Judgment summary
This decision concerns an application by Umar Hussain (the Appellant) to reinstate his application for permission to make a late appeal to the Tribunal, after that application had been automatically struck out for failure to comply with an unless order (29 October 2025, 'the Third Unless Order') [1]-[3], [30].
The Tribunal, applying the three-stage Martland test as adapted by Chappell for reinstatement applications, considered the length and seriousness of the delay, the reasons given, and the balance of prejudice to the parties [46]-[48], [49]. It found the delays serious and significant, the Appellant's reasons no longer sufficient to justify continued non-compliance after multiple extensions, and the balance of prejudice favouring HMRC and the efficient conduct of litigation [57], [63], [70]. The Reinstatement Application was refused [71].
Background
The Appellant submitted a notice of appeal on 12 October 2023 including an application for permission to make a late appeal ('the Late Appeal Application') [5]. It was unclear exactly what decision was being appealed, as the notice attached a statement of liabilities of £829,208.08 covering 5 April 2007 to 5 April 2023, which is not an appealable decision [6].
HMRC treated the Late Appeal Application as relating to two view of the matter letters: one dated 18 March 2021 concluding liability of £145,949 income tax and a £43,101 penalty plus statutory interest for tax years ending 5 April 2014 to 5 April 2017 [9], and one dated 24 May 2023 upholding an assessment of £272,560 capital gains tax and a penalty of £181,252.40 for the year ending 5 April 2019 [10]. The appeal to the Tribunal was 908 days late in respect of the first letter and 111 days late in respect of the second [12].
The Tribunal issued directions on 23 May 2024 ('the May 2024 Directions') requiring lists of documents and witness statements by 21 June 2024 [14]-[15]. The Appellant repeatedly failed to comply, citing his daughter's illness, his own health, anxiety and depression, and difficulty obtaining bank documents [16]-[29], [58]. Three unless orders were issued (9 April 2025, 30 May 2025, and 29 October 2025) [23], [25], [28]. Following failure to comply with the Third Unless Order by 28 November 2025, the proceedings were automatically struck out, confirmed by letter of 12 December 2025 [30].
Core dispute
The dispute was whether the Tribunal should exercise its discretion to reinstate the Appellant's Late Appeal Application, which had been automatically struck out for failure to comply with the Third Unless Order [2], [49]. The Appellant relied on his daughter's and his own ill health, the stress caused, and difficulty obtaining bank documents as reasons for his repeated non-compliance [41], [58]. HMRC objected, submitting that there should be no further delays [38], [42].
Court findings
The Tribunal applied the three-stage Martland test as adapted in Chappell for reinstatement applications, considering the seriousness of the breach of the Unless Order (taking account of prior breaches), the reasons for the breach, and all the circumstances including the balance of prejudice [47]-[49].
On length and seriousness, the Tribunal found that by the time of the Third Unless Order the Appellant was 495 days late in complying with the May 2024 Directions, and at the date of the hearing he remained 824 days late with those directions and 299 days late with the Third Unless Order. The Tribunal found the delays serious and significant, suggesting a complete disregard for Tribunal time limits [50]-[57].
On reasons, the Tribunal accepted that the Appellant's daughter's medical condition, including a kidney transplant and subsequent cancer, were genuine and difficult circumstances, and that the Tribunal had been sympathetic in granting generous extensions [59]-[61]. However, the Tribunal found that by the time of the Third Unless Order the Appellant had had ample time, over 17 months, to instruct an accountant or solicitor or otherwise comply, and that the same reasons could not justify repeated non-compliance after multiple generous extensions had already been granted [63].
On all the circumstances, the Tribunal weighed the prejudice to the Appellant of losing the opportunity to pursue his appeal against the need for litigation to be conducted efficiently and at proportionate cost, and the prejudice to HMRC and the public purse [64]-[65]. The Tribunal did not take into account the merits of the underlying appeal, noting it was unclear what the grounds of appeal were [66]. The Tribunal noted the Appellant had still not clarified his grounds of appeal or obtained supporting bank documents despite years of attempts, and was not persuaded he would be able to do so if reinstated [67]-[69].
Outcome
The Tribunal found that the prejudice to the Appellant from refusal was outweighed by the need for compliance with directions and efficient, proportionate litigation. The Reinstatement Application was REFUSED [70]-[71].
Major issues / areas of contention
- Whether the Tribunal should reinstate a Late Appeal Application struck out for breach of an unless order
- Application of the three-stage Martland test as adapted by Chappell to a reinstatement application
- Assessment of the seriousness and length of delay in complying with the May 2024 Directions and three successive unless orders
- Whether the Appellant's reasons (daughter's illness, his own health, difficulty obtaining bank documents) justified continued non-compliance after multiple extensions
- Balancing prejudice to the Appellant against the need for efficient litigation and prejudice to HMRC
- Lack of clarity as to what decision and grounds the Appellant was actually appealing against