The European Commission is taking the Government to court in the escalating row over "booze cruise" penalties against cross-channel shoppers.

The decision came at a meeting of commissioners in Brussels yesterday.

The charge against the Government is of breaching EU rules on the free movement of goods.

It says there are "disproportionate" penalties on consumers bringing cheap alcohol and cigarettes back from the continent in larger quantities than customs officers believe is for their own use.

Penalties imposed by Customs staff at the channel ports include the impounding of cars in some cases and the seizure of goods.

The Treasury, which says it is losing about £3bn a year in lost excise duty revenue, insists the Government is only targeting smugglers evading UK excise duties.

But the commission says innocent shoppers simply enjoying their rights in Europe's single market are being unfairly penalised.

Under EU law, shoppers can buy any amount of drink and cigarettes abroad, excise duty paid, and bring it in to Britain without paying British excise duties as well - as long as it is for private consumption.

The dispute is over the treatment of those who admit to Customs that they are bringing in goods for friends and relatives - in which case UK duty is payable even if no profit is being made.

The commission says that, while seizing property may be justified in some cases of genuine smuggling, it amounts to a "severe and intrusive" sanction when applied to "minor fiscal offences".