Cherian v Revenue and Customs (INCOME TAX/CORPORATION TAX : Other) [2016] UKFTT 316 (TC) (09 May 2016)

Cherian v Revenue and Customs (INCOME TAX/CORPORATION TAX : Other) [2016] UKFTT 316 (TC) (09 May 2016)

The tribunal found that HMRC had reasonable grounds for not issuing a closure notice, as the enquiry was at a preliminary stage and the appellant had not provided all requested information, particularly bank statements necessary to verify his income and benefits. The information notice was valid and the information requested was reasonably required. The penalties were properly imposed as the appellant did not have a reasonable excuse for non-compliance. There was no evidence of improper motive or abuse of power by HMRC, and the tribunal lacked jurisdiction to consider such arguments.

Citation
[2016] UKFTT 316 (TC)
Parties
Appellant: Mr Sony Cherian; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
09 May 2016
Procedural Posture
Income Tax/corporation Tax Other / First Tier Tribunal (tax) Decision on Closure Notice Application, Information Notice Appeal, and Penalty Appeals
Outcome
Application for closure notice refused; information notice varied; penalty appeals dismissed.
Legal Topics
Income Tax Enquiry, Closure Notice, Information Notice, Penalties for Non Compliance, Jurisdiction of Tribunal, Reasonable Excuse, Abuse of Power
Tax Law Administrative Law Income Tax Enquiry Closure Notice Information Notice Penalties for Non Compliance Jurisdiction of Tribunal Reasonable Excuse +1 more

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 5 Authorities cited 19 Party arguments 2 Amounts and remedies 7
Sign in to unlock

Parties

Mr Sony Cherian

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Income Tax/corporation Tax Other / First Tier Tribunal (tax) Decision on Closure Notice Application, Information Notice Appeal, and Penalty Appeals

Legal Issues

  1. 1 Whether HMRC should be directed to issue a closure notice for the 2012/13 tax enquiry under s 28A TMA
  2. 2 Whether the information notice issued under Schedule 36 Finance Act 2008 was valid and reasonable
  3. 3 Whether penalties for non-compliance with the information notice were properly imposed

Ratio Decidendi

The tribunal found that HMRC had reasonable grounds for not issuing a closure notice, as the enquiry was at a preliminary stage and the appellant had not provided all requested information, particularly bank statements necessary to verify his income and benefits. The information notice was valid and the information requested was reasonably required. The penalties were properly imposed as the appellant did not have a reasonable excuse for non-compliance. There was no evidence of improper motive or abuse of power by HMRC, and the tribunal lacked jurisdiction to consider such arguments.

Court Disposition

Application for closure notice refused; information notice varied; penalty appeals dismissed.

Orders

  • HMRC not directed to issue a closure notice; enquiry may continue.
  • Information notice varied to permit redaction of personal information from bank statements as per para 19(3) Schedule 36.