RevenueValue added tax - supply of goods or services - video cassettes sold for 20 each - customer entitled to return video and obtain new video for 10 - VAT payable on 20Commissioners of Customs and Excise v Bugeja: CA (Lords Justice Aldous, Chadwick and Sedley): 26 October 2001The vendor sold video cassettes for 20 each.

But he would accept a cassette previously sold by him in part exchange.

In such a case the amount paid by the customer, in addition to the return of the cassette previously sold, was 10.

The Customs and Excise assessed the VAT on the basis that the taxable amount in respect of each supply was 20.The vendor contended that the taxable amount where a cassette was taken in part exchange was only 10.

Mr Justice Carnwath dismissed the commissioners' appeal from a decision of a VAT tribunal that the taxable amount for a cassette taken in part exchange was 10 and not 20.

The commissioners appealed.Philippa Whipple (instructed by Solicitor, Customs and Excise) for the commissioners.

James Henderson (instructed by Roodyn Manski) for the vendor.Held, allowing the appeal, that the true analysis of the transaction was that the consideration for the supply of the replacement video comprised in part money (10) and in part goods (the return of the video previously sold); that the relevant question was what was the monetary equivalent of the non-monetary element of the consideration provided by the customer in the context of the transaction which actually took place; and that the only conclusion was that both the vendor and his customer treated the returned video as having a value equal to the difference between the sale price of 20 and the part exchange of 10.