Drinks and Food UK Limited v The Commissioners for HMRC [2025] UKUT 00315 (TCC)

“56. A review was sought. The request for review asserted that the Original Decision had been unreasonable on four grounds which were summarised and then particularised. The summary stated: “a. [the decision to refuse] has failed to meet the portion of the claim in which there is no suggestion of any breaches of conditions or advance criteria required. b. It has taken into account or given improper weight to irrelevant factors including elements of the movement which were not subject to the claim or factors preceding November 2019 when assurance was sought that the claim could be accepted by HMRC. c. It has failed to take into account or give sufficient weight to relevant factors including the guidance published by HMRC, the legislation introduced by HMRC, and the system operated by HMRC in such a way as to make one of the export conditions impossible to meet. d. It fails to properly consider the exercise of the Commissioners’ discretion to waive any and all conditions which necessarily calls for a proper consideration of the impact on DFUK for rejecting the claim and any countervailing considerations.” 57.The particularised errors were identified as: (1) The shipment of 112 bottles of vodka along with the goods which were the subject of the Claim was irrelevant to whether the Claim was valid and met the statutory conditions. They had not been included in the NOI or claim. (2) There was no requirement to amend the NOI, the information required in EX75 had not changed; in particular, there was no requirement to notify that some of the goods were exported post 31 December 2020. (3) HMRC were not entitled to reject the whole of the claim on the basis of a failure to provide the appropriate export documentation. They could, at most, cause the Claim to be reduced, excluding the duty claimed in respect of the goods exported on 8 April 2021. Further, and in any event, as it was impossible to obtain the documentation HMRC purportedly required to support a post Brexit shipment by roll-on-roll-off ferry there was no basis for rejecting the claim in respect of the April shipment. (4) There was no basis for rejection of that part of the claim pertaining to goods for which there was no requirement to obliterate. Further, sufficient and adequate records had been produced to HMRC of obliteration to justify a conclusion that either the requirement to obliterate had been met or, to the extent that a record of the obliterated URNo was a condition, it should be waived. (5) HMRC had failed to meet the Appellant’s legitimate expectation that the claim would not be rejected for failure to comply with the time limit condition.” “a. [the decision to refuse] has failed to meet the portion of the claim in which there is no suggestion of any breaches of conditions or advance criteria required. b. It has taken into account or given improper weight to irrelevant factors including elements of the movement which were not subject to the claim or factors preceding November 2019 when assurance was sought that the claim could be accepted by HMRC. c. It has failed to take into account or give sufficient weight to relevant factors including the guidance published by HMRC, the legislation introduced by HMRC, and the system operated by HMRC in such a way as to make one of the export conditions impossible to meet. d. It fails to properly consider the exercise of the Commissioners’ discretion to waive any and all conditions which necessarily calls for a proper consideration of the impact on DFUK for rejecting the claim and any countervailing considerations.” (1) The shipment of 112 bottles of vodka along with the goods which were the subject of the Claim was irrelevant to whether the Claim was valid and met the statutory conditions. They had not been included in the NOI or claim. (2) There was no requirement to amend the NOI, the information required in EX75 had not changed; in particular, there was no requirement to notify that some of the goods were exported post 31 December 2020. (3) HMRC were not entitled to reject the whole of the claim on the basis of a failure to provide the appropriate export documentation. They could, at most, cause the Claim to be reduced, excluding the duty claimed in respect of the goods exported on 8 April 2021. Further, and in any event, as it was impossible to obtain the documentation HMRC purportedly required to support a post Brexit shipment by roll-on-roll-off ferry there was no basis for rejecting the claim in respect of the April shipment. (4) There was no basis for rejection of that part of the claim pertaining to goods for which there was no requirement to obliterate. Further, sufficient and adequate records had been produced to HMRC of obliteration to justify a conclusion that either the requirement to obliterate had been met or, to the extent that a record of the obliterated URNo was a condition, it should be waived. (5) HMRC had failed to meet the Appellant’s legitimate expectation that the claim would not be rejected for failure to comply with the time limit condition.”

“58. The Review dated 24 November 2021 focusses on the time limit condition. It rejects the Appellant’s contention that the email of 27 December 2019 represented a waiver of the time limit. The position adopted in the letter is that because other conditions for drawback have not been met and there are no other exceptional circumstances, there can be no waiver of the time limit. The letter does not indicate that HMRC had the power to waive any of the other conditions. The identified failures are as previously: (1) The inclusion of 112 cases of vodka on which duty had not been paid. (2) A failure to provide the relevant evidence of export for the April 2021 shipment. (3) The absence of a record of the unique reference of the duty stamps obliterated. (4) The failure to notify that some of the goods were not exported by way of dispatch.” (4) The failure to notify that some of the goods were not exported by way of dispatch.”

“Power to provide for drawback of excise duty. (1) Subject to the following provisions of this section, the Commissioners may, in relation to any duties of excise, by regulations make provision (a) conferring an entitlement to drawback of duty in prescribed cases where the Commissioners are satisfied that goods chargeable with duty have not been, and will not be, consumed in the United Kingdom; and. (b) conferring an entitlement to drawback of duty, in prescribed cases, on the shipment as stores, or warehousing in an excise warehouse for use as stores, of goods chargeable with duty (2) The power of the Commissioners to make regulations under this section shall include power— (a) to provide for, or for the imposition of, the conditions to which an entitlement to drawback under the regulations is to be subject; (a) conferring an entitlement to drawback of duty in prescribed cases where the Commissioners are satisfied that goods chargeable with duty have not been, and will not be, consumed in the United Kingdom; and. (b) conferring an entitlement to drawback of duty, in prescribed cases, on the shipment as stores, or warehousing in an excise warehouse for use as stores, of goods chargeable with duty (a) to provide for, or for the imposition of, the conditions to which an entitlement to drawback under the regulations is to be subject; (b). to provide for the determination of the person on whom any such entitlement is conferred; (c) to make different provision for different cases, including different provision for different duties and different goods; and (d) to make such incidental, supplemental, consequential and transitional provision as the Commissioners think necessary or expedient. …”

“(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 section 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 review or further review as appropriate 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 review or further review as appropriate, 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.” (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 review or further review as appropriate 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 review or further review as appropriate, 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.”

“(8) Subject to subsection (9) below references in this section to a decision as to an ancillary matter are references to any decision of a description specified in Schedule 5 to this Act which is not comprised in a decision falling within section 13A(2)(a) to (h) above.”

“150. In relation to the interpretation of subsections 16(4) and (5) and the cases cited, the appellants' submissions had the effect of conflating the two separate provisions. These subsections identify different types of decisions to which they apply: subsection 16(4) governs "any decision as to an ancillary matter" (there is no need to track through the statutory definition of "ancillary matter"); whereas subsection 16(5) governs "other decisions". The basis of review in section 16(4), that the decision-taker could not have reasonably arrived at the decision, is not repeated in subsection 16(5), in respect of "other decisions". That must be seen as reflecting a deliberate choice by the legislature. Had it been intended that the basis of review in section 16(4) be available in respect of "other decisions" under section 16(5), this could have readily been provided for. It wasn't. The appellants' interpretation impermissibly conflates the two subsections. The same cases as were cited by the appellants to the FTT were referred to before me. Judge Reid QC considered these. As I accept the correctness of Judge Reid's reasoning, and his treatment of the authorities cited to him, I need not rehearse these. The cases under section 16(4) of FA 1994, or under other taxing regimes, are of no relevance. Nothing in the appellants' submissions persuades me that these words, or a like test, fall to be imported into section 16(5) or applied to decisions reviewable thereunder. 151. It follows that I accept the respondents' submissions regarding the distinct jurisdictions of the FTT under subsections 16(4) and (5) and as regards its power to assess, as correct in law and are to be preferred. I am particularly persuaded by the observations of Lord Lane in J H Corbitt (Numismatics) Ltd (anent an absence of a general supervisory power residing in the tribunal) and Underhill LJ in CC&C Ltd (anent the careful calibration of the remedies and powers as between subsections 16(4) and (5)). While technically not binding on me, I find the reasoning in these authorities cogent and persuasive…”

“140. In Butlers Ship the taxpayer had sought to challenge the FTT’s conclusion that its powers under section 16(5) FA94 included the powers identified in section 16(4) FA94. The argument advanced was, as here, that the language of section 16(4) FA94 confined the powers of the Tribunal to those identified in that section, giving the Tribunal only a supervisory jurisdiction in relation to ancillary matters but that for other decisions the Tribunal also had a full appellate jurisdiction. HMRC contended, as here, that the decisions to which section 16(4) FA94 relate are management decisions involving some element of subjective assessment appropriately reviewed by the Tribunal pursuant to a limited supervisory jurisdiction. It was therefore inappropriate to extend such supervisory jurisdiction to other decisions which did not involve the exercise of a discretion. HMRC therefore contended that the provisions of section 16(4) FA could not be used in the context of a challenge to a decision that the person was liable to excise duty once a duty point had arisen; it was contended that to do so was, in effect, to judicially review the assessment by the back door. 141. The Upper Tribunal had determined the appeal against the taxpayer on other grounds but proceeded to consider the jurisdiction question. It concluded that there was no error of law in the analysis of the FTT as set out in paragraphs 123 – 139 of the FTT judgment ([2016] UKFTT 501 (TC)). In those paragraphs the FTT had narrated that it is a creature of statute with no inherent judicial review jurisdiction and thus no inherent power to review alleged procedural unfairness. It concluded that the full appellate jurisdiction under section 16(5) FA94 did not provide for an assessment of the reasonableness of HMRC’s decision to assess. The FTT also went on to indicate that, on the evidence, there was nothing to justify a conclusion that HMRC had failed to assess to the best of their judgment or acted unreasonably or irrationally.”

“137. The first step in determining our jurisdiction is to interpret section 16(5) FA94. That section provides that in respect of an appeal such as this our powers “shall also include power to quash or vary any decision and power to substitute [our] own decision for any decision quashed on appeal”. 138. The Appellant contends that the words “shall also include” are a reference to the powers granted to the Tribunal on an appeal in relation to an ancillary matter under section 16(4) FA94 which include the power to require HMRC to conduct a further review. 139. HMRC contend, by reference to the Upper Tribunal in Butlers Ship Stores v HMRC [2018] UKUT 58 (TCC) (Butlers Ship), that the powers under section 16(5) FA94 are standalone powers; the powers under section 16(4) FA94 providing a supervisory jurisdiction in respect of ancillary matters and an appellate jurisdiction as provided under16(5) FA94 in relation to other decisions. … 142. Contrary to the submissions made by HMRC we do not consider that Butlers Ship determines the jurisdiction in this appeal. 143. In the first instance the comments of the Upper Tribunal are obiter dicta and not binding on us. Further, there is no evaluation of the statutory language adopted in sections 16(4) and (5) FA94. Finally, and in light of the Court of Appeal decision in David Beadle v HMRC [2020] EWCA Civ 562, (Beadle) and subsequent decisions of the Upper Tribunal, it is not clear that the decision is soundly reached. 144. In Beadle the Court of Appeal confirmed that the tax tribunals have no inherent judicial review jurisdiction but concluded that in the context of an enforcement decision (i.e. a decision to assess for tax or penalty) there is a presumption that a taxpayer will be able to challenge the decision on public law grounds save where the scope for challenging alleged unlawful conduct has been circumscribed by the relevant statutory scheme. In the context of enforcement action the question will be whether the statutory scheme in question excludes the ability to raise a public law defence in proceedings which are dependent on the validity of the underlying administrative act (see paragraph 44 in particular). 145. In the case of The Executors of David Harrison (Deceased) and others v HMRC [2021] UKUT 273 (TCC) (Harrison) the Upper Tribunal confirmed that in the context of an enforcement decision a challenge on public law grounds was permissible unless the statutory scheme precluded such a challenge. However, in the context of other (non-enforcement) decisions of HMRC clear words are required within the statutory language to permit the taxpayer to challenge the reasonableness of HMRC’s decision on appeal. The UT considered that there was no strong presumption against the FTT having power to consider public law arguments in a non-enforcement appeal; rather it was a question of statutory construction (see paragraphs 34 – 36).”

“148…we have determined to approach the question of statutory construction of sections 16(4) and (5) FA94 on the basis that a drawback claim is not an enforcement decision. 149. We note, in accordance with regulation 7(1) EGDR, drawback claims are subject to conditions imposed by EGDR and by notice published by HMRC but in each and every case those conditions apply “unless [HMRC] otherwise allow”

“41. There is in our judgment no room for doubt that the First-tier Tribunal does not have any judicial review jurisdiction. That was made abundantly clear by the House of Lords in Customs and Excise Commissioners v J H Corbitt (Numismatists) Ltd [1981] AC 22. That case related to the Value Added Tax Tribunals rather than the First-tier Tribunal, but they too were a creature of statute with no inherent jurisdiction, and the relevant principles are identical. Lord Lane (with whom the majority agreed) said, in what remains the classic statement on the point: “Assume for the moment that the tribunal has the power to review the commissioners’ discretion. It could only properly do so if it were shown the commissioners had acted in a way which no reasonable panel of commissioners could have acted; if they had taken into account some irrelevant matter or had disregarded something to which they should have given weight. If it had been intended to give a supervisory jurisdiction of that nature to the tribunal one would have expected clear words to that effect in the [Finance Act 1972]. But there are no such words to be found. Section 40(1) sets out nine specific headings under which an appeal may be brought and seems by inference to negative the existence of any general supervisory jurisdiction.” “Assume for the moment that the tribunal has the power to review the commissioners’ discretion. It could only properly do so if it were shown the commissioners had acted in a way which no reasonable panel of commissioners could have acted; if they had taken into account some irrelevant matter or had disregarded something to which they should have given weight. If it had been intended to give a supervisory jurisdiction of that nature to the tribunal one would have expected clear words to that effect in the [Finance Act 1972]. But there are no such words to be found. Section 40(1) sets out nine specific headings under which an appeal may be brought and seems by inference to negative the existence of any general supervisory jurisdiction.”

“20…In the UT's view, a number of features "point strongly to the conclusion that Parliament did not intend to confer a judicial review function on the VAT Tribunal or the FTT in relation to appeals under s 83 of the VATA 1994"(paragraph 78). The UT noted that the Tribunals, Courts and Enforcement Act 2007 conferred a judicial review function on the UT but not the FTT (paragraph 29) and that the approach Sales J had favoured would have conferred a very extensive judicial review jurisdiction on the FTT "without any of the procedural safeguards, in particular the filter of permission to bring judicial review, and time-limits to which ordinary applications for judicial review in the Administrative Court are subject" (paragraph 76). The UT also cited this passage from the judgment of Nicholls LJ in an income tax case, Aspin v Estill [1987] STC 723 (at 727): "The taxpayer is saying that an assessment ought not to have been made. But in saying that, he is not, under this head of complaint, saying that in this case there do not exist in relation to him all the facts which are prescribed by the legislation as facts which give rise to a liability to tax. What he is saying is that, because of some further facts, it would be oppressive to enforce that liability. In my view that is a matter in respect of which, if the facts are as alleged by the taxpayer, the remedy provided is by way of judicial review."” "The taxpayer is saying that an assessment ought not to have been made. But in saying that, he is not, under this head of complaint, saying that in this case there do not exist in relation to him all the facts which are prescribed by the legislation as facts which give rise to a liability to tax. What he is saying is that, because of some further facts, it would be oppressive to enforce that liability. In my view that is a matter in respect of which, if the facts are as alleged by the taxpayer, the remedy provided is by way of judicial review."”

“20…Were, however, his contentions as to the ambit of section 84(10) of the VATA well founded, it would seem that the FTT had, after all, a wide jurisdiction to rule on public law issues and, in particular, legitimate expectation claims. The jurisdiction would, moreover, have been conferred through a provision introduced in response to the Corbitt decision (viz section 84(10)) (“by the back door”, as Miss Mitrophanous would say), rather than under section 83, the main appeals section. Further, legitimate expectation (and, seemingly, other public law) arguments could be raised in the FTT without any need to satisfy the requirements as to obtaining permission and time limits that govern applications for judicial review: see CPR rr 54.4 and 54.5. It is highly improbable that Parliament intended this when it enacted what has now become section 84(10).”

“76. That approach, in effect if not name, would have been to give to the VAT Tribunal a power of judicial review in relation to the matters covered by section 83(1). Although not exhaustive of all areas in which HMRC is amenable to judicial review in relation to VAT, it would have conferred a very extensive judicial review jurisdiction. It would have done so, moreover, without any of the procedural safeguards, in particular the filter of permission to bring judicial review, and time-limits to which ordinary applications for judicial review in the Administrative Court are subject. 77. In any case, we disagree with the suggestion concerning the plausibility of what Parliament can be supposed to have had in mind. There are several reasons for this, including these: a. If Parliament had intended to confer this jurisdiction on the VAT Tribunal, we would have expected it to say so clearly. Even as late as the passing of VATA 1994, a fortiori when the VAT Tribunal was first set up and given a statutory appellate jurisdiction, it would have been exceptional for an inferior tribunal to have a judicial review jurisdiction or an appellate jurisdiction allowing it to adjudicate on public law issues other than in the course of its statutory jurisdiction. VATA 1994 does not use words which clearly confer such a jurisdiction, reliance instead having to be placed on the words “with respect to”. b. In cases where an inferior tribunal is intended to have a judicial review function, express provision has been made. See, for instance, the powers given to the newly-created (and now abolished) Charity Tribunal under section 8 Charities Act 2006. c. We have referred to the structure of the tribunal system put in place by TCEA 2007 at paragraph 29 above. Parliament decided that the F-tT should not have a judicial review function; and although the Upper Tribunal does have a judicial review function, its jurisdiction usually comes into play on the transfer of a case commenced in the Administrative Court. It is only in a very limited class of case that a judicial review application can properly be commenced in and heard by the Upper Tribunal. It is well known that there was significant opposition even to these powers being conferred on the Upper Tribunal. It is simply inconceivable that Parliament would have contemplated conferring a similar power on the F-tT notwithstanding the two factors which Sales J identified and of which legislators were well aware. d. Just as it was inconceivable that the F-tT should be given a judicial review jurisdiction, so to it was not plausible, in our view, that Parliament, when enacting section 83 VATA 1994, intended to confer a judicial review function on the VAT Tribunal. e. We are bound to say that, if it was plausible in the way which Sales J suggests, it is very surprising that the point was not raised in litigation or otherwise many years before Oxfam came before the court. In fact, it was not raised as a plausible result before the VAT Tribunal even in Oxfam itself. As Sales J acknowledged, he was departing from a widely held view, a view which, on his approach, was entirely at odds with what Parliament is to be supposed to have wished to achieve. Although Sales J describes the view as widely held (and we do not know on what he based that description) we ourselves know of no contrary view being promoted as a correct view prior to the decision of Sales J himself. f. Further, if Parliament’s intention had been as Sales J suggests, we would have expected the same Parliament to have introduced secondary legislation in the form of suitable tribunal rules to govern the procedure (and in particular rules concerning permission to bring judicial review and time-limits) applicable to public law claims.” a. If Parliament had intended to confer this jurisdiction on the VAT Tribunal, we would have expected it to say so clearly. Even as late as the passing of VATA 1994, a fortiori when the VAT Tribunal was first set up and given a statutory appellate jurisdiction, it would have been exceptional for an inferior tribunal to have a judicial review jurisdiction or an appellate jurisdiction allowing it to adjudicate on public law issues other than in the course of its statutory jurisdiction. VATA 1994 does not use words which clearly confer such a jurisdiction, reliance instead having to be placed on the words “with respect to”. b. In cases where an inferior tribunal is intended to have a judicial review function, express provision has been made. See, for instance, the powers given to the newly-created (and now abolished) Charity Tribunal under section 8 Charities Act 2006. c. We have referred to the structure of the tribunal system put in place by TCEA 2007 at paragraph 29 above. Parliament decided that the F-tT should not have a judicial review function; and although the Upper Tribunal does have a judicial review function, its jurisdiction usually comes into play on the transfer of a case commenced in the Administrative Court. It is only in a very limited class of case that a judicial review application can properly be commenced in and heard by the Upper Tribunal. It is well known that there was significant opposition even to these powers being conferred on the Upper Tribunal. It is simply inconceivable that Parliament would have contemplated conferring a similar power on the F-tT notwithstanding the two factors which Sales J identified and of which legislators were well aware. d. Just as it was inconceivable that the F-tT should be given a judicial review jurisdiction, so to it was not plausible, in our view, that Parliament, when enacting section 83 VATA 1994, intended to confer a judicial review function on the VAT Tribunal. e. We are bound to say that, if it was plausible in the way which Sales J suggests, it is very surprising that the point was not raised in litigation or otherwise many years before Oxfam came before the court. In fact, it was not raised as a plausible result before the VAT Tribunal even in Oxfam itself. As Sales J acknowledged, he was departing from a widely held view, a view which, on his approach, was entirely at odds with what Parliament is to be supposed to have wished to achieve. Although Sales J describes the view as widely held (and we do not know on what he based that description) we ourselves know of no contrary view being promoted as a correct view prior to the decision of Sales J himself. f. Further, if Parliament’s intention had been as Sales J suggests, we would have expected the same Parliament to have introduced secondary legislation in the form of suitable tribunal rules to govern the procedure (and in particular rules concerning permission to bring judicial review and time-limits) applicable to public law claims.”

“s18… (5) The Commissioners may refuse to grant any person a licence as a rectifier in respect of any premises on which, from their situation with respect to a distillery, they think it inexpedient to allow the keeping of a still for rectifying or compounding spirits.”

“Sections 14 to 16 of the Finance Act 1994 shall have effect in relation to any decision of the Commissioners to impose additional conditions under paragraph (2) above as if that decision were a decision of a description specified in Schedule 5 to that Act.”

“153. When undertaking the latter exercise, and following the guidance of the Court of Appeal in GB Housley Limited v HMRC [2016] EWCA Civ 1299, we consider that the approach we should adopt is as follows: (1) Evaluate the evidence and material available at the time of the Review (whether it had been provided to HMRC or not) and determine whether HMRC have reasonably concluded that the drawback claim should be refused. (2) If we conclude that no reasonable body of commissioners could have come to any conclusion other than to allow the drawback claim (or a relevant part of it) we may allow the appeal in that regard. (3) If we conclude that HMRC have acted unreasonably we may still refuse the Appellant’s appeal if we are satisfied that HMRC would inevitably have rejected the claim (or part of it) had they not acted unreasonably. (4) When considering whether HMRC have acted unreasonably we must consider whether they have taken account of all relevant factors and no irrelevant factors. If they have considered all relevant factors it is a matter for them how those factors are weighed in reaching their decision. We may disagree with the decision, but disagreeing with the decision does not mean that it was an unreasonable decision. (5) If HMRC have acted unreasonably and neither (2) nor (3) above applies we do not have the power to retake HMRC’s decision and should allow the appeal exercising our power under section 16(4)(b) FA94 to require HMRC to re-review the decision to refuse the claim with such directions as we consider appropriate.” (1) Evaluate the evidence and material available at the time of the Review (whether it had been provided to HMRC or not) and determine whether HMRC have reasonably concluded that the drawback claim should be refused. (2) If we conclude that no reasonable body of commissioners could have come to any conclusion other than to allow the drawback claim (or a relevant part of it) we may allow the appeal in that regard. (3) If we conclude that HMRC have acted unreasonably we may still refuse the Appellant’s appeal if we are satisfied that HMRC would inevitably have rejected the claim (or part of it) had they not acted unreasonably. (4) When considering whether HMRC have acted unreasonably we must consider whether they have taken account of all relevant factors and no irrelevant factors. If they have considered all relevant factors it is a matter for them how those factors are weighed in reaching their decision. We may disagree with the decision, but disagreeing with the decision does not mean that it was an unreasonable decision. (5) If HMRC have acted unreasonably and neither (2) nor (3) above applies we do not have the power to retake HMRC’s decision and should allow the appeal exercising our power under section 16(4)(b) FA94 to require HMRC to re-review the decision to refuse the claim with such directions as we consider appropriate.”

"[30] The principles that we understand to be derived from these authorities are as follows: (1) The FTT is a creature of statute. It was created by s. 3 of the Tribunals, Courts and Enforcement Act 2007 ("

'We have heard no argument about s. 83(1) VATA and therefore express no view about the correctness or otherwise of the judge's interpretation of that section.'

"[152] The starting point is therefore that appeal grounds which concern public law arguments should be pursued in judicial review proceedings rather than before the FTT. However, we, like the FTT, accept that the FTT may have jurisdiction to consider appeal grounds based on public law arguments (such as legitimate expectation) depending on the statutory provisions under consideration. [153] Thus, the statutory context is key, as the UT in Henryk [Zeman] explains. [154] In this appeal, the taxpayer appeals under s.83(1)(b) VATA, which permits appeals to the FTT with respect to "the VAT chargeable… on the importation of goods from a place outside the member States."

'We note one point immediately, which is that on the face of it, the scope of section 83(1)(p) is broader than the scope of section 83(1)(c) (the provision in issue both in Oxfam and Noor), because an appeal lies only with respect to the amount of an assessment but instead with respect to "an assessment… under section 73(1)." And the wording of section 73(1), on the face of it, is permissive not mandatory – 'the Commissioners may assess the amount of VAT due to the best of their judgment and notify it.'

“Time limits to Claiming Drawback HMRC do have discretion set by Regulation 7(1)a of Excise Goods (Drawback) Regulations 1995, to exceptionally waive the above Regulation 7(6) of the Excise Goods (Drawback) Regulations 1995 6. No claim for drawback shall be made if the event giving rise to the claim occurred more than three years after the duty on the goods in question was paid For discretion to be met, an explanation as to why the event did not occur before the three years limit was reached would have to be submitted. You have not supplied details of any circumstances that may have prevented a claim being made within the three years of UK duty being paid. When asked as to why the goods were not dispatched/moved or sold you referred me to your letter of 15 November 2019. In your letter you have said that from the end of May 2014, the claimant liaised with HMRC via its representative Alan Powell to seek options to recover the excise duty. These options included a repayment of the duty as overpaid or drawback via destruction. Eventually this matter was taken to the First Tier Tax Tribunal and was subject to a number of extensions and delays, including on request of HMRC. This appeal was withdrawn in August 2019. I do not consider that circumstance would have led to such a delay. In their letter dated 8 May 2014 from the claimant, Drinks & Foods UK Ltd (DFUK) to HMRC, they stated that their intention was to sell some of the goods in the UK, with the remaining stock returned to Germany. Officer Lucy Fisher in her letter dated 6 May 2016, did clearly inform the claimant that there was there is no basis for repayment of any of the duty accounted for by the excise assessment issued on 01 May 2014. Also provided HMRCs view that regulation 7(1)(a) of the Excise Goods (Drawback) Regulations 1995 does not give the Commissioners a discretion to dispense with any of the eligibility requirements and as a result, a claim to drawback on planned destruction may only be considered if the eligibility criteria are met. In your letter of 15 November 2019, you confirmed that a portion of the goods have been sold. It is my view that the reason that the goods were still in the UK up to being dispatched/exported is a commercial decision. DFUK did not dispatch the goods as stated in their letter dated 8 May 2014 neither were all the goods sold. It is my view that DFUK’s decision to keep the goods in the UK a purely commercial decision. DFUK then decided to dispatch their stock to Holland starting December 2020, again another commercial decision. Conclusion: I refer now to the email dated 27 December 2019 from the National Drawback Centre advising you that all other drawback conditions and requirements must be fully met to the Commissioner’s satisfaction: Excise notice 207, para 14.2: The circumstances when we will reject your claim: • You have not complied with all of the conditions or procedures set out in this notice or notified by us in writing - this includes not complying with the relevant period of notice. After reviewing your claim, as I have detailed in my letter, I conclude that you have not complied with all of the conditions or procedures set out in notice 207. The claim also fails Regulation 7(6) of the Excise Goods (Drawback) Regulations 1995 6. No claim for drawback shall be made if the event giving rise to the claim occurred more than three years after the duty on the goods in question was paid. As the claim fails to meet the above regulation and fails to meet all the conditions or procedures set out in excise notice 207, the claim is rejected on these grounds.,,”

“… As regulation 7(6) is a condition of the EGDR 1995, discretion by virtue of regulation 7(1) can be applied. This permits HMRC, if they wish to do so, to waive conditions in exceptional cases, however before applying this discretion, HMRC must be satisfied that the goods and claimant are eligible to drawback. Officer McKirdy contacted Mr Thornton on 27 December 2019, advising that no drawback claim can be made if the event (giving rise to the claim) was more than 3 years after the duty was paid. which in this case was paid on 5 June 2014. However, the reply went on to say, if Drinks and Food UK Ltd were able to show that the goods detailed in the drawback claim were the same goods as those listed in the assessment and all other conditions were met to HMRC's satisfaction, then a claim can be considered. A drawback claim DR1444520 for £385,165.31, was submitted on 13 May 2020. For HMRC to exercise their discretion, they must be satisfied that all the remaining drawback conditions have been met and, in this case, satisfied that: - … Other factors … Both of these factors [the failure to notify a change in date for some of the goods exported and failure to comply with the DSR in relation to the duty stamp obliteration] add further weight to rejecting the claim, as all the drawback conditions must be met for the claim to be successful. After considering the information above, I do not believe the company have met these conditions to HMRC's satisfaction. In addition to failing to meet the required conditions, the company have not supplied any information why the goods were not despatched, sold or removed within the 3-year time limit. When questioned on this matter, Mr Thornton directed Officer O'Rourke to his letter of 15 November 2019, this letter does not provide any specific details for the delay. It simply states that a portion of the goods has been sold. I have also noted that previous correspondence from the company, indicated the remaining goods were to be return[ed] to Germany. I am in agreement with Officer O'Rourke for HMRC to exercise discretion, there must be exceptional circumstances. As explained above the company did not meet the conditions to HMRC satisfaction nor did they provide any details why the goods remained in the UK for 6 years. The legislation and guidance state, a drawback claim must take place within 3 years of the UK excise duty being paid, evidence to support the claim provided and all conditions are met. After considering Mr Thornton ground for dispute, I am satisfied the company were advised in December 2019. what steps they needed to take to ensure the drawback claim was successful. I have also considered Officer O'Rourke's letter of 2 September 2021, which gives his reasoning for refusing the claim, I have nothing further to add to it nor have I found any evidence that he has not followed HMRC's guidance and processes. In accordance with legislation and paragraph 14.2 of Excise Notice 207, the company have failed to comply with all the conditions and the claim has been rejected. My conclusion Regulation 7(6) of EGDR 1995 is very clear on its requirements, no claim for drawback shall be made if the event giving rise to the claim occurred more than three years after the duty on the goods in question was paid. HMRC can by virtue of regulation 7(1) of EGDR 1995, can if they wish to do so, exercise discretion. This allows them to waive conditions in exceptional cases, however before applying this discretion, HMRC must be satisfied that the goods and claimant are eligible to drawback. Drinks and Foods UK Ltd were advised in November 2019, that a drawback claim would be considered if all the other remaining conditions were met. The company failed to provide the required evidence and by doing so failed to comply with the conditions. Therefore, it is not appropriate for HMRC to exercise their discretion in this case. The decision issued by Officer O'Rourke on 2 September 2021 refusing the drawback claim DR-144520 in the amount of £385,165.31 is upheld.”

“27. Mr Thornton considered that the email of 27 December 2019 amounted to a waiver of the time limit condition in regulation 7(6) EGDR. Before us HMRC contended that it was not a waiver and that the time limit condition would be waived only were the Appellant to meet the other conditions for drawback. 28. There is a degree to which the difference between the parties in this regard is semantic as, in order for there to be a valid claim for drawback, the EGDR conditions (including those prescribed in a notice) must be complied with unless “otherwise allowed” by HMRC even if the time limit has been waived. 29. We did not have the benefit of any evidence from the author of the 27 December 2019 email but, in any event, we considered whether there was or was not a waiver of the time limit as a matter of construction of the email in context. 30. In that regard, and as communicated during the hearing, we consider that the only reasonable construction of the 27 December 2019 email is that there was a waiver of the regulation 7(6) time limit i.e. that HMRC would not refuse an otherwise compliant claim solely on the basis that it had been made outside the three-year time limit. We reach this view for the following reasons: (1) Without waiver of the time limit there was no basis for a drawback claim at all as the excise duty which was the subject of the claim had been paid more than three years prior to the export event giving rise to a potential drawback claim. (2) Mr Thornton’s letter was clear that in order to begin the process of formulating and making the claim a waiver of the time limit was required. (3) Full facts were explained to justify a waiver. The letter was clear that it was focused only on a request for waiver of the time limit. Mr Thornton considered, at that time, that all other conditions would be met at the point a claim was submitted. (4) HMRC’s response said the relevant decision maker “can consider a drawback claim even though the condition stated in [EGDR] regulation (6) … has not been met”. (5) In light of Mr Thornton’s indication that he was not seeking waiver of any other condition HMRC reiterated that the claim must otherwise meet the conditions and requirements for drawback.” (1) Without waiver of the time limit there was no basis for a drawback claim at all as the excise duty which was the subject of the claim had been paid more than three years prior to the export event giving rise to a potential drawback claim. (2) Mr Thornton’s letter was clear that in order to begin the process of formulating and making the claim a waiver of the time limit was required. (3) Full facts were explained to justify a waiver. The letter was clear that it was focused only on a request for waiver of the time limit. Mr Thornton considered, at that time, that all other conditions would be met at the point a claim was submitted. (4) HMRC’s response said the relevant decision maker “can consider a drawback claim even though the condition stated in [EGDR] regulation (6) … has not been met”. (5) In light of Mr Thornton’s indication that he was not seeking waiver of any other condition HMRC reiterated that the claim must otherwise meet the conditions and requirements for drawback.”

“71. There can be no question that the three-year time limit is a condition which restricts the right of a claimant unless waived by HMRC. 72. However, as set out in paragraph 30. we have found that there was a waiver of the time limit condition. 73. We consider that it is plain from the terms of EN 207 (in both versions) that HMRC have the power to reject or reduce a claim. The power to reduce a claim arises, as set out in EN 207 where “… the conditions and requirements of this notice and EGDR for some, and not all, of the goods declared on the NOI and drawback claim form”

“155. The Appellant contends that the claim was refused because HMRC considered the event giving rise to the Claim occurred more than three years after the date of payment of the relevant duty. It contends, in view of the terms of the email dated 27 December 2019, it was unreasonable to reject the claim on that basis. 156. HMRC contend that the claim was rejected because various conditions had not been met and that the terms of the 27 December 2019 email required those conditions to be met before the time limit would be waived. 157. On the basis that we have found that there was a waiver of the time limit condition we consider that rejection of the claim in its entirety is unreasonable. Exercising our full appellate jurisdiction we have already allowed the appeal in respect of those parts of the claim which are unaffected by the Appellant’s failure to ensure that the duty stamps were obliterated in accordance with the DSR and the failure to provide evidence of export.”

“…[HMRC’s] Drawback Centre can consider a Drawback claim in this situation even though the condition stated in regulation [7](6) [the three year time limit] has not been met. However, the claimant would have to show that the goods subject to the drawback claim are the same ones that were subject to the assessment on 1/5/14 (paid 5/6/14) Also all other drawback conditions and requirements must be fully met to the Commissioners’ satisfaction”

“that HMRC would not refuse an otherwise compliant claim solely on the basis that it had been made outside the three-year time limit”

“… the Drawback Centre can consider a Drawback claim in this situation even though the condition stated in [EGDR] regulation [7](6) … has not been met.”

“…However, the reply [email of 27 December 2019] went on to say, if Drinks and Food UK Ltd were able to show that the goods detailed in the drawback claim were the same goods as those listed in the assessment and all other conditions were met to HMRC's satisfaction, then a claim can be considered. …For HMRC to exercise their discretion, they must be satisfied that all the remaining drawback conditions have been met…”

“You have won on that, you have won on the facts of that.”

“In that regard, and as communicated during the hearing, we consider that ...”

“It is correct that Ms Gable and I determined how, factually, the email of 27 December 2019 should be interpreted. We did so in the hearing, and after consideration of its terms…We carefully considered the correct interpretation of it and gave an ex-tempore decision of our factual finding, thus framing the basis for submissions on the effect of our finding.”

“7.— (1) Subject to paragraph (2) below and without prejudice to any condition imposed by, or in accordance with section 133 of the Act, every eligible claimant shall— (a) save as the Commissioners may otherwise allow, comply with the conditions imposed by these Regulations; and (b) in addition to those conditions, comply with such other conditions as the Commissioners see fit to impose in a notice published by them and not withdrawn by a further notice. … .”

“4.5. Actions required if goods carry fiscal marks or duty stamps … Before you can claim drawback on spirits bearing duty stamps you must first obliterate the duty stamps in accordance with the Duty Stamps Regulations…Note that at least 2 clear business days’ notice is required before you obliterate the stamps. You can find out more information about duty stamps in Notice DS5…”

“(3) For the purposes of these Regulations, a retail container of alcoholic liquor is to be treated as unstamped if it bears a duty stamp that has been obliterated. A duty stamp has been obliterated if, but only if— (a) the words “For the UK market” have been completely removed from it, (b) it has been completely obscured by an indelible dye or ink, or (c) it has been completely covered by a label using an adhesive that prevents that label from being removed without also destroying the stamp.”

“120. Paragraph 4.5 provides that before claiming drawback “you must first obliterate the duty stamps in accordance with the [DSR]” and reference is made to the provisions of DS5. The use of “you” is curious in the context of a duty drawback claimant which is not, and cannot be, authorised to obliterate duty stamps. The language of paragraph 4.5 would therefore appear to require that a person in the position of the Appellant ensures that the duty stamps were obliterated prior to dispatch/export and that such obliteration was carried out in accordance with the DSR and DS5.”

“121. The question arises as to whether that represents a condition, breach of which permits HMRC to refuse the claim in whole, or in respect of the part of the claim that relates to stamped goods. … 123. However, on balance, we consider that it is a condition of drawback that the goods are, as a matter of fact, obliterated in accordance with the DSR . There is a significant fiscal risk arising to the exchequer if drawback is claimed and paid but the obliteration is not carried out fully in accordance with the requirements of DSR , such that it is reasonable and proportionate to expect that the claimant satisfy itself that the provisions of the DSR have been complied with. In this case the Appellant was provided with a record of de-stamping but did not apparently verify that BWA had fully complied with the obligations on them regarding the records what needed to be maintained, including a record of URNo. 124. In reaching that conclusion we have undertaken the evaluative exercise advanced by the Appellant in determining what is and what is not a condition. We note that there is no statutory requirement that the Appellant maintain a record of the URNo. The 2021 notice does not identify the provisions of paragraph 4.5 as having force of law. However, its terms are clear that prior to export the duty stamps must have been obliterated in accordance with the DSR. There is a rational basis for the requirement, and it is not a condition which is disproportionately onerous on a claimant who simply needs to obtain the necessary confirmation and supporting records of compliant obliteration and retain those in its own records thereby evidencing compliance. 125. HMRC reference the failure to obliterate "in accordance with the DSR " in the original decision to refuse and the Review confirms that the Appellant had not produced evidence which demonstrated compliance with the condition in paragraph 4.5. We agree with HMRC that there has been a breach of a condition...”

“129. Finally, and with regard to the Appellant’s contention that if we were to find there was a condition regarding de-stamping there was no failure justifying a rejection of or reduction in the claim as the failure was de minimis. We note that Lord Simon in CEC v JH Corbitt (Numismatists) Ltd [1980] STC 231 (Corbitt) indicated that a de minimis incidence of non-compliance with conditions imposed by HMRC represented a basis on which to challenge, in that case, a VAT assessment. However, we consider that a failure to ensure that URNos had been obliterated (and then provide the record) is not de minimis. We do so for the reasons identified in paragraph 124. The management of the unique duty stamp numbers is a key contributor to the prevention of excise fraud. It is reasonable for HMRC to need to know not only the product from which stamps have been obliterated but also which stamps have been so obliterated.”

“165. Having considered all the evidence available to us we consider that HMRC did not act unreasonably in rejecting that part of the claim affected by the failure to remove the duty stamps in accordance with the DSR. If we were wrong in that conclusion we would consider that HMRC’s decision to refuse the claim was inevitable. There is insufficient evidence that the Appellant did enough to ensure compliance with this critical requirement. It selected the cheapest provider and did not, it seems, seek confirmation that the obliteration had been carried out compliantly. 166. We therefore refuse the Appellant’s appeal as regards that part of the claim which fails to meet the condition of ensuring that the duty stamps were obliterated in accordance with the DSR. By reference to Mr Thornton’s evidence this issue affected £272,980.74.”

“if the claim includes alcoholic goods subject to duty stamps, a copy of the notification of obliteration sent to the Duty Stamps team plus an extract from your records showing the details of the stamps that were obliterated.”

“as recorded at [127] in this case it was not possible to obtain such documentation”; and “In the event that the FTT is correct at [123] that the condition is more abstract requiring the person appointed to operate the de-stamping to act in accordance with any and all de-stamping rules, that is impossible or excessively difficult for a drawback claimant to achieve. They are not in control of the actions of such a person.”

“32. Having undertaken this exercise Mr Thornton was satisfied that the Appellant could proceed to arrange for the de-stamping and movement of the goods to The Netherlands. The Appellant approached BWA to carry out these tasks. BWA were selected because they were the cheapest provider (3-4 times cheaper than LCB). 33. Mr Roy's unchallenged evidence sets out that BWA were experienced in the obliteration of duty stamps having been approved by HMRC and subject to a number of inspections over a period of time. He states that he was contacted by Mr Thornton in June 2020. Following some delays in setting up an account for the Appellant, he arranged for the transfer of four containers of goods from LCB to the BWA warehouse. On receipt the goods were logged using the same stock information as provided by LCB, new rotation numbers were recorded. 34. Using the rotation numbers HMRC were notified of the proposal to de-stamp the goods on 12 November 2020. Mr Roy was aware that de-stamping could not begin until at least 2 clear days after the notification was given. The notification indicated that the goods would not be removed by way of dispatch prior to 19 November 2020, i.e. after the two clear days' notice had expired. 35. The duty stamps were removed using a Dremel hand drill to obliterate the words "for the UK market" with a sticker then placed over the site of the drilling. BWA's business record of the stock information was noted to show that the relevant stock had been de-stamped. No record was made of the URNo of the stamp as Mr Roy did not understand there to be such a requirement in light of the other records maintained and which had been subject to HMRC inspection previously. 36. There is no evidence, and we find that the Appellant did not, at any time, seek to verify for themselves that the provisions of the DSR regarding obliteration were complied with by BWA until after HMRC had refused the claim.”

“127. The breaches of paragraphs 4.5 and 7.4 are clearly connected. In the case of a claimant who is not authorised to obliterate duty stamps we would interpret paragraph 7.4 as requiring the provision of the records they obtained from the party which obliterated the stamps in order to satisfy themselves that obliteration had been carried out in accordance with the DSR. In this case such evidence does not exist as it is admitted that obliteration was not carried out fully in accordance with the DSR as the URNos were not recorded by BWA. There can therefore be no evidence which the Appellant was capable of producing.”

“Conditions to be complied with after export 10. Where an eligible claimant claims drawback after export, the eligible claimant must include with the claim such documentary evidence of export and (in the case of claims in respect of goods that have been transported from Great Britain to Northern Ireland via the EU), payment of excise duty as is specified by the Commissioners in a notice published by them (and not withdrawn).”

“7.4. What supporting evidence do I need to submit with my drawback claim form? You must provide the following documents with your completed drawback form: - evidence of UK duty payment - the CHIEF S8 print out showing the Entry reference number and a ‘departed’ status of 60 for direct exports or 62 for indirect export, or if you are exporting by post a certified C and E 132, and - if the claim includes alcoholic goods subject to duty stamps, a copy of the notification of obliteration sent to the Duty Stamps team plus an extract from your records showing the details of the stamps that were obliterated…”

“7.4. The supporting evidence you need to submit with your drawback claim form This paragraph contains requirements that have force of law under regulations 7(1) and 10 of the EGDR. In particular it imposes additional conditions on your claim for drawback and specifies the documentary evidence of export required to accompany a claim for drawback. You must provide all of the following documents with your completed drawback form: - evidence of UK duty payment (see paragraphs 4.7 to 4.9) - the CHIEF S8 print out showing the Entry reference number and a ‘departed’ status of 60 for direct exports or 62 for indirect export, or CDS equivalent, or if you are exporting by post a certified C and E 132 - if the claim includes alcoholic goods subject to duty stamps, a copy of the notification of obliteration sent to the Duty Stamps team plus an extract from your records showing the details of the stamps that were obliterated…”

“The goods were exported The S8 print out is a specific report generated by the CHIEF system, when a declaration has been finalised at departure, Mr Thornton has argued that these print outs are no longer produced and therefore their custom agent cannot be provided it. This is not strictly true, Mr Thornton is correct that the production of the form is no longer available at non-inventory linked ports, as these ports do not use the CHIEF system. The S8 print out is required as evidence in drawback claims and when this form is unavailable an exporter can obtain confirmation the goods have been departed via one of the following options; • a Community System Provider link • a local loader badge for direct access to CHIEF • form C1602 submitted to the NCH (National Customs Hub detailed above. Therefore, I do not accept Mr Thornton's argument that the form is no longer available. As an experienced agent, I share Officer O'Rourke's view that Mr Thornton would have had some awareness of the ongoing situation regarding the S8 print outs and the appropriate workarounds in place for exporters. Alternatively, the company could have exported the goods via an inventory port and obtained a copy of the S8 from CHIEF, thus eliminating any problems in acquiring the necessary documentation.”

“48. Also provided were the relevant tracing documents. For the shipments made in December 2020 SAADs were also provided. Those SAADs included the 112 cases of Vodka which were shipped but not included in the NOI or subsequent claim. For the April 2021 shipment T1 (Transit Accompanying Documentation) was provided. 49. No CHIEF S8 showing a departed status of 60 was provided. 50. By letter dated 13 May 2021 the Appellant explained that they understood that a CHIEF S8 could not be obtained and provided such evidence as they had of the export. 51. At about that time Mr Thornton was also corresponding with HMRC on the unavailability of CHIEF S8s. That correspondence, and Mr Thornton’s evidence, on which he was cross examined, was that although he had been unaware of the issue prior to the 8 April 2021 export he was aware post that time that HMRC had agreed to waive the requirement for other exporters who had used lorries and roll-on-roll-off ferries as the means of movement. He considered that HMRC were required to waive the requirement because it was impossible to comply with. 52. As part of Mr Thornton’s engagement with HMRC on this issue generally, HMRC indicated that where no S8 was available HMRC may accept alternative evidence of export provided that there was a full explanation of the reason was to why the claimant could not obtain a S8. It was indicated that commercial evidence was insufficient as alternative evidence, and that official evidence of arrival was required. 53. From the correspondence it is unclear whether it is or is not possible to obtain a CHIEF S8 printout showing a departure status of 60 when using a roll-on-roll-off ferry. It is apparent that one could still have been obtained if an alternative means of movement had been used i.e. shipping via an inventory port.”

“130. HMRC contend that the Appellant failed to provide a CHIEF S8 with a departed status of 60 or any of the alternative forms of documentation considered to be acceptable evidence of movement in breach of the condition contained in paragraph 7.4 EN 207 in respect of the goods exported on 8April 2021. 131. The Appellant does not deny that the requirements of paragraph 7.4 are a condition of drawback, and the Appellant accepts that it was in breach of this condition because it did not provide either a CHIEF S8 showing a departed status of 60 or the CDS equivalent but contends that the requirements specified in paragraph 7.4 were impossible to comply with as from 1 January 2021 the ferry ports no longer operated CHIEF. 132. In view of this concession we find that the Appellant failed to meet the condition requiring export evidence. We consider the implications of the breach below.”

“167. As indicated above, regulation 8(2)(b) EGDR authorises HMRC to specify in a notice the documents required to evidence export. EN 207 (in both the 2019 and 2021 versions) specified that a CHIEF S8 showing a departed status of 60 or the CDS equivalent be provided. 168. On 13 May 2021 when providing supporting evidence to the claim the Appellant included the export documentation endorsed by the Netherlands customs authorities confirming payment of duty in The Netherlands. By that letter the Appellant informed HMRC that an S8 could not have been obtained in circumstances in which the movement was by lorry on a roll-on-roll-off ferry. A copy of a Q&A forum on gov.uk was provided substantiating that the S8 could not have been obtained. 169. The Original Decision to refuse the claim acknowledges that the Appellant had indicated that it had been unable to obtain a CHIEF S8 and that the gov.uk forum indicated there was an issue but nevertheless refused the claim for failure to produce the S8. 170. The Review reiterates that no S8 was provided and accordingly, the Claim failed to meet the condition in paragraph 7.4. It goes on to indicate that an S8 could have been obtained by exporting via an inventory port or through the production of alternative acceptable documentation confirming departure by way of: 1) a community system provider link, 2) a local loader badge for direct access to CHIEF, or 3) a form C1602 submitted to the National Customs Hub. None of these means were open to the Appellant after export.”

“171. In cross examination of Mr Thornton HMRC sought to establish that the failure to obtain a CHIEF S8 was a failing of his, that he had not sufficiently researched how the necessary evidence could have been obtained, principally through use of a method of movement other than the one selected. Mr Thornton openly accepted that he had been unaware that S8s were not issued post 31 December 2020 in respect of roll-on-roll-off ferry movements but pointed out that there had been no publicity of, or change in the guidance regarding, the impending change and that it had taken many by surprise. He referenced communications he had had with freight forwarders and customs agents which demonstrated that it was a problem for many. 172. We have great sympathy for the Appellant in this regard. To have adopted an alternative method of export without warning or notice that they needed to do so in order to be able to claim drawback is harsh. 173. However, having reviewed the evidence, it is clear that HMRC considered the material provided by the Appellant as to the difficulties faced by exporters using roll-on-roll-off ferries. Had they failed to do so entirely then we could have required a re-review and a direction that they consider it. However, they have not failed to take account of a relevant factor, nor have they taken account of an irrelevant factor. They have considered whether the Appellant was able to offer alternative evidence of export and rejected such evidence as was produced on the grounds that it was commercial documentation and not official evidence. In doing so they have adopted a hard line that results in an outcome with which we disagree, but we are unable to conclude it was outside the bounds of reasonable. It is not therefore a decision which it is open to us to call them to re-review. 174. Accordingly, we refuse the appeal in this regard.”

“Evidence was actually or effectively impossible…evidence is that it realistically was not an exercise that could be complied with. Primary submission for such movement [is that] it was an ultra vires condition or didn’t apply to movements of that kind.”

“171. In cross examination of Mr Thornton HMRC sought to establish that the failure to obtain a CHIEF S8 was a failing of his, that he had not sufficiently researched how the necessary evidence could have been obtained, principally through use of a method of movement other than the one selected. Mr Thornton openly accepted that he had been unaware that S8s were not issued post 31 December 2020 in respect of roll-on-roll-off ferry movements…”

“100. Viewing the terms of the NOI form (EX75) we do not consider that there was a change in the information required which, in this regard, required further notification to HMRC. Accordingly, the fact that a proportion of the goods were exported on 8 April 2021 cannot, of itself, justify a refusal of either the whole claim or that part of the claim relating to the goods exported on that date. 101. Our view in this regard is reinforced by the terms of paragraph 12.2 EN 207 (2021) which clearly envisages that a pre-Brexit NOI may have been completed for a post Brexit export to an EU country; it reminds claimants that they must have the correct supporting documentation but does not advise that they must notify a change in status. 102. There is no part of the claim which is only affected by the position taken by HMRC on this issue.”

“107. Given the terms of paragraph 12.1 EN 207 we consider that there is also a general waiver of the requirement to notify a reduction in the quantity of goods exported where the claimant themselves made the reduction in claim value. As such, we conclude that there was no failure to meet the conditions required for drawback by virtue of the errors identified in paragraph 44. above. 108. HMRC were therefore not entitled to refuse the entire claim on the basis of those errors. There is no part of the claim which is only affected by the position taken by HMRC on this issue.”

“109. HMRC contend that because one of the SAADs for the December 2019 dispatched included 112 cases of vodka the Appellant has failed to comply with the requirement that the goods were duty paid. During the hearing Ms McArdle indicated, in a response to a question put to her by us, that the Appellant should have made clear in the claim itself that the supporting documentation also demonstrated that further goods not part of the claim had been dispatched so as to ensure the claim was compliant. 110. The Appellant contends that there is no legal requirement to so notify HMRC. It is submitted that the claim cannot be said to be inaccurate because additional goods were dispatched at the same time. 111. We agree with the Appellant. The drawback claim was made in respect only of goods which on which duty had been paid (i.e. excluding the 112 cases of vodka) and in respect of which a NOI had been given. There is no requirement or condition within EGDR or EN 207 which precludes a movement including other goods and therefore there can have been no failure to meet such a condition.”

“156. HMRC contend that the claim was rejected because various conditions had not been met and that the terms of the 27 December 2019 email required those conditions to be met before the time limit would be waived. 157. On the basis that we have found that there was a waiver of the time limit condition we consider that rejection of the claim in its entirety is unreasonable. Exercising our full appellate jurisdiction we have already allowed the appeal in respect of those parts of the claim which are unaffected by the Appellant’s failure to ensure that the duty stamps were obliterated in accordance with the DSR and the failure to provide evidence of export. 158. Given the terms of paragraph 12.1 EN 207 which confirm that where a claimant fails to meet the prescribed conditions for part of a claim the claim will be reduced, and the compliant part paid, we also consider that the total refusal of the claim was unreasonable.”

“[77] Thus the Court of Appeal endorsed the approach adopted by Turner J namely that, save in circumstances where the Commissioners could show that, had the additional material which should have been taken into account, in fact been taken into account, the decision would inevitably have been the same, where a tribunal could nonetheless dismiss the taxpayer’s appeal against a wrongly made decision of the Commissioners, the taxpayer’s appeal should be allowed and that it was not for the tribunal to re-exercise the discretion. The tribunal should have allowed the taxpayer’s appeal and ‘left it to the commissioners to take a fresh decision if they thought fit on the facts as they had become by the date of the fresh decision’. … [79] In my judgment a similar approach to that adopted by this court in John Dee is applicable to a case such as the present, where the relevant decision was a failure by HMRC, as a result of a misapprehension as to the necessity of a billing agreement, to consider the exercise of their discretion under reg 29(2) to allow input tax. The present case was one where, on the findings of fact by the FtT, HMRC clearly could not have suggested that, if they had properly considered or re-considered the exercise of their discretion under reg 29, they would have inevitably have come to the same result—ie to have refused to allow the credit for the input tax. Indeed, Mr Mandalia did not seek so to argue.”