UT/2023/000084 - [2024] UKUT 00382 (TCC)

The FTT rejected Beigebell’s case on the “channel model”, finding at [229] that Mr Patel had not arranged the transactions between Beigebell’s supplier and customer. Ground 4 is that this finding was one it was not entitled to reach on the evidence, and that in accordance with the principles set out in Edwards v Bairstow [1956] AC 14, it was therefore wrong in law.

Mr Brown points to the FTT’s reliance on e-mails of 19 August 2015, where Mr Patel introduced Mr Orton to Matt Jones at the supplier; he submits that (a) the FTT then failed to take the subsequent e-mails into account, and (b) had it done so, the only conclusion that could be drawn was that Mr Patel had set up the deals.

The two e-mails sent on 19 August 2015 were:

Further e-mails were:

Mr Brown submits that the only logical conclusion to be drawn from those email exchanges was that Mr Jones and Mr Saenz already knew each other and had traded before. In oral submissions, Mr Brown explained that the emails were significant because they showed that this was not the normal sort of commercial transaction, but was instead consistent with the deal having already been set up by Mr Patel. However, he went on to concede that the emails were also consistent with Mr Patel simply introducing the supplier to Beigebell.

As explained by the Court of Appeal in Georgiou (trading as Mario’s Chippery) v CCE [1996] STC 463 at p 476, the question for us as the appellate tribunal is whether there was:

“…evidence before the tribunal which was sufficient to support the finding made? In other words, was the finding one which the tribunal was entitled to make? Clearly if there was no evidence, or the evidence was to the contrary effect, the tribunal was not so entitled.”

This was clearly not a case where there was no evidence, so the issue is whether, looking at the totality of evidence before the FTT, the evidence was insufficient to support the FTT’s finding, or whether it was “to the contrary effect”.

In our view, the challenged finding was clearly sustainable in view of the totality of the evidence before the FTT, which was discussed in detail at [220] to [251]. For the reasons the FTT explained at [219] onwards, there was a conspicuous absence of documentation on the set up of the deal or deals. There were also a number of anomalies in Mr Patel’s evidence (see [228]) including the currency of the deals (Mr Patel’s evidence was that it was in US dollars whereas it was Euros), and the FTT’s rejection of his evidence that he had been called by the supplier SanDisk to say the contract of the company he was involved had a contract that was to supply only UK customers, when SanDisk did not appear in the supply chains. As Mr Puzey submitted, it did not follow from the fact that Mr Orton was talking to both the supplier and customer that Mr Patel had set the deal up. In summary, Beigebell’s challenge, based on the above sequence of e-mails, falls far short of establishing that the FTT was not entitled to reach the finding it did regarding Mr Patel not having set up the deals.

We therefore reject this ground of appeal.