Balaz v Director of Border Revenue [2013] UKFTT 643 (TC)
[23]Under s 2(1) of the Tobacco Products Duty Act 1979: There shall be charged on tobacco products imported into or manufactured in the United Kingdom a duty of excise … 24. Regulation 13 of the Excise Goods (Holding, Movement, and Duty Point) Regulations 2010 provides that:(1) Where excise goods already released for consumption in another Member State are held for a commercial purpose in the United Kingdom in order to be delivered or used in the United Kingdom, the excise duty point is the time when those goods are first so held.(2) Depending on the cases referred to in paragraph (1), the person liable to pay the duty is the person: (a) making the delivery of the goods; and (b) holding the goods intended for delivery; or (c) to whom the goods are delivered.(3) For the purposes of paragraph (1) excise goods are held for a commercial purpose if they are held -- (a) by a person other than a private individual; or (b) by a private individual ("P"), except in the case where the excise goods are held for P’s own use and were acquired in, and transported to the United Kingdom from, another member State by P.(4) For the purpose of determining whether excise goods referred to in the exception in paragraph (3)(b) are for P's own use regard must be taken of: (a) P’s reasons for having possession or control of those goods; (b) whether or not P is a revenue trader (c) P’s conduct, including P’s intended use of those goods or any refusal to disclose the intended use of those goods; (d) the location of those goods; (e) the mode of transport used to convey those goods; (f) any document or other information relating to those goods; (g)the nature of those goods including the nature or condition of any package or container; (h) the quantity of those goods and, in particular, whether the quantity exceeds any of the following quantities -- ... 3 kg of any other tobacco products [1 kg from 1 October 2011] (i) whether P personally financed the purchase of the goods; (j) any other circumstances that appear to be relevant.(5) For the purposes of the exception in paragraph (3) (b)- ... (b) "own use" includes use as a personal gift but does not include the transfer of goods to another person for money or money's worth (including any reimbursement of expenses incurred in connection with obtaining them)". 25. If excise duty has not been paid or secured prior to the time that the goods are held for a commercial purpose, they are liable to forfeiture under section 49(1) CEMA 26. Section 139(1) CEMA provides that: Any thing liable to forfeiture under the customs and excise Acts may be seized or detained by any officer or constable, or any member of Her Majesty’s armed forces or coastguard. 27. Under s 141(1) CEMA: where any thing has become liable to forfeiture under the Customs and Excise Acts- (a) any ship, aircraft, vehicle, animal, container (including any article of passengers’ baggage) or other thing whatsoever which has been used for the carriage, handling, deposit or concealment of the thing so liable to forfeiture, either at a time when it was so liable or for the purposes of the commission of the offence for which it later became so liable; and (b) any other thing mixed, packed or found with the fittings so liable, shall also be liable to forfeiture 28. Section 152 CEMA establishes that: The Commissioners may, as they see fit – (a) … (b) restore, subject to such conditions (if any) as they think proper, anything forfeited or seized under the Customs and Excise Acts.” 29. Section 14(2) of the Finance Act 1994 provides that: Any person who is – (a) a person whose liability to pay any relevant duty or penalty is determined by, results from or is or will be affected by any decision to which this section applies, (b) a person in relation to whom, or on whose application, such a decision has been made, or (c) a person on or to whom the conditions, limitations, restrictions, prohibitions or other requirements to which such a decision relates are or are to be imposed or applied, may by notice in writing to the Commissioners require them to review that decision. 30. Section 15(1) of the Finance Act 1994 states: Where the Commissioners are required in accordance with this Chapter to review any decision, it shall be their duty to do so and they may, on that review, either – (a) confirm the decision; or (b) withdraw or vary the decision and take such further steps (if any) in consequence of the withdrawal or variation as they may consider appropriate. 31. Section 16(4) to(6) of the Finance Act 1994 sets out the powers of the Tribunal on an appeal against a decision as follows: (4) In relation to any decision as to an ancillary matter, or any decision on the review of such a decision, the powers of an appeal tribunal on an appeal under this sections shall be confined to a power, where the tribunal are satisfied that the Commissioners or other person making that decision could not reasonably have arrived at it, to do one or more of the following, that is to say - (a) to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the tribunal may direct; (b) to require the Commissioners to conduct, in accordance with the directions of the tribunal, a further review of the original decision; and (c) in the case of a decision which has already been acted on or taken effect and cannot be remedied by a further review, to declare the decision to have been unreasonable and to give directions to the Commissioners as to the steps to be taken for securing that repetitions of the unreasonableness do not occur when comparable circumstances arise in future. (5) In relation to other decisions, the powers of an appeal tribunal on an appeal under this section shall also include power to quash or vary any decision and power to substitute their own decision for any decision quashed on appeal; (6) On an appeal under this section the burden of proof as to – (a) the matters mentioned in subsection (1)(a) and (b) of section 8 above; (b) the question whether any person has acted knowingly in using any substance or liquor in contravention of section 114(2) of the management Act, and (c) the question whether any person had such knowledge or reasonable cause for belief as is required for liability to a penalty to arise under section 22(1) or 23(1) of the Hydrocarbon Oil Duties Act 1979 (use of fuel substitute or road fuel gas on which duty not paid). shall lie upon the Commissioners, but it shall otherwise be for the appellant to show that the grounds on which any such appeal is brought have been established. Discussion and Conclusion[32]As we have explained the jurisdiction of the Tribunal in an appeal such as this is limited. The issue for us to determine is not whether the Vehicle should be restored to Mr Balaz ( and it is not sufficient that we might ourselves have reached a different conclusion ) but whether, having regard to our findings of fact, the decision taken by UKBF not to restore the Vehicle is one that could reasonably have been reached.33. Lord Phillips of Worth Maltravers MR (as he then was) said in Lindsay v Commissioners of Customs and Excise [2002] STC 508 at [40]: “… the Commissioners will not arrive reasonably at a decision if they take into account irrelevant matters, or fail to take into account all relevant matters”34. Having heard from Mr Harris who confirmed the matters he had taken into account when reaching his conclusion to uphold the decision not to restore the Vehicle to Mr Balaz (as set out in paragraph 20, above) we find that he did not take into account any irrelevant matters or fail to take into account all relevant matters. It therefore follows that we find the decision not to restore the Vehicle to be reasonable and proportionate having regard to all the circumstances of the case.35. Turning to the issue of exceptional hardship we note that circumstances have somewhat changed since Mr Balaz’s solicitors requested the review and the completion of the Notice of Appeal. Mr Balaz now lives in Ostend with Ms Kroupova and their son and as they no longer live in Cardiff there is no need to travel to the UK to see them. As for his other children, Mr Balaz has chosen to live in Ostend rather than Leuven where they live with his former wife and as a result he is less able to spend time with them.36. We agree, as Mr Harris has stated in his letter of 7 December 2012 to Mr Balaz’s solicitors (which we have quoted at paragraph 21, above), that “hardship is a natural consequence of having a vehicle seized” and accept that Mr Balaz has indeed suffered hardship as a result of the seizure of the Vehicle. However, we are unable to find that, having regard to all the circumstances, this hardship is exceptional.37. Therefore, for the above reasons the appeal is dismissed. Right to Apply for Permission to Appeal38. This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice. JOHN BROOKS TRIBUNAL JUDGE RELEASE DATE: 5 November 2013