Ex parte Bank of Credit and Commerce and Ex parte Customs and Excise Commissioners

Date

13 December 1979

Legislation

Taxes Management Act 1970, s.20C

Keywords

reasonable belief

Counsel

Andrew Bateson Q.C, Michael Tugendhat, Brian Davenport, Robert Gatehouse Q.C., Brian Davenport, M. H. D. Neligan and Julian Flaux

Solicitors:

unknown.

Judges:

Lords Wilberforce, Dilhorne, Diplock, Salmon and Scarman.

Court:

House of Lords.

Reported:

[1980] AC 952

Summary

The Inland Revenue had certain powers under s20 of the Taxes Management Act 1970 which enabled them to apply to the court for a search warrant in connection with suspected tax fraud. Under the terms of the Act, once a warrant was granted the Revenue had 15 days in which to execute it and seize any appropriate evidence.

One such warrant was obtained against a number of persons including Rossminster Limited and the police and Revenue inspectors searched the relevant premises and seized a number of documents. They did not inform the persons of the offences of which they were suspected, nor did the search warrant contain particulars of the alleged offences.

Rossminster judicially reviewed the grant of the warrants in the Queen's Bench Divisional Court. The Divisional Court refused the application, but its decision was later overturned by the Court of Appeal. The Revenue then appealed to the House of Lords.

Decision

The House of Lords concluded that:

• the warrants in question were within the Revenue’s powers and the suspects had no right to be told the nature of the offences alleged against them (Lord Salmon dissenting);
  
  
• whether there existed a 'reasonable cause to believe' that an offence had been committed was a question of fact to be determined on the evidence; and
  
  
• when the criminal proceedings had ended the immunity would lapse and the Revenue would then be required to state the reasons for their belief.

Lord Wilberforce noted that many criminal tax evasion operations are highly skilled and that the public interest weighed heavily in support of his conclusion that the defendant did not need to be told the exact nature of the allegations against him.

As this case related closely to the interpretation of the relevant section of the Taxes Management Act it is of only limited relevance in relation to more general forms of search and seizure warrants. It is also questionable whether this decision is fully compliant with the Human Rights Act 1999.