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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Awards Drinks Ltd v Revenue And Customs [2021] EWCA Civ 1235 (06 August 2021) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2021/1235.html Cite as: [2021] STC 1576, [2021] EWCA Civ 1235, [2021] BVC 17 |
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ON APPEAL FROM THE UPPER TRIBUNAL
(TAX AND CHANCERY CHAMBER)
(JUDGE SWAMI RAGHAVAN AND JUDGE THOMAS SCOTT)
[2020] UKUT 201 (TCC)
Strand, London, WC2A 2LL |
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B e f o r e :
LADY JUSTICE ELISABETH LAING
and
SIR DAVID RICHARDS
____________________
AWARDS DRINKS LIMITED (IN LIQUIDATION) |
Appellant |
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- and - |
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THE COMMISSIONERS FOR HER MAJESTY'S REVENUE AND CUSTOMS |
Respondents |
____________________
Mr Brendan McGurk (instructed by the General Counsel and Solicitor to HMRC) for the Respondents
Hearing dates : 21 & 22 April 2021
____________________
Crown Copyright ©
Lord Justice Henderson :
Introduction
"I believe that you have not declared or we have not assessed the correct amount of VAT due for the periods shown below. This is because monies have been deposited in the UK for the sale of goods said to be made in non-UK bonded warehouses, and the monies said to be transported into the UK by cash couriers. However, subsequent HMRC checks reveal this scenario is not credible and the monies must have had a UK origin. Therefore the goods [are] subject to UK VAT at the standard rate.
I have made assessments of VAT due under section 73 of the VAT Act 1994. This letter is our notice of those assessments."
"Where a person has failed to make any returns required under this Act… or to keep any documents and afford the facilities necessary to verify such returns or where it appears to the Commissioners that such returns are incomplete or incorrect, they may assess the amount of VAT due from him to the best of their judgment and notify it to him."
The two assessments were for VAT due in the 11 quarterly periods from December 2010 to June 2013 and totalled £6,573,391.
"I have now arranged that these assessments will be reduced leaving only those transactions where HMRC consider that the origin of the payments has not been sufficiently evidenced. HMRC does not offer a positive case that the transactions which have been excluded from the computation were legitimately made. The details of this reduction are given in the attached schedule."
The schedule showed that the reduced assessments were based on payments in cash or by cheque apparently emanating from 12 entities in or near Calais, France. The entities included, for example, Mammouth Trading of 1320 Route de St Omer, 62100, Calais, France which had made cash deposits of £8,807,355.
The appeal to the First-tier Tribunal
"2. The ground of appeal initially advanced by [Awards], and maintained until its closing submissions, was that these sums deposited into its UK bank accounts by couriers were payments for in-bond sales of alcohol from bonded warehouses in France to cash and carry operators in France. The money was paid in pounds sterling as that was the currency accepted by these outlets from UK "booze cruise" tourists. [Awards] contends that as there were no taxable supplies in the UK its appeal against the assessments should succeed.
3. However, HMRC do not accept that this is the case and contend that, having traced the relevant supply chains, the goods sold by [Awards] had entered the UK as a result of an inward diversion fraud and supplies were made in the UK and therefore taxable but, as made unequivocally clear in a letter to the Tribunal of 9 May 2017, HMRC makes no allegation of fraud against [Awards]."
"50. In outline, alcohol diversion fraud is used to evade excise duty and VAT through abuse of the Excise Movement and Control System ("EMCS"), which permits authorised warehouse keepers to move excise goods from warehouse to warehouse within the EU on behalf of account holders, in duty suspense. Any movement requires the generation of an Administrative Reference Code ("ARC") within the EMCS, which must travel with the goods. The system has operated in electronic form since January 2011. An ARC number will typically last for a few days, and expires when the load is recorded on the system by the receiving warehouse as having been being delivered.
51. Inward diversion fraud, … operates as follows. Alcohol originating in the UK is supplied under duty suspension to tax warehouses on the near continent, principally in France…. Once in the tax warehouse they will usually change hands a number of times and will often be divided up before being reconstituted. A supply chain is set up with a purported end customer based in France. Some of the goods will be consigned back to the UK in duty suspense using an ARC number. This is the "cover load". Within the lifetime of the ARC number further consignments of goods of the same description will purportedly be released for consumption in France, attracting duty at low French rates, but will in fact be smuggled to the UK using the same ARC number. These are the "mirror" loads, and this will carry on until the ARC number expires or one of the loads is intercepted by Customs, following which a new ARC number will be generated in a similar manner.
52. Mirror loads are typically sold immediately following their arrival in the UK for cash. This process is known as "slaughtering". The UK customers may create false paper trails to generate the impression that the goods were supplied to them legitimately."
"15. However, the same cannot be said of Mr Judd who we did not find to be a convincing or indeed a truthful witness. He appeared to change his evidence during cross-examination, e.g. initially saying that customers of [Awards] were cash and carry retailers who accepted cash in sterling from their "booze cruise" customers and describing how he had seen couriers collecting cash but subsequently saying that they were wholesalers suppling the cash and carry outlets but being unable to name the managers or operators of these businesses or the cash and carry operators they supplied. Also, his evidence was inconsistent e.g. he said both that he knew who his customers were as they were selling to booze cruise day trippers and that he had no knowledge of what happened to the goods after they left the account of [Awards] at the warehouse.
16. Additionally, Mr Judd gave new evidence when cross-examined, e.g. he made serious allegations against a former employee of [Awards] in connection with criminal activities…. His evidence was also inconsistent, e.g. after stating that he had made "loads of declarations" to French Customs he subsequently said that [he] did so "infrequently". However, there was no evidence of any such declarations having been made by him or by the couriers said to have been sent to [Awards].
17. Further, Mr Judd's assertions that HMRC officers had mis-stated the facts in almost every note of meeting or visit that had taken place, that letters from HMRC following such meetings or HMRC visits would only "include what they wanted to put" and would "never include everything" that he said and that a description of the business of [Awards] in a FAME Report that was exhibited to his witness statement was "not correct", was, in our view, simply not credible."
"The position on an appeal against a "best of judgment" assessment is well-established. The burden lies on the taxpayer to establish the correct amount of tax due:
"The element of guess-work and the almost unavoidable inaccuracy in a properly made best of judgment assessment, as the cases have established, do not serve to displace the validity of the assessments, which are prima facie right and remain right until the taxpayer shows that they are wrong and also shows positively what corrections should be made in order to make the assessments right or more nearly right: See Bi-Flex Caribbean Ltd v The Board of Inland Revenue (1990) 63 TC 515 at 522-523 per Lord Lowry)."
That was confirmed by this court, after a detailed review of the authorities, in Customs and Excise Comrs v Pegasus Birds Ltd [2004] EWCA Civ 1015, [2004] STC 1509.
…
It should be noted that this burden of proof does not change merely because allegations of fraud may be involved (see e.g. Brady (Inspector of Taxes) v Group Lotus Car Companies plc [1987] STC 635 at 642… per Mustill LJ)."
"78. The assessments in this case were made on the basis of the deposits made at various branches of Barclays Bank throughout the UK into the account of [Awards] which, HMRC say, relate to taxable supplies. These are, as in any other "best judgment" appeal, prima facie right and remain right until the taxpayer shows that they are wrong and also shows positively what corrections should be made in order to make the assessments right or more nearly right.
79. The bona fides or rationality of the sum assessed by the "best of judgment" assessments in this case were not challenged. [Awards] simply contends the assessments are wrong saying it did not make taxable supplies in the UK. It asserts that it sold goods in France and that the sums lodged in its bank account related to in-bond sales of alcohol to cash and carry outlets in and around Calais. These outlets accepted cash in pounds, sterling, from UK tourists and "booze cruise" day trippers… [Awards] asserts that it and its customers arranged for the cash to be delivered by courier and deposited at various branches of its bank.
80. There was no positive documentary evidence adduced by [Awards], and nothing from the entities from which [Awards] was said to have received payments that they were genuine retail cash and carry operators or genuine wholesalers that had made any payments to [Awards]. There was a distinct absence of cash declarations to French Customs by couriers, customers or appellant. Moreover, cheques said to be from three different French Customers, Champion, Glass and Ducain were drawn on [the] same UK bank account.
81. There was also, in our judgment, a complete lack of commerciality in the transactions said to have occurred. No costs analysis was provided by [Awards] comparing the costs of French banking facilities to cost of couriers despite this being requested by HMRC. It is, in our view, just not credible to contend, as [Awards] does, that French cash and carry operators would bear costs of couriers to banks throughout the UK without any recompense from [Awards]. Also, there was no rational explanation for cash deposits being made all around the UK but not in the branches nearest the channel ports or Eurotunnel terminus. In the absence of evidence, we cannot accept Mr Judd's assertion that this was because the Dover branch of Barclays would not accept cash payments. In addition, there was no evidence to connect any named courier with any of the deposits, nor was there any evidence of travel by any courier.
82. As a result, we find that the factual case advanced by and on behalf of [Awards] is not supported by the evidence and does not hold water. In our judgment it is not sufficient to displace the assessment which therefore remains "right". Having come to such a conclusion it is not necessary to address the legal submissions made on behalf of [Awards] as these were advanced on the basis of facts which we have found not to have been established i.e. that [Awards] sold the goods in France."
The appeal to the Upper Tribunal
"(1) Ground 1 – The FTT erred in law in failing to conclude, in the light of [Awards'] unchallenged documentary evidence of transactions within bonded warehouses in France, that [Awards] could not have had sufficient possession and/or control of the goods to make taxable supplies of those goods in the UK. In particular the FTT should have concluded, having regard to the… unchallenged documentary evidence, that since [Awards] divested itself of possession and/or control of the goods while they were located outside the UK, to the extent those goods came into the UK, taxable supplies of them were effected by persons other than [Awards].
(2) Ground 2 – The FTT erred in law in failing to give sufficient reasons for its decision."
"If, as [Awards] alleges, it effected in-bond transactions that caused it to lose possession and control of the goods while they were located in France, then it is arguable that, even though it had rejected as untrue [Awards'] account of who its customers were and how they paid, the FTT needed to go on [to] explain how [Awards] came to make subsequent supplies of those goods in the UK. Moreover, if, as [Awards] alleges, it lost possession and/or control of the goods while they were outside the UK, it is arguable that, to the extent those goods were the subject of taxable supplies in the UK, those supplies must have been effected by persons other than [Awards] (so that [Awards] cannot have been liable for VAT on those supplies)."
"However, we would go further and conclude that the strength of the countervailing evidence was such that an FTT which relied only on the documentary evidence, so as to find possession and control had been lost, would have erred in law by reaching a decision which no reasonable tribunal, properly directed, could have reached."
"We accordingly remake the FTT Decision. The new decision adopts in its entirety the decision the FTT made but incorporates by way of addition the reasons we have set out above at [76] to [79] as to why the FTDs could not be taken at face value and did not therefore mean possession and control of the goods had been divested by [Awards]. The remade decision accordingly concludes that [Awards'] appeal against the assessment is dismissed."
"Some documents showed [Awards] was dictating what happened in practice to the goods even after their purported sale."
The appeal to this court
"The appeal should go forward on the basis that the FTDs are not genuine documents."
Further, in rejecting the third ground, Rose LJ said:
"The UT was entitled to go on to remake the decision rather than remit it to the FTT. The UT held that the evidence was overwhelming that there had been no genuine transactions in France and therefore that [Awards] had not lost possession and control of the goods."
The burden of proof and questions of fraud
"It should be noted that this burden of proof does not change merely because allegations of fraud may be involved (see e.g. Brady (Inspector of Taxes) v Group Lotus Car Companies PLC [1987] STC 635 at 642… per Mustill LJ)."
"In 1978 the taxpayer companies became involved in the notorious affair of the De Lorean Motor Car. There were three relevant agreements all dated 1 November 1978. The first was an agreement between [DLRP] of America, [DLMC] of Northern Ireland and a company called GPD Services Inc (GPD). GPD agreed to provide its services for design, test and calculation work for the purpose of developing a sports car, the DMC 12, and it was provided that Lotus Cars Ltd and Mr Chapman himself [Mr Colin Chapman, the driving force behind Lotus] would be engaged in doing the work. The second was a letter agreement whereby Lotus Cars Ltd warranted and guaranteed to [DLRP] and [DLMC] the timely and full performance of each and every obligation of GPD under the first agreement. The third was an agreement between GPD and Lotus Cars Ltd whereby Lotus Cars Ltd agreed to carry out research, design and development work in connection with the DMC 12 prototype sports coupé which was to be manufactured by [DLMC]. Under this third agreement a good faith deposit of £2m was paid to Lotus Cars Ltd on 6 November 1978, but was refunded in April 1979.
GPD was a Panamanian company… It had an address in Geneva and a bank account, but neither facilities nor experience for research, design or development work on sports cars. It received, however, on the signing of the first agreement, a total of some $17.65m from [DLMC] and [DLRP]. It is now known that some $8.5m were paid out to Mr De Lorean personally, but a balance of $9.15m or thereabouts remained unaccounted for.
Since it was plain that the work which GPD had contracted to do for [DLMC] and [DLRP] had in fact been done by Lotus Cars Ltd, the Revenue were concerned to enquire whether any of the monies thus received by GPD had come to the hands of the taxpayer companies or either of them, or their officers, in addition to sums for work done admittedly received by [Lotus] directly from [DLMC]. The Revenue consequently carried out a lengthy investigation into the books of [Lotus]. In the upshot, on 16 December 1983 the Revenue made a number of estimated assessments on [Lotus]… "
"was that the outstanding assessments could only be justified if there had been fraud on the part of the taxpayer companies or their officers, that, if fraud was in question, the onus was on the Revenue to prove the fraud and that the Revenue had failed to discharge that onus."
"In my judgment the position was that the burden lay throughout upon Lotus to show that the assessments were wrong… if the Inland Revenue showed circumstances which cast doubt on the whole position, the correct question which the commissioners should have asked themselves was not: "Have the Inland Revenue proved fraud?" but "In all the circumstances, including the background circumstances, the documents and the oral evidence, have Lotus shown the assessments to be wrong?" At no stage in my judgment could any shift in the evidential burden require the Revenue positively to prove fraud in order to succeed; all that is required, even if the evidential burden be shifted, would be for the Revenue to show circumstances which might lead the commissioners in doubt on a balance of probabilities, whether Lotus (either itself or through its officers) in fact received or was entitled to receive payments giving rise to the assessments."
"Estimated assessments may be made by an inspector where the taxpayer has failed to make any return at all and the inspector has no idea what the taxpayer's taxable income truly is or they may be made where the inspector suspects that the taxpayer has concealed part of his income whether by fraud, wilful default or mere mistake. In either case, if the assessment is made in due time, the onus to displace the assessment is on the taxpayer throughout."
"It may well be that, if the taxpayer companies' version does not correspond with the true facts, it must follow that someone was guilty of fraud. This does not mean that by traversing the taxpayer companies' case the revenue have taken on the burden of proving fraud. Naturally, if they produce no cogent evidence or argument to cast doubt on the taxpayer companies' case, the taxpayer companies will have a greater prospect of success. But this has nothing to do with the burden of proof, which remains on the taxpayer companies because it is they who, on the law as it has stood for many years, are charged with the task of falsifying the assessment. The contention that, by traversing the taxpayer companies' versions, the Revenue are implicitly setting out to prove a loss by fraud, overlooks the fact that, in order to make good their case, the Revenue need only produce a situation where the commissioners are left in doubt. In the world of fact there may be only two possibilities: innocence or fraud. In the world of proof there are three: proof of one or other possibility and a verdict of not proven. The latter will suffice, so far as the Revenue are concerned."
"Before leaving this part of the case, I should mention the contention that there is a presumption of innocence which operates in any case where the defendant, by controverting the case put forward by the plaintiff, impliedly suggests that he has been guilty of dishonest conduct. I do not accept this argument. The fact that the possibility of fraud is on one side of the case will of course require the tribunal to take particular care when weighing the evidence, given the seriousness of any finding which puts in question the honesty of a party to a civil suit (see Hornal v Neuberger Products Ltd [1957] 1 QB 247). At the same time, I cannot accept that this bears on the burden of proof. The burden is material only to the question of which party succeeds if the tribunal is left in doubt. I can see no reason why the rule which entails that the taxpayer should fail in such a situation needs to be completely turned round simply because the alternative explanation of the facts to that advanced by the taxpayer is one which is explicable only on the ground of dishonesty on his part.
I therefore conclude without hesitation that the commissioners were in error in stating that it was for the Revenue to prove fraud if the taxpayer companies' claim for an adjustment of the assessments was to be defeated."
"62. At the heart of the Appellants' amended case is the proposition that it is not open to HMRC to put allegations of dishonesty (or other serious forms of misconduct) to their witnesses, or to invite the FTT to make adverse findings of fact on such a basis, unless the relevant allegations have been pleaded with full particularity and the Appellants have been given a proper opportunity to respond to them.
63. In cases where the burden of proof lies on HMRC to establish fraud or dishonesty, these principles undoubtedly apply in the same way as they would in ordinary civil litigation. Examples include cases where HMRC wished to make assessments to income tax outside normal time limits on the ground (before 1989) of fraud or wilful default under s36 of the Taxes Management Act 1970, or (in the modern world) where, relying on principles developed by the Court of Justice of the European Union, they wish to deny a VAT-registered trader his otherwise incontrovertible right to deduct input tax because of his alleged participation in, or connection with, "missing trader" (or MTIC) fraud.
64. The present case, however, is not of that nature. It is common ground that the burden of proof lies on the Appellants to displace the closure notices issued to them by HMRC within normal time limits… It is for the Appellants to adduce such evidence as they think fit with a view to discharging the burden which throughout lies on them.
65. The IFP2 Information Memorandum is one of the pieces of documentary evidence relied upon by the Appellants as supporting their case on this issue. HMRC were under no obligation to accept it at face value, when it was disclosed to them, and they were fully entitled to cross-examine the witnesses for the Appellants who had been involved in its preparation in order to test its reliability and examine the assumptions on which it was based. HMRC were not obliged to give advance notice of the lines of questioning which they intended to pursue with the witnesses, and still less were they obliged to plead a positive case of dishonesty in preparation of the Memorandum before putting questions to the witnesses which, depending on how they were answered, might in due course provide a foundation for the FTT to draw such a conclusion. The obligations which lay on HMRC were in my judgment of a different nature. First, as a matter of professional duty, counsel may not put questions to a witness suggesting fraud or dishonesty unless they have clear instructions to do so, and have reasonably credible material to establish an arguable case of fraud. Secondly, as the FTT rightly recognised, it is not open to the tribunal to make a finding of dishonesty in relation to a witness unless (at least) the allegation has been put to him fairly and squarely in cross-examination, together with the evidence supporting the allegation, and the witness has been given a fair opportunity to respond to it. Important though these obligations are, they are quite different from, and do not entail, a prior requirement to plead the fraud or misconduct which is put to the witness. If it were otherwise, a party would be obliged to serve an amended statement of case before attempting to expose a witness as dishonest in cross-examination, and the element of surprise which can be a potent weapon in helping to expose the truth would no longer be available."
"36. Two principles emerge from Ingenious and Brady:
(1) The burden of showing an assessment is incorrect remains on the taxpayer throughout the appeal. This is so even if the circumstances of the case are such that there either must, or may, have been some fraudulent conduct on the part of the taxpayer which is relevant to the tax liability.
(2) The allegation that a witness is dishonest must be put fairly and squarely to the witness in cross-examination before the tribunal can find the witness is dishonest, but does not need to have been pleaded in advance in cases where the burden is on the taxpayer.
37. The fact that no authority was cited in Ingenious for that latter proposition reflects that it is a long-held and established principle: Browne v Dunn (1893) 6 R 67 explains that the principle is grounded in fairness. That principle was approved by the Court of Appeal in Markem Corporation v Zipher Ltd [2005] EWCA Civ 267."
HMRC's pleaded case before the FTT
"In respect of trading outside the UK the appellant would be and is entitled to repatriate funds to the UK without thereby incurring any VAT liability in respect of trading that has taken place outside the UK."
Those grounds were signed by leading counsel then appearing for Awards, Mr Geraint Jones QC.
"(i) That HMRC be barred from taking any further part in these proceedings on the basis that its defence has no reasonable prospect of success; or, in the alternative
(ii) That HMRC be required to amend its Statement of Case so that they (a) set out their case as to the basis on which it is said that the Appellants' supplies should be subject to UK VAT law and (b) provide particulars of any allegations of fraud or other serious wrongdoing."
"The issue that the Tribunal will have to determine in due course is whether the Appellant has displaced the assessments, not whether the Appellant was knowingly or dishonestly involved in fraud."
"That is the long and the short of HMRC's case."
"HMRC wishes to reduce the scope of its application to amend its Statement of Case in order that there can be no doubt that fraud is not alleged specifically against the Appellant…"
A list was then given of various amendments which HMRC no longer wished to pursue, and the letter concluded by asking the FTT to permit the amendments in that limited form.
"For the avoidance of doubt, HMRC contends that the monies lodged in the Appellant's UK bank accounts relate to taxable supplies made for consideration in the UK."
To similar effect, paragraph 3 pleaded that:
"Supply chains have been traced to tax losses, and HMRC contend, instead, that the deposits relate to taxable sales of goods made by or on behalf of the appellant in the UK."
"The purported supply of alcohol by the Appellant to alleged French customers in the circumstances giving rise to this appeal bear all the hallmarks of inward diversion. Those circumstances are set out immediately below. For the avoidance of doubt HMRC do not accept that they were "customers" in the sense of being parties who received a taxable supply at all and/or insofar as they made no payment for those alleged supplies. Therefore, any reference herein to the Appellant's "customers" is for ease of reference and should be understood accordingly."
"The funds received by the Appellant arise upon the sale of the goods once diverted into the UK: the transactional documents as between the Appellant and those from whom it claims to receive payment in cash or cheque are arranged to give the impression of taxable supplies being made in France. To that extent, they are sham transactions. HMRC do not accept that taxable supplies were made in France and the amounts received by the Appellant relate to the taxable supply of those goods within the UK."
Request 1
Request: "2. In respect of each and every lodgement of monies that is alleged to relate to taxable supplies made for consideration in the UK, particularise by whom and when each such taxable supply was made."
Reply: "2. HMRC does not know the identity of those who made the taxable supplies in the UK, the consideration from which was paid into the Appellant's UK bank account… HMRC positively avers that the payments were not made by the alleged French cash and carry customers".
Request 2
Request: "2. If it is alleged that taxable sales of goods were made in the UK on behalf of the appellant, identify by whom and when each such taxable supply is alleged to have been made"
Reply: "2. HMRC cannot – and does not need to – identify the person who made the taxable supply in the UK or the date on which it was made."
Request 4
Request: "2. For the avoidance of doubt whether all or any of the persons, firms or companies [said to have diverted the relevant goods into the UK] are alleged to have been acting as agent for the Appellant."
Reply: "2. HMRC's case is that the Appellant's goods were only sold for consideration in the UK and that that consideration was what comprised the deposits in the Appellant's UK bank accounts. Those supplies were, to that extent, made on behalf of the Appellant."
Request 6
Request: [In relation to HMRC's plea that] "the indications are that the supplier of the goods or the purported French customer divert the alcohol back into the UK under cover of a single ARC number which is used on more than one occasion to facilitate inward diversion", particularise…. (2) "whether the Appellant is alleged to be the supplier to whom reference is here being made"… (5) "whether any [person, firm, or agent is] alleged to have so acted as agent for the Appellant… ."
Reply: "2. The "supplier" of the goods is not a reference to the Appellant but a reference to the Appellant's own suppliers.
3. HMRC does not allege, since it does not need to allege, that the supplier, as explained, is the Appellant's agent as regards the inward diversion of the goods to the UK which it originally supplied to the Appellant.
…
5. HMRC does not allege, since it does not need to allege, that the Appellant's alleged French cash and carry customers were the Appellant's agents as regards the inward diversion of the goods to the UK."
"On the basis that HMRC considers that its case, as set out in the Amended Statement of Case is clear, HMRC considers that it is not required to provide further particulars. Moreover, HMRC is not required to provide responses to requests that are disproportionate, as many of the Appellant's requests are. Without prejudice to the fact that HMRC's case is clear, it responds to the Appellant's requests as set out below."
"We reject Mr Howard's arguments. We agree with HMRC that [Awards'] suggested analysis impermissibly reverses the burden of proof. It rests on the assumption that HMRC had to plead fraud against [Awards], in order to come to a conclusion that the assessment, based on [Awards'] possession and control of the goods, should be upheld. The point falls squarely within [Brady], which confirms the burden remains on the appellant to show the assessment was incorrect even if that conclusion may, or indeed must, involve fraud. Even accepting [Awards'] submission that it could not have supplied in the UK without possession and control of the goods, fraud did not need to be pleaded in order for a conclusion to be reached which entailed [Awards] retaining possession and control. We agree with HMRC it is a non-sequitur to say that because HMRC did not run a positive case on fraud they are taken in addition to concede that the appellant lost possession and control. The burden remained at all times on the appellant to discharge. It was for [Awards] to show it lost possession and control of the goods."
Disposal
Lady Justice Elisabeth Laing:
Sir David Richards: