Excise duty restoration of vehicle – Dismissed on facts

LONDON TRIBUNAL CENTRE

                                  MICHAEL ANTHONY CULLY                   Appellant

	- and -

	THE COMMISSIONERS OF CUSTOMS AND EXCISE	Respondents

				Tribunal:	  Dr David Williams (Chairman)
  Mrs Caroline de Albuquerque 

Sitting in public in London on 11 June 2003 

The Appellant did not attend and was not represented

Sarabjit Singh, counsel, instructed by the Solicitor of Customs and Excise for the Respondents

© CROWN COPYRIGHT 2003

DECISION

1	Mr Cully is appealing against a decision contained in a letter dated 16 July 2002 in which the Commissioners reviewed and confirmed an earlier decision of the Commissioners to restore a lorry and trailer to the appellant for a “restoration fee” of £13,750.

The absence of the appellant 

2	The case was called for hearing at the notified time. Mr Singh was in attendance with several witnesses, but the appellant was neither present nor represented. The tribunal adjourned for a short while to establish whether the appellant intended to be present or represented. On reconvening after 20 minutes, the clerk told the tribunal that the appellant had been contacted. He was not planning to attend as he was not aware that the hearing was that day. But he was also understood to say that his representative had faxed to ask for a postponement. The clerk confirmed that the office had received no fax or telephone message from the representative. The hearing notice had been sent to the representative in good time at the address given by the representative on the notice of appeal. Attempts had been made to contact the representative at both the office telephone number and the mobile telephone number given, but there was no reply on either.

3	Mr Singh asked the tribunal, in the circumstances, to continue the hearing in the absence of the appellant under regulation 26(2) of the Tribunal Regulations. Having checked that proper notice was given, the tribunal decided to hear the case in the absence of the appellant. 

The grounds of appeal 

4	The tribunal noted that the grounds of appeal given on the notice of appeal was “contradictory facts”. The tribunal was assisted in considering the appellant’s case by an exchange of letters handed by Mr Singh at the hearing. These consisted of a letter from Mr Cully to the Commissioners datestamped as received on 5 February 2003, and a reply for the Commissioners from Mr Penfold, the review officer, also dated 5 February 2003. Mr Cully’s letter contained a two page handwritten statement of his view of what happened when his vehicle was seized. It adds to the evidence about the seizure itself, and the background to the load being carried by Mr Cully at the time of the seizure. But it does not explain the “contradictory facts” or raise any specific issue by way of a challenge to or in mitigation of the decision in the review letter. Mr Penfold, in reply, acknowledges the letter and contends that it confirms the view taken by the Commissioners in seizing the cargo and lorry. There are no other documents in the papers indicating why the appellant appealed against the decision of the Commissioners. 

5	The tribunal was therefore not entirely clear why the appeal was brought before them. Nonetheless, it was satisfied that the appellant had had a full opportunity, with his representative, both to appear before it and to state in writing the nature of the grounds of appeal and neither opportunity had been taken. The tribunal therefore proceeded by asking Mr Singh to put the case and evidence for the Commissioners before it.

The Commissioners’ case

6	Evidence was given to the tribunal by four officers of Customs and Excise. Rachel Whittaker gave evidence in support of her written statement of her role in intercepting a lorry, registered as 93KE4590, and trailer being driven by Mr Cully at about 3.00 am on 31 January 2002. This had taken place at the Import Freight Lane, Eastern Docks, Dover. The load consisted of alcohol. The appellant indicated that he did not know precisely what. She had asked the appellant for his papers. He had confirmed that the lorry and trailer were his. At the request of another officer she had seized the lorry and load from Mr Cully some two hours later, after interviewing Mr Cully and inspecting the papers. 

7	Peter Dyer gave evidence in support of his written statement. He was also on duty at the time of the interception and subsequent seizure of the appellant’s lorry and load. At about 2.45 that morning he had interviewed Mr Cully, and he produced a record of that interview. The appellant had signed a copy of the record of the interview as a true account. The load on the vehicle and trailer consisted of 15,660 litres of whisky  (40% alcohol by volume). The tribunal was separately told that the duty involved on this load was £122,516. Mr Dyer confirmed that he had made the decision to seize the vehicle and load because the address on the ADD (accompanying administrative document, a copy of which is in the appeal papers) related to a former bonded warehouse known to the Commissioners to be no longer in business at the address given. The Commissioners were therefore put on notice that the goods were not destined for a bonded warehouse. They had not been satisfied by Mr Cully that any other arrangements had been made to secure the duty on the load.

8	Carl Penfold also gave evidence. He was the review officer in the case, and he gave evidence in support of the review letter that formed the basis of the decision under appeal. He gave evidence that confirmed that the address to which the appellant’s documents stated he was to take the load was invalid and that there was no other valid means of accounting for the excise duty on the load in place. He further gave evidence that the Commissioners’ records  showed that the appellant had imported consignments of beer and spirits on at least six occasions prior to the current case. Further the records showed that the appellant was owner and driver of a freight vehicle carrying a full load of spirits that was seized by the Commissioners on 29 January 1999. Mr Penfold had therefore taken the view that the appellant was aware of the possibility of the Commissioners seizing any load. It was his view that the appellant should in all these circumstances have undertaken reasonable checks to ensure that any excise goods being carried by him were being carried properly.

9	The tribunal also received a witness statement from Gerry Dolan, an officer of Customs and Excise, about the restoration policy of the Commissioners and its application to combat the use of vehicles in cross channel excise smuggling and fraud. This statement had been served on the appellant and representative and no objection raised to it. 

10	Copies of the review letter and of the witness statements of each of the witnesses had been served on the appellant and his representative. In the absence of any challenge to any specific aspect of the evidence of any of the officers, the tribunal accepts that evidence. As it confirms written statements in the record available to both parties, the tribunal sees no useful purpose served by repeating it in detail in this decision save as directly relevant to our review of the decision of the Commissioners. 

The appeal 

10	The jurisdiction of the tribunal on an appeal about the seizure of a vehicle is limited to the powers under section 16 of the Finance Act 1994. The tribunal is satisfied that there has been a decision by the Commissioners under section 15 of that Act. Accordingly, the tribunal has the powers under section 16(4) to direct a further review. Having considered its powers, the tribunal sees no ground to reach any conclusion other than that the decision of the Commissioners was a decision at which the Commissioners could reasonably have arrived.

11	With regard to the decision to seize the vehicle, there was clear evidence at the time of seizure of an irregularity. The appellant had a load with potential excise duty of over £100,000. He was carrying this as a commercial cargo. He had collected it from a distillery in Spain so that, although he stated he did not know precisely what his cargo was, he should have been aware when receiving the cargo from the place of collection of the likely contents. But any doubt he might have had should have been put beyond question by both the International Consignment Note (CMR) and the AAD he handed to the Customs officers. Both stated on their face that the load was 1300 cases of whisky (or whiskey). The tribunal accepts that the potential excise duty on this load was £122,000.  

12	The tribunal also accepts that the appellant’s personal history of carrying such loads would have made any reasonable person in his position fully aware of both the responsibilities and risks of carrying this form of load. Without repeating the evidence, the tribunal is satisfied that the appellant did not make reasonable checks  – or indeed any significant checks - about the delivery address for the load or about the payment of the excise duty. He was, or should have been, fully aware of the risks that his vehicle and the load would be seized. 

13	The other question considered by the tribunal was whether the Commissioners had taken a reasonable decision in offering to return the vehicle and trailer in exchange for a restoration fee of £13,750.  The tribunal takes the view that this decision is entirely reasonable and in particular cannot be challenged as disproportionate in the circumstances of this case. That sum is little more than 10 per cent of the excise duty at risk in the seized cargo. The appellant has not sought to challenge that this was unfair as a valuation of the lorry and trailer, and the tribunal expressly accepts that it is a fair value. The Commissioners have therefore acted within the declared policy in this case. The tribunal accepts that policy as providing for a proportionate response to the actions of the appellant in this case. It also accepts the offer made by the Commissioners to the appellant as an entirely appropriate exercise of that policy. 

14	Accordingly, the tribunal sees no ground on which to ask the Commissioners to conduct any further review of their decision of 16 July 2002, and dismisses the appeal. 

15	There is no order for costs. 

DR DAVID WILLIAMS
CHAIRMAN

RELEASED:

LON/02/8235