David Peters Ltd v Revenue & Customs [2012] UKFTT 124 (TC) (10 February 2012)

David Peters Ltd v Revenue & Customs [2012] UKFTT 124 (TC) (10 February 2012)

The Tribunal held that there was an unconditional contract for the sale of ascertained goods, payment was made, and the goods were identified and deliverable. The Appellant acquired ownership and an immediate right to possession, even though physical delivery was postponed. The Appellant acted in good faith and was not party to the fraud. Therefore, there was a supply for VAT purposes, and the Appellant was entitled to reclaim input tax. The cases of Pennystar and Icon Construction were distinguished on the facts. Interest charged on the assessment should be repaid as the assessment was not justified.

Citation
[2012] UKFTT 124 (TC)
Parties
Appellant: David Peters Ltd; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
10 February 2012
Procedural Posture
VAT Input Tax Appeal / First Tier Tribunal (tax) Final Decision
Outcome
Appeal allowed
Legal Topics
Value Added Tax (vat), Input Tax Credit, Supply of Goods, Sale of Goods Act, Fraud and Innocent Party, Interest on Tax Assessments
Tax Law Commercial Law Value Added Tax (vat) Input Tax Credit Supply of Goods Sale of Goods Act Fraud and Innocent Party Interest on Tax Assessments

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 6 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

David Peters Ltd

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

VAT Input Tax Appeal / First Tier Tribunal (tax) Final Decision

Legal Issues

  1. 1 Whether there was a supply of machinery by Thorneycroft to the Appellant for the purposes of s.24 VATA 1994
  2. 2 Whether the Appellant is entitled to credit for input tax on goods paid for but not delivered
  3. 3 Whether interest payments are due by the Appellant and if so how much

Ratio Decidendi

The Tribunal held that there was an unconditional contract for the sale of ascertained goods, payment was made, and the goods were identified and deliverable. The Appellant acquired ownership and an immediate right to possession, even though physical delivery was postponed. The Appellant acted in good faith and was not party to the fraud. Therefore, there was a supply for VAT purposes, and the Appellant was entitled to reclaim input tax. The cases of Pennystar and Icon Construction were distinguished on the facts. Interest charged on the assessment should be repaid as the assessment was not justified.

Court Disposition

Appeal allowed

Orders

  • Assessment disallowing input tax of £118,335 set aside
  • Interest of £15,334 to be repaid to the Appellant