MTIC Appeals - Application for order to comply with Fairford Directions and cross application for disclosure

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Hammad Baig appeared before the First-tier Tribunal (Tax Chamber) for the Appellant in Greencyc Ltd v Revenue & Customs [2021] UKFTT 332 (TC). He was instructed by Steve Simmonite of SKS - Indirect Tax and International Trade Consultancy The Tribunal had before it two applications relating to conjoined appeals concerning decisions reached by HMRC where the Appellant’s company was notified that it was not entitled to its claim of input VAT deduction. The decisions in question had been based on the conclusion that the input VAT was incurred on purchases of goods connected with the fraudulent evasion of VAT, and that the appellant knew or should have known of that connection. HMRC had made an application for an order to comply with Fairford directions. The Appellant made a cross-application for further disclosure of documents.

These applications considered: an order to comply with Fairford Directions in MTIC appeals after repeated failures; an application granted with Directions – cross-application for Disclosure – burden of proof in Kittel test – rule 27(2) of the Tribunal Rules confirmed – application refused.

The Tribunal granted the application to comply with Fairford directions. The proposition that the directions forced the Appellant to make an advance disclosure of its substantive position or to disclose its cross-examination strategy was rejected.

The Tribunal rejected the Appellant’s cross-application for further disclosure of documents. The Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 r.27(2) set out the default position regarding disclosure of documents. It provided that each party would disclose to the other party only those documents on which it proposed to rely. The Tribunal has the power to exercise its discretion to displace this rule, however it was found that there was a lack of proportionality in the disclosure requests to the uncertain prospect of the relevance of the documents requested. Consequently, the Tribunal decided against exercising its discretion.

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