HM Revenue and Customs v First Stop Wholesale Ltd & Anor

These appeals are against orders in three linked judgments of Singh J dated 27 March, 16 July, and 5 October 2012 arising out of the detention in June 2011 by Her Majesty’s Revenue & Customs (“HMRC”) of large quantities of alcohol from the warehouse and other premises of First Stop Wholesale Ltd (“First Stop”), the respondent to the first two appeals and the appellant in the third. At the time the alcohol in this case was detained in June 2011, HMRC gave as the grounds for their detention that they were “detained and removed from premises pending evidence of duty status” and were “goods detained and removed pending duty status”.

The first two decisions concern goods still detained on 4 November 2011. In the first the judge declared the detention of the goods unlawful because the reasons given in the notices for their detention were ones which were flawed and erroneous as a matter of public law. In the second he ordered HMRC to pay First Stop’s costs. HMRC appeals against these orders. The third appeal is by First Stop. It concerns goods the subject of notices of seizure issued under paragraph 1 of Schedule 3 to the Customs and Excise Management Act 1979 (“the 1979 Act”) before 4 November 2011 which the judge held were valid notices.

Section 139(1) of the 1979 Act provides that “any thing liable to forfeiture under the Customs and Excise Acts may be seized or detained by any officer…”. Sections 49(1) provides that goods improperly imported inter alia because duty has not been paid on them are liable to forfeiture. Section 144(2) provides a “costs shield” for HMRC. Under it, a person who obtains judgment against HMRC is not entitled to recover any damages or costs where “the court is satisfied that there were reasonable grounds for seizing or detaining” the goods in question.

One difference between the position of goods seized and goods only detained is that in the case of goods seized, a person claiming the goods are not liable to forfeiture can give notice within a month and HMRC must then institute condemnation proceedings in the High Court or a magistrates court: Schedule 3 paragraphs 3, 6 and 8 of the 1979 Act. Either party has an appeal either by way of case stated or to the Crown Court against any decision in condemnation proceedings: paragraph 11 of Schedule 3 to the 1979 Act. In the case of goods detained, there is no statutory appeal and the remedy of the goods owner is by an application for judicial review or a civil suit for wrongful interference with goods.

The outcome of these appeals depends on the scope of two judgments of this court in a judicial review brought by Eastenders Cash and Carry Plc (“Eastenders”) about the meaning of sections 139 and 144(2) of the 1979 Act. I shall therefore summarise the effect of those judgments before turning to the decisions of the judge in this case.

R (Eastenders Cash and Carry Plc) v Revenue and Customs Commissioners [2012] EWCA Civ 15 (“Eastenders No 1”) was decided in January 2012. Before that decision, there was no binding authority on the construction of section 139(1) of the 1979 Act, and there were differing views.

In Gora v Customs and Excise Commissioners [2003] EWCA Civ 525, at [50] – [52], Pill LJ (with whom Chadwick LJ agreed) suggested that the power of detention in section 139 was intended to allow for a reasonable investigation to be carried out where it was uncertain whether duty had been paid or not. Longmore LJ, however, considered (at [64] and [68]) that it was arguable that the section be given a narrower construction and that detention of goods which were not in fact liable to forfeiture was an unlawful interference with goods. In Demand & Supply Cash & Carry Ltd. v. Revenue and Customs [2009] EWHC 3321 (Admin) at [24] Kenneth Parker J broadly agreed with Pill LJ, but in R (Millenium Cash & Carry Ltd) v Revenue and Customs [2010] EWHC 1308 (Admin) Mitting J shared Longmore LJ’s reservations.

In Eastenders No 1 a majority of this court took the narrower approach to the scope of section 139. Elias and Davis LJJ held that, although at the time of the detention it may not be known whether goods are in fact liable to forfeiture, section 139 only empowers their detention if they are in fact so liable on account of inter alia unpaid duty. It does not suffice that the goods are “at risk” of being forfeited or that there are reasonable grounds for their detention or seizure: see Elias LJ at [85] – [90] and [93] and Davis LJ at [99] – [100], [107] and [108]. Mummery LJ dissented. An appeal against that decision is pending before the Supreme Court.

In the “discussion” section of his judgment in Eastenders No 1, Elias LJ stated that the starting point was the natural construction of section 139. On its face it made the conditions for exercising the power to detain and the power to seize the same, namely where goods are liable to forfeiture. He considered (see [78]) that to read the provisions to enable a difference to be made between the position of detention and seizure goes “well beyond the legitimate approach to statutory construction”. He concluded that the inevitable inference from the way the section is drafted is that “the conditions precedent to the lawful exercise of the power of detention must be precisely the same as those which will justify the lawful exercise of the power of seizure”. Once goods are seized (see [79]), this is the first stage in the route to forfeiture. Because the scheme of Schedule 3 leaves the court no discretion as to whether to order forfeiture, “Parliament could not possibly have intended to permit goods to be seized on suspicion alone where this leads to automatic forfeiture of the goods unless challenged by their owner”: see [82].

Elias LJ considered that the existence of the immunity in section 144 of the 1979 Act where the court is satisfied that the Commissioners or the officers had reasonable grounds for the seizure or detention supported this construction: see [83]ff. Section 144 would (see [84]) have no purpose if a seizure or detention on reasonable grounds were lawful. It is directed and premised on the assumption that the seizure or detention, even if based on reasonable grounds, is unlawful. Elias LJ also relied on the need not to construe a power to interfere with property rights more widely than is reasonably necessary (see [88]), the fact that, had Parliament intended the section to be interpreted to empower detention on reasonable suspicion alone, it would have been easy to have said so in terms as was done in section 138 (see [89]), and, albeit of less significance, that once one departs from the literal approach “it is not obvious why the test for determining whether goods can lawfully be detained should be the reasonable suspicion of the relevant official as opposed to, say, an honest suspicion”: see [90].

It was stated that the effect of this analysis was that the Revenue would not know for sure until a determination of the court whether a seizure or detention is lawful or not, and (see [92]) “legality is determined with hindsight”. Elias LJ accepted that this “is a surprising way to draft the legislation”. He, however, again pointed to the fact that the potential difficulties are largely catered for by section 144, and added (at [93]) that his construction might have certain advantages to HMRC. He stated that:

“if reasonable suspicion that goods are liable for forfeiture is the test for determining the legality of detention, HMRC may be liable on the basis that any suspicions are not reasonable, even though it turns out that the goods are in fact liable to forfeiture. Conversely, if the test is whether goods are in fact liable to forfeiture, detention will be lawful even if it was not in fact reasonable for HMRC to suspect that they were at the time of detention, and indeed even if HMRC justifies forfeiture on some basis not known at the time of detention.”

Davis LJ stated (at [114]) that Elias LJ’s reasoning “in essentials” corresponded with his approach and he agreed with it. He considered (at [99] – [100]) it “particularly telling” that in Schedule 3 to the 1979 Act the phrase “liable to forfeiture” means to be given up on account of unpaid duty or some other breach. That meaning is incorporated into section 139 by section 139(6). It is also telling because judgment could only be given in favour of the goods’ owner in condemnation proceedings if the court has found that the goods are not in fact liable to forfeiture. He also considered (see [103], [105]) section 144 to be important in the construction of section 139. He stated (at [108]):

“… there are wide ranging grounds for forfeiture in the legislation, not confined to non-payment of duty; and it would seem that HMRC could invoke any such ground, whether or not suspected at the time, when subsequently saying that the goods were (in fact) liable to forfeiture: quite apart from relying on the protection given in s.144.”

In May 2012, after the first of Singh J’s decisions in the present case,in Eastenders No 2, the same constitution of this court dealt with the costs implications of the decision in Eastenders No 1. In R (Eastenders Cash and Carry Plc) v Revenue and Customs Commissioners (No. 2) [2012] EWCA Civ 689, [2012] 1 WLR 2912it unanimously held that the “costs shield” in section 144(2) precluded the recovery of costs in that case.

In that case proceedings had been brought on account of the detention of goods in circumstances in which it was originally not disputed that there were reasonable grounds for detaining the goods. It has been submitted that for this reason the present case is distinguishable because there is no such concession and because it could not be said there were reasonable grounds for the detention in this case. This submission, however, has to overcome a formidable hurdle created by Eastenders No 2. In Eastenders No 2, in this court Eastenders had raised a new point based on Singh J’s analysis in his 27 March decision in the present case. It was submitted that the protection in section 144 is only available where the officer reasonably believed that the detention was lawful and on a permitted ground, but the detention was subsequently found to be unlawful, a category of detention described as “potentially lawful”.

The Court rejected this. It also rejected the contention that there is a distinction between a potentially lawful detention and a detention that is unlawful per se for which the protection against costs is not available. Mummery LJ stated (at [27]:

“The only condition stipulated by s.144(2) is the objective one that there were reasonable grounds for detaining the goods. That stipulation assumes that the detention was unlawful, as, if the detention was lawful, there would be no occasion for HMRC to invoke s.144(2) . Nothing is said in the section about whether the reason relied on at the time of detention is a potentially lawful reason or a reason which is unlawful per se. In any event, it is difficult to see what difference in substance there is between the existence or non-existence of reasonable grounds for detention of the goods and the different kinds of reason for the detention of the goods. The reasonable grounds in this case were the reason for detention.”

I now turn to Singh J’s decisions in these proceedings. His first judgment, [2012] EWHC 1106 (Admin), was handed down on 27 March 2012. In Eastenders No 1 it had been stated that the legality of seizure or detention is determined with hindsight (at [92]), and that, (at [93]) even if HMRC “justifies forfeiture on some basis not known at the time of detention” detention will be lawful if the goods are in fact liable to forfeiture. Notwithstanding these statements, it was submitted on behalf of First Stop that detention will not be legal where a legally insufficient reason for detention is given at the time of detention. After referring to Christie v Leachinsky [1947] AC 573 and R (Lumba) v Secretary of State for the Home Department [2011] UKSC 12 at [66], [73] – [74] and [76], the judge accepted that submission. He stated:

“35.

In the present context it seems to me that what the Court of Appeal has decided in Eastenders is that a condition precedent for the power to detain goods is that they are in fact liable to forfeiture, the same condition as for the power of seizure. But that is not necessarily a sufficient condition for the lawful exercise of the power to detain goods. Just as in the context of false imprisonment, either in the context of immigration detention which was considered in Lumba or in the context of the power of arrest which was considered in Christie v Leachinsky, the existence of a power does not necessarily mean that it must be exercised. It follows from well known principles of administrative law - Wednesbury principles as Lord Dyson referred to them in Lumba - that a discretionary power must be exercised lawfully. If it turns out that it was exercised unlawfully, as it seems to me, it would not matter, by way of analogy with false imprisonment cases, that the defendants could have exercised the power lawfully on some other basis.

36.

In the present case, in my judgment, the claimant has succeeded in establishing on the basis of the decision of the Court of Appeal in Eastenders that the purported exercise of the power to detain goods was flawed by an error of public law. And, in principle, it would be right that a declaration should be granted to reflect that success.”

He held that although Eastenders No 1 held it to be a necessary condition for the power to detain goods that they are, in fact, liable for forfeiture that was not a sufficient condition for the lawful exercise of the power to detain: [35]. I have referred (at [1]) to the grounds given for the detention of the alcohol at the time it was detained in June 2011. The judge considered that Eastenders No 1 held there was no power to detain goods “pending evidence of duty status”. Accordingly, he held the goods detained and still held on 4 November 2011 were unlawfully detained. He held that the purported exercise of the power to detain the goods was flawed by an error of public law because, whether or not it turned out later that the goods were in fact liable to forfeiture, there is no power to detain goods for the purposes of investigation.

The judge adjourned First Stop’s application for costs pending judgment in Eastenders No 2. The costs application came before him again on 16 July 2012. He held ([2012] EWHC 2191 (Admin)) that the costs shield in section 144(2) did not avail the Commissioners because the written and oral grounds given for detaining the alcohol, that is “pending further inquiries into their duty status”, were unlawful as a matter of public law, and therefore could not amount to reasonable grounds within section 144(2). He considered the position in Eastenders No 2 was different because in that case Eastenders had originally accepted that there were reasonable grounds for the detention of the goods.

The Commissioners appeal against Singh J’s orders declaring the detention of the specified goods unlawful, and ordering them to pay First Stop’s costs.

The third of Singh J’s judgments, [2012] EWHC 2975 (Admin), was handed down on 5 October 2012. In it, the judge rejected a challenge to the Commissioners’ decisions to seize the goods that were not the subject of the March 2012 judgment; that is goods seized before 4 November 2011. He rejected First Stop’s claim that notices stating that the alcohol was liable to forfeiture “in that no evidence of UK duty payment has been provided…” were unlawful because they did not state that duty had not been paid on the alcohol. He stated that in circumstances of this case, where there had been investigations for about a month before the seizure, there can have been no doubt that the Commissioners were stating that they believed the duty was owed on the goods in question. Those investigations had not led to any evidence establishing that duty had in fact been paid. He also observed that, under section 154(2) of CEMA 1979, the burden of proof to show that duty had been paid rested on First Stop.

The Supreme Court will decide whether it is a condition precedent to the power in section 139 of the 1979 Act to detain goods that they are in fact liable to forfeiture, or whether, as Mummery LJ considered, the legality of the exercise of the power in section 139 does not depend on proving this. HMRC will contend that Mummery LJ was correct and that the legality of the use of the power under section 139 is a matter subject to review by reference to ordinary public law principles, including the requirements of the Human Rights Act 1998.

Pending that decision, this court is bound by the decisions in the two Eastenders cases. Accordingly, the starting point of analysis must be that the legality of detention depends whether the goods in question are in fact liable to forfeiture. The question is whether Singh J was correct in holding that, while liability to forfeiture is a necessary requirement, it is not a sufficient requirement, and that the legality of a detention of goods pursuant to section 139 must additionally be judged on public law principles.

The proposition that the requirement that the goods are in fact liable to forfeiture cannot be regarded as sufficient to render detention or seizure legal gains powerful support from general principles of public law. This is because, in cases where it turns out that, for example, duty has not in fact been paid so that the goods are liable to be forfeited, there appears to be no protection against gross abuses of their power by HMRC. During the hearing, an extreme example was used to test the position. It was a situation in which the goods of those of a particular ethnicity or with red hair are detained for unacceptable racial or other reasons, but it later turns out that duty has not in fact been paid on the goods.

It is a fundamental principle of public law that public officers can only exercise their statutory powers in accordance with the law, which, for this purpose, includes the principles of propriety of purpose and relevance of considerations identified in the classic formulation of the grounds of review. Where the public law illegality concerns the decision-making process rather than the end result, the decision will be susceptible to judicial review and liable to be set aside even though the same result could be achieved lawfully without recourse to the illegitimate part of the reasoning. The ultimate outcome in Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997, after the Minister took the decision again and maintained his refusal to refer the complaint to a consumers’ committee without relying on the improper purposes and irrelevant considerations, illustrates this: see Harlow (1976) PL 116 at 120. But the fact the Minister could so achieve the same result did not preclude judicial review of the original decision which was tainted by such purposes and considerations. So, taking the extreme example canvassed at the hearing, the fact that it turns out later that duty has not in fact been paid should not in principle validate detention of the goods of a person for unlawful racial reasons.

The scenario in the extreme example was not canvassed in Eastenders No 1. On behalf of First Stop, Mr Jones QC submitted that the passages from Eastenders No 1 in which Elias LJ stated that legality is determined with hindsight and Davis LJ that HMRC could invoke any ground, whether or not suspected at the time of detention, when subsequently saying that the goods were in fact liable to forfeiture relied on by HMRC are obiter and per incuriam. He submitted that in the present case the judge applied well-known public law principles, in particular that, where the state seeks to interfere with the liberty of the subject and/or a citizen’s property rights, it can only do so lawfully upon exercising a statutory power. He also submitted that, even though there is not as yet a general rule requiring reasons for all public law decisions, reasons must be given before interfering with the liberty of the citizen and his property rights, because otherwise a citizen would be unable to know what facts had been relied on by the public authority and could not sensibly obtain advice to consider whether the decision is subject to challenge.

Mr Jones also relied on the provisions of paragraph 1 of Schedule 3 to the 1979 Act. That provides for the “grounds” to be stated when a written notice of seizure is provided to the owner of goods who was not present at the time of the seizure. The fact that notice is not required where the owner is present is, submitted Mr Jones, plainly premised on the fact that notice of the fact of seizure and “the grounds therefor” will be communicated at that time. He also relied on the principle that the court regards with suspicion reasons not relied on at the time of the decision where other reasons are relied on at the time of the decision: see R v Richards and Leeming (1985) 81 Cr. App. R 125, O’Hara v Chief Constable of the RUC [1977] AC 286 at 298, and R v Westminster City Council, ex. p Ermakow [1996] 2 All ER 302. In the last of these cases, the court concluded that improper reasons given in a decision letter could not be corrected by later affidavits seeking to justify the legality of the decision. See also, in the context of HMRC’s powers, R (CheckPrice (UK) Ltd) v HMRC [2010] EWHC 682 (Admin) at [43].

There is force in Mr Jones’s submissions and the judge’s analysis. Notwithstanding that, I have concluded that there is no requirement that, when detaining goods, the reason for their detention must be given. First, there is no requirement in the 1979 Act for any formal written notice of detention. That, in itself, is a contrast from the position with regard to seizure where paragraph 1 of Schedule 3 requires notice of the fact of seizure and “the grounds therefor”. Mr Jones’s submissions, in effect, invited the court to read such a requirement into the Act in respect of detention, despite the clear distinction made by the draftsman between the position of detention and seizure. The fact that there is a proposal in the Draft Finance Bill 2013 for a new Schedule 2A to the 1979 Act which will introduce a requirement that, when goods are detained, HMRC must take reasonable steps to serve a Notice of Detention and the grounds on the goods’ owner was drawn to our attention by Mr Jones QC. He submitted that this will “restore the position as it existed before” the Court of Appeal in Eastenders. His submission is premised on the assumption that the provisions will be enacted in their present form. But, whether or not they are, the fact that provisions of this sort are contemplated for detention suggests that there is, at present, no such requirement.

Secondly, during the course of the hearing, Lewison LJ observed that it was not necessary for the notice required by paragraph 1(1) of Schedule 3 to be given at the time of the seizure. It might be given later. Mr Jones accepted that this was so. That, however, is consistent with Mr Swift’s submission that the purpose of notice was not as a pre-condition to legality, but as part of the process by which a decision to seize may be challenged.

Thirdly, even in the case of seizure, notice is not required where goods are seized in the presence of the owner or the owner’s agent: see paragraph 1(2) of Schedule 3. In the light of this, it cannot be argued that the articulation of the reasons for detention is a condition precedent to the legality of the detention.

There is a more fundamental difficulty. Despite the general public law arguments which persuaded the judge and to which I have referred, requiring such reasons at the time the goods are detained cuts directly across and is inconsistent with the reasoning in Eastenders No 1 that goods could be liable to forfeiture on grounds which were not advanced or even known at the point of seizure or detention. I reject the submission that the statements by Elias and Davis LJJ at [93] and [108] were obiter. This court is bound by them. It will be for the Supreme Court to assess how the general public law principles which are referred to by the judge at [16] and by me at [24] are to be accommodated within the structure of the 1979 Act when Eastenders No 1 comes before it.

The submissions on behalf of First Stop also cut across the role accorded to section 144 of the 1979 Act by this court in Eastenders No 1. It is clear from the majority judgments that, if goods are detained and detention is ongoing, but more time is needed for investigation, the return of the goods is unlikely to be ordered. Both Elias and Davis LJJ stated (see [92] and [109]) that, if HMRC satisfied the court that it “had reasonable grounds for believing the law may be broken and that restoring the goods pending trial may undermine its ability in the public interest to enforce payment of taxes due”, an application for a mandatory interlocutory injunction would not succeed. Davis LJ stated that an application for such relief would only succeed if the goods’ owner showed at that stage that the goods were not liable to forfeiture: see [109]. The court in Eastenders No 1 regarded the provisions of section 144 as affording a safeguard to the goods’ owner in this situation. This is because where HMRC is unable to show reasonable grounds for the detention or seizure, it will be liable in damages and for costs. That must be the corollary of the protection from liability to damages or costs where HMRC satisfies the court that there were reasonable grounds for seizing or detaining the goods under the Customs and Excise Acts.

Mr Swift sought to meet the argument from general public law principles in the following way. He accepted that there must be grounds for detention and they must be reasonable. However, he maintained that reasons that are given for detention at the time must not preclude the court having an opportunity to consider whether the goods are in fact liable to forfeiture. The analysis in Eastenders No 1 of section 144 as the safeguard that permits investigation upon reasonable grounds even where goods are not liable to forfeiture has, he submitted, the effect of preserving the court’s role in this way because the exercise under section 144(1) and 144(2) is only undertaken after a court has found that goods are not liable to forfeiture. He submitted that the scheme of the 1979 Act provides safeguards for goods’ owners in the requirement that, where a goods’ owner objects to forfeiture of goods, the matter is to be determined by the High Court or Magistrates Court in appropriate proceedings.

As far as the judge’s reliance on Christie v Leachinsky and Lumba’s case is concerned, Mr Swift argued that those cases are distinguishable because the decisions to arrest and to detain were themselves unlawful, whereas, in the present case, the decision to detain the goods was lawful (see appellant’s skeleton argument, paragraphs 24, 26 and 32). Reliance was placed on the evidence in Mr Hewitt’s witness statement that officers went to First Stop’s premises to inspect goods; and that previous visits had resulted in seizures from the same business and from businesses operated by Mr Tajinder Singh, First Stop’s director. Mr Swift submitted that since, in the light of Eastenders No 1, the legality of detention can only be determined with hindsight after the full examination before the court in condemnation or other proceedings, until then, it cannot be said that the initial decision to detain is, in itself, unlawful.

Essentially, Christie v Leachinsky and Lumba’s case involve powers exercisable, in the case of the arrest power in Christie v Leachinsky, on the basis of reasonable suspicion, and in the case of the detention power in Lumba’s case, on the basis of a reasonable belief that it will be possible to remove the foreign national prisoner, whereas the structure of the power in section 139 is quite different. I have concluded that construing that power as not authorising detention of goods save where there is an assertion that duty has not been paid is inconsistent with the discussion in Eastenders No 1.

As far as Singh J’s second judgment is concerned, on the question of costs and section 144, it is clear from the extract from Eastenders No 2 which I set out at [15] that this court considered the argument that the protection of section 144 only applied where a category of detention was “potentially lawful” but not where it was “unlawful per se” and rejected it. Accordingly, the judge erred in concluding that what Mummery LJ stated at [27] of the judgment was obiter. It is necessary to consider the objective grounds that existed for detaining the goods. This involves considering the reason relied on at the time of detention and, in this case, the evidence provided by Mr Hewitt. In order to determine whether HMRC had reasonable grounds for detaining the goods, the court has to consider the circumstances that existed at the time the goods were detained. In basing his approach on a distinction which was rejected by this court in Eastenders No 2, the judge fell into error.

What remains is the challenge to the judge’s conclusion that the seizure notices met the requirements of paragraph 1 of Schedule 3 to the 1979 Act. The seizure notices stated that the goods were seized on the basis that “no evidence of duty payment has been provided” and that each seizure had been pursuant to sections 49 and/or section 100(2)(c) or 100(2)(e) of the 1979 Act or section 49(3) of the Alcoholic Liquor Duties Act 1979. On this, I accept Mr Swift’s submissions. First, the judge found, as a matter of fact, that there “can have been no doubt, and certainly should not have been any doubt, that what the defendants were saying was that they believed the duty was owed on the goods in question”: see [21]. If there is any doubt, the express reference to section 100(1)(e) made it clear that HMRC’s position was that the alcohol was liable to forfeiture because duty had not been paid on it.

Secondly, for the reasons I have given, a notice under paragraph 1 of Schedule 3 is not a requirement for the exercise of the power to seize. Paragraph 1(2) of Schedule 3, to which I have referred, identifies circumstances in which there is no need to serve any notice at all. Even where a notice is required, there is no requirement that the notice be given at the time of the seizure or decision to seize the goods. The lawfulness of the decision is a matter that will be decided in condemnation proceedings. The consequence of not serving a notice or serving one at a later stage relates to the time from which the goods’ owner will have to serve a notice under paragraph 3 of Schedule 3 claiming that the goods are not liable to forfeiture.

In any event, the difference between the statement on the notices that “no evidence of UK duty payment has been provided” and an assertion that duty has not been paid is a highly technical distinction. First Stop relied on the statement of Lord Hoffmann in Mannai Investment Company v Eagle Star Life Assurance Co Ltd [1997] AC 749 at 774 – 775. It is not at all clear how that case bears on the present case. If anything, Lord Hoffmann’s statement that people can convey their meaning unambiguously although they have used the wrong words and his example of Mrs Malaprop’s reference to a person being as “obstinate as an allegory on the banks of the Nile” is a point that tells against First Stop. In this case, looking at the words in context and including the reference to the statutory provisions to which I have referred, the judge was plainly correct in concluding that the notice given was a sufficient statement of the Commissioners’ assertion that duty had not been paid on the alcohol.

For these reasons, HMRC’s appeal against paragraphs 1 and 2 of the judge’s order dated 23 July 2012 must be allowed. First Stop’s appeal against paragraph 1 of the order dated 5 October 2012 is dismissed. The parties are invited to make written submissions as to the implications of this decision for the costs order made against First Stop in the October decision before the Court hands down its judgment.

I agree.

I also agree.