E1015
EXCISE DUTY — consignments of beer transported under movement suspension arrangement from England to France — receipted AADs never returned to dispatching warehouse — assessment for UK duty on the load — liability of guarantor — DSMEG Regulations 4 & 7(1) —appeal dismissed
MANCHESTER TRIBUNAL CENTRE
CHIP LOGISTICS LIMITEDAppellant
- and -
THE COMMISSIONERS FOR
HER MAJESTY’S REVENUE AND CUSTOMSRespondents
Tribunal: Lady Mitting
Mr M Farooq
Sitting in public in Birmingham on 19 January 2007
The Appellant did not appear and was not represented
Mr B McCluggage, counsel, instructed by the Acting Solicitor for HM Revenue and Customs for the Respondents
© CROWN COPYRIGHT 2007
DECISION
- The decision under appeal is that of the Commissioners, taken on review and notified by letter dated 18 January 2006, to substantially confirm an assessment to excise duty dated 6 July 2005. The amended assessment was in the sum of £396,566 and related to 20 movements of beer under duty suspension.
- When the case was called on for hearing, there was no representation on behalf of the Appellant company. The Tribunal clerk rang the telephone number of Mr Derek Payne, the Appellant’s representative, but there was no answer. She left a message on the answerphone asking for the call to be returned but it was not. She also telephoned the Appellant company direct but there was no answer and no facility for an answerphone message. Having confirmed that proper notification of the hearing had been given, we decided to proceed under regulation 26(2) Value Added Tax Tribunals Rules 1986.
- We heard oral evidence from the assessing officer, Mr Robert McWilliams.
Legislation
- The relevant regulations governing this movement are set out in Regulations 4 and 7 of the Excise Duty Points (Duty Suspended Movements of Excise Goods) Regulations 2001 (SI2001/3022) which provide as follows:
“Failure of excise goods to arrive at their destination
4.(1)The regulation applies where:
(a)there is a duty suspended movement that started in the United Kingdom; and
(b)within four months of the date of removal, the duty suspended movement is not discharged by the arrival of excise goods at their destination; and
(c)there is no excise duty point as prescribed by regulation 3 above; and
(d)there has been an irregularity.
(2)Where this regulation applies and subject to paragraph (3) below, the excise duty point shall be the time when the goods were removed from the tax warehouse in the United Kingdom
(3)The excise duty point as prescribed by paragraph (2) above shall not apply where, within four months of the date of removal, the authorised warehousekeeper accounts for the excise goods to the satisfaction of the Commissioners.
Payment
7.(1)Subject to paragraph (2) below, where there is an excise duty point as prescribed by regulation 3 or 4 above, the person liable to pay the excise duty on the occurrence of that excise duty point shall be the person shown as the consignor on the accompanying administrative document or, if someone other than the consignor is shown in Box 10 of that document as having arranged for the guarantee, that other person.”
The Facts
- The Appellant company is a haulier and between 24 March 2004 and 6 May 2004, the company provided the guarantee for the movement of 20 duty suspended consignments of beer from the UK Excise warehouse of Edwards Beer & Minerals Limited, Leyton Buzzard (“EBML”) to EDW Excise warehouse in Wimille, France. The Appellant subcontracted carriage to a firm called Mulberry.
- When Customs paid a routine visit to EBML to check their documentation, officers noted a significant number of missing receipted AADs. EBML provided the officers with copy 1 of the AAD in respect of each of the consignments and in relation to each, the Commissioners raised a request for verification with the French tax authorities. In each case, the verification was returned to the effect that receipt of the goods could not be confirmed either in fact or within EDW’s records. Mr McWilliams considered that the non-receipt of the goods by EDW evidenced an irregularity which gave rise to a duty point at the time of the release of the goods from EBML’s warehouse (Regulation 4) and under Regulation 7(1), the Appellant was liable for the duty having given the guarantee. Mr McWilliams made a detailed item by item calculation of the duty payable and raised an assessment against the Appellant in the sum of £412,907.
- A request for a review of this decision was made and was carried out by Miss Linda Cunningham. She confirmed Mr McWilliams decision in principle but as one consignment of beer, which had been included within Mr McWilliams’ assessment, had in fact been seized by the Commissioners as being liable to forfeiture, she reduced the assessment by the amount of duty applicable to that consignment only.
The Appeal
- Mr Payne of Grove Business Services lodged an appeal with the tribunal dated 6 February 2006. The stated grounds of appeal were as follows:
“The 20 loads of goods were properly consigned for delivery from a bonded warehouse in the UK to a bonded warehouse in France and were covered by a movement guarantee provided by the Appellant. Customs claim that the loads were not received at the intended destination.”
- No further clarification of the Appellant’s case has ever been received.
Conclusions
- In the absence of any evidence from the Appellant, all we have to go on is the evidence put in by the Commissioners. That evidence consists of clear and unequivocal documentation. There is documentary evidence in the form of the first copy of the AAD that the 20 consignments of beer left EBML’s warehouse. There is equally clear evidence from the French tax authorities that the consignments never arrived at their destination. In the absence of any evidence whatsoever of their receipt, we are satisfied that Regulation 4 engages and that an excise duty point arose at the time of the removal of the goods from EBML’s warehouse. The Appellant company gave the guarantee for the movement of the goods and it was their name which was given in Box 10 of the AAD and as such they are liable for payment of the duty. No challenge has at any time been made to the calculation of the duty and we uphold the assessment as amended in the sum of £396,566. The appeal is therefore dismissed.
- Mr McCluggage made an application for costs. He maintained that the Appellant had abused the tribunal system by commencing an appeal and then taking no further part in it. The Appellant failed to comply with directions given on an earlier hearing and arranged no representation on the full hearing without giving any notice that it intended not to attend. We grant Mr McCluggage’s application for costs which he calculated in the sum of £820 plus VAT.
- In summary therefore the appeal is dismissed and we direct that the Appellant pays the Commissioners’ costs in the sum of £820 plus VAT.
LADY MITTING
CHAIRMAN
Release Date: 1 February 2007
MAN/06/8004