“I can confirm that there is no evidence to contend that Radarbeam Ltd is involved in any fraudulent trading. I cannot confirm whether or not Radarbeam Ltd has any knowledge of such trading. I can confirm, from our frequent discussions, that Mr. Todd is aware that fraudulent trading exists in the area in which he has chosen to conduct his business.”
“56. In the same way, a taxable person who knew or should have known that, by his purchase, he was taking part in a transaction connected with fraudulent evasion of VAT must, for the purposes of the Sixth Directive, be regarded as a participant in that fraud, irrespective of whether or not he profited by the resale of the goods.
“47. Accordingly, the objective criteria which form the basis of concepts used in the Sixth Directive form the basis of the concepts which limit the scope of VAT and the right to deduce under ss. 1, 4 and 24 of the 1994 Act. Applying the principle in Kittel , the objective criteria are not met where a taxable person knew or should have known that by his purchase he was participating in a transaction connected with fraudulent evasion of VAT. That principle merely requires consideration of whether the objective criteria relevant to those provisions of theVAT Act 1994 are met. It does not required the introduction of any further domestic legislation.
“In my judgment the primary facts found by the Tribunal relevant to @tomic’s knowledge were, in the aggregate, sufficient to permit the tribunal, if it thought fit, to make a finding of dishonest knowledge on the part of @tomic. It is in this context important for an appeal court to have regard to the need to appraise the overall effect of primary facts, rather than merely their individual effect viewed separately. As Lewison J put it in Arif v Revenue and Customs Commissioners[2006] EWHC 1262 (Ch) at paragraph 22:
“There is one other general comment that is appropriate at this stage. It relates to the evaluation of circumstantial evidence. Pollock CB famously likened circumstantial evidence to strands in a cord, one of which might be quite insufficient to sustain the weight, but three stranded together might be quite sufficient ( R v Exall (1866) 4 F & F 922). Thus there can be no valid criticism of a tribunal which considers that one piece of evidence, while raising a suspicion, is not enough on its own to find dishonesty; but that several such pieces of evidence, taken cumulatively, lead to that conclusion.”
“… the referring court asks essentially whether, where the recipient of a supply of goods is a taxable person who did not and could not know that the transaction concerned was part of a fraud committed by the seller…”
“Where a recipient of a supply of goods is a taxable person who did not or could not know that the transaction concerned was connected with a fraud committed by the seller…”
“62. The principle of legal certainty provides no warrant for restricting the connection, which must be established, to a fraudulent evasion which immediately precedes a trader’s purchase. If the circumstances of that purchase are such that a person knows or should know that his purchase is or will be connected with fraudulent evasion, it cannot matter a jot that that evasion precedes or follows that purchase. That trader’s knowledge brings him within the category of participant. He is a participant whatever the stage at which the evasion occurs.”