Khan Tandoori 11 & Khan Tandoori (NW) Ltd v Commissioners for Her Majesty's Revenue and Customs
Decision date: 17 March 2011
Neutral citation: [2011] UKFTT 189 (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 challenged HMRC's decisions to compulsorily register Mr Khan (sole trader) from 1 December 2002 and Khan Tandoori (NW) Ltd from 1 December 2005 and to assess VAT in lieu of returns. Central disputes were whether a numbered meal bill book represented one evening's takings and whether HMRC's purchase-based "business economics" estimates and assumptions about wastage/staff consumption were reasonable. The tribunal preferred HMRC's evidence, accepted the meal book and business-economics exercise as a reasonable basis for estimating turnover, and dismissed the appeal, upholding the registration dates and assessments.
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 tribunal held that, where better records are absent, a numbered meal bill book corroborated by oral confirmation and supported by purchase records can form a reasonable basis for estimating takings and determining liability to compulsory VAT registration; likewise, a business-economics exercise using available purchase records and reasonable mark-ups can validly indicate turnover for registration purposes. The tribunal also found that adherence to HMRC guidance did not, by itself, bar valid assessments where no returns were submitted.
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 decision contains commentary suggesting an HMRC officer is not obliged to re-visit premises and that a refusal to re-visit does not necessarily invalidate an earlier estimate. It also notes that concessions by an internal reviewer on assumed wastage or staff consumption do not necessarily undermine a decision to register where the threshold is still met.