Appeal against seizure of excise goods and vehicle – Appellant with wife as passenger – “own use” considered – frequency of travel – appeal dismissed

MANCHESTER TRIBUNAL CENTRE

	MICHAEL CODD	Appellant
	and
	COMMISSIONERS OF CUSTOMS & EXCISE	Respondent

Tribunal:	Mrs E Gilliland (Chairman)
		Mr P Whitehead (Member)

Sitting in public at Manchester on 2nd September 2002
The Appellant in person
Mr Puzey of Counsel instructed by the Solicitors Office of HM Customs and Excise for the Respondents

	© CROWN COPYRIGHT 2003

DECISION

1.	 This is an appeal by Michael Codd (the Appellant) against a decision on review of the Commissioners who refused to restore seized excise goods (“the goods”) and a Ford Transit Van registration number N329PPR (“the vehicle”) to the Appellant.  The decision was contained in a letter dated 3 March 2002 sent by D. Harris the Review Officer and was conducted within the two tier system of reviews and appeals created by the Finance Act 1994 Section 14 and schedule 5 (the Act).
2.	In his Notice of Appeal dated 26 March 2002 the Appellant stated he wished to appeal on the following grounds; “that I may give my reasons for purchasing these goods, my wife nor myself never intentionally misled custom officials.  We cannot be expected to recall all details of every trip.  I do not wish to be treated in this manner because of a  “presumption”.    I wish my goods and vehicle to be returned to me.”
3.	The Appellant has presented his own case to the tribunal and given a sworn testimony.   Mr. J. Puzey of Counsel has represented the Commissioners.  There have been no witnesses
4.	It is not in dispute that the Appellant travelling with his wife Mrs Rosaline Codd was stopped in the vehicle at the UK Customs Control Zone at Coquelles in France on 10 November 2001.  After replies to initial questions when it was indicated that the vehicle contained 5kg of hand-rolling tobacco and 2,300 cigarettes, the Appellant and Mrs Codd were interviewed separately.  Copies of handwritten notes of each interview duly signed by the interviewee have been produced to the tribunal.   The seizure information form, the seizure of vehicle form and the warning were each signed by the Appellant and his wife.  The items listed as seized were the vehicle, 5 kilos of hand rolling tobacco, 3,000 cigarettes mixed, 4 bottles of spirits (i.e. 2.8 litres), 40 cases of beer (i.e. 312 litres), 9 cases plus 12 bottles of still wine (i.e. 59¼ litres) and 250 cigarillos.  
5.	The interview notes of the Appellant and Mrs Codd show inconsistencies and discrepancies.  It was the view of the Commissioners that Mrs Codd was vague in her responses to questions about her own use of tobacco, the cost of the goods which were bought on the trip and as to goods which had been purchased on previous trips.  We note that Mrs Codd said that the goods belonged to herself and her husband and had been purchased in Belgium and France whereas he said that the goods belonged to him and had been purchased in Belgium.  Mrs Codd had said she was not sure of the cost because her husband had paid for them and he said he had paid £520.00 for the tobacco and £251.00 for the alcohol they had with them.   She said that she smoked any brand of cigarettes or tobacco; she did not know how many she smoked but it was at least 60 per day and a pouch of tobacco would last her 2/3 days.  The Appellant said he smoked 40 cigarettes a day and drank a couple of beers a day.  He said his wife smoked Silk Cut and that they both smoked Benson & Hedges.   He also smoked Super Kings.  He said he would get 40 cigarettes from a pouch of tobacco and a pouch would last him three days.  He smoked hand-rolling tobacco at work and cigarettes at home.  Mrs Codd said she did not work or have savings and Mr Codd said his income was £300.00 per week and the purchase was financed from savings and that his wife dealt with that aspect.  Mrs Codd said that she intended to make her next trip in January 2002 and that she had last travelled abroad 4/5 weeks before and had made 3 or 4 trips abroad with her husband in the past 12 months.  She travelled to France with her husband on every occasion “more or less” when he made the trip.  She could not remember the quantities of excise goods which she and her husband had imported previously but the goods had been consumed at home.  The Appellant said he had last been abroad on 12 October 2001 and before that in September or at the end of August.  On both occasions he had purchased 12 cartons of cigarettes (2,400) and 40 pouches of tobacco (2 kg).  He had made 7 or 8 trips abroad in the last 12 months to Calais and Belgium.  He had smoked all the tobacco he imported on each occasion.  He had been stopped by a Customs Officer with 6,000 cigarettes early in 2000.  Both the Appellant and his wife confirmed that they had no intention to supply others with the goods.  Mrs Codd said she was not aware of guidance levels or that it was an offence to sell imported excise goods on which duty had not been paid.  The Appellant said he was aware of the guidance levels and knew it was an offence to sell imported excise goods on which duty had not been paid. 
6.	Subsequently it was claimed by the Appellant that his wife and he had purchased the goods for Christmas and birthday presents and for New year celebrations.  Thete were goods for members of the family who could confirm what they smoked.  The Commissioners however have queried the credibility of this since the interview notes were signed without any record of it and in the letter of 14 January 2002 first referring to the intention to make gifts it was not suggested that this had already been brought up.  In cross-examination, the Appellant said that he had the “board money” to pay for the purchases for the family but that they did not buy cigarettes from him.  The Appellant has sought to argue that “gifts” are a different category from “supply” or “own consumption” and therefore the answers which he and his wife had given were not misleading.
7.	The Appellant on his own admission made a considerable number of trips to the continent.  The Commissioners were able to produce a copy of a commercial record showing trips made by the Appellant in a Peugeot car which he has said belonged to his son-in-law.  The Commissioners did not consider that the record tallied with the Appellant’s own evidence as to trips and that a third vehicle could have been used which the Appellant denied.  It is noted also that neither the Appellant nor his wife disclosed that she planned to go back to work less than a week after the seizure.
8.	The Appellant submitted that the guidelines were just guidelines and were not law.  Where there was a grey area there was bound to be confusion.  He emphasised that the posters in the terminal were misleading in that they suggested that a traveller could bring in as much in the way of goods for own consumption that he wished.  He had seen other travellers bring in more than he had without seizure.  He had not been given an opportunity to pay the duty.  Further,  the fact that he had brought in 6 different brands of cigarettes was not relevant as he was allowed to buy them and could be under the guidelines with 40 brands.
9.	At the hearing we had submissions from Counsel on the decision of the Divisional Court in Hoverspeed Limited v Customs & Excise Commissioners [2002] 3WLR1219.  Since then there has been the Court of Appeal Decision in Hoverspeed and changes in the Statutory Regulations so that the relevant levels of transported goods which the Commissioners are to take into account in determining whether such excise goods are held or used for a commercial purpose have been increased.  The quantity for hand-rolling tobacco is one exceeding 3 kgs and for beer 110 litres.  In addition it has been made clear that the burden of proof on establishing commerciality is on the Commissioners.  
10.	The tribunal has afforded the opportunity to both parties to make any further submissions oral or written arising from changes in the law since the hearing.  Neither has wished to do so.   In coming to our decision however the tribunal is aware of and has taken note of legislative changes and decisions in recent cases.  
11.	We are not satisfied that the goods were jointly owned by the Appellant and Mrs Codd.  The Appellant has said that they were his and that he paid for them though both he and his wife would consume the goods.  We do not however find Mrs Codd’s comments as to her smoking habits plausible.  The Appellant has submitted also that so long as he is under the guidelines he can bring in whatever goods he wishes.  This is not the case.  The relief in respect of cross border shopping in the European Union is in respect of goods for “own use” and the reference to quantities in the 2002 Regulations (The Excise Goods, Beer and Tobacco Products (Amendment) Regulations 2002) is merely one of a number of factors which the Commissioners are to take into account in considering whether goods have been brought into the U.K. for a commercial purpose.  It is the case that “own use” can include gifts and it has been submitted by the Appellant that gifts were to be made within the family.  The Commissioners could not accept this evidence as credible at the late stage it was first introduced and nor do we.  
12.	It is clear to the tribunal that the Appellant as indeed he has acknowledged was a frequent traveller.  We cannot accept however his evidence that what he brought in was solely for his own consumption.  Looking at the figures he has himself disclosed the volume of goods is more than would be needed for the period between trips.  Equally the number of different brands of cigarettes brought in would only make sense if gifts were to be made to persons smoking a variety of brands.  We are satisfied that the goods were not brought in even in part to be given out as presents whether at Christmas or at any other time.  
13.	As we do not consider that Mrs Codd had any goods of her own, we do not accept there are goods “mixed, packed or found with” goods liable to forfeiture which might themselves not be forfeitable within S.141 of the Customs and Excise Management Act 1979.  The vehicle carrying the goods is liable to forfeiture under the same section.
14.	The seizure and non-restoration of property and deprivation of the Appellant of his possessions falls within Article 1 protocol 1 of the ECHR.  It was established in the case of Lindsay (Lindsay v the Customs and Excise Commissioners [2002] (“the Lindsay case”) 1WLR1766) that there has to be a “ reasonable relationship with proportionality” between the aim of the State’s securing the payment of taxes and the means employed in doing so.  In the Lindsay case however Lord Phillips at page 63 said that in normal circumstances deliberate use of a car for smuggling to make a profit would take a case beyond the point where the value of the car could carry significant weight although exceptional hardship would always have to be considered.  
15.	The power of the tribunal in appeals against non-restoration of goods or vehicles is limited under Section 16 (4) of the Act.  We are to satisfy ourselves as to whether the Commissioners have been reasonable in coming to their decision.  In doing so the Commissioners must not have not taken into account some irrelevant matter or disregarded something to which they should have given weight.  We are satisfied that the primary facts upon which the Commissioners have based their decision are correct and that the decision not to restore the vehicle and the goods is one that a reasonable body of Commissioners could reach.  The appeal is dismissed.  
16.	The Commissioners have not sought costs and we make no direction.

MRS E GILLILAND
CHAIRMAN
RELEASE DATE:

Man/02/8062