Major Micros Limited (in Liquidation) v Commissioners for Her Majesty's Revenue and Customs
Decision date: 10 March 2010
Neutral citation: [2010] UKFTT 105 (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
Major Micros claimed large VAT repayments for 10/02 and 11/02 which HMRC selected for verification because of MTIC/carousel fraud concerns. HMRC carried out extensive enquiries (including of third parties and EU authorities) beginning 4 Nov 2002 and 4 Dec 2002, made an interim payment in Jan 2003 and full payment by CHAPS on 19 Feb 2003, but withheld a repayment supplement. The Tribunal held HMRC's enquiries were reasonable, that the statutory 30-day repayment period was suspended while enquiries were pursued, and dismissed the appeal for a repayment supplement.
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 treated s79(4) as suspending the 30-day repayment period from the date HMRC first consider an enquiry necessary until they either receive a complete answer or decide not to pursue the enquiry; such enquiries may be directed to third parties and foreign authorities and need not be limited to the taxpayer, and reasonable enquiries into complex MTIC fraud can justify withholding the repayment supplement.
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 observed that HMRC's contemporaneous misunderstanding of the legal doctrine of "economic activity" (later addressed by the ECJ) did not alone render their enquiries unreasonable, and that administrative steps taken to expedite payment (e.g. CHAPS, interim payments) are relevant when assessing whether HMRC unduly delayed.