the times | Tuesday July 28 2020 1GM 51
Register
HM Revenue and Customs’ general
investigatory powers encompassed
the checking of tax returns and re-
questing information from taxpayers
without the opening of a formal in-
quiry pursuant to specific statutory
provisions, and the exercise of such
investigatory powers would only be
subject to judicial review in excep-
tional circumstances.
The Court of Appeal so held when
dismissing the appeal of the claim-
ants, JJ Management Consulting LLP,
Boisson Consultants Ltd, Intereurope
Foods Ltd, Mr Bryn Robertson, Over-
seas Imports SL (incorporated in
Spain) and Overseas Supermarcados
Unipessoal LDA (incorporated in
Portugal), from the dismissal by Mr
Justice Nugee ([2020] QB 619) of their
claim for judicial review of the deci-
sion of the Revenue and Customs
Commissioners, to commence an in-
formal investigation into their tax
affairs domestically and abroad.
Mr Philip Moser, QC and Mr
David Bedenham for the claimants;
Ms Aparna Nathan, QC and Mr Tom
Richards for the commissioners.
Lady Justice Simler said that since
2016, Her Majesty’s Revenue and
Customs (HMRC) had been investi-
gating the tax affairs of Mr Bryn Rob-
ertson, a successful businessman who
was both resident and domiciled in
England, and operated a successful
chain of supermarkets in Spain and
Portugal, through corporate vehicles
incorporated both in the United
Kingdom and in Spain and Portugal.
The investigation was not being
conducted pursuant to HMRC’s in-
quiry powers provided for in section
9A of the Taxes Management Act
1970 (as inserted by paragraph 4 of
Schedule 29 to the Finance Act 2001),
and indeed, the relevant time limits
for opening such inquiries had largely
passed when HMRC started the in-
vestigation in 2016.
Nor had HMRC pursued powers
contained in Schedule 36 to the Fi-
nance Act 2008 to obtain information
and/or documents from the claim-
ants. In those circumstances, the
claimants challenged the lawfulness
of the ongoing investigation by judi-
cial review, contending, among other
things, that HMRC had no power to
conduct it so that it had no lawful
basis, and further, it was irrational and
disproportionate.
The judge had been right for the
reasons he gave to reject those con-
tentions.
First, as section 5 of the Commis-
sioners for Revenue and Customs Act
2005 and section 1 of the 1970 Act
made clear, HMRC’s primary func-
tion was the collection of tax. That in-
volved both a power and a duty to col-
lect tax. The well-established princi-
ple of tax law to the effect that there
was a public interest in taxpayers pay-
ing the correct amount of tax meant
that the duty to collect tax was to col-
lect, so far as reasonably possible, the
correct amount of tax rather than sim-
ply the tax that a taxpayer accepted
was due.
The position was all the more clear
because the ancillary powers con-
ferred on HMRC by section 9(1) of the
2005 Act were to do anything which
“they think” necessary, expedient, in-
cidental or conducive to (or in) the
exercise of their functions.
Given the wide managerial discre-
tion available to HMRC as to the best
means of collecting tax, it could not
possibly be said that it was impermissi-
ble or unreasonable for HMRC to hold
the view that it was both expedient
and conducive to their tax collecting
function to conduct informal investi-
gations.
Second, the use of an informal in-
vestigation was not inconsistent with
the statutory scheme.
Outside the scope of a section 9A
inquiry, the statutory scheme con-
ferred power, by section 29 of the 1970
Act, on HMRC to collect tax by way of
a discovery assessment where HMRC
discovered that there had been a loss
of tax consequent on an assessment to
tax being insufficient or relief given
having become excessive.
The power to make a discovery as-
sessment applied outside the section
9A inquiry window in circumstances
where there was no such window
because no return had been filed; or
where either of the conditions in sec-
tion 29(4) or (5) were fulfilled (in other
words, either the error in the tax
return was brought about by deliber-
ate or careless conduct of the taxpayer
or his advisers, or a hypothetical offi-
cer of HMRC could not reasonably
have been expected to have been
aware of the error within the section
9A inquiry window from the informa-
tion provided by the taxpayer).
Since it was part of the statutory
scheme that HMRC could issue dis-
covery assessments where the rele-
vant conditions were fulfilled, it was
necessarily part of HMRC’s functions
to consider and investigate whether a
discovery assessment should be made.
Schedule 36 of the 2008 Act was not
drafted so as to confer power on
HMRC to check tax returns by way of
conducting investigations or inquir-
ies: it proceeded on the basis that
HMRC had power (conferred else-
where) to check the tax position of the
taxpayer. It conferred power to obtain
information and documents by com-
pulsion for that purpose.
Since the statutory scheme con-
templated checks otherwise than pur-
suant to section 9A, there was nothing
inconsistent in HMRC asking a tax-
payer for information and documents
on a voluntary basis (without compul-
sion) where they thought it necessary
or expedient in the exercise of their
function of checking a taxpayer’s tax
position, or incidental or conducive to
the exercise of that function.
An informal investigation, such as
the one conducted in the present case,
was premised upon consent and co-
operation. The voluntary nature of the
exercise meant that the taxpayer
could (at any time) simply refuse to
co-operate and could thereby forceCourt of Appeal
Published July 28, 2020
Regina (JJ Management
Consulting LLP and others) v
Revenue and Customs
Commissioners
Before Lady Justice Simler and Lord
Justice Popplewell
[2020] EWCA Civ 784
Judgment June 22, 2020
Windsor Castle
27th July, 2020
The Queen, Duke of Lancaster
today held a Meeting with Sir
Alan Reid (Chairman of the
Council of the Duchy of
Lancaster) and Mr Nathan
Thompson (Chief Executive
Officer) via telephone.Clarence House
27th July, 2020
The Duchess of Cornwall,
Patron, the Wiltshire Bobby
Van Trust, this morning held a
Meeting with Mrs J Shaw
(Director) via telephone.WE are afflicted in every way, but not
crushed; perplexed, but not driven to
despair; persecuted, but not
forsaken; struck down, but not
destroyed. 2 Corinthians 4.8-9 (ESV)Bible verses are provided by the
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Revenue having powers of
investigation outside
specific statutory provisions
HMRC to open a section 9A inquiry if
the window remained open, or issue a
formal information notice pursuant to
Schedule 36, with the attendant safe-
guards.
Finally, it would be the very antith-
esis of good administration for an arm
of the state to use compulsory, intru-
sive powers as a first step in obtaining
information from an individual,
rather than resort to them only when
attempts to obtain the information
voluntarily had run into the sand.
For all those reasons, it was beyond
doubt that HMRC’s functions includ-
ed checking tax returns without open-
ing a section 9A inquiry, including
after the inquiry window had closed,
with a view to determining if there
were grounds for making a discovery
assessment, and that such checking
could include not just carrying out in-
ternal investigations by rereading the
file and any documents contained on
it, but conducting external inquiries,
including contacting the taxpayer, to
obtain information and documents on
a voluntary basis.
On the assumption that an inform-
al investigation was available to
HMRC without limitation, the claim-
ants submitted that judicial review
had to be available on ordinary princi-
ples and there was no warrant for im-
porting a threshold test of exception-
ality, as the judge had done.
A test of wholly exceptional cir-
cumstances was capable of applying
to the civil context as well as the crimi-
nal or quasi-criminal context.
However, HMRC had a statutory
duty to collect the public revenue and
a broad managerial discretion as to
how best to perform their tax collec-
tion function. That was reinforced by
the width of their discretion in section
9 of the 2005 Act to do what they
thought necessary or expedient in the
exercise of their functions.
The power to conduct informal in-
vestigations undoubtedly involved a
balance of policy and public interest
considerations. Satellite litigation in
relation to requests by HMRC for vol-
untary co-operation by a taxpayer was
highly undesirable, particularly in
circumstances where taxpayers were
able to challenge compulsory infor-
mation notices pursuant to Schedule
36 or discovery assessments under
section 29 of the 1970 Act in proceed-
ings in the First-tier Tribunal.
The self-denying ordinance re-
quired by the separation of powers
was also important given the width of
the discretion available to HMRC.
That did not mean that the court
had no jurisdiction on judicial review.
To the contrary, HMRC, like all public
authorities, had to exercise their pow-
ers so as to promote the statutory pur-
pose for which they were given; and
had to act lawfully, exercising their
powers in good faith and on a rational
basis. However, in practice it would
take a wholly exceptional case on its
legal merits to justify judicial review of
a discretionary decision by HMRC to
conduct an informal investigation of
the kind conducted in the present case.
Lord Justice Popplewell agreed.
Solicitors: Memery Crystal LLP;
General Counsel and Solicitor, HM
Revenue and Customs.St James’s Palace
27th July, 2020
The Duke of Kent, Colonel,
Scots Guards, this morning
held a Meeting via video link
with Brigadier Harry
Nickerson upon relinquishing
his appointment as Regimental
Lieutenant Colonel and
Major General Christopher
Bell upon assuming the
appointment.Court Circular
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AND SR. D.F.J.ORJALES-
MOURENTE
The marriage took place on 21st July
2020, at Kensington and Chelsea
Register Office, Chelsea Old Town Hall,
King's Road, London, between Paul
Jonathan Douglas Waite and Francisco
Javier Orjales-MourenteMrs. Heather
Waite has the pleasure of announcing
the marriage of her son, Paul Jonathan
Douglas Waite, to Francisco Javier
Orjales-Mourente. The wedding
ceremony took place at the Kensington
and Chelsea Register Office, Chelsea
Old Town Hall, King's Road, London at
10:00am on Tuesday 21st. July 2020. El
Sr. D. Silvio Santiago Orjales Teijeiro y
la Sra. Dña. Margarita Mourente Prieto
se complacen en anunciar el enlace
matrimonial de su hijo, Francisco Javier
Orjales-Mourente, con Paul Jonathan
Douglas Waite. La ceremonia tuvo
lugar en la Oficina del Registro Civil de
Kensington y Chelsea, Chelsea Old
Town Hall, King's Road, Londres a las
10 : 00 de la mañana del martes 21 de
julio de 2020.MARRIAGE
ANNOUNCEMENTMajor H.C. Codrington and
Miss L.A.C. Dalrymple
The marriage took place
on July 25th, 2020 in the garden
at Quarryford House, Gifford,
between Hugo Codrington and
Louisa DalrympleGOLDTHORP Valerie Pauline Morrison
(née Hall) died suddenly on 17th July
2020, aged 91 at home in York.
Formerly of Wotton, Surrey. Beloved
wife of the late Anthony Goldthorp and
adored mother of Lucy. Family funeral
in Yorkshire and a Memorial Service at
Wotton later in the year. No flowers
please, but donations if desired can be
made to the British Heart Foundation
c/o J G Fielder & Son, Chapel Street,
Easingwold. YO61 3AF Tel: 01347
666505JONES John Byron died peacefully on
21st July 2020, aged 82, at
Northumberland Specialist Emergency
Care Hospital, Cramlington. Much-
loved and revered husband of
Elizabeth, father of Toby and Harriet,
father-in-law of Sara and Rory and
grandfather of Calum, Lottie and
Rhys. Private family service on
Wednesday 5th August at Alnwick
Cemetery. No flowers please but
donations to the British Heart
Foundation appreciated.POTTER Susan (Sue) died peacefully
on 20th July 2020, aged 73 QARANC
(‘64-’74) Capt Ret’d. 0 2.10.1946 -
18.07.2020. Died peacefully at home,
with Louisa her devoted & loving
partner for over 36 years, at her side.
Loved by her siblings, Robert, David
(dec) Tom, Anna and Richard (dec).
Will be missed by the many friends to
whom she was so loyal. Funeral to be
live streamed on the 7th August,
1.30pm. All enquiries to Alexander
Burn fd. Cheltenham. 01242 245350.SYMES Douglas Kean peacefully on
1st July 2020 aged 74 years, much
loved husband of Antonia and father of
Nicholas, Harriet and Richard and fun
loving grandfather to Zach, Cora, Leo,
Henry and Felix. Private family funeral.
Memorial service to be announced.
Family flowers only.Donations in lieu
to Cancer Research UK c/o DL Hancock,
Chapel House, 13 North Street,
Bicester, Oxon. OX26 6NAEMBLETON Pamela died peacefully
with her family by her side, aged 85 on
19th July 2020, Beloved wife of the late
Philip Embleton. Dearly loved mother off
Lucy, Sarah and Dennis, grandmother
to Peter, Oliver, Thomas, Dominik,
Harry and Freddie. Private family
funeral. Donations if desired to RNLI
Aldeburgh Guild c/o Tony Brown's
Funeral Service, Saxmundham, Suffolk
IP1 7 1EHDALE-STAPLES Hannah (née
Stenton) died peacefully on 20th July
2020, aged 65, with her husband Ian
and her sister Jayne by her side.A
beautiful, loving and truly courageous
person. She will remain in all our
hearts forever. Private funeral on 31st
July 2020.No flowers please.
Donations, if wished, to Harefield
Hospital (www.rbhcharity.org).WILSON Jeremy Paul died peacefully
on 25th July 2020, aged 88 of East
Budleigh and formerly Queen Mary’s
Hospital, Sidcup .Dear husband of
Maggie Giraud, father of Harriet and
James (children of his first marriage to
Clare) stepfather of Rebecca, Bridie
and Rosie, he was also Grandpa Jem to
eight grandchildren.TAYLORPOOLE
On 23rd July 2020 to Alice Poole
and Julian Taylor, a son,
Alexander Michael David John,
born at Chelsea and Westminster
hospital.CHAVASSE Rose, died peacefully on
26th July 2020, aged 94. Beloved wife
of the late Michael, darling mother of
Camilla, Julia and Sarah and devoted
grandmother.Family funeral due to
restrictions. Donations to St Mary's
Church, Ticehurst.Cheques can be sent
to Francis Chappell, 27 London Road,
Sevenoaks TN13 1ARLEGAL, PUBLIC, COMPANY &
PARLIAMENTARY NOTICESTo place notices for these sections please call:
020 7481 4000
or email: [email protected]Notices are subject to confirmation and should be
received by 11.30am three days prior to insertion.LAND Kathleen Annette (née Coyle )
died peacefully at home on 4th June,
aged 97. Much loved sister, mother,
grandmother and friend, who will be
missed by all who knew her. All
enquiries to Alex Jones Funeral
Directors, Oxted, tel: 01883 730383.WOOD April Mary died peacefully on
8 th July 2020, dearly beloved wife of
John Hainsworth Wood. Dear friend.
Never to be forgotten. (Funeral at St
Mary-le-Bow Friday 31st July at 12.40
for 1pm)BENJAMIN John Loftus - Suddenly
and peacefully at home. Due to the
present circumstances there will be a
Service of Thanksgiving for his life at a
later date. Enquiries:
[email protected]NAPIER Major General Lennox
Alexander Hawkins CB OBE MC DL died
peacefully on 21st July 2020, aged 92
Beloved father to Joanna, Philip and
Sally. A Memorial Service will take
place in Wales when it is safe to do soMCLUSKY John on 14th July 2020,
aged 76 Beloved husband of Linda and
one who will be sadly missed by
family and friends. Private family
funeral. Donations to the British Heart
Foundation via www.austins.co.ukLIPWORTH.In cherished memory of
Bertrand Ivan, who died 5 years ago.
"MEDIA VITA IN MORTE SUMUS".
(Rilke) +442 073289948
[email protected]WEIL On 29th April 2020 to Sarah (née
Courtauld) and Jonathan, a daughter,
Francesca Rosalie Courtauld, sister to
MatildaWEIL On 1st June 2020 to Roisin (née
Stimpson) and Edmund, a son, Patrick
Sonny Stimpson, brother to Conrad and
OscarBURTT Deirdre (née Larbalestier)
passed away peacefully on 22nd July
2020, aged 87 Very much loved.GALLAGHER On 12th July 2020 to
Emily (née Eaves) and Rory, a son,
Ralph William, brother to Finnbar.STAINES on 17th July 2020 to Nicola
and Peter, a son, Heath Ernest Peter,
brother to Miles William Freddie.ROGERS On 25th July 2020 to Camilla
(née Gare) and James, a son, William
Jack StephenIn Memoriam -
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