Cambria Automobiles (South East) Limited & Anor v The Commissioners for HMRC
[2023] UKUT 249 (TCC)
Telent Technology Services Limited v The Commissioners for HMRC
20 June 2024
[2024] UKUT 183 (TCC)
Upper Tribunal
A company withdrew a VAT appeal, then tried to claim the same money back. The court said the first withdrawal meant they couldn't try again, because it was the same issue and they had already lost.
Key Facts
- •Telent Technology Services Limited (TTSL) withdrew an appeal (Assessment Appeal) against a VAT assessment for input tax credit.
- •TTSL later claimed repayment of VAT (Claim) including periods covered by the withdrawn appeal (Overlap Period).
- •HMRC applied to strike out the Claim Appeal, arguing procedural bars: cause of action estoppel, issue estoppel, and abuse of process.
- •TTSL argued HMRC was estopped by acquiescence.
- •The FTT struck out the Claim Appeal.
Legal Principles
Section 85 VATA 1994: Withdrawal of an appeal deems an agreement to uphold the decision without variation.
Value Added Taxes Act 1994, s 85(1) and (4)
Cause of action estoppel: Absolute bar if the cause of action in later proceedings is identical to that in earlier proceedings between the same parties, involving the same subject matter.
Arnold v National Westminster Bank Plc [1991] 2 AC 93
Issue estoppel: Prevents relitigation of an issue already decided in previous proceedings between the same parties, even if the cause of action differs; exceptions exist (e.g., new material unavailable with reasonable diligence).
Arnold v National Westminster Bank Plc [1991] 2 AC 93
Abuse of process: Bringing a claim that should have been raised in earlier proceedings can constitute abuse; a merits-based judgment considering public and private interests.
Johnson v Gore Wood & Co [2002] 2 AC 1
Estoppel by acquiescence requires detrimental reliance by the party claiming estoppel.
Tinkler v HM Revenue & Customs [2021] UKSC 39; ING Bank NV v Ros Roca SA [2011] EWCA Civ 353
Outcomes
Appeal dismissed.
The FTT correctly applied section 85 VATA 1994, finding that the withdrawal of the Assessment Appeal deemed a determination against TTSL's entitlement to input tax credit for the Overlap Period. This barred the Claim Appeal under issue estoppel and cause of action estoppel. Even without estoppel, the Claim Appeal would be an abuse of process.
FTT's decision to strike out the Claim Appeal upheld.
TTSL's attempt to reclaim VAT for the Overlap Period was barred by the deemed determination under section 85 VATA 1994, resulting in issue estoppel and cause of action estoppel. The court found no error of law in the FTT’s application of these principles.