“61. Rimer J at paragraph 23 of his judgment suggested that the test could be applied by asking ten people lined up to identify a site. The Tribunal was persuaded that such people would not consider the footprint of the dam as one site and the footprint of the quarry as another. 62. The Tribunal considered the distance of the quarry from the dam but found that this in itself (because it was only an average of five hundred metres) was no more persuasive than if it had been two kilometres as long as all were within the, sensible workable meaning of the word, “site”. 63. Lastly, in consideration of the definition of “site”, the Tribunal took account of the scale of the project which was a major civil engineering project and within this the size of the area that was required for the dam and reservoir. 36. In Northumbrian Water gravel was extracted from a borrow pit next to a reservoir which was used to raise the level of Abberton Reservoir south of Colchester in order to increase its storage capacity. The FTT in its decision (reported at[2014] SFTD 316 ) applied a “sensible working meaning” to the concept of “site” and held (at [195]-[196]) that an ordinary person looking at the works would conclude that it was all one site. 37. Rose J, who dismissed HMRC’s appeal to the Upper Tribunal noted (at [14] of her decision) that Northumbrian Water owned the freehold to all the land covered by the reservoir and borrow pit and that the FTT had stated that the raising of the main dam, the construction of the col dams and the causeway and the extraction from the borrow pit were all part of a single construction project. She went on (at [23]) to list, with approval, the following factors considered by the FTT in applying s 19(3)(e) FA 2001 to the facts of the case: (a) the distance, scale and size of the project: they held that these factors did not suggest that the locations constitute one site but, given this was a large scale civil engineering project, these factors were also ‘not… inconsistent with them being on one site’; (b) the site boundaries in the planning application: these were not determinative but were something that the Tribunal ought to take into account. Looking at the plans, and in particular at Condition 105, this factor was supportive of the extraction of the gravel and the raising of the reservoir being viewed as part and parcel of the same project. However this factor did not assist the Tribunal a great deal in applying section 19(3)(e) and so was not something they placed any significant weight on; (c) the site boundaries in the construction contract and the fencing on the ground. The Tribunal considered that while the construction site is not necessarily determinative of what is the site for section 19(3)(e), it is a significant factor to take into account because that is the primary form of exploitation to which the relief in that section is directed. The extent of the construction site was a matter of fact and impression, not necessarily co-extensive with the bounded area. They concluded that the pits and the reservoir formed one construction site; (d) NWL’s rights to the whole site. The fact that NWL owned both the pits and the reservoir enabled it to create the temporary haulage road for the transport of the gravel, thereby breaching any ‘buffer area’ created by agricultural land in between the Rye Borrow Pit and the reservoir. 38. At [35] of her decision Rose J observed that the “tenor” of the decision in Customs and Excise Commissioners v East Midlands Aggregates Ltd[2004] EWHC 856 (Ch) : “… emphasises that the identification of the ‘site’ in these provisions is a multi-factorial test in which one weighs a number of factors without relying on any one factor as being conclusive.”
“I agree with HMRC to the extent that it is difficult to see how the exception in section 19(3)(e) can be squared with the primary environmental objective pursued by the levy. One would have thought that the situation where the operator of a construction site is comparing the benefits of using virgin aggregate won on site with the benefits of transporting recycled aggregate from elsewhere is precisely the situation where imposing the levy would ensure that the environmental disadvantages of using virgin aggregate are taken into account in deciding which option is more cost effective. However, although minimising transport is not the primary goal of the levy, I consider that the policy basis for section 19(3)(e) must be to avoid discouraging use of aggregate which is immediately to hand when construction works are being carried out. That follows from a rejection of the submission that the primary aim of section 19(3)(e) is to encourage the return to the land of aggregate that has been removed but is not, in the event, needed. I do not accept that the references to the policy behind section 19(3)(e) led the Tribunal into an error of law in their interpretation of the statutory provisions” 47. It is also clear from the decision of the Upper Tribunal in Northumbrian Water that we should consider the state of the site as at the date of the works rather than on their completion. 48. As Rose J said, at [36]: “I do not accept HMRC’s argument that the Tribunal was wrong to look at the state of the construction site as at the date of the building works (when a temporary haulage road had been created to transport the aggregate to the reservoir) rather than when the work had been completed (when that track would be removed and the land between the Pit and the reservoir returned to agricultural use). There is nothing in the wording of the section to direct attention exclusively to the position once the construction works have finished. I accept Mr Baldry QC’s submission that it is important for a builder to know at the time it makes use of the aggregate whether the exploitation of the aggregate will be ‘commercial’ or not and hence whether he is under an obligation to register for the levy under section 24 or not. The definition of ‘taxable activity’ in section 24(3) indicates that a person will know at the time he is carrying on a particular activity whether it amounts to subjecting the aggregate to commercial exploitation or not and whether he is responsible for it or not. This does not fit comfortably with an interpretation which requires the person to predict on the basis of the initial building plans whether there is going to be a sufficient nexus between the quarry and the reservoir once the project is completed many months afterwards for the exploitation to fall outside the definition of commercial exploitation.” 49. Therefore, in order to determine the “site” in the present case we consider the following various factors as they existed at the time the aggregate was won and used for the construction of the platform in the Restoration Area: (1) Ownership of the Quarry and Restoration Area; (2) Planning consents; (3) The location of Restoration Area within the original boundary of the Quarry; (4) The use of land; (5) Contiguous physical connection between Restoration Area and remainder of the Quarry; (6) The continuing drainage of the Quarry through the Restoration Area (7) The view of ordinary person; and (8) The adoption of a sensible working meaning of the site. 50. Although HMRC, in their letter of22 May 2013 to HQPE, state that the Restoration Area and remainder of the Quarry “would be seen as one site prior to the sale of part of the site to the developer” and appear to accept if it had all remained in HQPE’s ownership the liability to aggregates levy and indeed this dispute would not have arisen, Miss Busch does not contend that the separate ownership of the Quarry and Restoration area are determinative but “highly relevant” factors and argues that following its sale the Restoration Area ceased to be part of the Quarry and therefore was no longer part of the site. 51. We agree that the ownership of the land, while relevant, cannot be determinative of whether there was a single site at the time the aggregate was won as, quite clearly, a site can have more than one owner as was the case in Hochtief . However, we do not consider the approach advocated by Ms Busch, with its conflation of quarry and site, to be appropriate. Section 19 FA 2001 refers to a “site” and even if the land sold to the Developer on which the platform was constructed ceased to be part of the quarry it does not, in our view, necessarily follow that is also no longer part of the site. 52. Although in both Hochtief and Northumbrian Water the site, for the purposes of s 19 FA 2001, extended beyond the boundaries of the quarry where the aggregate was won that is not the position in the present case. As is clear from the reasons for granting planning permission for the construction of the platform at the Restoration Area (see paragraphs 9 and 10 above) it was considered that amenity impacts could be satisfactorily contained as “operations will be contained within an existing operational quarry”
“… If, as the Tribunal found, there is no commercial exploitation taking place at all here, then the question as to where the boundary lines should be drawn on the register does not arise – there is nothing to register.”
"96. Applying those principles to the facts of the present appeal we first look to see if a right of appeal is given by statute. It was agreed that the jurisdiction of the Tribunal in this appeal derived from s.83(e) of the 1994 Act which provides that an appeal shall lie to the Tribunal with respect to "the proportion of input tax allowable under section 26"