Golding, R (on the application of) v General Commissioners of Income Tax & Anor

An allegation of apparent bias is assessed by considering all relevant circumstances and asking whether a fair-minded and informed observer would conclude that there was a real possibility of bias. A tribunal does not act unfairly by refusing irrelevant evidence or by expressing a provisional view during an investigation, provided its mind remains open. A judicial review claim based on alleged bias or procedural unfairness will fail where the tribunal’s reasons are objectively sound and the alleged procedural defects lack substance.

The claimant sought judicial review of the General Commissioners’ decision of 3 December 2008 refusing to issue a closure notice in respect of an HMRC enquiry into his 2006/07 tax return. The enquiry concerned, among other matters, a claimed deduction for losses from a failed concert venture.

The claimant alleged apparent bias, an unfair hearing, refusal to admit documents and improper conduct by the enquiry inspector and the Commissioners. The central issues were whether the Commissioners had acted unfairly or with apparent bias, and whether the excluded material was relevant to the closure-notice application.

1. Application dismissed. The Commissioners’ first three reasons were sound: the application for a closure notice had been made unusually soon after the enquiry began, the requested information had not been supplied, and there had been no undue delay in opening the enquiry.
2. The allegation that the inspector had a closed mind was unfounded. His provisional view on the loss claim was permissible during the enquiry and was accompanied by a request for documentary evidence. The fact that the claimant and another taxpayer’s claims arose from the same transactions provided a rational explanation for enquiring into both returns.
3. Evidence concerning the separate Backhouse matter was properly excluded. That case involved different parties, a different inspector and different allegations. Even if the alleged conduct had been established, it had no relevance to whether a closure notice should be issued in this case.
4. The governing test for apparent bias was that stated in Lawal v Northern Spirit [2003] UKHL 35: the court must ascertain the relevant circumstances and ask whether a fair-minded and informed observer would conclude that there was a real possibility or real danger of bias.
5. Applying that test, there was no substance in the allegations of apparent bias or lack of a fair hearing. It was unnecessary to determine the alternative arguments that any unfairness had been waived or that an appeal provided an alternative remedy.
6. Costs were awarded to the defendants on the standard basis. An interim payment of £6,000 was ordered, and permission was given for Dr Milton to be joined for a possible costs application under section 51 of the Supreme Courts Act.

The claim was a first-instance judicial review of the General Commissioners’ decision dated 3 December 2008. The High Court dismissed the claim and refused permission to appeal, leaving any appeal to be pursued in the Court of Appeal.