TC09627 - [2025] UKFTT 01068 (TC)

On 7 April 2022, HMRC Mobile Enforcement Team (MET) Officers attended Craigantlet Service Station, Holywood, Belfast.

HMRC Officer Scott established that the vehicle contained approximately 12,000 litres of fuel and, with agreement from the driver, took three samples of fuel from the tanker unit. The Officer then advised the driver that the samples would be sent for preliminary analysis and both the vehicle and fuel would be detained pending test results.

On 11 April 2022, Officer Scott issued a Notice of Seizure (“the Notice of Seizure”) letter to CFL. The letter advised that the fuel and vehicle had been seized as liable to forfeiture under section 24(4) HODA and section 141(1)(a) and (b) CEMA 1979. The Notice of Seizure did not explain why the goods or vehicle were liable to forfeiture. The Notice of Seizure included the following text:

“If you claim that the goods were not liable to forfeiture you must within one month from the date of this notice of seizure give notice of your claim in writing in accordance with paragraphs 3 and 4 of the Schedule 3 to the Customs and Excise Management Act 1979.

…

If you do not give notice of claim within the said period of one month or, if any requirement of the above mentioned paragraph 4 is not complied with, the goods will be deemed to have been condemned as forfeit.”

On 25 April 2022, Tiernans Solicitors (CFL’s representative) wrote to HMRC asking for restoration of the seized fuel and vehicle. So far as relevant, their letter reads as follows:

“We act on behalf of the above named client an (sic) confirm that our client instructs that the goods and tanker seized are not liable to forfeiture and hereby formally seeks the restoration of the said items. No evidential basis for seizure has been served or presented to our client.”

On 5 May 2022, HMRC considered the request and wrote back to CFL’s representative to explain that they were awaiting the results of the formal samples sent to Eurofins Forensic Services, a government approved chemist, and therefore no restoration decision could be made yet. We should note two passages in this letter (the underlining and bold text are in the original letter):

“Thank you for your letter dated 25 April 2022 on behalf of your above named client. You have confirmed you are seeking restoration of the fuel and vehicle seized from your client on 11 April 2022.

…

I note the fuel and vehicle were seized as initial field tests on the fuel indicated fuel irregularities. I can advise that formal fuel samples will now be tested by the Government Chemist. This process may take several weeks before tests results are provided to HM Revenue and Customs.

In light of the above, please be advised that no restoration decision can be made until such times as test results of fuel analysis are available from the Government Chemist.”

In due course, the fuel samples were tested by Eurofins Forensic Services (“Eurofins”), a government approved chemist. The results (with Date Reported of 6 June 2022 for sample 256107 and 23 May 2022 for sample 246106 – we were not given a copy of the report for sample 246108) were as follows:

On 27 June 2022, HMRC wrote to CFL’s representative to refuse (“the Decision”) restoration of the fuel and vehicle. The letter (“the Decision Letter”) explained the reasons for this, the background to the seizure, the Eurofins’ test results and an explanation of HMRC’s restoration policy and the provisions under which the goods were seized. Importantly, the letter contains the following passages:

“Thank you for your letter dated 25th April 2022 on behalf of your above-named client. Your clients have requested restoration of these seized items. …

In your letter dated 25th April 2022, you request restoration of the seized fuels and vehicle …

Separately, your client has not submitted a Notice of Claim contesting the legality of this seizure.

Seizure of the fuels

All the things described below were seized under the authority of Section 139 of the Customs & Excise Management Act 1979 (“the Act”).

The Heavy Oil fuels were liable to forfeiture under Section 24A of the Hydrocarbon Oil Duties Act 1979 (“HODA”) because they were found to contain laundered UK rebated fuel.

…

Customs’ Policy for the Restoration of Seized Road Fuel

The Commissioners general policy is that seized fuel should not normally be restored but each case is examined on its merits to determine whether or not restoration may be offered exceptionally.

Customs’ Policy for the Restoration Excise Goods

The Commissioners general policy is that any excise goods seized because of an attempt to evade payment of duty should not normally be restored. In this instance your clients have sought restoration of the seized vehicle described above.

In all cases any other relevant circumstances will be taken into account in deciding whether restoration is appropriate.

This Department’s efforts are directed towards deterring and detecting fraud, failure to pay excise duty that is due, irregularities and encouraging compliance with procedures established to control movements of excise goods. In this way protection will be given to both Revenue and legitimate trade in the UK. It is appropriate that this objective is applied consistently throughout the UK. The creation of the Single Market meant the removal of fiscal frontiers; this significantly increases opportunities for smuggling and irregular movement of goods with less risk of detection. Thus routine restoration, even on fairly stringent terms, would thoroughly undermine the Department’s objectives. To maximise deterrence and encourage compliance, the normal policy in these cases is to refuse to restore seized goods.

Customs’ Policy – Mis-use of rebated fuels

Where the offence committed relates to the deliberate misuse of rebated fuels e.g. fuel laundering, the Departments general policy is that the seized apparatus [including vehicles] should not normally be restored but each case is examined on its merits to determine whether or not restoration may be offered exceptionally.

My Decision

I have considered your request under section 152 (b) of the Customs & Excise Management Act 1979 (“the Act”) and our policy.

In considering restoration I have looked at all of the circumstances surrounding the seizure, but I do not consider the legality or the correctness of the seizure which in this case has not been contested under Schedule 3 of CEMA. I also take account of Revenue and Customs policy in these matters.

It is for me to consider in all of the circumstances whether restoration of the seized fuel and vehicle should be offered, with or without conditions. Alternatively, I also have the discretion to refuse restoration.

I conclude that there are no exceptional circumstances that would justify a departure from the Commissioners policy.

Regrettably, on this occasion the seized fuels and vehicle HXZ 9215 will not be restored.”

There then followed further correspondence between CFL and HMRC. On 18 January 2023 HMRC accepted an e-mailed letter dated 20 November 2022 as a request for a late review of the Decision. The review was asked to consider the following matters:

The review (“the Review”) was concluded, and the Decision was upheld in a letter (“the Review Letter”) dated 22 February 2023. Officer Gordon explained that HMRC’s policy on the restoration of seized goods and vehicles was that alcohol, tobacco, vehicles, and other things (such as cover loads) seized as liable to forfeiture should generally not be restored. The Review Letter made it clear that Officer Gordon was “unable to consider the legality of the seizure itself. This is because the legality of the seizure can only be considered by the Magistrate’s Court should you appeal it. In your case, you did not appeal the legality of the seizure”.

She said that she did not accept CFL’s contention that they did not accept the results of the Eurofins tests, which were “demonstrative of ‘innocent contamination’.” This was because Eurofins was a tried and tested company which had been used by HMRC and provided reliable results. In addition, CFL had given no explanation of what the “innocent contamination” was or how the laundered fuel came to be in the vehicle. She noted that official tests “were conclusive that laundered fuel was contained” within the vehicle. Later she said that the fuel could not be restored “because official tests confirm it contains laundered fuel, which is non UK duty paid”.

She concluded by observing that, although she had not been provided with any information regarding hardship or humanitarian issues, she had considered this as part of her review of reasonableness and proportionality. She concluded that the Decision was both reasonable and proportionate.