UT/2023/000069 - [2024] UKUT 00278 (TCC)

This is an appeal by HM Revenue and Customs (“HMRC”) against a decision of the First-tier Tribunal (Tax Chamber) (“the FTT”) released on 28 April 2023 ([2023] UKFTT 00404 (TC)). We refer to this as “the FTT 2023 decision”. The respondent is Mr Mohammed Zaman, who is the sole director and shareholder of Zamco Ltd.

The FTT first decided the relevant issue in this matter in a decision released on 24 June 2021 ([2021] UKFTT 0228 (TC) (“the FTT 2021 decision”)). The FTT 2021 decision determined the issue before us in favour of Mr Zaman.

HMRC appealed the FTT 2021 decision to the UT (“the UT”), which allowed HMRC’s appeal on the basis that the FTT had made an error of law regarding the burden of proof (which we discuss below) ([2022] UKUT 00252 (TCC) (“the UT 2022 decision”), released on 20 September 2022). The UT remitted the case to the FTT.

The FTT, on the remitter in the FTT 2023 decision, determined the relevant issue (again) in favour of Mr Zaman.

HMRC now appeals against the FTT 2023 decision to the UT. The basis of HMRC’s appeal was that the FTT, in the FTT 2023 decision, had made a decision that was ‘perverse’ (in the sense that no tribunal could, applying the relevant legal principles and in the light of its findings of primary fact, have reached the decision that it did) and should be set aside on Edwards v Bairstow [1956] AC 14 grounds. The Scots approach is identical: see Advocate General for Scotland v Murray Group Holdings Ltd 2016 S.C. 201, which refers expressly to Edwards v Bairstow. Mr Zaman is domiciled in Scotland and Scots Law is the governing law.