1. This appeal is about timelines. It is about whether the appellant complied with Section 51(11) of the Tax Procedures Act which provides that;
“The Commissioner shall make the objection decision within sixty days from the date of receipt of a valid notice of objection failure to which the objection shall be deemed to be allowed.”
2. And what is the import of section 51(3) which provides for the notice: that its shall be treated as validly lodged if;
(a)the notice of objection states precisely the grounds of objection, the amendments required to be made to correct the decision, and the reasons for the amendments;
(b)in relation to an objection to an assessment, the taxpayer has paid the entire amount of tax due under the assessment that is not in dispute or has applied for an extension of time to pay the tax not in dispute under section 33(1); and
3. (c)all the relevant documents relating to the objection have been submitted.
4. The appellant is the Commissioner of Domestic Taxes appointed under section 13 of the Kenya Revenue Authority Act 1995. Under section 5(1) of the Kenya Revenue Authority is an agency of the government for the collection and receipt of all revenue. Further under section 5(2) with respect to the performance of its function under subsection (1) the Authority is mandated to administer and enforce all provisions of the written laws as set out in part 1 and 2 of the first schedule to the Act for the purpose of assessing, collecting and accounting for all revenues in accordance with those laws
5. The Respondent is a private limited company duly incorporated in Kenya and its principal place of business is Meru. Its principal activity is civil and water engineering and general construction works.
6. The Appellant issued the Respondent with VAT additional assessment for the period between December 2017 and December 2019 for total tax of kshs 20, 939, 009. 00 on 13/01/2021. On 02/03/2021, the Respondent applied to the Appellant requesting to be allowed to file a late objection. The acknowledgement of receipt was 3rd March 2021. Through an email dated 15/03/2021, the Appellant acknowledged receipt of the objection but deemed it to be invalid for having not satisfied the requirements of section 51(3) of the Tax Procedures Act (TPA). The Appellant made a demand from the Respondent to provide reasons for the late objection as well as documents in support of the objection within 7 days of the email.
7. Eventually the Appellant reviewed the objection and issued an objection decision on 15/06/2022 where it gave a new tax demand of kshs 11,344, 693 for 2017 and kshs 4,088, 196.40 for 2019. Aggrieved by that decision, the Respondent filed an appeal at the Tribunal.
Appeal before the Tax Appeals Tribunal
8. The Respondent (Appellant in the Tribunal) raised the following grounds;
a) The Commissioner erred in law and fact by arbitrarily and retroactively imposing VAT on the variance found between the income tax and VAT declared resulting to higher taxation and applied it retrospectively to the Appellant’s detriment.
b) The Respondent breached the Appellant’s right of certainty and regularity of law. The Appellant correctly relied on legitimate expectation and correctly conducted its affairs by correctly declaring its actual income in the IT2C and VAT.
c) The Commissioner opted to punish the Appellant for declaring its actual income and therefore the impugned demand by the Respondent is contrary to the settled law and facts therefore suffering from serious legal infirmity.
d) The Respondent violated the Appellant’s right to fair administrative action and natural justice by summarily and arbitrarily issuing and enforcing the assessment without affording them any reasonable opportunity to be heard on the demanded taxes as by law required.
9. The Tribunal found merit in the appeal and gave the following orders;
10. The Tribunal found that their palant who was the respondent therein had indicated that the time had begun running on the 6th of May 2022 and not on the second of March 2021 The reason for this was that the 6th of May was the last date when it made a request to their appellant to supply some specific documents According to the appellant this was supported by section 5111 B of the tax procedures act However the Tribunal did not find Any correspondence exchange between the parties subsequent to the email Of 15th March 2021 and prior to the issuance of the objection decision Dated 15th June 2022 And no such correspondence was availed to the tribunal.
11. Citing WEC Lines Limited versus the Commissioner Of Domestic Taxes T AT case no.247 of 2020 where the court stated
The existence of strict timelines in taxation matters is to ensure certainty and predictability in matters revenue and finance. The government revenue must be collected timeously and the tax payer must know his/her liability at the earliest for planning purposes. In this regard, the Tribunal erred in entertaining the fact that the assessment stood yet the objection had succeeded by operation of law.
12. And where it reiterated the holding in Krystalline Salt Limited vs KRA [2019] eKLR
“Where there is a clear procedure for redress of any particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed. Accordingly, the special procedure provided by any law must be strictly adhered to since there are good reasons for such special procedures. The relevant procedure here is the process of opposing an assessment by the Commissioner.”
The Tribunal found that the appeal had no merit and made the following orders:
a) The Appeal be and is hereby allowed.
b) The objection decision dated 15th June 2022 be and is hereby set aside.
c) Each party to bear its own costs.
13. Aggrieved by that judgment, the Appellant filed this appeal vide the Memorandum of Appeal dated 10/11/2023, onthe following grounds;
a) The Honourable Tribunal erred in law and fact by holding that the Appellant’s objection decision dated 15th June 2022 was not valid.
b) The Honourable Tribunal erred in law by failing to consider the Appellant’s case on merit.
c) The Honourable Tribunal misdirected itself on both facts and law, and thereby arrived at wrong, erroneous and absurd findings/decision.
14. Directions were given that the appeal be canvassed through written submissions and the only submissions on record are for the Appellant.
Appellant’s Submissions
15. The Appellant submitted that a review of the Individual withholding VAT certificates, withholding Income Tax certificates and the Appellant’s sales ledger, revealed the following discrepancies;
Timing differences
a) There were timing differences between the date an invoice was issued and declared versus the payment and the corresponding Withholding VAT was deducted. The Respondent also lumped sales in their VAT declarations and thus their sales ledger was used to establish the individual invoices declared monthly.
Undeclared sales
b) It was noted the Respondent failed to declare an invoice issued to Nkabune Technical Training Institute of amount KShs. 51,379,949.00 which the Appellant charged to tax.
c) It was also noted that the Respondent partially declared an invoice issued to National Irrigation Authority of amount 25,821,510.00 with the undeclared amount being KShs. 22,413,358.00 which the Appellant charged to tax.
d) The Respondent was providing records in piecemeal as they had let go of their Nairobi office and most of the requested documents had been archived.
e) The last document was received on 6th May 2022 and Objection decision issued 15th June 2022. The assessment was confirmed on 13th January, 2021 by the Appellant.
f) The Respondent lodged a late objection on 3rd March 2021 against VAT assessments raised on 13th January 2021.
g) On 15th March 2021 the Appellant requested supporting documents for the late objection and sent a reminder on 19th March 2021. The late objection acceptance letter was issued on 20th March 2022 and all relevant supporting documents for review of objection requested in the same letter.
h) A reminder was sent on 5th May 2021 and the Respondent provided documents on various dates from 24th May 2021 with the last document being received on 6th May 2022.
i) The Objection decision was issued thereafter on 15th June 2022.
16. The Appellant identified the issues for determination to be;
a) Whether the Objection decision was issued out of time.
b) Whether the assessment was correctly raised.
17. On whether the objection decision was issued out of time, it was submitted that the Finance Act 2022 introduced an amendment to Section 51 (11) of the Tax Procedure Act which requires the Appellant to issue an objection decision within sixty (60) days from the date of receipt of a valid objection and receipt of further information after receipt of the objection. Reliance was placed on Samuel Kamau Macharia & another -vs- Kenya Commercial Bank Limited & 2 others [2012] eKLR where the Supreme Court of Kenya stated that;
“(61) As for non-criminal legislation, the general rule is that all statutes other than those which are merely declaratory or which relate only to matters of procedure or evidence are prima facie prospective, and retrospective effect is not to be given to them unless, by express words or necessary implication, it appears that this was the intention of the legislature.”
18. It was submitted that upon receipt of the last document on 6th May 2021, the Appellant issued its decision on 15th June 2021 within the timelines as provided by law. That, the law applicable as at the date of issuing the Objection decision is the law that required the Appellant to issue the Objection decision within sixty (60) days of receipt of notice of objection and/or further information. That the sixty (60) days within which the decision ought to have been issued started running on 6th May 2021 when the Appellant received the further information from the Respondent. That, the Objection decision was issued on 15th June 2021 which is forty-one (41) days after receipt of the information and it was therefore issued within time.
19. Consequently, it was submitted that the Tribunal erred in law and fact in not considering when the last information was received and on that ground the Appeal should succeed.
20. On whether the assessment was correctly raised, it was submitted that the failure to object as required means that the taxes as demanded cannot be amended. Reliance was placed on Mohamed Ali t/a Top Model Apparels & 44 others -vs- Kenya Revenue Authority [2020] eKLR where it was stated that:
“48. Section 31(4) of the TPA provides the circumstances under which the Commissioner may amend a taxpayer’s tax assessment as follows:
“(4) The Commissioner may amend an assessment—
(a) in the case of gross or wilful neglect, evasion, or fraud by, or on behalf of, the taxpayer, at any time; or
(b) in any other case, within five years of—
(i) for a self-assessment, the date that the self-assessment taxpayer submitted the self-assessment return to which the self-assessment relates; or
(ii) for any other assessment, the date the Commissioner notified the taxpayer of the assessment.”
49. Upon carrying out the amendment, the Commissioner is required by Section 31(8) of the TPA to take the following steps:
“(8) When the Commissioner has made an amended assessment, he or she shall notify the taxpayer in writing of the amended assessment and specify;
(a) the amount assessed as tax or the deficit or excess input tax carried forward, as the case may be;
(b) any amount assessed as late payment penalty payable in respect of the tax assessed;
(c) any amount of late payment interest payable in respect of the tax assessed;
(d) the reporting period to which the assessment relates;
(e) the due date for payment of any tax, penalty or interest being a date that is not less than thirty days from the date the taxpayer received the notice; and
(f) the manner of objecting to the assessment.”
…………………………….
55. A perusal of the pleadings disclose that the Respondent called in the petitioners and confronted them with the allegations that they were involved in a tax evasion scheme. Mr Mohammed Hussein Ali in the affidavit sworn on 15th October, 2018 in support of the amended petition does indeed confirm that he was summoned several times by the Respondent’s officers and confronted with allegations of tax evasion and given the opportunity to provide documents to prove otherwise. Although the director of the 1st to 17th petitioners view the summonses as harassment and intimidation, the evidence gleaned from the pleadings show that the petitioners were accorded an opportunity to dispute the allegations of tax fraud.”
21. It was submitted that the Appellant bent over backwards to accommodate and reach the Respondent who remained difficult and unresponsive through the process. That, the Respondent was so reluctant to provide documents and when she did, the Appellant issued its decision within timelines. Reliance was placed on Oliver Merrick Fowler & another v Kenya Revenue Authority [2022] eKLR which quoted Saima Khalid vs The Commissioner for Her Majesty’s Revenue and Customs- Appeal No. TC/2017/02292 as follows;
“…The very use of the word ‘judgement makes it clear that the commissioners are required to exercise their power in such a way that they make a value judgement on the material which is before them… What the words ‘best of their judgement’ envisage, in my view is that the commissioners will fairly consider all material placed before them, and on that material come to decision which is one which is reasonable and not arbitrary as to the amount of tax which is due.”
22. It was submitted that the Appellant is mandated to use the available information and its best judgment to issue an additional assessment where income has been under declared or taxes not withheld or paid to ensure that the correct amount of tax has been paid. That, the Tribunal erred in failing to consider that the last document in this case was received on 6th May 2021 and should have decided the case on its merits as the objection decision was within timelines. It was contended that the objection decision before this court and before the Tribunal is valid hence this Appeal should be allowed and the matter be referred back to the Tax Appeals Tribunal for hearing and determination on merit.
Duty of Court
23. Section 56(2) of the Tax Procedures Act provides that an appeal to the High Court from the decision of the Tax Appeals Tribunal or to the Court of Appeal is on a question of law only. In John Munuve Mati -vs- Returning Officer Mwingi North Constituency & 2 others [2018] eKLR, the Court of Appeal summarized what amounts to “matters of law” as follows;
“The interpretation or construction of the Constitution, statute or regulations made thereunder or their application to the sets of facts established by the trial Court. As far as facts are concerned, our engagement with them is limited to background and context and to satisfy ourselves, when the issue is raised, whether the conclusions of the trial judge are based on the evidence on record or whether they are so perverse that no reasonable tribunal would have arrived at them. We cannot be drawn into considerations of the credibility of witnesses or which witnesses are more believable than others; by law that is the province of the trial court.”
24. I have carefully considered the grounds of appeal, the statement of facts, the submissions and entire record. The issue of law for determination is whether the Appellant’s objection decision dated 15th June 2022 was issued within the prescribed timelines.
Analysis & Determination
Whether the Appellant’s objection decision dated 15th June 2022 was issued within the prescribed timelines.
25. The provisions of s. 51(11) of the TPA give the Commissioner 60 days from the date of receipt of a valid notice of objection to make the decision. Failure to do so the objection shall be deemed to be allowed.
26. Section 51(11) of the TPA provides that; “The Commissioner shall make the objection decision within sixty days from the date
27. There is no issue as to the validity of the notice. The Commissioner issued a decision hence the presumption is that the Commissioner considered that the objection as filed was valid as required by s. 51(3) of te TPA
(a)the notice of objection states precisely the grounds of objection, the amendments required to be made to correct the decision, and the reasons for the amendments;
(b)in relation to an objection to an assessment, the taxpayer has paid the entire amount of tax due under the assessment that is not in dispute or has applied for an extension of time to pay the tax not in dispute under section 33(1); and
(c)all the relevant documents relating to the objection have been submitted.
28. The Appellant’s argument that the 60-day period did not start to run on 02/03/2021 but on 06/05/2022 is premised on the argument that there was exchange of correspondence in culminating in the last document being furnished on the 06/05/2022. However, even upon my perusal of the record I found no such evidence.
The requirements under section 51(3) of the TPA are conjunctive hence they should all be fulfilled for a notice of objection to be valid. The onus was upon the Appellant to prove this facts
29. Section 109 of the Evidence Act provides that; ‘The burden of proof as to any particular fact lies on the person who wishes the Court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.’
30. There was no s no correspondence whether electronic or physical placed before the Tribunal of this court to support the averment.
31. The only evidence of time that is on record is the email dated 15th March 2021 demanding further documents from the Appellant within 7 days .
32. . I am persuaded to agree with WEC and Kyrstalline above, on procedural times lines.
33. I also found that no evidence was placed before the Tribunal to show that the appellant had indeed sought the alleged information and that there had been a delay on the part of the Respondent.
34. The provisions of Section 51(11) of the TPA provides that on time time began running on 3rd March 2021 and ran out in June 2021. The decision of June 2022 was way out of time.
35. I find that the appeal has no merit. There was no error on the part of the tribunal. The holding of the tribunal is upheld.
36. The appeal is dismissed with costs to the respondent.
37. Orders accordingly
Dated signed and delivered via CTS this 8th August 2025
Mumbua T Matheka
Judge
“The Commissioner shall make the objection decision within sixty days from the date of receipt of a valid notice of objection failure to which the objection shall be deemed to be allowed.”
2. And what is the import of section 51(3) which provides for the notice: that its shall be treated as validly lodged if;
(a)the notice of objection states precisely the grounds of objection, the amendments required to be made to correct the decision, and the reasons for the amendments;
(b)in relation to an objection to an assessment, the taxpayer has paid the entire amount of tax due under the assessment that is not in dispute or has applied for an extension of time to pay the tax not in dispute under section 33(1); and
3. (c)all the relevant documents relating to the objection have been submitted.
4. The appellant is the Commissioner of Domestic Taxes appointed under section 13 of the Kenya Revenue Authority Act 1995. Under section 5(1) of the Kenya Revenue Authority is an agency of the government for the collection and receipt of all revenue. Further under section 5(2) with respect to the performance of its function under subsection (1) the Authority is mandated to administer and enforce all provisions of the written laws as set out in part 1 and 2 of the first schedule to the Act for the purpose of assessing, collecting and accounting for all revenues in accordance with those laws
5. The Respondent is a private limited company duly incorporated in Kenya and its principal place of business is Meru. Its principal activity is civil and water engineering and general construction works.
6. The Appellant issued the Respondent with VAT additional assessment for the period between December 2017 and December 2019 for total tax of kshs 20, 939, 009. 00 on 13/01/2021. On 02/03/2021, the Respondent applied to the Appellant requesting to be allowed to file a late objection. The acknowledgement of receipt was 3rd March 2021. Through an email dated 15/03/2021, the Appellant acknowledged receipt of the objection but deemed it to be invalid for having not satisfied the requirements of section 51(3) of the Tax Procedures Act (TPA). The Appellant made a demand from the Respondent to provide reasons for the late objection as well as documents in support of the objection within 7 days of the email.
7. Eventually the Appellant reviewed the objection and issued an objection decision on 15/06/2022 where it gave a new tax demand of kshs 11,344, 693 for 2017 and kshs 4,088, 196.40 for 2019. Aggrieved by that decision, the Respondent filed an appeal at the Tribunal.
Appeal before the Tax Appeals Tribunal
8. The Respondent (Appellant in the Tribunal) raised the following grounds;
a) The Commissioner erred in law and fact by arbitrarily and retroactively imposing VAT on the variance found between the income tax and VAT declared resulting to higher taxation and applied it retrospectively to the Appellant’s detriment.
b) The Respondent breached the Appellant’s right of certainty and regularity of law. The Appellant correctly relied on legitimate expectation and correctly conducted its affairs by correctly declaring its actual income in the IT2C and VAT.
c) The Commissioner opted to punish the Appellant for declaring its actual income and therefore the impugned demand by the Respondent is contrary to the settled law and facts therefore suffering from serious legal infirmity.
d) The Respondent violated the Appellant’s right to fair administrative action and natural justice by summarily and arbitrarily issuing and enforcing the assessment without affording them any reasonable opportunity to be heard on the demanded taxes as by law required.
9. The Tribunal found merit in the appeal and gave the following orders;
10. The Tribunal found that their palant who was the respondent therein had indicated that the time had begun running on the 6th of May 2022 and not on the second of March 2021 The reason for this was that the 6th of May was the last date when it made a request to their appellant to supply some specific documents According to the appellant this was supported by section 5111 B of the tax procedures act However the Tribunal did not find Any correspondence exchange between the parties subsequent to the email Of 15th March 2021 and prior to the issuance of the objection decision Dated 15th June 2022 And no such correspondence was availed to the tribunal.
11. Citing WEC Lines Limited versus the Commissioner Of Domestic Taxes T AT case no.247 of 2020 where the court stated
The existence of strict timelines in taxation matters is to ensure certainty and predictability in matters revenue and finance. The government revenue must be collected timeously and the tax payer must know his/her liability at the earliest for planning purposes. In this regard, the Tribunal erred in entertaining the fact that the assessment stood yet the objection had succeeded by operation of law.
12. And where it reiterated the holding in Krystalline Salt Limited vs KRA [2019] eKLR
“Where there is a clear procedure for redress of any particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed. Accordingly, the special procedure provided by any law must be strictly adhered to since there are good reasons for such special procedures. The relevant procedure here is the process of opposing an assessment by the Commissioner.”
The Tribunal found that the appeal had no merit and made the following orders:
a) The Appeal be and is hereby allowed.
b) The objection decision dated 15th June 2022 be and is hereby set aside.
c) Each party to bear its own costs.
13. Aggrieved by that judgment, the Appellant filed this appeal vide the Memorandum of Appeal dated 10/11/2023, onthe following grounds;
a) The Honourable Tribunal erred in law and fact by holding that the Appellant’s objection decision dated 15th June 2022 was not valid.
b) The Honourable Tribunal erred in law by failing to consider the Appellant’s case on merit.
c) The Honourable Tribunal misdirected itself on both facts and law, and thereby arrived at wrong, erroneous and absurd findings/decision.
14. Directions were given that the appeal be canvassed through written submissions and the only submissions on record are for the Appellant.
Appellant’s Submissions
15. The Appellant submitted that a review of the Individual withholding VAT certificates, withholding Income Tax certificates and the Appellant’s sales ledger, revealed the following discrepancies;
Timing differences
a) There were timing differences between the date an invoice was issued and declared versus the payment and the corresponding Withholding VAT was deducted. The Respondent also lumped sales in their VAT declarations and thus their sales ledger was used to establish the individual invoices declared monthly.
Undeclared sales
b) It was noted the Respondent failed to declare an invoice issued to Nkabune Technical Training Institute of amount KShs. 51,379,949.00 which the Appellant charged to tax.
c) It was also noted that the Respondent partially declared an invoice issued to National Irrigation Authority of amount 25,821,510.00 with the undeclared amount being KShs. 22,413,358.00 which the Appellant charged to tax.
d) The Respondent was providing records in piecemeal as they had let go of their Nairobi office and most of the requested documents had been archived.
e) The last document was received on 6th May 2022 and Objection decision issued 15th June 2022. The assessment was confirmed on 13th January, 2021 by the Appellant.
f) The Respondent lodged a late objection on 3rd March 2021 against VAT assessments raised on 13th January 2021.
g) On 15th March 2021 the Appellant requested supporting documents for the late objection and sent a reminder on 19th March 2021. The late objection acceptance letter was issued on 20th March 2022 and all relevant supporting documents for review of objection requested in the same letter.
h) A reminder was sent on 5th May 2021 and the Respondent provided documents on various dates from 24th May 2021 with the last document being received on 6th May 2022.
i) The Objection decision was issued thereafter on 15th June 2022.
16. The Appellant identified the issues for determination to be;
a) Whether the Objection decision was issued out of time.
b) Whether the assessment was correctly raised.
17. On whether the objection decision was issued out of time, it was submitted that the Finance Act 2022 introduced an amendment to Section 51 (11) of the Tax Procedure Act which requires the Appellant to issue an objection decision within sixty (60) days from the date of receipt of a valid objection and receipt of further information after receipt of the objection. Reliance was placed on Samuel Kamau Macharia & another -vs- Kenya Commercial Bank Limited & 2 others [2012] eKLR where the Supreme Court of Kenya stated that;
“(61) As for non-criminal legislation, the general rule is that all statutes other than those which are merely declaratory or which relate only to matters of procedure or evidence are prima facie prospective, and retrospective effect is not to be given to them unless, by express words or necessary implication, it appears that this was the intention of the legislature.”
18. It was submitted that upon receipt of the last document on 6th May 2021, the Appellant issued its decision on 15th June 2021 within the timelines as provided by law. That, the law applicable as at the date of issuing the Objection decision is the law that required the Appellant to issue the Objection decision within sixty (60) days of receipt of notice of objection and/or further information. That the sixty (60) days within which the decision ought to have been issued started running on 6th May 2021 when the Appellant received the further information from the Respondent. That, the Objection decision was issued on 15th June 2021 which is forty-one (41) days after receipt of the information and it was therefore issued within time.
19. Consequently, it was submitted that the Tribunal erred in law and fact in not considering when the last information was received and on that ground the Appeal should succeed.
20. On whether the assessment was correctly raised, it was submitted that the failure to object as required means that the taxes as demanded cannot be amended. Reliance was placed on Mohamed Ali t/a Top Model Apparels & 44 others -vs- Kenya Revenue Authority [2020] eKLR where it was stated that:
“48. Section 31(4) of the TPA provides the circumstances under which the Commissioner may amend a taxpayer’s tax assessment as follows:
“(4) The Commissioner may amend an assessment—
(a) in the case of gross or wilful neglect, evasion, or fraud by, or on behalf of, the taxpayer, at any time; or
(b) in any other case, within five years of—
(i) for a self-assessment, the date that the self-assessment taxpayer submitted the self-assessment return to which the self-assessment relates; or
(ii) for any other assessment, the date the Commissioner notified the taxpayer of the assessment.”
49. Upon carrying out the amendment, the Commissioner is required by Section 31(8) of the TPA to take the following steps:
“(8) When the Commissioner has made an amended assessment, he or she shall notify the taxpayer in writing of the amended assessment and specify;
(a) the amount assessed as tax or the deficit or excess input tax carried forward, as the case may be;
(b) any amount assessed as late payment penalty payable in respect of the tax assessed;
(c) any amount of late payment interest payable in respect of the tax assessed;
(d) the reporting period to which the assessment relates;
(e) the due date for payment of any tax, penalty or interest being a date that is not less than thirty days from the date the taxpayer received the notice; and
(f) the manner of objecting to the assessment.”
…………………………….
55. A perusal of the pleadings disclose that the Respondent called in the petitioners and confronted them with the allegations that they were involved in a tax evasion scheme. Mr Mohammed Hussein Ali in the affidavit sworn on 15th October, 2018 in support of the amended petition does indeed confirm that he was summoned several times by the Respondent’s officers and confronted with allegations of tax evasion and given the opportunity to provide documents to prove otherwise. Although the director of the 1st to 17th petitioners view the summonses as harassment and intimidation, the evidence gleaned from the pleadings show that the petitioners were accorded an opportunity to dispute the allegations of tax fraud.”
21. It was submitted that the Appellant bent over backwards to accommodate and reach the Respondent who remained difficult and unresponsive through the process. That, the Respondent was so reluctant to provide documents and when she did, the Appellant issued its decision within timelines. Reliance was placed on Oliver Merrick Fowler & another v Kenya Revenue Authority [2022] eKLR which quoted Saima Khalid vs The Commissioner for Her Majesty’s Revenue and Customs- Appeal No. TC/2017/02292 as follows;
“…The very use of the word ‘judgement makes it clear that the commissioners are required to exercise their power in such a way that they make a value judgement on the material which is before them… What the words ‘best of their judgement’ envisage, in my view is that the commissioners will fairly consider all material placed before them, and on that material come to decision which is one which is reasonable and not arbitrary as to the amount of tax which is due.”
22. It was submitted that the Appellant is mandated to use the available information and its best judgment to issue an additional assessment where income has been under declared or taxes not withheld or paid to ensure that the correct amount of tax has been paid. That, the Tribunal erred in failing to consider that the last document in this case was received on 6th May 2021 and should have decided the case on its merits as the objection decision was within timelines. It was contended that the objection decision before this court and before the Tribunal is valid hence this Appeal should be allowed and the matter be referred back to the Tax Appeals Tribunal for hearing and determination on merit.
Duty of Court
23. Section 56(2) of the Tax Procedures Act provides that an appeal to the High Court from the decision of the Tax Appeals Tribunal or to the Court of Appeal is on a question of law only. In John Munuve Mati -vs- Returning Officer Mwingi North Constituency & 2 others [2018] eKLR, the Court of Appeal summarized what amounts to “matters of law” as follows;
“The interpretation or construction of the Constitution, statute or regulations made thereunder or their application to the sets of facts established by the trial Court. As far as facts are concerned, our engagement with them is limited to background and context and to satisfy ourselves, when the issue is raised, whether the conclusions of the trial judge are based on the evidence on record or whether they are so perverse that no reasonable tribunal would have arrived at them. We cannot be drawn into considerations of the credibility of witnesses or which witnesses are more believable than others; by law that is the province of the trial court.”
24. I have carefully considered the grounds of appeal, the statement of facts, the submissions and entire record. The issue of law for determination is whether the Appellant’s objection decision dated 15th June 2022 was issued within the prescribed timelines.
Analysis & Determination
Whether the Appellant’s objection decision dated 15th June 2022 was issued within the prescribed timelines.
25. The provisions of s. 51(11) of the TPA give the Commissioner 60 days from the date of receipt of a valid notice of objection to make the decision. Failure to do so the objection shall be deemed to be allowed.
26. Section 51(11) of the TPA provides that; “The Commissioner shall make the objection decision within sixty days from the date
27. There is no issue as to the validity of the notice. The Commissioner issued a decision hence the presumption is that the Commissioner considered that the objection as filed was valid as required by s. 51(3) of te TPA
(a)the notice of objection states precisely the grounds of objection, the amendments required to be made to correct the decision, and the reasons for the amendments;
(b)in relation to an objection to an assessment, the taxpayer has paid the entire amount of tax due under the assessment that is not in dispute or has applied for an extension of time to pay the tax not in dispute under section 33(1); and
(c)all the relevant documents relating to the objection have been submitted.
28. The Appellant’s argument that the 60-day period did not start to run on 02/03/2021 but on 06/05/2022 is premised on the argument that there was exchange of correspondence in culminating in the last document being furnished on the 06/05/2022. However, even upon my perusal of the record I found no such evidence.
The requirements under section 51(3) of the TPA are conjunctive hence they should all be fulfilled for a notice of objection to be valid. The onus was upon the Appellant to prove this facts
29. Section 109 of the Evidence Act provides that; ‘The burden of proof as to any particular fact lies on the person who wishes the Court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.’
30. There was no s no correspondence whether electronic or physical placed before the Tribunal of this court to support the averment.
31. The only evidence of time that is on record is the email dated 15th March 2021 demanding further documents from the Appellant within 7 days .
32. . I am persuaded to agree with WEC and Kyrstalline above, on procedural times lines.
33. I also found that no evidence was placed before the Tribunal to show that the appellant had indeed sought the alleged information and that there had been a delay on the part of the Respondent.
34. The provisions of Section 51(11) of the TPA provides that on time time began running on 3rd March 2021 and ran out in June 2021. The decision of June 2022 was way out of time.
35. I find that the appeal has no merit. There was no error on the part of the tribunal. The holding of the tribunal is upheld.
36. The appeal is dismissed with costs to the respondent.
37. Orders accordingly
Dated signed and delivered via CTS this 8th August 2025
Mumbua T Matheka
Judge