is very wide.  It will not be unfair to say that it is a akin to a fishing expedition.  In matters such as these, it is necessary to look at the relationship between the applicant and the matter to which the application relates to see if there is sufficient interest for disclosure of information in the interest of fairness and costs.  Given the wide request for information which has been made, it is difficult to see the relevance of the information and it also raises issues of costs. 
4	This is not to say the Appellant is not interested in the information, this is self evident.   Similar requests have previously been put before the Tribunal.  I understand from the parties that the same firm involved in this matter was involved in a High Court matter relating to Operation Galleon and had access to a substantial amount of information on the investigation.  I also understand that the charges against Mr Colin Ridgewell, a director of Kingpin, have been dropped and some of the information requested related to his position.  
5	Therefore, in the circumstances, the better way to proceed would be for the Appellant to provide a reasonable list of relevant documents to the Respondents which they would like to be disclosed.  I do not think that the hearing will in anyway be prejudiced or unfair if we proceed on that basis.

DR KAMEEL KHAN

CHAIRMAN
RELEASE DATE:11 October 2005

LON/2001/712