Hussain Ali Omar v The Commissioners for HMRC
[2023] UKFTT 101 (TC)
Adebiyi Shonubi v The Commissioners for HMRC
18 July 2024
[2024] UKFTT 641 (TC)
First-tier Tribunal
A man tried to bring way too many cigarettes into the UK. He said he didn't know there was a limit, but the judge didn't believe him. Because of his inconsistent stories and the large amount of cigarettes, the judge decided he was dishonest and had to pay a fine. The man tried to appeal, but the appeal was rejected.
Key Facts
- •Adebiyi Shonubi attempted to bring 62,000 cigarettes into the UK from Nigeria, exceeding the duty-free allowance of 200 cigarettes.
- •HMRC imposed civil evasion penalties totaling £18,568.
- •The appeal was filed four days late but was permitted due to the holiday season.
- •Shonubi claimed he was unaware of the restrictions on importing cigarettes.
- •HMRC argued Shonubi acted dishonestly.
- •Shonubi's evidence contained inconsistencies with witness statements and previous correspondence.
Legal Principles
Customs and excise civil evasion penalties are payable only if conduct is for the purpose of evading duty and involves dishonesty.
Section 8 Finance Act 2003; Section 25 Finance Act 1994
The burden of proving dishonesty rests on HMRC.
Section 33(7) FA 2003; Section 16(6) FA 1994
The test for dishonesty follows the Supreme Court decision in *Ivey v Genting Casinos (UK) Limited* [2017] UKSC 67: (1) Subjective assessment of the individual's knowledge or belief; (2) Objective assessment of whether conduct was honest according to the standards of ordinary decent people.
*Ivey v Genting Casinos (UK) Limited* [2017] UKSC 67
In civil cases, the standard of proof is the balance of probabilities.
*Han v HMRC* [2001] EWCA Civ 1048; *HMRC v Khawaja* [2008] EWHC 1687 (Ch)
Outcomes
Appeal dismissed.
The Tribunal found that Shonubi's conduct was dishonest based on the evidence presented, which included the large quantity of cigarettes, his inconsistent statements, and the lack of evidence supporting his claim of intending to declare the cigarettes.
Civil evasion penalties upheld.
The Tribunal concluded that Shonubi knew or believed there was a limit on the amount of cigarettes he could import and that the quantity he possessed significantly exceeded that limit. His actions, including evasive answers and implausible explanations, demonstrated dishonesty.
30% reduction in penalties maintained.
The Tribunal found no reason to alter the 30% reduction already granted by HMRC.