[2012] UKFTT 188 (TC)
TC01883
Appeal number:
LON/2008/2398
PROCEDURE – whether case to
be stayed pending CJEU decision - whether expert witness to comply with CPR –
yes –– whether opinion evidence of someone with “expertise” to be admitted –
no – exclusion of witness statement containing largely opinion evidence –
leave to serve substitute statement
FIRST-TIER TRIBUNAL
TAX CHAMBER
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ARJAN
CHANDANMAL, ASHOK ARJANDAS NAINANI,
and RAJESH
CHANDANMAL
T/A C NARAIN
BROS
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Appellants
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- and -
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THE
COMMISSIONERS FOR HER MAJESTY’S
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Respondents
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REVENUE &
CUSTOMS
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TRIBUNAL:
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JUDGE BARBARA MOSEDALE
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Sitting in public at Bedford Square London on 22 February 2012
Mr J Dagnall, Counsel,
instructed by Hill Dickenson, for the appellants;
Mr J Kinnear, Counsel,
instructed by the General Counsel and Solicitor to HM Revenue and Customs, for
the Respondents
© CROWN COPYRIGHT
2012
DECISION
1.
This appeal is against a decision by HMRC to deny the appellants
recovery £4,718,819 input tax claimed in the period 04/06. The grounds of
HMRC’s refusal are an allegation that the transactions in which this input tax
was incurred were connected to MTIC fraud and that the appellants knew or ought
to have known this.
2.
After a full day’s application hearing before me I reserved my decision
to give me time to read in detail the witness statement of Mr Stone which the
appellant sought to be excluded from proceedings. I promised to issue
directions after the hearing and provide written reasons for them. The directions
are issued to the parties: this decision records my reasons for them.
The application for a stay
3.
The stay is refused firstly on the grounds that even if it were
appropriate for proceedings to be stayed pending the release of the Bonik
decision C-285/11, it is virtually certain that the CJEU will have delivered
its judgment in Bonik before this appeal comes on for hearing bearing in
mind that due to other directions made (explained below) it is most unlikely
this appeal will come on for hearing before 2013. Therefore, there is no
prejudice to the Appellant in refusing a stay. The parties will have the
benefit of the CJEU’s opinion in Bonik before the hearing of this
appeal.
4.
Secondly, in any event, I do not consider it appropriate for proceedings
to be stayed behind Bonik as the matters at issue in this appeal took
place six years ago. It is in the interests of justice to bring this matter on
to hearing as soon as possible. One witness has already died and the matter
should come on before the remaining witnesses lose their recollection of events.
5.
Thirdly, the reference in Bonik appears to be only peripherally
relevant to this appeal because it concerns a chain of transactions in which,
unlike this case, it appears the goods did not exist and because there is no
allegation of actual knowledge. There is therefore only a small possibility
that the CJEU’s decision in Bonik would significantly change this
Tribunal’s understanding of the CJEU’s decision in Kittel as explained
by the Court of Appeal in Mobilx.
6.
It is therefore in the interests of justice that the parties should
continue to prepare this case for hearing pending the CJEU’s decision in Bonik.
The application for Mr Fletcher to give CPR 35 undertaking
7.
HMRC have served an expert witness statement by Mr Fletcher, a
consultant with KPMG, who gives expert evidence on the grey market in mobile
phones. It contains only a statement of truth and not the normal expert witness
statement given under Part 35 of the Court Procedure Rules (“CPR”). The appellant
seeks a direction that Mr Fletcher provides a further statement saying whether
he has complied with Part 35 of CPR.
8.
It is part of the role of the court or Tribunal to ascertain the
reliability of evidence of fact: where opinion evidence is being expressed in
a specialist area it may not be as easy for a court or Tribunal to assess the
reliability of that evidence. It is likely to be for that reason that the
courts have detailed rules, such as CPR 35 for the High Court, which seek to
ensure the reliability of expert evidence.
9.
CPR practice direction 35 at 2 requires an expert witness to give an
independent view. At 3.2 it requires the expert witness to state his
expertise, disclose his sources, make clear if anyone helped him with the
report, summarise the range of opinions on the matter and give reasons for his
own opinion, and state that he has complied with his duty to the court. At 2.5
he is required to communicate any material change of view to the parties
without delay.
10.
HMRC point out that the Tribunal does not have rules similar to CPR part
35. The Tribunal can admit what evidence it chooses (Rule 15(2)(a) of Tribunal
Procedure (First Tier Tribunal)(Tax Chamber) Rules 2009) and theoretically
could admit expert evidence from an expert who was not independent. But I see
no good reason why I would do that in this case. A Tribunal as much as a court
is concerned with the reliability of expert evidence. It is right and in the
interests of justice that the only opinions of witnesses relied on by the
Tribunal are witnesses who are both expert in the specialist area on which they
give their opinion and who are impartial between the parties.
11.
I reviewed the requirements of CPR Practice direction 35 paragraph 3.2
at the hearing and HMRC agreed that Mr Fletcher would comply or had complied
with every one. Indeed, Mr Kinear said Mr Fletcher was instructed to observe
the practice direction on experts. However, I note that in one respect at
least I was not satisfied that Mr Fletcher had necessarily complied with the
practice direction. His summary of sources at paragraph 1.3.1 of his statement
does not contain a reference to a confidential report from Nokia which the
appellant believes that Mr Fletcher may have relied on when compiling the
report and I know from my experience in another case that Mr Fletcher did rely
on in compiling the report in that case.
12.
This only goes to reinforce my view that expert witnesses, even in the
Tribunal, should comply with the requirements of CPR practice direction 35 and
state that they have done so. Indeed, it is normal practice within the Tribunal
to direct that expert witnesses should do so.
13.
That such a direction has not been given in this case is likely to be because
leave to serve an expert witness statement was not sought by HMRC. Although no
point is taken on this, arguably under Rule 15(1)(c) such leave should have
been obtained before serving Mr Fletcher’s statement.
14.
My conclusion is that there is every advantage to expert witnesses in
the Tribunal following CPR Practice Direction 35 and no disadvantage. While
some cases in the tax tribunal are informal, in this case, with nearly
£5million at issue, both parties are represented by solicitors and counsel and
there is no advantage to informality. Even HMRC do not suggest that Mr
Fletcher would not in practice obey CPR 35. There is no reason why he should
not state (if true) that he has so complied and I so direct.
Application for disclosure
15.
Originally the appellants asked for disclosure of “any notes or transcripts
of relevant evidence at Tribunal hearings at which any of the Respondents’
witnesses (and in particular John Fletcher and/or Roderick Stone have given
generic or expert evidence and have in any way resiled from their own evidence
and/or conceded or admitted/accepted generic or expert evidence points from the
relevant respondents (sic) at such hearings and/or otherwise given generic or
expert evidence which differs from the generic or expert evidence sought to be
adduced from them in this case.”
16.
At the hearing, the appellants asked in effect for this application to be
stayed on the assumption I ordered Mr Fletcher to serve an additional statement
(as I have) stating that he has complied with CPR Practice Direction 35. They
expect that, by undertaking to be bound in particular by clause 2.5, Mr
Fletcher will realise he must also immediately serve an updating statement
saying to what extent he has changed his views. The appellants indicated that
they expected Mr Fletcher to retract a number of the views he has made in his
statement because they believe he has done so in cross examination in other
MTIC cases. The appellants also indicated that if Mr Fletcher does not serve
an updating statement, they will wish to revive their application for
disclosure in order that they can challenge his evidence at the hearing of this
appeal by putting to him the change of views he has expressed (they allege) in
cross examination in other cases.
17.
In order to avoid unnecessary future applications hearings in this
appeal, I will therefore make a few comments on what a Tribunal might be likely
to order. Firstly, the appellants request is for HMRC to review all
transcripts and indentify any instance where Mr Fletcher has said something inconsistent
with his witness statement. This would involve an HMRC officer reading a very
great many transcripts and then forming a view on whether Mr Fletcher has in fact
said anything inconsistent with his rather lengthy witness statement. It is
likely a Tribunal would consider this a fishing expedition and unreasonably
onerous.
18.
A Tribunal would be more likely to consider ordering the disclosure of
named transcripts: this is far less onerous on HMRC as they would not be
required to read them first. Mr Dagnall said the transcript of H T Purser
Ltd TC01694 would be top of his list, but was unable to name at the
hearing in front of me any other case the transcript of the hearing of which he
would wish to see. I note that in any event, had Mr Fletcher said anything in
cross examination in H T Purser Ltd or indeed in any other case which
the Judge had found to be inconsistent with his witness statement, I would
expect this to be recorded in the decision notice. It should not to be taken
for granted, therefore, that disclosure would be ordered even of named
transcripts unless there is something which suggests it might be relevant to
the current proceedings.
The application to exclude Mr Stone’s witness statement
19.
HMRC also served a witness statement by a Mr Stone, a senior officer of
HMRC in their Serious Civil Investigations Directorate and acting as a senior
policy advisor on MTIC fraud. The appellant seeks a direction that his
statement be excluded.
20.
This is not an application to admit a witness statement out of time but
an application to exclude one served on time on the grounds it contains opinion
and/or irrelevant and/or hearsay evidence. It is therefore for the Appellant
whose application it is to satisfy me that it is well-founded: it is not for
HMRC to satisfy me that it is not well founded.
Outline of position
21.
The appellant objects to Mr Stone’s evidence because it includes opinion
evidence.
22.
Witnesses give evidence of fact from which the Tribunal forms its own
opinion of the facts; opinion evidence is where the witness’ opinion on
the facts may be relied on by the Tribunal in reaching its own decision. There
is therefore a very crucial distinction between fact and opinion evidence. As
the Tribunal’s duty is to form its own opinion on the facts, opinion evidence
is only necessary where the matter is a specialist area outside the tribunal’s
general knowledge.
23.
I reject HMRC’s contention that there is an intermediate category of
witnesses of “expertise” who while not expert witnesses may nevertheless give
opinion evidence to the Tribunal. Opinion evidence can only be relevant to the
Tribunal where it is a matter beyond the Tribunal’s general knowledge. Where
the matter is within the Tribunal’s own ability to form an opinion, expert
evidence is not required and it would wrong in law for the Tribunal to rely on
a witness’ opinion in such circumstances. There are witnesses of fact and there
are expert witnesses: there is no intermediate category.
24.
HMRC do not advance the proposition that Mr Stone could be an expert
witness. Although it seems likely that Mr Stone is an expert in MTIC fraud from
the experience he sets out in his witness statement, he is an officer of HMRC
and he could not be considered to be an independent witness. And while the
Tribunal might have power to accept expert evidence from someone who is not
independent, I cannot see why I would do so particularly in this case where the
opinions he expresses (largely on how MTIC fraud works) can as easily form part
of HMRC’s counsel’s submissions. So in so far as Mr Stone gives opinion
evidence it is not admissible.
25.
Mr Kinnear argues that Mr Stone’s explanation of MTIC fraud is useful to
a panel which is not familiar with MTIC fraud and mentions the comment of the
Judge in H T Purser Ltd where he said that he found Mr Stone’s
explanation of MTIC fraud useful. I do not agree that this is grounds to admit
opinion evidence from a witness not put forward as an expert: if an
explanation of how theoretically MTIC fraud works is required, counsel can do
this in opening and it can be a matter for submissions. I do not accept that a
non-expert witness can give opinion evidence.
26.
The questions for me are therefore (1) to what extent is Mr Stone’s
evidence inadmissible and (2) what is the appropriate and proportionate manner
of dealing with his witness statement to the extent it is inadmissible. To
ascertain this, I have to look at Mr Stone’s statement in detail.
Opinion
27.
The appellants consider paragraphs 6-64 is opinion evidence as it is Mr
Stone’s current view of how MTIC fraud works and the typical features of MTIC
fraud. I agree that Mr Stone’s current view of MTIC fraud is opinion evidence
and inadmissible; I do not agree that paragraphs 6-64 contain nothing but
opinion evidence.
28.
To the extent that Mr Stone is giving factual evidence of the understanding
HMRC had of MTIC fraud at the time of the events giving rise to the appeal it
is a matter of fact. Examples of this are in paragraphs 8 and 18. There are
other matters of fact referred to in paragraphs 45, 46, 53, 57, 58, 59, 60, 61,
62, 63, and 64.
29.
I find that paragraphs 65- 138 contain evidence of fact about HMRC’s
policies and procedures during the period at issue in this appeal: while it
might be challenged on the grounds of relevance or hearsay it is not opinion
evidence.
30.
Paragraphs 139-141 are Mr Stone’s opinion on the law relating to the
reverse charge: submissions on the law are to be made by counsel and not by the
witness. While not strictly opinion evidence, Mr Stone’s view of the law is
certainly irrelevant.
31.
I find that while paragraphs 142-145 contain evidence of fact, paragraphs
146-149 are opinions drawn from the facts and are inadmissible.
32.
I also find paragraphs 150 is opinion evidence. It is inadmissible.
33.
Paragraphs 151-164 are opinion evidence on the grey market: it is inadmissible.
34.
Paragraph 165 was accepted by all parties as factual.
35.
Paragraphs 166-169 appears to be a mixture of Mr Stone’s and HMRC’s
current views on MTIC fraud and the grey market: it is inadmissible. While
HMRC’s views on the grey market in 2005/6 might be something on which Mr Stone
could give factual evidence, possibly relevant to the extent it informed HMRC’s
policies at the time, HMRC’s current views can only be a matter for
submissions.
Relevance
36.
It is for the Appellant to satisfy me that the matter or matters covered
in the witness statement are irrelevant to the matters under appeal. The
witness statement of Mr A A Nainani refers at paragraphs 80-83 and subsequently
to dealings with HMRC officer Mr Jeffels and therefore I am not satisfied that the
policies of HMRC and the reasons for them at the time in question are
irrelevant to this appeal, even though it is likely they may only have
peripheral relevance.
37.
Nevertheless, I am satisfied that references to contra-trading are
irrelevant to this appeal as both parties were agreed that none of the chains
at issue in this appeal were alleged to be contra-trading chains. Paragraph 18
is therefore irrelevant.
38.
Mr Dagnall queries whether Mr Stone’s role was sufficiently senior to
allow him to give evidence of fact on HMRC’s policies. This is goes to
credibility and is something on which Mr Dagnall can cross examine Mr Stone in
due course.
39.
Paragraphs 57-60 all appear to relate to events after the matters at
issue in this appeal and I find are not relevant except possibly paragraph 60
to explain why HMRC has access to the statements of persons banking with FCIB.
40.
I am not satisfied that the question of the extent to which there was a
genuine market for mobile phones in 2006 is irrelevant in this appeal: indeed
the witness statement of Mr A A Nainani at paragraph [15] gives evidence on the
genuine market for mobile phones. To the extent Mr Stone’s factual evidence
covers this issue it is relevant to this appeal.
41.
In summary I consider paragraphs 18, 57-60 to be irrelevant. Many of
the other matters of fact covered by Mr Stone, mostly dealing with HMRC’s
policy at the time, are likely to have only peripheral relevance to the issues
in this appeal. The Tribunal judge will be in a much better position to decide
if something is relevant to the issues he is called upon to decide that I am.
It is therefore right to be cautious in excluding evidence of fact served on
time as irrelevant at this stage.
42.
I emphasise that the Tribunal might take a very different view if this
were an application to admit evidence out of time when it would be for the
applicant to satisfy the Tribunal that the evidence was relevant.
Hearsay
43.
Some of Mr Stone’s evidence is properly regarded as hearsay, for
instance where he gives evidence of third party websites. This Tribunal has
the discretion to admit evidence not admissible in a court of law: Rule
15(2)(a). In some circumstances hearsay evidence is now admissible in the
civil courts: the mere fact it is hearsay evidence will not lead to its
exclusion in the Tribunal (although of course the weight that the Tribunal will
place on it may be affected).
44.
The appellants asked for the evidence to be excluded to the extent it
was hearsay: no other particular reason was given. As I have said it is for
the appellants to satisfy me that the evidence should be excluded: I am not
satisfied that it should be excluded merely because is hearsay and so I would
not exclude it (but see paragraph 52 below)
45.
At the hearing the appellant is of course free to make representations
to the judge on the weight to be attached to it.
Conclusion
46.
In summary I am satisfied that the following paragraphs are opinion
evidence or submissions or irrelevant and in all cases inadmissible: 6-7; 9-44;
47-52; 54-59; 139-141 146-164; 166-169.
47.
In conclusion, the substantial part of Mr Stone’s statement is
inadmissible. The question is what is the appropriate method of dealing with
this matter.
Proportionate manner of dealing with witness statement
48.
The appellants’ case appeared to be that it was necessarily prejudicial
for witness statements containing opinion to be before the Tribunal hearing the
substantive appeal. I cannot agree: a Tribunal hearing is not a criminal
trial and there is no jury. A Judge will exclude from his mind opinion
evidence given by witnesses of fact. The panel member(s) will be instructed to
do likewise.
49.
However, I agree that statements by witnesses of fact should be limited
to facts because (a) it will save the Tribunal’s time in having shorter witness
statements, (b) it will save the other party time in that they will not have to
respond to a matter (the opinion of a witness of fact) which is irrelevant and
(c) it is more appropriate for submissions to be made by counsel.
50.
Nevertheless, it may not always be proportionate to exclude a witness
statement simply because it includes opinion. The exclusion itself requires a
hearing to decide whether and to the extent the evidence is opinion. It will
depend on the facts of each individual case. In some cases a Direction “that a
failure by the other party to cross examine on the opinion of a witness of fact
is not to be taken as acceptance of it” would suffice to deal with the matter
proportionately.
51.
However, dealing with matters proportionately will also include
consideration of proper case management. Failing to exclude a witness
statement which contains largely inadmissible material will only encourage the
submission of such statements in the future. Good case management suggests
that the statement should be excluded, although with the right for HMRC to
serve a new statement covering the factual matters covered in the original
statement.
52.
As I have found the inadmissible parts of the Mr Stone’s statement to
substantially exceed the admissible parts, I have decided it is right to exclude
it. Nevertheless as parts of the statement appear to be factual and
potentially relevant I have given HMRC leave to file a new statement of fact by
Mr Stone. In reaching my decision I have taken into account that because they
are other delays, there will be plenty of time for such a new statement to be
compiled and it will not prejudice the timetabling of this appeal.
Other witnesses giving opinion evidence
53.
HMRC also served a witness statement by a Mr Moorhead, an HMRC officer
who has analysed statements of bank accounts held with FCIB, and a statement by
Mr Jeffels who was the appellants’ visiting officer at the time in question.
54.
I do not agree with Mr Dagnall that where Mr Moorhead states
“examination of the record shows…” he is stating anything other than fact. He
is simply saying he looked at the record and found certain payments. That is
not a statement of opinion. Paragraphs in which he makes such a statement are
admissible.
55.
However, in paragraph 160-161 Mr Moorhead states that he found payments involving
the appellants’ purchases to be circular in that the person at the start of the
money chain was the same as the person at the end. Mr Kinnear says that this
is a statement of fact. Mr Dagnall says it is a statement of opinion. I find
it is a statement of opinion: this is because it is built on other opinions
that Mr Moorhead has formed. In particular, he has looked at the statements
and found payments between FCIB account holders. He has formed a view that a
payment from A to B relates to a payment by B to C and so on. This in turn has
led to his forming a view that the payment chains were circular. That is a
matter of opinion and as he is not an expert witness it is inadmissible. The
view that the payments are circular can of course form the basis of submissions
by counsel at the hearing if counsel is of the same opinion.
56.
HMRC accepted that paragraph 162 was a statement of opinion.
57.
So I agree with the appellants that paragraphs 160-162 of the witness statement
of Mr Peter Moorhead are a statement of opinion and inadmissible. Nevertheless,
excluding the entire statement for these 3 short paragraphs is disproportionate
and the appellants did not suggest that I should. They suggest that a general direction
that a failure by the appellants to cross examine the witness on his opinions
is not to be taken as acceptance of them: I agree and make such a direction.
58.
Mr Jeffels made a long statement and the appellants’ allege that many
sections amount to prejudicial opinion evidence. I ruled that I would not hear
the arguments on this as HMRC had indicated that they were likely to withdraw
the statement. The background is that, very sadly, Mr Jeffels died at the end
of 2011. HMRC wish another officer (a Mr Cordwell) to become familiar with the
documents held in this case and make a replacement witness statement. HMRC do
not expect this to be ready until July 2012 partly because Mr Cordwell will
have the responsibility to undertake the disclosure exercise agreed by the
parties and ordered by me at the last directions hearing on 27 April 2011, a
duty which Mr Jeffels was to undertake but died before he could do so. Until
this statement is ready, HMRC are not withdrawing Mr Jeffels’ statement.
59.
Therefore, this application by the appellant is stayed pending a
decision by HMRC on whether they are withdrawing the statement. If by 13 July
2012 HMRC have not notified the appellant that they are withdrawing Mr Jeffels’
statement, the appellant should request the Tribunal to arrange a further
hearing to decide this application.
60.
I note that the appellant, applying for a stay in any event, raised no
objection to HMRC’s request for four months before notification of whether or
not HMRC are applying for leave to serve a new statement. As both parties
consent to the further delay in these proceedings, I have allowed it but
bearing in mind the difficulty for the Tribunal in hearing stale evidence, HMRC
should not assume an extension to this date will be granted even if unopposed.
Copying costs
61.
At the last directions hearing in April 2011 by consent of the parties I
ordered disclosure of, amongst other things, FCIB material. HMRC had already
served a witness statement which exhibited the FCIB material which they relied
on: they considered that the rest of the FCIB material neither assists the
appellants’ case nor undermines their own. Nevertheless, the appellants wished
to check this for themselves and it seems right they should have an opportunity
to do so: no doubt for this reason the application for disclosure was conceded
by HMRC.
62.
What was not agreed at the hearing was who would be responsible for the
costs of the disclosure. It was agreed this would be left to the parties to
seek to agree themselves failing which they would revert to the Tribunal. They
have failed to reach agreement and do now revert to the Tribunal.
63.
Mr Kinear told me that at the time he conceded this he had not
appreciated the quantity of material involved: it is estimated it will fill
some 27 lever arch files. HMRC’s position is that they do not wish either a
paper or electronic version of the material to leave HMRC’s premises as it
contains confidential taxpayer information: being information from the Paris
server of the FCIB not only are company names recorded but also names of
individuals. They want the appellants to inspect the material at HMRC’s
premises and for the appellants to bear the burden of copying any of the
statements they wish to take away. He considers that HMRC made a generous
concession allowing inspection and that it would be unreasonable to expect HMRC
to pay for making copies of the material to be inspected.
64.
HMRC do not consider that they can produce the material electronically.
Although the material is held electronically, HMRC’s position is it will have
to be printed out in any event to see if any of it needs to be redacted. It
would be expensive to create an electronic copy of printed out material and
indeed for policy reasons regarding taxpayer confidentiality they would not do
so, at least not without a court order.
65.
At the hearing before me, Mr Dagnall for the appellants conceded that
they only required to see the FCIB statements for the two months before and the
two months after so the deals at issue in this appeal that they can perform
their own analysis of the money movements. This limits the amount of material
they wish to see but Mr Kinear was not in a position to estimate by how much. The
appellants’ position is that they want the material provided in paper or
electronic form to them at their offices. They offer a solicitors’ undertaking
to keep it confidential. As an alternative, they would be prepared to visit an
HMRC office to inspect the material as long as that office was in Liverpool where the appellants’ solicitors are based. The information is however held in London.
66.
It is the appellants’ position that HMRC should be responsible for the
cost of making the material available for them to inspect. HMRC have
introduced evidence from the FCIB, it follows that the appellants should have
the right to inspect it and (they say) should not have to bear the burden of
the cost of copying the material.
67.
I am aware from having looked at FCIB printouts how very time consuming
it will be for the appellants to look at such a quantity of material. I can
understand their reluctance to send a solicitor to London potentially for days
at a time to sit in Customs House and plough through this material and that it
will save them travelling costs and travelling time if they could do this at
their offices in Liverpool.
68.
At root therefore the argument is over whether the appellants should
have the entire 6 months of material provided to them in their offices at
HMRC’s expense which would save them travelling time and costs; or whether they
should travel to London to inspect it and save HMRC making a copy of a great
deal of what is likely to be mostly irrelevant confidential taxpayer
information. I take into account that while it is it is reasonable for the
Appellant to wish to look at the undisclosed material, it is also reasonable
for HMRC not to wish to bulk copy a very large amount of confidential
information most of which is unlikely to be referred to at the hearing. If the
appellants must copy the material at their own expense, this will necessarily
limit their decision of how much to copy and likely restrict it to relevant
material.
69.
For these reason I have decided that the inspection must be at HMRC’s
offices. The appellants will have the right at their own expense to take
copies (although I note HMRC has offered to pay if the quantity is not too
great).
Costs regime
70.
At the hearing before me both parties were agreed that they wished the
old costs regime to apply to this appeal. It was agreed that I would make such
a direction, no such direction having been made before.
71.
The day after the hearing and before the direction was made, the
appellants changed their position. Their
solicitors indicated that the agreement on costs the day before had been made
without specific instructions from their clients and in ignorance of the recent
decision of the Upper Tribunal in Atlantic Electronics Limited FTC/29/2011,
2012UKUT45TCC. They asked me to withhold making the direction but instead
direct a timescale in which the matter could be resolved. I have done so.
72.
This document contains full findings of fact and reasons for the
decision. Any party dissatisfied with this decision has a right to apply for
permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure
(First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be
received by this Tribunal not later than 56 days after this decision is sent to
that party. The parties are referred to “Guidance to accompany a Decision from
the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this
decision notice.
Barbara Mosedale
TRIBUNAL JUDGE
RELEASE DATE: 13 March 2012
