The final battle in the David and Goliath struggle between a small manufacturer and the Inland Revenue ended yesterday - with a big win for the little guy. The Privy Council in London ruled Dr Henry Yu Tat-ching did not have to pay employee severance tax when he shut his Hong Kong factory in 1990-91. But the landmark decision in favour of Dr Yu's company, Cosmotorn Manufacturing, could cost the Government up to $450 million a year in lost revenue. 'Our seven-year struggle with the Commissioner of Inland Revenue has come to an end,' Dr Yu said. The 65-year-old engineer single-handedly battled the Government through two tax tribunals, the High Court and the Court of Appeal, before being forced to the Privy Council by the Hong Kong Government. With no legal training, he won each leg of the battle. Dr Yu's father founded the stainless steel firm in 1929, but rising costs drove it to move over the border. The Government claimed Dr Yu owed severance tax of $157,914 for his 123 workers. The ruling means the Government can no longer collect tax under Section 16 (1) of the Inland Revenue Ordinance.