Commissioners of Customs & Excise v Anglo German Breweries Ltd., Court of Appeal - Chancery Division, November 29, 2002, [2002] EWHC 2458 (Ch)
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Commissioners of Customs & Excise v Anglo German Breweries Ltd., Court of Appeal - Chancery Division, November 29, 2002, [2002] EWHC 2458 (Ch)
a:\anglo german.doc Royal Courts of Justice Strand London WC2A 2LL Friday, November 29, 2002BeforeMR JUSTICE LAWRENCE COLLINSIn the Matter ofANGLO GERMAN BREWERIES LIMITEDBetween THE COMMISSIONERS OF CUSTOMS & EXCISE Petitionersand ANGLO GERMAN BREWERIES LIMITED RespondentsJUDGMENTApproved by the Court for handing downMr Paul Girolami QC and Mr Paul Harris (instructed by Moon Beever) for the PetitionersMr George Bompas QC and Mr Peter Griffiths (instructed by Penningtons) for the RespondentsMr Anthony Mann QC and Mr Adam Deacock (instructed by Hammond Suddards Edge) for the Provisional Liquidatora:\anglo german.doc Mr Justice Lawrence Collins:I Introduction1. The fraudulent diversion of duty suspended alcohol into the market without payment of duty and VAT is estimated to cost the exchequer some £450 million p.a. Alcoholic goods can lawfully be manufactured, sold, held or moved by the owner without payment of duty, provided that they remain in bond. Fraudulent diversion occurs by the creation of false administrative documents ("AADs") which permit the release of the duty suspended products from a bonded warehouse. Goods kept in such a warehouse can move from one such warehouse to another without the payment of tax provided the necessary documentation accompanies the goods showing that they are going to another bonded warehouse (both within the United Kingdom and also other EU countries). 2. In theory the bonded warehouse system is enforced by the requirement that one of the AADs must be returned by the warehouse of destination to the warehouse of despatch by the 15th day of the month following receipt to evidence the fact that the goods are still in bond. If it is not received in that period the warehouse of despatch is required to report this fact to Customs & Excise, and if it is not received within 4 months of despatch (and no alternative acceptable evidence of delivery is provided) the warehouse of despatch becomes liable for the duty.3. There is widespread evasion of these controls by alcohol being unlawfully diverted onto the UK home market through the use of AADs being returned with false stamps evidencing receipt of the goods by the supposed warehouse of destination. The false documents achieve a release of the goods from a bonded warehouse, supposedly to be passed to another such warehouse, but in fact the goods never arrive, and instead they are fed into the home market where they are sold at a reduced price, usually for cash, because duty and VAT have not been paid.II Anglo German Breweries Ltd and the assessments4. Anglo German Breweries Ltd ("AGB") operates an excise warehouse at 227-247 Gascoigne Road, Barking, Essex. The warehouse was approved under section 92 of the Customs and Excise Management Act 1979 and AGB is therefore an "authorised warehouse keeper". At all relevant times AGB carried on business as a bonded warehouseman, for the most part trading with other bonded warehouses in other parts of the EC on its own account in alcoholic drinks "duty-suspended," i.e. where the liability to pay excise duty and VAT on the drinks in question is suspended. As an authorised warehouse keeper and consignor of excise duty goods, AGB has provided a guarantee to the Commissioners to cover the movements of excise duty goods from the warehouse.5. On May 8, 2002 AGB was assessed by the Commissioners of Customs and Excise ("the Commissioners") in ...See the full content of this document
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