Collector-general entitled to €1.7m in VAT from motor dealer, court rules

The collector-general is entitled to judgment for some €1.7million in outstanding VAT and interest against a motor dealer, the High Court has ruled.

Ms Justice Niamh Hyland rejected arguments on behalf of Peter McGregor Senior the court should refuse judgment for the €1.7million because no proof was advanced to establish Michael Gladney, the plaintiff, is, in fact, the collector-general.

Mr Gladney initiated the proceedings in 2016 against Mr McGregor Senior, then with an address at Weston Lawn, Lucan, Co Dublin.

In her recently published judgment, Ms Justice Hyland said much of Mr McGregor’s opposition to the tax judgment claim had concerned the alleged unlawfulness of certificates issued under the Taxes Consolidation Act 1997, as amended.

Those certified, when these proceedings issued in 2016, an assessment to tax was duly made, a notice of assessment was provided to Mr McGregor, that assessment had become “final and conclusive” within the meaning of the Acts, the sum of €1,712,253 in respect of arrears of tax and interest was due and outstanding and a demand had been made for that, she said.

The Revenue had relied on those certificates until the morning of the hearing of this case on September 24th when it withdrew its reliance on them, she said. It maintained, even without the certificates, the sum identified in the notice of assessment was due and payable and all necessary proofs were before the court.

That led to the defence being narrowed down at the hearing to an argument that judgment should be refused on the basis no proof had been adduced that Mr Gladney was in fact the collector-general, she said.

There is an “explicit statutory basis” authorising the collector-general to bring proceedings to recover tax due and owing and where it has been pleaded in the summary summons, and not controverted by Mr McGregor, that Mr Gladney is the collector-general, she said.

That plea was a sufficient identification of Mr Gladney as the appropriate plaintiff and evidence is not required in that respect, she held.

She rejected additional arguments, including the reference in the applicable legislation to “due and payable” was not sufficient to render the debt owing and the words “final and conclusive” were required for this purpose.

Earlier, she noted the bulk of the Revenue demand arose from a July 2015 notice of assessment for some €1.5 million in VAT, made up of €40,976 for the period September 1st 2013 to December 31st 2013, and some €1.48 million for the period January 1st 2014 to December 31st 2014.

The notice issued arising from an investigation by Revenue into Mr McGregor’s activities as a motor dealer, she said. Because he had not lodged an appeal against the assessments within the period allowed, the sum became due and payable.

In April 2016, the collector-general issued a summary summons seeking €1,716,811, comprising €1,530,315 VAT and €186,496 interest.

In November 2016, in response to a motion for liberty to enter final judgment in the €1.7million sum, Mr McGregor accepted he might have a VAT liability in respect of a small number of motor vehicle sales but argued that liability was a very small fraction of the sum claimed in the proceedings.

He sought documents from Revenue and maintained he had a bona fide defence that he never made the volume of transactions meriting the sum claimed.

Ms Justice Hyland said the notice of assessment became due and payable once the time to appeal expired and, as the defendant had not established an arguable defence, the Collector General is entitled to judgment as sought.