TC00086 Singleton v Revenue & Customs [2009] UKFTT 118 (TC) (27 May 2009)

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URL: http://www.bailii.org/uk/cases/UKFTT/TC/2009/TC00086.html
Cite as: [2009] UKFTT 118 (TC)

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Singleton v Revenue & Customs [2009] UKFTT 118 (TC) (27 May 2009)
EXCISE DUTY HYDROCARBON OIL - (See also EXCISE RESTORATION OF VEHICLE)
Assessment

    [2009] UKFTT 118 (TC)

    TC00086

    EXCISE DUTY – use of 'red diesel' – appellant access to 'red diesel' from fork lift truck – filled vehicle to get to petrol station – in receipt of tax credits – insufficient evidence of use – some diesel receipts – insufficient evidence to rebut use of 'red diesel' for 12 months – assessed accordingly - appeal dismissed
    MANCHESTER TRIBUNAL CENTRE
    CHRISTOPHER SINGLETON Appellant
    - and -
    THE COMMISSIONERS FOR HER MAJESTY'S REVENUE AND CUSTOMS Respondents
    Tribunal: DAVID S PORTER (Judge)
    MISS SUSAN STOTT (Member)

    Sitting in public in Manchester on 13 May 2009

    No one appearing for the Appellant

    Bernard Haley an officer of customs and excise acting for the Commissioners for H M Revenue and Customs, for the Respondents

    © CROWN COPYRIGHT 2009
     
    DECISION

  1. Christopher Singleton (the Appellant) appeals against an assessment in the sum of £2,827 issued on 7 April 2008 in respect of rebated excise duty reduced to £1,465 on a review contained in a letter dated 25 June 2008. The assessment had been amended to £1,465 because Mr Abbas Ali, who had raised the assessment, had incorrectly used 172 days in calculating the average daily miles travelled instead of 316 days. The Appellant says that he only filled the vehicle with red diesel on one occasion in order to drive to the petrol station. The Respondents say that, as he had been unable to produce adequate receipts for the purchase of diesel for the vehicle, they were correct to calculate that he had been using red diesel for the period of 12 months.

  2. Bernard Haley appeared on behalf of Her Majesty's Revenue and Customs and produced a bundle of documents for the tribunal. As no one was appearing for the Appellant, this tribunal determined to proceed under rule 33 of the Tribunal Procedure (First-tier Tribunal)(Tax Chamber) Rules 2009

    3. Preliminary issue
  3. The Appellant did not attend and the Judge asked the clerk to telephone the Appellant to ascertain whether he intended to attend. The Appellant did not respond, and it was clear from the office file that the Appellant was aware of the date and time of the hearing. The Judge and Member therefore decided to proceed under rule 33.

    4. The Facts
    We find the following facts:
  4. The Appellant carries on the business in the engineering industry from 559A Manchester Road, Linthwaite, Huddersfield, West Yorkshire HD7 5QX and is not registered for Value Added Tax.

  5. On 19 November 2007 the Respondents stopped the Appellant, who was driving a Nissan Terrano registration number DG51 BWY, in order to check the fuel in the running tank. A sample of fuel drawn from the running tank was found to be red in colour. At the interview carried out on the same day the Appellant confirmed that he owned the vehicle and that the vehicle achieved 20 to 25 miles to the gallon. He said that he had run out of fuel the pervious day and that he had put about a gallon of red diesel in the tank to get him to the petrol station, where he put in a further twenty pounds worth of ordinary diesel. He had taken the red diesel from the supply that he has for his forklift truck. He considered that he had about 20% of red diesel in the tank of the Nissan Terrano. He confirmed that he did not keep many business records, as he was in receipt of tax credits. Nor did he have an accountant. The vehicle was restored to him on the payment of £500, which he was able to pay, in cash, at the time of the incident. The Appellant subsequently produced various receipts for fuel, but these were incomplete with substantial gaps between February and April, and April to May 2007.

  6. Mrs Hazel Havard, the reviewing officer, in reviewing the assessment raised by Mr Ali, realised that he should have used 316 days to arrive at the average daily mileage not 172 days. As a result the average number of daily miles was reduced to 62.58 miles per day. The mileage for the year had been calculated from the mileage shown on the MOT certificate in January 2007, deducted from the mileage shown on the speedometer on 19 November 2007. The Appellant alleged that he had had to replace the speedometer on two occasions and that as a result the mileage readings were unreliable. Mrs Havard had contacted Nissan and they had advised that the speedometers on the Terranos were very reliable. We do not believe that the Appellant had needed to replace the speedometers. Mr Ali had also decided that the Appellant had only been using red diesel for 365 days as he thought, looking at the receipts, that the irregularities only started in November 2006. Mrs Havard had therefore reduced the assessment allowing for the change of rates over the period:-

    7. 20/11/06 to 06/12/06 17 days £ 65.56
    07/12/06 to 30/9/07 298 days £1,317.00
    01/10/07 to 19/11/07 50 days £ 83.41
        ----------------------
        £1,465.00 (rounded down)

    The Appellant had supplied the receipts for fuel that were available and indicated in his letter to Mr Ali that he believed the vehicle achieved 30 miles to the gallon. Mrs Havard has used that figure in her calculations.
    The Law

    8. •    Section 6 of the Hydrocarbon Oils Duties Act 1979 ( "HODA") provides for the levy of excise duty on hydrocarbon oil delivered for home use and by virtue of section 11 a rebate of duty is allowed at the time of delivery.
    •    Section 12 of HODA prohibits the taking in or use of that heavy oil in road vehicles.
    •    Under section 13 where such heavy oil is taken into or used in a road vehicle with the intent of contravening section 12A the Commissioners may assess an amount equal to the rebate on like oil at the rate in force at the time of contravention as being excise duty due from any person who used the oil or is liable for it being taken into the road vehicle.
    •    An assessment is issued pursuant to the provisions of section 12A.
    Summing up
  8. Bernard Haley submitted on behalf of the Commissioners that as the Appellant had not attended, the tribunal could only rely on the evidence in the bundle supplied to the tribunal. Mrs Havard had recalculated the assessment after allowing for the ordinary diesel for which evidence had been produced and re-calculated the usage using 30 miles to the gallon. The Appellant, in his appeal, had objected to an assessment based on 3 years. In fact the assessment was only for one year, and had been arrived at honestly and was not capricious. In the circumstances the tribunal should find that Mrs Havard had acted reasonably and the appeal should be dismissed.

    9. The decision

  9. We have considered all the facts and the law and have decided that the assessment is to best judgment. The Appellant has not attended the tribunal and we can only rely on the evidence before us. We are surprised that the Appellant was able to produce £500 in cash to have the vehicle restored to him because he says that he is in receipt of tax credits. Mrs Havard has made allowances for such receipts as he has produced and allowed the higher mileage figures. Further Mr Ali has only raised the assessment for 12 months. We believe it is unlikely that the Appellant only filled the vehicle with red diesel to get to the garage, not least because he had red diesel available to him for use in his fork lift truck. We therefore dismiss the appeal and we have decided that the assessment is to best judgement and has been properly assessed by Mrs Havard.

  10. Under rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 the Appellant may appeal in writing to the tribunal within 56 days of the release of this decision

    11. David S Porter

    JUDGE
    RELEASE DATE: 27 May 2009

    MAN/08/8094

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URL: http://www.bailii.org/uk/cases/UKFTT/TC/2009/TC00086.html