The Guardian from London, Greater London, England • 33

THE GUARDIAN Friday February 3 1989 PERSONAL 33 Obituary: William Stephenson Another day Walter Sichel Law Report ClhiuiirclhDDDD's Whole hock VAT errors may be set against future liability Court of Appeal upheld that decision and the taxpayer appealed. February 3, 1918: In spite of the forebodings, the day went off quietly as the Bolsheviks had given in at the last moments and authorized the procession. I went to the Nevsky Prospekt to watch it There was an enormous crowd, in which a lot of men were walking about bareheaded, carrying ikons and singing hymns. The. weather was superb, with that yellow light which is peculiar to this country, and which lights up everything with flashed of gold.

As I watched the procession passing, I had a vision of the old Russia of the past The solemn chanting of the hymns, sung in several parts by the choirs, was a rest from the revolutionary tunes to which we have become accustomed. Banners with a mellow patina and gleams of tarnished gold floated above the heads of the crowd and were a change from the vivid red standards, whose startling colour has for the last year proclaimed itself stridently above the dark mass of the demonstrators and the whiteness of the snow. A lot of people were carrying big Orthodox crosses like those one sees on graves, and at times they were so numerous and so serried that it seemed like a walking graveyard, a dream graveyard with crosses of gold. All this created an impression of strength, the strength of ancient, ignorant Russia, superstitious and formidable. (The Diary of a Diplomat in Russia, by Louis de Robien: Michael Joseph, 1969).

another historian of the spy trade as "the largest integrated intelligence network enterprise in (In 1983, the Americans presented him with the award named after his American counterpart, Bill Donovan, for "distinguished services in the interests of the democratic process and the cause of freedom by the veterans of the Office of Strategic Ian Fleming was one of those who served under him, and there's not much doubt that elements in Bond's makeup were derived from Stephenson, not least his love of fancy gadgetry. This taciturn and wealthy Canadian industrialist a millionaire by the time Churchil appointed him had been a highly decorated fighter pilot in the first world war, with a bag of 26 German planes, and was later a winner of the King's Cup air race. He was also a onetime European lightweight amateur boxing champion (Captain Machine Gun, they called him, for the speed of his punching), and famous or notorious for his vast martinis, served in huge glasses. In 1940, Churchill sent him to America on what was ostensibly a mission to establish an office to protect British shipping. In fact he was put in charge of all Western hemisphere intelligence for the duration of the war.

The phrase "Personal Representative of Winston Churchill" in his Who's Who entry is said to indicate that he served also as the personal wartime go-between of Churchill and Roosevelt. WLW his remarkable wine bottle collection of three centuries. Sichel used to dismiss any question of retiring "I'll drop dead one day" and his Tuesday away from the office was sacred not for leisure but for work with a local colony of mentally retarded children. (To his colleagues' surprise he actually died on holiday, in Switzerland.) His ramrod physique was impeccable to the end. An incisive turn of phrase was softened by a slight German accent.

He took graceful pleasure in well-turned correspondence and a rare ironic smile was conferred on an interviewer who raised a question about a small vintage on the Rhine one year: "No wine merchant has ever perished from lack of wine." House of Lords Commissioners of Customs and Excise Fine Art Developments Pic Before Lord Keith of Kinkel, Lord Templeman, Lord Ackner and Lord Lowry February 2 1989 UNDER the relevant statutory provisions relating to value added tax, a taxpayer who by mistake in an accounting period pays a greater amount of tax than is properly due is entitled to deduct the amount of the excess in computing his liability for a later period. That applies irrespective of whether the overdeclara-tion was made through an error of law or through an error of fact. Th facts The taxpayer, Fine Art Developments Pic, registered for value added tax, carried on the business of manufacturing and distributing greeting cards. The supply of cards to UK customers was a taxable supply, so the taxpayer was liable to charge its customers with VAT and to account for the tax so charged (output tax) to the Commissioners of Customs and Excise. However, under section 14(2) of the Value Added Tax Act 1983 it was entitled to take credit for the tax on the supply to it of goods and services (input tax).

Some customers were not registered for VAT, so that they were not liable for output tax nor in a position to take credit for any input tax. The prices charged to those customers for wholesale supplies of cards were lower than the prices to retail customers. On August 13 1981 the Commissioners served a notice of direction on the taxpayer requiring it to calculate output tax on the open market value of the cards on sale by retail, which was more than the prices charged to the customers. The taxpayer complied, but another taxpayer subject to a similar direction challenged its validity under community law before the Court of Justice for the European Communities: Direct Cosmetics Ltd Customs and Excise Commissioners 1985 2 CMLR 145. As a result of that judgment all notices of direction after July 27 1981 became null and void, including that issued to the taxpayer on August 13 1981.

The taxpayer accounted for VAT in accordance with the notice from August 13 1981 until June 30 1983 and the excess tax paid amounted to 1,399,022. The Commissioners refused to refund that sum. Accordingly the taxpayer in its return for the quarter ended December 31 1985 deducted that sum from the net amount of VAT then due. The Commissioners contended that the amount was irrecoverable as having been made under a mistake of law and requested the payment of the 1,399,022 within seven days. The Commissioners began a High Court action claiming that sum as a debt due to the Crown and obtained summary judgment against the taxpayer.

The WALTER SICHEL. who has died the day after his 83rd birthday, was the father of Blue Nun (a giant step from ordinary Liebfraumilch, according to our wine correspondent). The brand was launched in 1933 but it started to climb only in the 1950s, when the Sichel firm commissioned market research and appointed an agency which sold Blue Nun under the slogan of "Right Through the The llong-running campaign rested nit iho VI mhin nsl witino imimnevi vie frf tc bwirsMK utrK. igitu' uM and embarrassment of British executives, who could be seen puzzling over a wine list to reconcile old sovnd-so's well-cooked tournedos and J.B.'s grilled sole and settling for Blue Nun. CRD.

SICHEL was initially a merchant of finer German wines and remained so for sixty years. Anti-German feeling lingered when he came to Britain in 1928 with his case of sample bottles from the family firm, H.Sichel Sonne of Mainz. Intelligence and vigour apart, he was lucky to have in his luggage Rhine wines of the best year he remembered, 1921. He even sold 3,000 bottles to Frenchmen in a Biarritz hotel, considered as an extraordinary coup back at home in Nierstein. But potential customers in the British provincial trade had to be persuaded to buy German wines whose names they could not hope to spell or pronounce or even fit into a newspaper Deaths Elaine de Kooning, in New York, aged 70: artist and critic, wife of the American abstract painter William de Kooning.

She held professorships in art history at Yale, Pennsylvania and the University of New Mexico, and some of her work is in the Museum of Modern Art and the Guggenheim. She met de Kooning while she was a student and became a pupil of his. They were married in 1943. Walter Sterling Surrey, in Washington, aged 73: international lawyer, adviser to China and other countries on trade laws and treaties, and lately to the USSR Academy of Sciences and the Ministry of Foreign Trade on trade and economic issues between America and the Soviet Union. Starting in the Washington of the New Deal, he finished a decade of government work as chief of the Division of Economic Security Controls and assistant legal adviser at the Department of State.

In 1950 he founded the firm which grew into Surrey Morse, which he headed for 35 years, establishing himself in private practice by defending successfully more than 25 targets of Senator McCarthy's HUAC sub-committee. David Morse, formerly director general of the ILO, joined him in 1970 and the firm expanded to include offices in New York, Paris, London and Saudi Arabia. Walter Surrey was a founder, and later secretary and counsel to the Institute of SIR William Stephenson, the wartime spymaster whom Churchill called has died at the home he retired to in Bermuda, aged 93. He last appeared in the news when he backed Peter Wright's claim that Sir Roger Hollis, the former head of MIS, was a Soviet agent: his wartime deputy, Guy Liddell, had told him so, he said in an interview published in a Ber-mudan newspaper in the summer of 1987, and for that reason he had refused Hollis access to the Soviet defector, Igor Gou-zenko. When Hollis was sent out to Stephenson's headquarters in New York, Stephenson said then, "I had him sent back across the Atlantic on the same US bomber he had arrived on.

He was a bad egg if ever there wds one Fleet Street had almost forgotten this remarkable figure until the publication of a biography (A Man Called Intrepid) in 1976, when Chapman Pincher was moved to call him "the nearest thing to James Bond, Call an and 'M' rolled into (Pincher also, with Lord Mountbatten's aid, questioned, the accuracy of Stephenson's recollection of, among other things, the real motive for the Dieppe raid at which 4,260 Allied troops, most of them Canadian commandoes, lost their lives. Stephenson, himself Canadian, claimed that Churchill went ahead with the raid knowing what the casualties were likely to be in order to demonstrate to the Russians and Americans that to open a second front by invading France in 1942 would have been a suicidal failure.) In fact, the Anglo-American show Stephenson ran in New York, British Security Co-ordination, has been described by Frank Hardie Historic DID Frank Hardie, who has died at the age of 77, suffer in later life from being a marked man because he had been President of the Oxford Union in 1933, when the Union voted "in no circumstance to fight for King and Many of his contemporaries would have predicted a bright future for the shrewd and likeable young man with a first in Modern History from Christ Church, a senior scholarship at Merton, chairmanship of the Labour Club, and presidency of the Union. In fact, he was unable to gain a permanent University post or the seat in Parliament he had hoped and worked for. Eventually after a modest career in industry he retired in his fifties, producing two works of political history The Political History of the British Monarchy, and The Abyssinian Crisis and collaborating with I. Herr-man on a book called Britain andZion.

Quick Crossword Birthdays Jacques Sous telle, the French politician who split with de Gaulle oyer Algeria and planned a party in the hope of providing a meeting ground for "moderate, non-Communist is 77 today. Other birthdays The Earl of Antrim keeper of conservation, Tate Gallery, 54; Shelley Berman, comedienne, 63; Michael Dickinson, racehorse trainer, 39; Lord Fraser of Tullybelton, former Law Lord, 78; Val Doonican, 60, Frankie Vaughan, 61, singers; Morgan Fairchild, actress, 39; Air Chief Marshal Sir John Gingell, Gentleman Usher oi the Black Rod, Serjeant-at-Arms, House of Lords, apd Secretary to the Lord Greaf Chamberlain, 64; Jeremy Kemp, actor, 54; James Michener, author, 82; Bobby Simpson, former Australian Test cricketer, 53; Glen Tetley, ballet director and choreographer, 63. advertisement By chance, the firm had recently had a label designed to give an identity to the vast quantities of wine sold from the cask in German inns. Walter Sichel adopted the pictorial label two nuns in brown habits and came up with "Blue One of the world's best-selling branded wines was born: 24 million bottles are sold annually in 81 countries. As a businessman, he was resolute.

He recalled an Indian prince who bought 800 magnums of very fine old Cognac through Sichel. "We had the greatest difficulty in getting our money and ultimately the floor waiter at the Savoy had to extricate a cheque from the maharajah." One of his few failures were growing grapes and he eventually uprooted his vineyard at his home in Chalfont St Peter. A more reliable pleasure was International Finance, which brought together leading banks to consider solutions to the international debt problem. Sir Arnold Nordmeyer, in Wellington on February 2, aged 87: former New Zealand Labour Party leader, who helped to draft the Social Security Act of 1938, which was a corner-stone of the country's welfare state. It was to preserve welfare programmes at a time of falling export prices that he introduced as Finance Minister in 1958 a budget containing sharp tax increases.

This "Black as it was called, led to a signal defeat in the general election two years later, after which Labour was out of power for twelve years. He was leader of the party from 19635, and retired from politics in 1969. Michael Virally, in Paris on January 29, aged 67: leading international lawyer, arbitrator at the US-Iran Claims Tribunal at the Hague which is dealing with the vast financial disputes between America and Iran left in the wake of the revolution which overthrew the Shah's regime. Virally held several chairs at the university of Geneva, most recently at the Graduate Institute of International Studies, and before that had the chair of International Institutions at the University of Strasbourg. He had been appointed to to the Court of Justice to resolve a border dispute between El Salvador and Honduras.

YOUR POSmON 15 THAT IFITUEFS- TRULY ADDICTIVE; 7HXE-(WMNTB tXJMANYKJXr MeRSMOKBSi rr cayfe To MMOM iT MAV ThdocisSon Lord Keith, with whom the other members of the Committee agreed, said the taxpayer was not entitled to deduct past overpayments of VAT from that currently due unless there was some provision of primary or subordinate legislation which authorised it to do so. It was maintained that such authorisation was to be found in the Value Added Tax (General) Regulations 1985 (SI No 886). The Commissioners contended that the effect of section 14 of the 1983 Act was that for the purposes of accounting for VAT the taxpayer was entitled to credit in any accounting period only for input tax, and that any regulations allowing credit for anything else, in particular for past overdeclara-tions, would be inconsistent with those provisions and thus ultra vires. In his Lordship's opinion the terms of section 14 were not inconsistent with an intention on the part of Parliament that the Commissioners should have pqwer to bring about that past errors, resulting in whatever way, in overdeclarations or underdeclarations of tax should be corrected in subsequent returns. In the ordinary case liability would fall to be estab- lished simply by deducting input tax from output tax, or vice versa, in the current accounting period, and that was what section 14 contemplated.

But paragraph 2(4)(c) of Schedule 7 to the 1985 Regulations gave the Commissioners specific power to make regulations for the correction of errors, and such regulations, when made, took their' place in the Act alongside the provisions of section 14. The prescribed form 4 and paragraphs 63(b) and 64 of the "VAT Guide" issued and revised by the Commissioners from time to time could only be construed as giving a legal right, and indeed imposing an obligation, to make deductions from current liability to VAT in respect of past overdeclarations made in error. No differentiation was made between overdeclarations made through error of law and those made through error of fact. If the Commissioners did not accept that a deduction had been properly made, they could raise an assessment on the taxpayer under paragraph 4(1) of Schedule 7 to the Regulations, and the assessment would be subject to appeal to the VAT tribunal under section 40(lKm) of the Act The appeal was allowed and the action against the taxpayer, was dismissed with costs here and in lower courts. Appearances Andrew Park QC and Robin Mathew instructed by Berrymansfor the taxpayer; John Laws and Robert Jay instructed by the Customs and Ex cise Solicitor jor the Commissioners.

Shlranlkha Herbert barrister 1E17.50 Family I U.i payable to Greenpeace Ltd. 30-31 Isllnolon Green. London NI6BRJ Allen Hall Walter Sichel born January 29, 1906; died January 30. Letter Graham Binns writes: May I add a note to Christopher Driver's appreciation of Thelma Cazalet-Keir? Greece was fighting the Italians on the Albanian front and had pushed them back. The Greeks were at that time (1941) our only allies at arms.

On January 23, 1941, Mrs Cazalet-Keir put a question to the Prime Minister asking "whether he would introduce legislation to restore the Elgin Marbles to Greece after the end of the hostilities as a recognition of the Greeks' magnificent stand for civilisation." Of course attempts had been made to dissuade her from raising the issue, but she would not be put off from doing so. Attlee, deputising for Churchill, procrastinated in his reply, saying, in effect, that this was not the right time for such a decision and that the matter would be given consideration when appropriate. Such consideration as has been given since then has been cold-hearted and singularly lacking in the warmth and generosity of spirit shown by Thelma Cazalet-Keir. Morton da Costa, 74: American director of stage and screen whose greatest coup was The Music Man, produced in 1957, with Robert Preston in the title part. Auntie Mame, Plain and Fancy, and No Time for Sergeants were other successes of his on Broadway.

AND VST IF ITS NOT ADDICTIVE, WHY D0907oOF ALU SMOKERS TODAY SAY 7WV WOULD UKB TO QUIT? OOP? 1 KU3ULD TORN UP MY TOC.fi by BLOOM COUNTY Berke Breathed Sir William (Samuel) Stephenson, born Winnipeg 1896, son of a lumber mill owner; died Bermuda, January 31. debate Lord Longford adds: Most unfairly, public opinion blamed the vote against fighting for King and Country on the President of the Union, who preserved a dignified calm throughout It was an extraordinary occasion. Randolph Churchill came down to Oxford and persuaded me, at that time a young Conservative don, to join him in trying to expunge this resolution from the minutes. The hostility to us was ovemhelrning. Stink bombs rained down from the gallery.

We left the chamber amid boos and hisses, with attempts made to trip us up. The debate did Frank Hardie enormous harm in the long run, but always in later years he preserved the same gentle dignity. He was the model of the old-fashioned, incorruptible liberal man. Frank Hardie died on January 26 5,864 3 Supple (5). 5 Conveyance to guillotine (7).

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5.863 Across: 1 Chrysalis; 8 Vials; 9 Seventh; 10 Red-nosed; 11 Oslo; 13 Hockey; 14 Au pair; 16 Loll; 17 Lucky-dip; 19 Mugshot; 20 Diner; 21 Thereupon. Down: 1 Customer; 2 Russet; 3 Save; 4 Long-standing; 5 School report; 6 Over the limit; 7 Eau de Cologne; 12 Tucked in; 15 Bust-up; 18 Thee. 'li 3 1 4 5 I To" TT 12" 113 I l3" I fig 17 1 18 I 19" 120 I 27" 22" 23 h-jH Doonesbury DAD, ONB OF THE FINDINGS THB INDUSTRY UKSS TO CALL THE FACT 1 THAT THE NICOTINE- IN TO I OArm Kt Slnnir-nic 1 BY GARRY TRUDEAU DOD? RIGHTHERB. I iCDUGHs JUST mn OUT PAP? FOR A SMOKS. poAHYlWHGTo 2 GET ROUNP 1 IMMIGRATION CONTROL! 'd rS.3bl-TWS ONE'S CONCERN I AM ABOMA-FI9E.

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