The High Court has rejected a claim for €55,000 in damages over a Mercedes seized by the Revenue Commissioners and ordered the vehicle forfeited under the Finance Act 2001.
Thomas Murray, trading as Tom Murray Garden Machinery, brought the action after Revenue detained the Mercedes ML420 CDi in Moone, Co Kildare, in March 2009 and seized it in April. The damages figure represented the vehicle’s agreed value at the date of seizure. Revenue denied the claim and counterclaimed for forfeiture.
Mr Justice Michael White delivered judgment on 7 February 2012, following a two-day hearing in December 2011 and further written submissions. The dispute concerned vehicle registration tax and the vehicle’s classification. The Mercedes was imported from Northern Ireland in January 2007 after being converted from a passenger vehicle to a commercial vehicle. It was registered in category C and €50 in vehicle registration tax was paid.
Within four weeks, Mr Murray had the vehicle converted back to carry passengers. The judgment says no new declaration was made to Revenue. The vehicle was used in his business and on public roads. Revenue officers stopped it at a checkpoint after suspecting it had been converted from commercial to passenger use without the required declaration and tax.
Mr Murray argued that the vehicle was designed or constructed for off-road use and therefore fell outside the statutory definition of a mechanically propelled vehicle subject to the tax provisions. Revenue disputed that interpretation. The court accepted that the vehicle was capable of off-road use and could be considered designed or constructed for such use, but concluded that the statutory definition had to be read as a whole.
The judge noted that the vehicle had been registered as a category C vehicle after an official examined the declaration, and that registration was required before it could receive an identification mark and road tax. Mr Murray had then taxed it as a private vehicle and converted it to carry passengers without giving Revenue an opportunity to consider his argument about the vehicle’s status. The judgment also records that it was used on public roads about two-thirds of the time and had road tyres unsuitable for off-road use.
The court rejected Mr Murray’s allegation of trial by ambush, finding Revenue was entitled to advance its interpretation of the statutory definition. It dismissed his damages proceedings and directed forfeiture of the Mercedes under section 127(2) of the Finance Act 2001.