EXCISE DUTIES  — importation of 24 kilograms of hand rolling tobacco by 3 students — forfeiture of vehicle and goods — claim for restoration of vehicle by mother of driver of vehicle — whether she was the owner of the vehicle — whether review decision not to restore vehicle was reasonable — joint ownership of vehicle by mother and son — appeal dismissed

MANCHESTER TRIBUNAL CENTRE

 	
	JOYCE ANN THOMPSON	Appellant
	
	- and -

	THE COMMISSIONERS OF CUSTOMS AND EXCISE	Respondents

				Tribunal:	Mr I E Vellins (Chairman)
						Mr R Presho (Member)	
				
Sitting in public in York on 16 October 2003
The Appellant appeared in person
Mr M Graham of counsel instructed by the Solicitor for the Customs and Excise for the Respondents

	© CROWN COPYRIGHT 2003

DECISION
1.	 This is an appeal by Mrs Joyce Ann Thompson, the Appellant, against the decision of the Commissioners confirming a refusal to restore to the Appellant a seized vehicle, K195 UCP which had been seized by officers of the Commissioners on 24 March 2001 when the Appellant’s son, Robert Edward Thompson, together with two other students, David James Hampton and Craig Massingham, had been stopped in the UK Control Zone at Couquelles, France when returning to the United Kingdom.  At the time of the seizure the Appellant’s son, Robert Edward Thompson, claimed to have been the owner of the vehicle.  In a letter dated 26 March 2001 the Appellant had requested the restoration of the vehicle claiming that the vehicle had been owned by her. On 14 April 2001 the Commissioners refused to restore the vehicle to the Appellant.  On 28 April 2001 the Appellant requested a review of that decision.  By a letter dated 15 June 2001 the Commissioners decided to uphold the decision not to restore the vehicle to the Appellant.  That is the decision against which the Appellant now appeals.
2.	On 23 January 2003 the Commissioners themselves decided to conduct a re-review of their decision but reached the same conclusion namely not to restore the vehicle to the Appellant.
3.	At the hearing of this appeal at York on 16 October 2003 the Appellant represented herself.  The Commissioners were represented by Mr Michael Graham, counsel.
Background
4.	The background to this appeal is as follows.  At about 11:20 a.m. on 24 March 2001 a Volkswagen Golf vehicle K195 UCP being driven by the Appellant’s son, Robert Edward Thompson, in which were travelling two of his student friends, David James Hampton and Craig Massingham, were stopped by Customs in the UK Control Zone of the Channel Tunnel in Coquelles, France.  In the vehicle was a quantity of excise goods including 24 kilograms of hand rolling tobacco and approximately 96 litres of beer in 8 cases.  In answer to questions put to them by the officers of the Commissioners the passengers offered the following information.  They had been to Belgium and Calais to purchase beer and tobacco.  Between them they had about 8 cases of beer and 4 boxes of tobacco.  Robert Thompson stated that the car was his and that he had owned it for roughly 6 months.  He said that the car was registered in his mother’s name but he had bought it and that he was the only user of the vehicle.  The officer asked if any of them had had goods seized before, or if they been issued with a Customs Notice 1 before, or had the guideline explained to them before.  They all replied that they had not, and Robert Thompson stated that this was the first time that they had come over to the continent.
5.	Robert Thompson told an officer that 160 pouches of hand rolling tobacco belonged to him and had cost him around £255.  He said that he had paid for the tobacco himself and that everybody gave their money to him, and he had paid it at the counter but that he had obtained separate receipts.  He said that he had paid in cash.  He said that he smoked roughly 30 a day, 3 pouches a week.  He obtained about 30 roll-ups from a pouch.  He said that some of the tobacco was for his family namely his mother, father and two uncles although not for sale.  He said that about half of the tobacco was for family members but that no-one had contributed to the cost.  The officer asked if they would repay him at cost price.  He stated that they would if asked for it but he was not going to sell it at a profit.  The officer asked if he expected them to give him the money and he replied “obviously, within the family, usually”.
6.	Robert Thompson told the officer that he worked in a supermarket part time but he was at college.  His take home pay was about £400 a month and he also received money from his mother.  He said that his outgoings were £70 per month for telephone bill and car tax etc.  He said that the car was fully paid for and that he had no loans or debts.  The officer asked him if he had travelled before, and he replied that he had, and the last time was the previous Friday or Saturday with a friend for shopping.  They had obtained 8 cases of beer and his friend bought 20 pouches of tobacco.  He said the ticket for 24 March 2001 had cost £49 and that his father had paid for it.  He said that all three travellers had contributed towards the cost.  They had all shared the costs of petrol, about £50, and they had all jointly organised the trip.  They knew where to go for the tobacco from the internet.  He was not aware of the guidelines but was aware that it was illegal to sell imported excise goods without first paying the duty.  He said that he had about £2,000 savings for University.  He said that the money for the purchases that day had been saved up.  The officer asked why he had not taken to opportunity to buy tobacco on this last trip.  He replied that he had not saved up sufficient funds.  The last time he travelled he went to the same places.  He stated that on 24 March 2001 this was the first time that he had brought anything back and that he had no intention of selling it.  He said that he had been saving a long time.  He had enrolled at University for the following year and so he would not have time to travel again so he thought he would stock up.  He stated “my car means everything to me and I would not risk that.  The money that is in the car and the money I’ve spent is not worth the risk”.  He said that he was actually starting University in the September and he expected the tobacco would last roughly about a year.
7.	David Hampton told an officer that of the tobacco, 160 pouches of Drum belonged to him and nothing else.  He said that he normally smoked Regal cigarettes but smoked roll-ups when he was working.  He stated that he smoked 1 pouch every 2-3 days and more at weekends, that was about 3.5 pouches in a week.  He said that he had paid for the tobacco from his wages and had paid cash and handed the money over at the till.  He thought it cost about £283 and produced a receipt for £280.20.  He had not been to Belgium before and first travelled to France when he was 12 or 13 years of age.  He had been working on a building site and received £135 a week and had no outgoings.  He said that Robert Thompson had planned the trip and that Robert Thompson had asked him if he wanted to go on the Wednesday night prior to the trip as someone else should have gone instead.  He said that Robert Thompson had paid for the ticket and David Hampton had given Robert Thompson a share of the costs which also covered the fuel.  He did not know how many roll-ups he obtained from a pouch.  The officer asked him why he had not taken the opportunity to buy Regal cigarettes and he replied that they were not as cheap as he thought they would be and that there were bigger savings to be made on tobacco.  He had worked out the that 160 pouches would last him a year.  He had no idea what the guidelines were for tobacco.  He had not thought to enquire before making the trip as he had a friend who had been, who told David that he had brought a box back.
8.	Craig Massingham told the officer that a box of Drum tobacco and 6 of the crates of beer were his own personal purchases.  He told the officer that he bought 1 pouch of Drum tobacco per week, maybe two.  He said that his mother, father, and brother all smoked, so they would take some although he would not charge his family for it.  He said that he was a student but worked part time.  He intended to take the tobacco to University with him.  He did not know how much was for him and how much for his family.  He smoked between 5 and 10 roll-ups per day and would roughly get about 50 per pouch.  He said that he used a machine to roll his cigarettes but he did not have his machine or an open pouch with him.  He told the officer that he had spent about £170 that day and that the funding came from savings from his wages.  He had saved about £600 in the bank.  He said that he had not been to France or Belgium before.  He had not checked prior to travel about how much he could bring back.  He said he earned £300 on average for his part time work and had paid cash for the goods.  He thought that Robert Thompson paid for all the goods.  The officer asked him who many pouches were in his box or what sort of box it was or how heavy it was, but he replied that he was not sure.
9.	The officer concluded following the interviews that there were considerable discrepancies in the replies given by the three passengers and lack of credibility in the information they had provided.  The officer concluded that there had been commercial importation and seized the 24 kilograms of hand rolling tobacco and the 96 litres of beer together with the vehicle.
10.	On 26 March 2001 the Appellant Mrs Joyce Ann Thompson wrote to the Commissioners requesting the return of the vehicle which was a 1.4cc Golf with a K registration, claiming that she was the owner of the vehicle.  In the letter she stated that her son Robert Thompson had been the driver of the car, but that the car had been bought as a replacement for a R registered VW Polo car damaged beyond repair whilst her son was driving.  She wrote that she used the car to get to and from her work at a school and was having to organise lifts.  She stated that the seizure of the vehicle had caused her inconvenience which was caused by her son’s stupidity, and she stated that he would no longer have access to that vehicle or any other car which she owned in the future, and that he would have to save for his own car and his own insurance if he wished to drive.
11.	On 14 April 2001 a senior officer, Mr Marwood, replied to the Appellant that he had considered all the factors and recommended that the vehicle be not offered for restoration, bearing in mind that the vehicle had been used to carry large quantity of excise goods with the total revenue involved in excess of £2,300.  He concluded that there were no exceptional circumstances which would justify departure from the Commissioners’ policy.
12.	On 28 April 2001 the Appellant wrote to the Commissioners requesting a review.  She stated in the letter that although she had lent to car to her son she was unaware that it had been taken out of the country.  She stated that her son Robert had been working until the early hours of Saturday morning and she had presumed that he had stayed at a friend’s house.  She stated that it was only the second time her son had driven abroad.  He and his friends in the car, all under 18 years of age had apparently been advised by the retailer that sold them the goods they could take them through customs.  Her son was now working to repay some of the cost of the car prior to acquiring a place at college.
13.	On 15 June 2001 a review officer, G M Hurrell, reviewed the decision not to restore to the Appellant the vehicle.  In the review letter the officer set out the information in detail that had been given to the officers by the three travellers when they had been stopped on 24 March 2001, together with the correspondence, and the legislation, in detail.
14.	The review officer reached the following conclusions.  The travellers had had 24 kilograms of hand rolling tobacco between them which was a large amount.  On initial questioning Mr Robert Thompson had stated that that was the first time he had travelled, but in his subsequent interview he had told an officer that he had travelled only a few days previously.
15.	The total tobacco in their possession was 24 kilograms, that is 4 boxes of 120 pouches each making 480 pouches in total.  Mr Robert Thompson had claimed that 160 pouches were his, Mr Hampton also claimed 160 pouches and Mr Massingham claimed 1 box (120 pouches).  There was therefore 40 pouches unclaimed.  Me Massingham did not know how much tobacco he had purchased in his box.
16.	Mr Hampton claimed that he paid £283 for his 160 pouches, and the cost was verified by a receipt.  Mr Robert Thompson thought his 160 pouches had cast him only £255.  Mr Massingham stated that he had spent £170 that day which included beer as well as tobacco.  If he had purchased a box of tobacco (120 pouches) the cost for that alone would have been £212.40.  The review officer considered that these replies threw doubt on who had actually purchased the goods, and the true ownership of the goods.
17.	Mr Thompson had stated that he smoked 30 a day and 3 pouches a week, and yet he obtained 30 roll-ups from each pouch.  He stated that about a half was for his family and therefore he expected his 80 pouches to last him a year.  However at a consumption rate of 3 pouches a week his half would only last him about 6 months.  Mr Hampton had stated that he normally smoked cigarettes, and he did not know how many roll-ups he obtained from a pouch.  Mr Massingham smoked 5 to 10 roll-ups per day and roughly obtained 50 roll-ups from a pouch.  He normally purchased 1 or 2 two pouches of Drum a week.  Drum tobacco is not legally sold in the United Kingdom.  Mr Massingham stated he used a machine, but did not have one with him.  The officer concluded that this again threw doubt on who would be actually consuming the goods.
18.	Mr Robert Thompson had travelled only a few days previously.  He stated that he did not purchase tobacco on that trip as he had not saved up sufficient funds.  The officer concluded that it was not credible that he then managed to save up sufficient funds within less than a week, especially as the trip had actually been planned before the preceding Wednesday, when Mr Hampton had been invited to replace someone else.  In his statement at the end of this interview Mr Thompson also said that he had been saving a long time to save money by coming across to the continent.  In that case the officer concluded that the officer would have expected him to have had sufficient funds when he travelled on the previous occasion a few days earlier, which made his reason for not buying tobacco at that time implausible.
19.	Mr Hampton had stated that he handed his own money over the counter and yet Mr Thompson stated he handed everyone’s money over.  Mr Massingham thought that Mr Thompson had paid for it all.
20.	The officer did not consider it plausible that students on limited income, saving for University would purchase tobacco and provide it to others free of charge.
21.	Mr Thompson had an expectation that his family would be paying the cost price for some of the tobacco.  The officer concluded that this prevented the goods being subject to relief from duty.
22.	The officer concluded that taking the responses of the three travellers as a whole, there were sufficient discrepancies and lack of credibility in the information provided to the officers, to lead the officer to the conclusion that the goods were the subject of a commercial importation.
23.	The review officer also considered the issue of restoration of the vehicle.  He concluded that there appeared to be a discrepancy over the ownership of the vehicle.  Mr Robert Thompson had stated that the car was his, as he had bought it even though the registered keeper was his mother.  He told an officer that “my car means everything to me”.  He told the officer that he was the only user of the vehicle.  On the other hand the Appellant had stated in her letter that the car was hers and that she relied on the car to get to work.  
24. 	The officer was not satisfied that the Appellant was in fact the owner of the vehicle, but concluded that even if she were the owner, as she claimed, on her own account she had agreed to loan the vehicle to her son, and by doing so had accepted the risks and consequences that resulted from that decision.  The review officer upheld the decision not to restore the vehicle to the Appellant.
25.	On 14 July 2001 the Appellant appealed to the tribunal giving as the grounds of her appeal that she only wanted the car releasing.  She stated that she was unaware that her son had taken her car abroad.  She was not appealing against the decision to confiscate the goods brought from France and Belgium.  She stated that it was clear that her son had lied in his statement to the Commissioners about the use of the car being for his sole use.  She stated that she was the owner of the vehicle.  Her son had paid for the vehicle as a replacement for her R registered VW Polo which had been damaged beyond repair while her son was driving.  She stated that the Golf was used by both of them until she could purchase another car suitable for her own use.  She stated that she had been unaware that the vehicle was being taken out of the country although she did lend the car to her son.  Her son had been working until 2 a.m. on the day it occurred and she presumed that he was sleeping at a friend’s house which was a usual occurrence.  She had not needed the car because it was the weekend.  She stated that Robert had lied when he told an officer that he was the sole user of the car, apparently to try to persuade the authorities not to confiscate the car.  She needed the vehicle as part of her job.  She concluded “his statement to customs and excise seems to be series of lies told in order to get out of trouble”.
26.	After the hearing of the Lindsay case and the Hoverspeed case in the Court of Appeal, another officer I F McEntee re-reviewed the decision not to restore the vehicle.  That re-review was conducted by the Commissioners on their own volition.  That officer came to the same conclusions as the previous officer, and was communicated to the Appellant in a letter dated 23 January 2003.  The officer highlighted the large amount of importation namely 24 kilograms of tobacco.  Her son had initially told an officer that it was the first time he had travelled although at a subsequent interview he admitted that he had also crossed the channel the previous Saturday.  Commercial information available to the officer confirmed that the same vehicle did pass through the tunnel on 17 March 2001.  There were discrepancies in the interviews as to which traveller had purchased what amount of tobacco, and there were discrepancies in their stated smoking habits.  Mr Robert Thompson had expected his family to give him money towards the costs of the tobacco.  The officer concluded that Mr Hampton’s story was implausible.  He smoked both hand rolling tobacco and tailor made cigarettes but had only bought tobacco and not cigarettes in spite of the fact that cigarettes would have been less than half the price of cigarettes sold in the UK and he was on a one off trip to Belgium where cigarettes were very cheap.  The officer concluded that Mr Hampton’s actions confirmed that he was not on a normal shopping trip to the continent as the officer would have expected him to buy a mixture of tobacco and tailor made cigarettes as that is what he said he smoked.  There were discrepancies as to who had handed over the money.  The officer concluded that not all the tobacco was for the own use of the three travellers.  Mr Robert Thompson had in fact admitted this when he confirmed that half of his tobacco would be supplied to family members in return for money.
27.	With regard to the vehicle, officer McEntee pointed out that in the Appellant’s original letter of 26 March 2001, she had stated that she was the owner of the car, that it had been bought as a replacement for a VW Polo that her son had written off.  However, in her appeal to the tribunal she had stated that her son had paid for the car and that the vehicle was being used by both herself and her son until such time as she could purchase a car suitable for her own use.  The officer concluded that the version of events would appear to agree with what her son had told the officer, when he said that the car belonged to him and he had only had it for about 6 months.  He had said that it was registered in her name although he had paid for it and at the end of the interview he had stated that “his” car meant everything to him.  The officer noted that the car was actually registered in the Appellant’s name but concluded that this may have been a deliberate action to reduce the insurance costs, and that the vehicle registration document, although in the name of the Appellant, carried the words “registered keeper – please note that the registered keeper is not necessarily the vehicle’s legal owner”.  The officer stated in his letter that she had supplied no evidence to demonstrate that she held any legal entitlement to the vehicle, and that her son had been lying when he said that it belonged to him and that he had paid for it himself.  The officer concluded she did not hold any legal title to the vehicle, but added that if she could supply undisputed proof that she did hold legal entitlement of the vehicle he would be prepared to look into matter again, although he would need to see a range of supportive documentation such as a sales receipt, insurance documentation and evidence to show where the money had come from to buy the vehicle in the first place.  The officer concluded that the vehicle belonged to her son who was present at the time of seizure and who was involved in the smuggling attempt and who had never requested restoration of the vehicle himself.
Evidence at the Hearing
28.	Mrs Joyce Ann Thompson gave evidence at the hearing of this appeal that the K registered Golf vehicle had been purchased for £2,500 4 months before the vehicle had been seized by the Commissioners.  She claimed that she was the owner of the vehicle.  She produced the vehicle registration book which named herself as the registered keeper.  She also produced the certificate of motor insurance issued in November 2000 which stated her name as the policy holder, and with herself, her husband and her son, Robert, as the persons entitled to drive.  She said that she had been the owner of a previous Polo R registered vehicle which had been damaged beyond repair whilst her son had been driving that vehicle.  She had received the value of the Polo vehicle from the insurance company, £6,000, which she had used to purchase a new kitchen.  When the F registered Golf was purchased to replace the Polo the cost of £2,500 was paid by her son Robert.  She said that she had made her son pay for the vehicle to teach him a lesson, although it had not been intended that he would be the owner of the Golf.  Her son had paid the £2,500 from the proceeds of a children’s bond of £1,700 together with £800 from his own savings.  She said that she used to drive the vehicle to and from her work at a school during the day, but that her son drove the vehicle after school and at weekends when she did not need it.  She said that her son was not sole user of the vehicle despite what he had told the officer at his interview.  She said that this had been the second occasion that he had taken the vehicle abroad.  She had known that he had gone abroad in the vehicle the week before because he had brought her back some goods, “a little”.  She said that she had paid for the insurance of the vehicle.  When the vehicle had been purchased her son had wanted a smaller steering wheel and he had paid for a smaller sized steering wheel to be installed in the vehicle in place of the original steering wheel.  She had been aware that her husband had paid for her son’s ticket in the vehicle for 24 March 2001 because her husband had a master card and her son did not.  She added that her husband may have known about the trip but not that it was to be in her car.  She agreed that her husband also had a car.  Her son had bought wine and beer for her but not cigarettes as she did not smoke and her husband did not smoke either.  She said that her son lied to the officer when he told the officer that some of the cigarettes were for her.  She also said that her son had lied at the interview when he had claimed that he had paid for the car tax.  She stated that in fact she had paid for the car tax.  She said that she had not responded to the officers suggestion that she sent in proof of her ownership of the vehicle in the form of documents relating to the purchase of the vehicle, and she said that she did not respond because the documents would have shown that the money for the purchase of the vehicle had been paid by her son.
29.	Mrs Thompson at the hearing complained that the vehicle had been sold by the Commissioners on 11 May 2001 without notifying her about this.  She complained that she would have been prepared to buy the car back and that the reviewing officer had been reviewing the decision on 15 June 2001 when the vehicle had already been sold by the Commissioners.  She had had various correspondence from August 2001 to the effect that a driver of the vehicle had been committing road traffic offences, and notices of intended prosecution had been served on her as the new purchaser of the vehicle from the Commissioners had not notified the authorities that he was the new keeper of the vehicle.  This had caused her considerable anguish and inconvenience.  She stated that she had been unaware that her son had taken the vehicle abroad on 24 March 2001 as she had assumed that he had been staying at a friend’s house and he had not told her that he was taking the vehicle abroad on that occasion.  Mrs Thompson agreed that her son had told a number of lies to the officers including initially not divulging his previous trip, lies about who the tobacco was destined for, and indeed she claimed that he had lied about the ownership of the vehicle and about him having paid for the car tax.
The Relevant Law
30.	Alcoholic drinks, cigarettes and tobacco are chargeable with excise duty upon importation into the United Kingdom under the Alcoholic Liquor Duties Act 1979 and Tobacco Products Duty Act 1979 section 2.
31.	By regulation 4(1) of the Excise Goods (Holding, Movement, Warehousing and REDS) Regulations 1992 SI 3135 the excise duty point at which excise duty is payable generally arises at importation.
32.	Under article 10(2) of the Excise Goods (Holding, Movement, Warehousing and REDS) Regulations 1992, except where the Commissioners otherwise allow, imported community excise which are subject to a duty of excise that has not been paid and which it could not consigned to a tax warehouse shall upon their importation be consigned to a REDS.
33.	Article 8 of the European Union Council Directive 92/12/EEC states that:
“As regard products acquired by private individuals for their own use and transported by them, the principle governing the internal market lays down that excise duty shall be charged in the Member State in which they are acquired”.
34.	Article 9 of the Council Directive states as follows:
“9.1	Without prejudice to article 8 excise duty shall become chargeable where products released for consumption in a Member State are held for a commercial purpose in another Member State”.
In this case the duty shall be due in the Member State in whose duty the products are and shall become chargeable to the holder of the products.
35.	Article 9.2 of the EC Directive provides as follows:
“9.2	To establish that the products referred to in Article 8 are intended for commercial purposes, Member States may take into account inter alia the following:
-	the commercial status of the holder of the products and his reasons for holding them
-	the place where the products are located or where appropriate the mode of transport used
-	any document in relation to the products
-	the nature of the products 
-	the quantity of the products
Member States may lay down guide levels solely as a form of evidence.  These guidelines may not be lower than [specified levels]”.
36.	The quantity of those goods specified in the United Kingdom was in connection with tobacco products 800 cigarettes, 400 cigarillos, 200 cigars and 1kg of tobacco products.  The cigarettes and tobacco figures since the seizure have been increased under Amendment Regulations 2002 No. 2692.
37.	Section 3 of the Excise Duty (Personal Relief’s) Order 1992 states that:
“Subject to the provision of this Order a community traveller entering the United Kingdom shall be relieved from payment of any duty of excise on excise goods obtained for his own use in cross-border shopping of which he transported”.
38.	“Own use” is defined in the Order as:
“Own use includes use as a personal gift provided that that if the person making the gift receives in consequence any money or money’s worth (including any reimbursement of expenses incurred in connection with obtaining the goods in question) its use shall not be regarded as own use for the purpose of this Order”.
39.	Section 5(3) of the Order establishes that paragraphs 3(a) and 3(c) applied to a person who has in his possession or control any excise goods afforded relief under this Order in excess of any of the quantities shown in the schedule to the Order.
40.	Paragraph 3(a) states that the Commissioners may require a person to whom this paragraph applies to satisfy them that the excise goods afforded relief from this Order are not being held or used for a commercial purpose.
41.	Paragraph 3(b)	provides that where a person fails to satisfy the Commissioners that the excise goods in question are not being held or used for a commercial purpose the condition imposed shall be treated as not being complied with.
42.	This schedule specified at the time in connection with tobacco products 800 cigarettes and 1kg of tobacco product as quantities about which a traveller may be required to satisfy the Commissioners in this way.  The cigarettes figure has since been increased to 3,200 cigarettes, and the tobacco figure increased to 3kgs.
43.	Paragraph 5(1) of the Order states that if this condition is not met “those goods shall without prejudice to article 6 be liable to forfeiture”.
44.	Paragraph 5(2) sets out various factors where regard should be taken in determining whether or not the condition in paragraph 5(1) is being complied with.
45.	Section 141(1) of the Customs and Excise Management Act 1979 (CEMA) provides that:
“(a)	any … vehicle … which has been used for the carriage … of the thing so liable to forfeiture, either at a time when it was so liable or for the purposes of the commission of the offence for which it later became so liable; and
(b)	any other thing mixed, packed or found with a thing so liable shall also be liable to forfeiture”.
1. Section 152 to the 1979 Act provides that:
“The commissioners may, as they see fit … (b) restore, subject to such condition (if any) as they think proper, any thing forfeited or seized under [CEMA]”.
46.	Section 49(1) of CEMA enables the commissioners to forfeit dutiable goods that had been imported or held without payment of duty.
47.	The Court of Appeal in Hoverspeed appeal placed the burden of proof upon the Commissioners as to whether goods are being held or used for a commercial purpose.
48.	Section 15 of the Finance Act 1994 empowers the Commissioners to confirm and vary or withdraw a reviewable decision on behalf of the Commissioners.
49.	The basis of the Tribunal’s jurisdiction is set out in section 16 of the Finance Act 1994, subsection (4) of which provides that:
“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 persons making their decision could not reasonably have arrived at it”.
50.	In John Dee Ltd v Commissioners of Customs and Excise [1994] STC 941, Neill L.J. approved the principle that the tribunal could only properly review the commissioners’ decision if it was shown that the commissioners had acted in a way in 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, and stated that the tribunal may also have to consider whether the commissioners had erred on a point of law.
51.	The jurisdiction of  the Tribunal was further considered by the Court of Appeal in the case of Lindsay v Commissioners of Customs and Excise [2002] EWCA Civ 267.  Lord Phillips stated at paragraph 40-
“The principle issue before the tribunal, was whether the commissioners’ decision not to restore Mr Lindsay’s car to him was one that they “could not have reasonably have arrived at” within the meaning of those words in section 16(4) of the 1994 Act.  Since the coming into force of the Human Rights Act 1998, there can be no doubt that if the commissioners are to arrive reasonably at a decision, their decision must comply with the Convention for the Protection of Human Rights and Fundamental Freedoms 1950 (as set out in schedule 1 to the Human Rights Act 1998).  Quite apart from this the commissioners will not arrive reasonably at a decision if they had taken into account irrelevant matters or fail to take into account all relevant matters – see Customs and Excise Commissioners v J H Corbitt (Numismatists) Ltd [1980] STC 231 at 239, 1981 AC 22 at 60 per Lord Lane”.
52.	In the Lindsay case the Court of Appeal considered the then policy of the commissioners as explained in a witness statement relating to the commissioners’ general policy of non-restoration.  Lord Phillips considered the commissioners’ policy at paragraphs 63-65 inclusive.  He concluded as follows:
“63.	I would not have been prepared to condemn the commissioners’ policy had it been one that was applied to those who were using their cars for commercial smuggling, giving that phrase the meaning that it naturally bears of smuggling goods in order to sell them at a profit.  Those who deliberately use their cars to further fraudulent commercial ventures in the knowledge that if they are caught their cars will be rendered liable to forfeiture cannot reasonably be heard to complain if they lose those vehicles.  Nor does it seem to me that in such circumstances, the value of the car used need to be taken into consideration.  Those circumstances will normally take the case beyond the threshold where that factor can carry significant weight in the balance. Cases of exceptional hardship must always of course be given due consideration. 
64.	The commissioners’ policy does not however draw a distinction between the commercial smuggler and the driver importing goods for social distribution to family or friends in circumstances where there is no attempt to make a profit.  Of course even in such a case the scale of importation, or other circumstances, may be such as to justify forfeiture of the car.  But where the importation is not for the purpose of making a profit, I consider that the principle of proportionality requires that each case should be considered on its particular facts, which will include the scale of importation, whether it is a first offence, whether there was an attempt at concealment or dissimulation, the value of the vehicle and the degree of hardship that will be caused by forfeiture.  There is open to the commissioners a wide range of  lesser sanctions that will enable them to impose a sanction that is proportionate where forfeiture of the vehicle is not justified. 
65.	I do not think that it would be impractical to distinguish between the truly commercial smuggler and others.  The current regulations shift the burden to the driver of showing that he does not hold the goods for commercial purposes when these exceed the quantity in the Schedule.  In a case such as the present the driver importing for family or friends should be in a position to demonstrate that this is the case if called upon to do so (see the comments of Lord Woolf CJ in Goldsmith v Customs and Excise Commissioners [2001] 1WLR 1673 at pages 1679-1680)”.
53.	The case of  Hoverspeed (2) in the Court of Appeal [2002] EWCA Civ 2002 clarified that the burden of proof as to commerciality is on the commissioners and not on the appellant.
54.	That case also decided that the seizure was not to be regarded as axiomatically invalid merely because it occurred as a result of a check which was invalid.
55.	The case also decided that if an individual acquires products for a person other than his own use such products are to be regarded as held for commercial purposes.
56.	In the Hoverspeed appeal in the High Court Case No [2002] EWHC 163L the Court stated at paragraph 187:
“We would however draw the same distinction as that which was drawn in the Lindsay case between the treatment of those who are found to be smuggling for profit and those who are directly or indirectly involved in not-for-profit smuggling.  So far as the latter are concerned the remedy applied by the commissioners must be proportionate to the activity of which complaint is made”.
57.	The Court of Appeal in Gora v Commissioners of Customs and Excise Case No. 2003 EWCA Civ 525 confirmed that it was not intended that the tribunal should have jurisdiction to reconsider the condemnation of goods as forfeited, although the tribunal has the capacity to determine the issue of reasonableness which includes proportionality, in the light of facts found.
58.	The High Court in the case of Gascoyne v Customs and Excise Commissioners Case No. CH/2002/AWP/0743 has held that taken as a whole the condemnation and restoration rights are sufficient to comply with Convention Rights set out in article 6 of the ECHR.

Conclusions
59.	We have considered all of the evidence in this appeal and the provisions in the law involved.  We make the following findings of fact and reach the following conclusions.
60.	We find that on 24 March 2001 the Appellant’s son Robert Thompson together with two student friends were returning to the United Kingdom from a visit to Belgium and Calais to purchase beer and tobacco, travelling in a K registered VW Golf which Robert Thompson was driving.  Between them they had purchased approximately 8 cases of beer containing 96 litres and 4 boxes of tobacco containing 24 kilograms of hand rolling tobacco.  At first Robert Thompson told an officer that it was the first time he had been to the continent, but he later admitted that in the previous week he had been shopping abroad with another friend.  Indeed information available to the Commissioners confirmed that the same vehicle had passed through the channel tunnel on 17 March 2001.
61.	When each of the three travellers were asked questions about their own individual purchases of tobacco, their answers left 40 pouches of tobacco unaccounted for.  Their answers about their smoking habits did not correspond with their stated consumption of the tobacco.  There were considerable discrepancies in their own individual accounts as to how the tobacco had been purchased.  Mr Robert Thompson told the officers that half of the tobacco he was importing was for family members including his father, mother and two uncles.  The Appellant, a Mrs Pauline Thompson at the hearing gave evidence that neither she nor her husband smoked at all.  Robert Thompson had admitted that he had expected members of his family to give him the money for tobacco which he had purchased for his family.
62.	We find that Robert Thompson’s explanation why he had not purchased tobacco on his previous trip the week before was not credible.  His explanation had been that he had not purchased tobacco on that previous trip as he had not saved up sufficient funds.  We find that it is not credible that he would have managed to save up sufficient funds within less than a week.
63.	We find that the three travellers were not purchasing and importing the tobacco for their own use.  We find that on all the evidence they were importing the tobacco for a commercial purpose, that is for re-sale at a profit.  They were students on limited incomes from working for periods between their studies, and the amounts purchased by them abroad did not accord with their own smoking patterns.  The tobacco and beer were seized together with the vehicle.  The Appellant has appealed against the decision of the Commissioners on review on 15 June 2001 not to restore to her the vehicle.  We find that that decision was reasonable.  Although that decision was made before the Lindsay case and the Hoverspeed case in the Court of Appeal, we find that had the decisions in Lindsay and Hoverspeed been taken into account, and had the additional evidence that we have heard been taken into account, the decision would inevitably have been the same.
64.	We find on all the evidence in this appeal that we are not satisfied that the vehicle was owned by the Appellant.  Robert Thompson at his interview had stated that the car was his and that he had bought it.  He had told the officer that his car meant everything to him and he had told that officer that he was the only user of the car.  If Robert Thompson was trying to avoid the vehicle being forfeited, it did not make sense that he would claim that the car was his if it was not.  Mrs Thompson at the hearing has admitted that the money to purchase the vehicle was paid solely by her son.  He had cashed in his children’s bonds amounting to some £1,700 and £800 from his savings.  Mrs Thompson accordingly accepted that all the money to purchase the vehicle was provided by her son.  When her son had been involved in an accident in her previous vehicle which had been damaged beyond repair, the £6000 paid by the insurance company had been used by her not in the purchase of a new vehicle but towards purchasing “a nice kitchen”.  When the Commissioners had requested further evidence as to the ownership of the vehicle she had not submitted that further evidence, because she thought that if she had sent evidence as to the origin of the funds used to purchase the vehicle, this would have been regarded as evidence against her claim to ownership of the vehicle.  She had claimed that she had used the vehicle during the school day for her work to drive to and from a school where she taught, but in the evenings and at weekends her son used and drove the vehicle.  Her son however at the interview had told the officer that he was the only user of the vehicle and his car meant everything to him.  The vehicle registration book showed the Appellant as the registered keeper of the vehicle, and she had insured the vehicle in her own name but naming her son and husband as named drivers.  We take the view however on the evidence that she had insured the vehicle in her own name in order to obtain a cheaper insurance than would have been the case had the vehicle been insured in her son’s name.  We find that the reality of the situation was that this was a shared vehicle with the use of the vehicle being shared jointly by Mrs Thompson and her son.  He had claimed at his interview that he had paid for the taxation of the vehicle whereas Mrs Thompson’s evidence was that she claimed she had paid the vehicle registration fee.  There is no written evidence in this appeal as to who paid that fee.  Her son had wished for a smaller steering wheel when the vehicle was purchased, and he had paid for the replacement smaller steering wheel.  In the circumstances and on all the evidence we are not satisfied that Mrs Thompson was the sole legal owner of the vehicle.  The evidence seems to point to the conclusion that they were the joint legal owners.  She was certainly aware that her son had driven the vehicle abroad the week before to purchase excise goods abroad.  Indeed some of those goods were for her.  Her husband had paid for the ticket for the travel on 24 March 2001 with his own Mastercard.  Mrs Thompson claimed that she had not known that her son was intending to go shopping abroad in her vehicle on 24 March 2001.  We did not find this claim to be credible.  We find that the Appellant was aware  that her son was using the vehicle to travel abroad to purchase excise goods, and she and her husband allowed him to do so.  We find that she was taking the risk that the vehicle could be forfeited.  We do not find that she is an innocent third party owner whose vehicle was being taken without her knowledge or permission.
65.	We find accordingly that the passengers were bringing the tobacco into the United Kingdom for commercial purposes and not for their own use.  We find that the Commissioners have satisfied the burdens of proof on them.  We find that it was reasonable for the Commissioners to refuse to restore the vehicle to the Appellant.
66.	We find that the Commissioners acted proportionately.  We bear in mind the duty evaded and that the vehicle was a K registered vehicle.  We find no exceptional circumstances relating to the Appellant.
67.	We are satisfied that the Commissioners have proved that the goods were not for the own use of the travellers and the goods were being held for commercial purposes.  We are satisfied following the Hoverspeed decision in the Court of Appeal that the seizure of the vehicle was valid.  We consider there were no exceptional circumstances in the case of the Appellant which would justify the Commissioners restoring the vehicle to the Appellant.  We find that the decision of the Commissioners not to restore the goods was in accordance with the legislation and was reasonable.  We find that the review decision was reasonable.  Although the later re-review decision was made by the Commissioners of their own volition, there is nothing in the evidence that we have heard which would justify those conclusions being reversed.
68.	The Appellant expressed dissatisfaction and concern that the vehicle was in fact sold by the Commissioners before the review decision was made.  No advance warning was given that the vehicle was to be disposed of by the Commissioners so early.  We share the Appellant’s concern, particularly when the purchaser did not notify the vehicle registration authorities that he was the new owner, which led to the Appellant receiving notices of intended prosecution when the new purchaser  committed road traffic offences.  We find that the Commissioners should be criticized for their actions in disposing of the vehicle without notification to either the Appellant or her son, but this does not lead us to the view that the decision should be further reviewed.
69.	In conclusion we find that the decisions of the Commissioners were reasonably arrived at.  We find that the Commissioners have not acted in a way that no reasonable panel of Commissioners could have acted and that they have not taken into account irrelevant matters or disregarded something to which they should have given weight.  We further find that the Commissioners have made no error in law.

70.	The appeal of the Appellant is dismissed.  The Commissioners did not apply for costs and we do not order as to costs.

I E VELLINS
CHAIRMAN
Release Date:

MAN/01/8143