Shakeel Ali v Her Majesty's Revenue & Customs
Decision date: 18 November 2009
Neutral citation: [2009] UKFTT 309 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned a claim by Mr Ali for repayment of £4,375 input VAT said to have been charged on fixtures and fittings bought when he acquired a lease for a bar. The tribunal found the vendor had been de‑registered for VAT before completion, so the sale was not a taxable supply and no VAT was chargeable. Because no VAT was chargeable, Mr Ali could not recover input tax from HMRC and the appeal was dismissed.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The ratio is that input tax can only arise where VAT was actually chargeable on a supply; if the supplier was not a taxable person at the time of the transaction (for example because they had been validly de‑registered before the sale), then VAT is not chargeable and the purchaser cannot claim input tax from HMRC.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The tribunal noted that alternative evidential arguments are irrelevant where the evidence shows no tax was chargeable rather than merely showing lack of documentation. It also indicated, as a non‑binding remark, that the purchaser’s recourse for any overcharge would be a contractual claim against the vendor, though that appeared unlikely to succeed on the available facts.