Augean Plc v HM Revenue & Customs

For the contaminated-land landfill tax exemption, the relevant activity is assessed by reference to whether it has ceased in relation to the land. The court must consider proposed future activity where it would involve the same activity that caused pollutants to be present. The statutory references to the presence of pollutants are distinct from the provisions defining the purpose and qualifying conditions of reclamation. A pollutant bears its ordinary meaning under the Finance Act 1996; definitions in separate pollution-control legislation cannot be imported without express incorporation. A proposed landfill operation remains the relevant activity where it will place substances capable of causing pollution in, on or under the land, even if containment is intended to prevent their release.

Augean plc appealed from a decision of the VAT and Duties Tribunal dated 27 February 2008. The Tribunal had dismissed Augean’s appeal against HMRC’s refusal to issue a contaminated-land exemption certificate under section 43B of the Finance Act 1996.

Landfill at the site had ceased in 1993, but Augean proposed removing the existing waste, engineering a contained landfill and depositing hazardous waste. The central issue was whether, in light of that proposal, all relevant activities had ceased for the purposes of section 43B(8)(c).

1. The appeal was dismissed. The Tribunal’s conclusion that the statutory condition in section 43B(8)(c) was not satisfied was upheld, although the judge rejected the Tribunal’s alternative reasoning that past deposits continuing to produce pollutants were themselves sufficient.
2. The general environmental purposes of landfill tax and its exemptions were relevant to construction. However, those purposes could not justify adding qualifications to the distinct wording of section 43B(8)(c) and section 43B(10)(a). The former provisions concern the object and qualifying conditions of reclamation, while the latter concern whether the relevant activity has ceased.
3. Future activity must be considered. Augean’s proposed replacement landfill would still be disposal of waste by landfill, and would result in the presence in the land of substances capable of causing pollution. The fact that the waste would be contained, and was intended not to cause pollution, did not mean that it was not a pollutant for section 43B.
4. The word pollutant was to receive its ordinary meaning in the Finance Act 1996. Definitions in the Pollution Prevention and Control (England and Wales) Regulations 2000 and the Environmental Protection Act 1990 could not be treated as controlling the meaning in a different statutory code. The legislation was not in pari materia, and the Finance Act had not incorporated those definitions.
5. The proposed landfill would therefore mean that the relevant activity had not ceased. Section 43B(8)(c) was not satisfied. The court noted that use of inert rather than hazardous waste would, on HMRC’s accepted position, remove this particular bar to certification.

• High Court (Chancery Division): Augean’s appeal from the VAT and Duties Tribunal was dismissed.
• VAT and Duties Tribunal: On 27 February 2008, the Tribunal dismissed Augean’s appeal against HMRC’s refusal of a section 43B exemption certificate.