United Kingdom Immigration and Asylum (AIT/IAC) Unreported Judgments

 

Upper Tribunal

(Immigration and Asylum Chamber) Appeal Number: Hu/04788/2018

hu/09592/2018

 

 

THE IMMIGRATION ACTS

 

 

Heard at Field House On 23 August 2021

Decision & Reasons Promulgated: On 04 October 2021

 

 

Before

 

UPPER TRIBUNAL JUDGE GLEESON

 

 

Between

 

Vikram Arvind Deshmukh

Harsha Vijay Deshmukh

[NO ANONYMITY ORDER]

Appellants

and

 

THE SECRETARY OF STATE FOR THE HOME DEPARTMENT

Respondent

 

 

Representation:

For the appellants: Mr Michael Biggs of Counsel, instructed by ITN Solicitors

For the respondent: Ms Alexandra Everett, a Senior Home Office Presenting Officer

DECISION AND REASONS

1.              The appellants appeal with permission from the decision of the First-tier Tribunal dismissing their appeal against the respondent's decision on 5 February 2018 to refuse them indefinite leave to remain on human rights grounds based on 10 years' continuous residence by the first appellant, and his private and family life with his wife, the second appellant and their infant daughter born in the United Kingdom on 6 June 2016. Both appellants are Indian citizens.

2.              The appeal of the second appellant stands or falls with that of the principal appellant: her status was always as his dependant. Their daughter is not an appellant in this appeal but her circumstances are relevant, because of her citizenship.

3.              'New matter': statelessness of the appellants' daughter. The appellants' daughter, who is now 5 years old, was never registered as an Indian citizen and Ms Everett for the respondent did not dispute that as a matter of law, she is stateless: see R on the application of MK (a child, by her litigation friend CAE) v Secretary of State for the Home Department [2017] EWHC 1365 (Admin). On 8 June 2021, the appellants' daughter applied for British citizen status and that application is pending.

4.              On behalf of the Secretary of State, Ms Everett indicated at the hearing that she did not object to the Upper Tribunal taking the nationality of the appellants' daughter into account as an issue in these proceedings, and also as part of the human rights factual matrix.

5.              Mode of hearing. The hearing today took place face to face, save that the principal appellant's accountant, Mr Usman Butt, was available to give evidence by Microsoft Teams. In the event, Ms Everett did not seek to cross-examine him and he appeared only briefly, so that I could explain to him that his evidence would not be called upon.

Background

6.              The principal appellant ('the appellant') has a physics degree from Pune University. In September 2006, he came to the United Kingdom to study for an MSc in Management at Robert Gordon University, and worked for Primark during his studies. He set up a self-employed business consultancy, trading as 'Maxwell Consultancy. He developed a significant client base and his self-employment prospered, as did his work for Primark, where he became a Manager in the Operations department. The appellant remained in the United Kingdom as a student, although he did return to India in 2009 when his first visa expired, applying for a second visa and returning successfully after two weeks in India.

7.              In 2010/2011, the appellant filed the first ever tax return, completing it himself. He took advice from friends who considered the process to be fairly straightforward. He constructed a spreadsheet to help him work out his tax, but he made a major error by deducting from his turnover the significant outgoings on his business account: instead of £28060 turnover, he inserted £8060 in the tax return as his turnover. He paid the tax and continued trading. In 2012/2013, he made the same error in his tax return, again understating the figure significantly.

8.              On 4 April 2011, the appellant applied for leave to remain as a Tier 1 (General) Migrant, which was granted on 22 June 2011, valid to 22 June 2013. The respondent's GCID notes confirm that his declared income was accepted to be genuine and that he was awarded 35 points for previous earnings.

9.              On 9 April 2013, the appellant applied for further leave to remain as a Tier 1 migrant, and again the GCID notes confirm that the previous earnings were accepted to be genuine and that the application was allowed on that basis, with leave given from 26 June 2013 to 26 June 2016. The second appellant now works as a Quality Analyst for Prudential through his company, Harsha Limited (named after his wife).

10.          The appellant's maternal grandfather suffered a stroke towards the end of 2011 but battled on until 20 February 2013. At the same time, the appellant was organising his wedding to the second appellant, which was to take place in India. He says that he lost focus and was careless in his tax returns during this very stressful period, but that he was never dishonest in his intentions: he was an emotional wreck, getting through life on 'auto-pilot mode', unfocused and careless in his personal tax affairs.

11.          On 6 July 2012, the appellant married the second appellant in India. The second appellant joined the appellant in the United Kingdom as his dependant on 17 June 2013 and now works for London Property Managers Limited. She would like to use her microbiology degree to make a real contribution in the Life Sciences sector but cannot do so because of her immigration status.

12.          On 17 January 2013, the second appellant entered the United Kingdom as a Tier 1 dependent. In 2014, with more familial pressures and a busy self-employment as well as professional life, the appellant employed Mr Butt's firm, Tax Maths. Mr Butt is a Chartered Certified Accountant, and he spotted the error in the appellant's two tax returns and helped him file amended returns and pay the tax due. HMRC did not impose a penalty. The appellant need not have paid the tax for 2010/11 but he was keen to set matters right and did so.

13.          On 6 June 2016, their daughter was born to them here in the United Kingdom. The second appellant was granted leave in line with that of the principal appellant, to expire on 26 June 2016. The second appellant has not done anything that she should not have done and has always resided lawfully in the United Kingdom.

14.          On 21 June 2016, the principal appellant applied for further leave to remain based on his private life in the United Kingdom. On 16 September 2016, he varied his pending application to seek indefinite leave to remain with reference to paragraph 276B of the Immigration Rules HC 395 (as amended).

15.          On 22 February 2017, according to the refusal letter, the respondent paused Appendix FM decision making where the minimum income requirement was not met or a child was involved, following the decision of the Supreme Court in MM (Lebanon) v Secretary of State for the Home Department [2017] UKSC 10. On 10 August 2017, the respondent made changes in the Immigration Rules to give effect to that judgment and resumed decision making.

16.          The appellants have always been lawfully in the United Kingdom and have made their applications for further leave to remain properly, before the expiry of their previous leave. They have never overstayed or had any criminal convictions. There is evidence in the bundle of the regard in which they are held by their community, and the good works they undertake, none of which is disputed.

17.          The appellant feels terrible about his error in the tax returns: he was not brought up to be dishonest, having been taught good morals by his parents from a young age. The family are paying a high price for his innocent mistake, he says, and he feels nearly suicidal when considering what his carelessness has caused.

Refusal letter

18.          On 5 February 2018 for the principal appellant and 11 April 2018 for the second appellant, the respondent refused their applications for indefinite leave to remain made in June 2016, based on paragraph 276ADE(1) with reference to section S-LTR and paragraph 322(5) of the Rules.

19.          The respondent considered that the appellants' applications fell for refusal on grounds of suitability, because of the appellant's failure to declare to HMRC the full income relied upon in his Tier 1 applications of £55408.61 in 2010/2011 and £57025 in 2012/2013. The appellant had declared only £22275 for 2010/2011 and £34872 for 2012/2013. If he had used the lower figures, the refusal letter states that he would not have been awarded 35 points, or any points, for previous earnings and his applications for Tier 1 leave would have been refused.

20.          Paragraph 322(5) states that leave to remain and variation of leave to enter should normally be refused in the light of 'the undesirability of permitting the person concerned to remain in the United Kingdom in the light of his conduct (including convictions which do not fall within paragraph 322(1C), character or associations or the fact that he represents a threat to national security'.

21.          In this case, the undesirability relied upon was the earnings discrepancy in the 2010/2011 and 2012/2013 tax returns as originally filed. By the date of decision the applicant had amended his tax returns for those two years and arranged to pay the unpaid tax. HMRC did not apply a penalty or prosecute: they accepted the underpaid tax.

22.          The respondent accepted that the relationship between the appellants was genuine, but neither was settled, and family life was therefore of no assistance. The respondent considered the citizenship of the child under EX.1, treating her as an Indian citizen, and concluded that her parents could help her settle in India and that she would already have some knowledge of the language, customs and culture of India, making it easier to adapt to life there.

23.          The respondent did not consider that any exceptional circumstances had been shown for which leave to remain should be granted outside the Rules.

24.          The appellants appealed to the First-tier Tribunal.

First-tier Tribunal decision

25.          The appeal was heard in the First-tier Tribunal on 13 November 2018 by First-tier Judge Lucas, who allowed the appeal. Following an appeal by the respondent to the Upper Tribunal, the appeal was remitted to the First-tier Tribunal for rehearing before a different First-tier Judge.

26.          The appeal was reheard in the First-tier Tribunal on 19 September 2019, the First-tier Judge finding that the principal appellant had been dishonest, that his explanation for his conduct was implausible, and that the underpayments were so substantial that he must have been aware of them. The appellants' community spirit was taken into account, as was their daughter's eczema and the difficulties which the Indian climate might present in that context. The First-tier Judge found that permitting the principal appellant to remain in the United Kingdom was fatal to the appeals and dismissed them.

27.          The appellants appealed to the Upper Tribunal.

Permission to appeal

28.          Permission to appeal was granted by First-tier Judge Andrew. On 22 January 2021, Upper Tribunal Judge Plimmer set aside the decision of the First-tier Tribunal and an intervening decision by Upper Tribunal Judge Coker, with which we are not here concerned.

29.          Upper Tribunal Judge Plimmer ordered that the decision be remade afresh in the Upper Tribunal and gave directions for skeleton arguments, a position statement from the respondent, and so on.

Evidence before the Upper Tribunal

30.          The appellants filed a bundle of evidence (721 pages) and a supplementary bundle (209 pages), which included witness statements from both appellants and Mr Butt, their accountant. The principal and second appellants gave evidence. Mr Butt was released, as his evidence was undisputed.

31.          There was no provision in Judge Plimmer's order for the filing of the supplementary bundle and witness statement which were filed without leave, on the Friday before the hearing on Monday 23 August 2021. However, Ms Everett did not object to the admission of this bundle.

32.          I have had regard to the all of the evidence before me, in particular those pages and passages to which I was directed at the hearing today.

Upper Tribunal hearing

Mr Usman Butt's evidence

33.          Mr Butt provided two witness statements, which stand unchallenged. On 10 September 2021 he explained how the error in the appellant's tax returns had come to light, and how he had informed him of the need to rectify the error and pay the tax. He confirmed that the appellant had paid the shortfall entirely, with interest. His statement concluded:

" 8. Having dealt with the appellant's accounts thoroughly, I have, in my professional opinion, no doubt that the appellant's self-employment income is genuine.

9. It is also entirely plausible that the error in question could have occurred, due to the appellant's misunderstanding of the tax rules, which can often be quite intricate, particularly for clients starting a business for the first time and filing their tax returns without the help of someone specialising in accounts. The law does allow individuals to make self-assessment submissions themselves and we regularly come across such mistakes, not just from such individuals like the appellant but in some cases, from professionals working within the field of accounts."

34.          In his second witness statement of 8 February 2021, Mr Butt confirmed his previous witness statement and expressed his willingness to testify.

Appellants' evidence

35.          The appellant adopted his three witness statements of 13 September 2019, 12 January 2021 and 19 August 2021, summarised under 'Background' above. He recognised that he made a careless mistake in each of the Tier 1 (General) applications. He had not fully understood what was deductible and what was not. He was inexperienced and careless, but not dishonest. He accepted that the tax returns, which he drafted and filed himself, were his responsibility. He could not now remember, some 10 years later, why he had filled in the deductibles he had.

36.          The appellant had not known that money paid out of the business account could not be deducted from the gross turnover figure. He had looked at both the business and personal accounts: that was a question of accidental confusion.

37.          At the beginning of her cross-examination, Ms Everett stated that the respondent maintained her position that the appellant's abilities were such that he could not be heard to say that he did not know how to work out the figures for his HMRC tax returns. However, she did not cross-examine on that area.

38.          Ms Everett did cross-examine on the 'new matter' about the statelessness of the appellants' daughter. The appellant said that he did not assume when she was born that she was an Indian citizen: he had applied for indefinite leave to remain and was expecting that this would give his daughter British citizen status. He had not taken any legal or community advice on the point. His daughter had never left the United Kingdom, which was 'killing [him]'. She asked him why they could not go on holidays, but he did not have a passport for her so it was not possible.

39.          The appellant did not consider registering his daughter at the Indian consulate: she was going to be British as soon as he got indefinite leave to remain. That was his intention at all times. When the indefinite leave to remain application was refused, his whole world collapsed and his top priority was to remove the allegation of dishonesty. He had had to chase the respondent for a decision, including through his local Member of Parliament.

40.          The appellant was clearly very upset when giving his evidence, and at times tearful. He could not believe that he had put his family, and in particular his 5-year old daughter, who was his princess, in this terrible situation. He would die for her, her health and happiness were his top priority.

41.          There was no re-examination.

42.          The second appellant also gave evidence. Again, she adopted the evidence in her witness statements. She had been outside with their daughter while the appellant gave evidence but her answers in cross-examination were the same as his: she had never considered that her daughter might be an Indian citizen, had taken no advice on the point and did not think of asking about it. Her husband was an honest man, who made an honest mistake. At all material times, they had thought that the child would be British.

43.          That concluded the oral evidence for the appellants.

Submissions

Appellants' submissions

44.          For the appellants, Mr Biggs filed a helpful skeleton argument, setting out the issues for the Upper Tribunal. He reminded the Upper Tribunal of the test in Balajigari and others v Secretary of State for the Home Department [2019] EWCA Civ 673 at [33]-[44], which holds that the respondent bears the burden of proof of dishonesty, rather than carelessness, to the ordinary civil standard of balance of probabilities; and if dishonesty is proved, it is for the Tribunal to consider whether his presence in the United Kingdom is undesirable; and finally, if both points are against the appellant, the Tribunal must consider whether the use of paragraph 322(5) requiring the appellants to leave the United Kingdom constitutes a disproportionate interference with their Article 8 ECHR protected rights.

45.          Mr Biggs set out seven reasons why the respondent should not be found to have discharged the burden of proving dishonesty: the explanations in the principal appellant's witness statements; the documentary evidence supporting it; the witness statement from his accountant, Mr Butt, who had been instrumental in bringing the errors to light and organising the filing of amended returns; the principal appellant's voluntary amendment of the relevant tax returns , including the payment of tax for the 2010/2011 year, although HMRC indicated that he could not be compelled to do so; the lack of any penalty imposed by HMRC; the character references and DBS certificate, indicating that the principal appellant was an honest man; and that there was no evidence that the principal appellant had lied to the respondent. On the contrary, he had provided his business bank account statements for the relevant periods and the invoices supporting the payments received: see RP (proof of forgery) Nigeria [2006] UKAIT 00086 at [14].

46.          Even if dishonesty were shown, the first appellant had behaved responsibly and paid his taxes, albeit late. The first appellant had volunteered for the NHS to assist with the coronavirus pandemic and actively supported the United Kingdom response to the pandemic generally, the free school meals initiative, and the local community, and he had in the past volunteered for and supported the Red Cross and other charities. He had provided character references.

47.          The second appellant has a Masters degree in Microbiology with which, once her status was resolved, she would be able to make a significant contribution to the United Kingdom economy and society.

48.          If both dishonesty and undesirability were found, then under Article 8 ECHR, the appellants would rely on the statelessness of their daughter, which meant that she would not be able to travel with them to India, and her right to register herself as a British citizen on that ground. It was clearly in the child's best interests to have both parents available and to grow up here.

49.          The appellants were financially self-sufficient and were fluent English speakers. Section 117B(5) was not applicable to family life, but only to private life: see Rhuppiah v Secretary of State for the Home Department [2018] UKSC 58 at [49].

50.          In oral submissions, Mr Biggs repeated the core of his written arguments. The appellant's account was perfectly plausible: people made mistakes and his evidence on the earnings discrepancy point had not been tested in cross-examination, nor was there any opportunity in cross-examination for him to respond to the allegation that he must have realised the shortfall in his taxes. There was no proper basis to find that the respondent had discharged the burden upon her of proving dishonesty. Mr Biggs reminded me that the two spreadsheets, now disclosed, showed how the appellant had calculated his income and were contemporaneous with the incorrect returns.

51.          The respondent could not prove that the appellants' presence in the United Kingdom was undesirable. They both contributed to the United Kingdom and local community and had a loving relationship with their daughter, a stateless child who was eligible for British citizen status on that basis. The misconduct relied upon was now very old and had been remediated by the appellant. There had been no subsequent problems, indeed no other misconduct at all by either appellant.

52.          In relation to Article 8 ECHR and proportionality, Mr Biggs relied on his skeleton argument and on the lack of challenge to the evidence of both appellants on the earnings discrepancy point. There was an insurmountable obstacle to return as at the date of decision and the date of hearing, their child was stateless. Her entitlement to British citizen status should weigh heavily in the assessment scales (see ZH Tanzania v Secretary of State for the Home Department [2011] UKSC 4 at [30]-[34] in the majority opinion of Lady Hale JSC, with whom Lord Brown JSC and Lord Mance JSC agreed). The best interests of the child must be a primary consideration.

53.          The appellants had an impeccable immigration history, and as far as the second appellant was concerned, there was nothing negative against her at all, save by association. The tax returns had been prepared by the appellant, one of them before she even came to the United Kingdom and the other shortly after her marriage. The error or carelessness therein had nothing to do with her.

Respondent's submissions

54.          Ms Willocks-Briscoe prepared and filed a skeleton argument for the respondent on 21 October 2020. However, that skeleton argument refers to the decision of Upper Tribunal Judge Coker, which has been set aside. Ms Everett did not rely on it at the hearing.

55.          In oral submissions for the respondent, Ms Everett relied on the refusal letter and noted the thoroughness of Mr Biggs' skeleton argument. She submitted that on the evidence, the respondent had discharged the burden of showing dishonesty, but conceded that she had to accept that the contemporaneous documents now before the Tribunal were supportive, and that the GCID showed that the respondent had accepted the income when submitted. She was in a difficult position for that reason.

56.          Nevertheless, the earnings discrepancy in the income tax return had conferred a benefit on the appellants. The Tribunal should not accept the explanation given. If the Tribunal was satisfied that dishonesty had been proved to the appropriate standard, then as regards the undesirability test, the respondent placed great weight on the dishonest act committed. Good deeds and words were not a sufficient corrective counterweight.

57.          Ms Everett did not dispute that the parties' daughter was currently stateless and had been since birth. Article 8 ECHR must be considered in the round.

Analysis

58.          The principal question in this appeal is whether the appellant has been dishonest, or merely careless. I have regard to Ms Everett's failure to cross-examine on this point, and also to the evidence of the appellant that he was careless and naïve, at a difficult time in his life. I place weight on Mr Butt's evidence that mistakes of this type are often seen in his practice. The appellant's error in treating his net turnover as his gross turnover led to the error in both tax returns. I am not satisfied on the evidence before me that the respondent has proved that it was dishonestly done and accordingly, the question of undesirability is not reached.

59.          Even had it been reached, so far as the second appellant is concerned, the error was not hers and she had nothing to do with it. The respondent has not shown that her presence in the United Kingdom is undesirable. On the contrary, both appellants have done their best to make a contribution to the United Kingdom and to their local communities and charities. Against a finding of dishonesty, that would not have been enough, but absent such a finding, it was not open to the respondent to find that their continued presence in the United Kingdom is undesirable.

60.          I turn then to Article 8 ECHR. This is the only area where I am not entirely satisfied by the appellants' evidence. It is most odd that they made no attempt to register their daughter at the Indian Embassy for 5 years after her birth: however, that is of no legal account, since in MK's case, Mr Ockelton, Vice-President of the Upper Tribunal (IAC) sitting as a deputy High Court Judge, held that on similar facts, the child MK 'was or is 'stateless' at any time when she did or does not in fact have Indian nationality'.

61.          In this case, the appellants' daughter has never had Indian nationality and has been stateless since birth. She cannot travel anywhere and she cannot be expected to remain in the United Kingdom without her parents. It is plainly in her section 55 best interests that she have access to both parents during her childhood.

62.          I therefore find that to remove the appellants, or either of them, would be a disproportionate breach of the child's Article 8 private and family life rights, and further, that her lack of any citizenship is a very significant, indeed an insurmountable obstacle to this family returning to India together.

63.          The appellants' appeals are therefore allowed.

 

DECISION

64.          For the foregoing reasons, my decision is as follows:

The making of the previous decision involved the making of an error on a point of law.

I set aside the previous decision. I remake the decision by allowing the appellants' appeals.

 

 

Signed Judith AJC Gleeson Date: 23 August 2021

Upper Tribunal Judge Gleeson