The landlord of light industrial premises sought damages from his tenant for breach of the user covenant in the lease. This permitted the premises to be used, inter alia, as an ‘industrial building or structure’ as defined by the Capital Allowances Act 1968. The tenant was in business of purchasing used tyres, storing and inspecting them in the premises to see whether they were suitable for making re-moulds. Those thought to be suitable were then consigned to a re-moulder which would then select and purchase the tyres it wanted. The tenant also sold re-moulded tyres on commission and provided a re-moulding service for some of its customers. Due to the nature of its business, at any one time there would be a large number of tyres stored in the premises awaiting despatch to a re-moulder.
Held: The storage of used tyre casings and re-moulds fell within s.7(1)(f)(ii) and (iii) of the 1968 Act. As to Dale -v-Johnson, the true ratio of that decision was that the storage in that case was no more than ancillary to the company’s trade and that Shiel J did not decide that s.7(1)(f) was only applicable if ‘there is a trade which consists in storage and nothing else’. The words ‘which consists in’ in s.7(1)(f) means he said ‘involves’ .
Judges:
HH Judge Finlay QC
Citations:
(1979) 54 TC 246
Statutes:
Citing:
Explained – Dale (HM Inspector of Taxes) v Johnson Brothers 1951
(Year?) The taxpayer claimed an industrial buildings allowance against his tax liabilities for a warehouse used as storage as a trade in itself. Two thirds of the use was for storage of finished goods awaiting collection or delivery. The taxpayers . .
Cited by:
Wrongly Decided – Revenue and Customs v Maco Door and Window Hardware (Uk) Ltd ChD 19-Jul-2006
The Revenue sought to disallow for industrial buildings allowance sums expended on warehouse premises which were to be used to store window products imported for use in other manufacturing processes.
Held: The Revenue’s appeal succeeded. ‘The . .
Lists of cited by and citing cases may be incomplete.
Landlord and Tenant, Corporation Tax
Updated: 01 May 2022; Ref: scu.244454
