Brewer Greene King could be left crying into its beer when the Upper Tribunal (UT) delivers its judgment later this week over a tax planning scheme designed by the company's auditors Ernst & Young (EY), which is being challenged by HMRC.

The scheme, devised by EY in 2003, involved the group company lending £300m to a subsidiary. The subsidiary receiving the loan could then offset the interest paid on the borrowings against its tax bill. Greene King made a series of complicated transactions, which meant the loan income would not be taxable.

The scheme, called Project Sussex, has already been rejected by the First Tier Tax (FTT) tribunal in a hearing last year and is now subject to an UT appeal which will conclude this week. HMRC's lawyer at the UT described the plan as a 'contrived transaction' and said it was 'blindingly obvious' that its primary purpose was the avoidance of tax.

In an earlier interview with the Guardian, Greene King chief executive Rooney Anand said: 'To accuse Greene King of being corporate tax dodgers a la Starbucks, Google, etc [is] a total surprise and a shock.'

Chris Lee, partner at accountancy firm James Cowper, said: 'The Tax Tribunal has said that Greene King's actions might eventually lead to double taxation. Greene King had no objection to the receipt being untaxed, and the Tribunal's view is that they cannot legitimately complain if a correct interpretation of the law results instead in their paying tax twice.'