' Introduction
1. This appeal arises from the judgment of the Tax Appeals Tribunal (the Tribunal) delivered on 17th January 2025 in Tax Appeal No. E672 of 2023, in which the Tribunal struck out the Appellant’s appeal on grounds that it was lodged in breach of Sections 229(1) and 230 of the East African Community Customs Management Act, 2004 (EACCMA).
2. The Tribunal in the said judgment also upheld the customs duties uplift in the sum of Kshs. 3, 112,231 by the Respondent (Commissioner) on account of what the Commissioner alleged to be a tariff misdeclaration by the Appellant.
Background
3. The factual background of the dispute is that on 18th September 2023 the Appellant imported five chemical components used in the manufacture of mattress under Import Entry No. 23EMKIM4010006729, namely: NIAX Silicone L-580 and NIAX Silicone L-618 both classified under HS Code 3910.00.00; SO NIAX Stannous Octoate declared under HS Code 2915.90.00; A33 NIAX Amine Catalyst declared under HS Code 3824.99.90; and NIAX Processing Additive DP-1022 declared under HS Code 2915.90.00.
4. Upon verification of the consignment, the Respondent, on 20th September 2023, in the exercise of its statutory powers, reclassified the goods and raised additional taxes. The Respondent contended that the Appellant had incorrectly classified the goods for customs purposes. The Respondent therefore reclassified the goods as follows: -
i. NIAX Silicone L-580 and NIAX Silicone L-618, declared under HS Code 3910.00.00, were reclassified under HS Code 3402.90.00.
ii. A33 NIAX Amine Catalyst, declared under HS Code 3824.99.90, was reclassified under HS Code 3815.90.00.
iii. NIAX Processing Additive DP-1022, declared under HS Code 2915.90.00, was reclassified under HS Code 3824.99.90.
5. As a result of the tariff reclassification by the Respondent, additional taxes in the sum of Kshs. 3, 112,231 was raised and demanded by the Respondent from the Appellant.
6. A dispute that ensued on the tariff classification between the parties was thereafter referred to the Tribunal by the Appellant. The Respondent raised a preliminary objection on the competence of the appeal at the Tribunal, arguing that the appeal was premature since np review application had been made by the Appellant within the timelines specified under 229(1) of the EACCMA, 2004. The Appellant, on the other hand, argued that the appeal was properly before the Tribunal.
7. On 17th January 2025, the Tribunal delivered its judgment and dismissed the Appeal, upholding the Respondent’s argument that the appeal had been filed in contravention of Section 229(1) of the Act. Specifically, the Tribunal found that the Appellant had proceeded to the Tribunal without first filing a review application under the Act.
The Appeal
8. Aggrieved by the Tribunal’s decision, the Appellant appealed to this Court vide its memorandum of appeal dated 29th January 2025, raising some eight (8) grounds of appeal. The core of the Appellant’s appeal is that the Tribunal erred at Paragraphs 48, 52, 53, and 54 of the judgment in stating that the Appellant failed to comply with section 229(1) of EACCMA, 2004.
9. The Appellant asserted that the Tribunal erred both in law and in fact at paragraphs 55 and 56 of its judgment, when it totally ignored the Appellant’s letter dated 4th May 2023, which disputed the tariff classification (HS Code 3402.90.00) by the Respondent regarding the goods in question.
10. The Appellant also contended that the Tribunal failed to hear and determine its urgent application dated 12th October 2023, in which it had sought release of the consignment under Section 122(3) pending resolution of the tariff dispute, thereby occasioning a miscarriage of justice.
11. The Respondent opposed the appeal vide her Statement of Facts (SoF) dated 16th April 2025. The Respondent’s position, as expressed in the SoF, is that the Tribunal was right in its decision striking out the appeal.
12. The Respondent maintained that the Tribunal was right since the Appellant had not applied for a Review of the Commissioner’s decision before lodging the appeal to the Tax Appeals Tribunal, contrary to the express provisions of Section 129(1) of the EACCMA, 2004.
13. According to the Respondent, the Appellant had on 18th September 2023 imported a consignment of silicone L580 and L618 and declared them under HS Code 3910.00.00 contrary to prior tariff classification ruling of 16th May 2023 by the Respondent which had placed the goods under HS Code 3402.90.00, hence the reclassification.
14. The Appeal was canvassed by way of written submissions. The Appellant, through the law firm of MKAN & Company Advocates, filed their submissions dated 26th June 2025, whilst the Respondent, through Triza Nyakundi, filed its submissions dated 4th July 2025.
Appellant’s Submissions
15. The Appellant submitted that the Tribunal’s finding was erroneous since the Appellant had by its letter dated 29th September 2023, objected to the Respondent’s reclassification of the goods in line with Section 229(1) and (2) of the EACCMA, 2004. The Appellant therefore asserted that contrary to the Tribunal’s findings, its appeal to the Tribunal was competent.
16. According to the Appellant, the Respondent retrospectively reclassified the goods on the basis of tariff ruling letters dated 16th May 2023, which were only disclosed to it on 28th September 2023. The Appellant asserted that its letter of objection dated letter of 29th September 2023 was well within the 30 days timeline provided under Section 229(1) and (2) of the EACCMA, 2004 and that the Tribunal therefore erred in holding otherwise.
17. The Appellant further argued that the Respondent failed to render such a decision on the Appellant’s Objection to the Tariff Classification with the thirty (30) days permitted under Section 229(4) and (5) of the Act which obliges the Commissioner to communicate a decision within thirty (30) days. In default, the law deems the application allowed. Reliance was placed on Republic v Kenya Revenue Authority Ex parte M-Kopa Kenya Ltd [2022] eKLR.
18. The Appellant further contended that the Respondent’s conduct of reclassification of the goods without prior notice and failure to communicate a decision in goods time constituted unfair administrative action and violated its constitutional rights under Article 47 of the Constitution and the Fair Administrative Action Act. Counsel cited the case of Republic v Commissioner of Customs Services Ex parte Unilever Kenya Ltd [2016] eKLR in support of this argument.
19. The Appellant also criticized the Tribunal in the way it handled the proceedings. According to the Appellant, the Tribunal failed to hear and determine its urgent Notice of Motion dated 12th October 2023, in which it had sought early release of the disputed consignment pending resolution of the Tariff dispute under section 122(3) of the EACCMA, 2004, so as to avoid the delay. This, Counsel submitted, violated the Appellant’s right to a fair hearing as recognized in among others, the decision in the case of Dry Associates Ltd v Capital Markets Authority [2012] eKLR.
20. Lastly, the Appellant faulted the Tribunal for upholding the Respondent’s tariff rulings of 16th May 2023 without addressing the earlier ruling of 18th November 2020 which favoured the Appellant. According to Counsel, this omission amounted to an error apparent on the face of the record as described in National Bank of Kenya Ltd v Ndungu Njau [1997] eKLR.
21. In conclusion, the Appellant urges this Court to set aside the judgment of the Tribunal, vacate the tariff rulings of 16th May 2023, quash the Respondent’s demand of Kshs. 3,112,231.00, and award costs of both the appeal and the Tribunal proceedings.
Respondent’s Submission s
22. The Respondent, on its part, opposed the appeal and urged the Court to uphold the judgment of the Tribunal. The Respondent, maintained that the Tribunal was correct in striking out the Appellant’s claim for having complied with the strict provisions of Section 229(1) and (2) of the EACCMA, 2004.
23. The Respondent explained that the Appellant, in September 2023, imported Niax Silicone L-580 and L-618 under HS Code 3910.00.00, contrary to the Commissioner’s earlier (16th May 2023) binding tariff rulings which had classified similar products under HS Code 3402.90.00. This the Commissioner asserted led to additional tax liability of Kshs. 3,112,231.00, hence the demand.
24. It is contended that under Section 229(1) of EACCMA, a person aggrieved by the Commissioner’s decision is required to lodge an application for review within thirty days. Section 229(4) obligates the Commissioner to communicate a decision within thirty days of receipt of the objection, while Section 230 allows an appeal to the Tribunal only against a decision properly made under Section 229.
25. Relying on among others, the celebrated case of Cape Brandy Syndicate v IRC (1921) 1 KB 64, it was submitted on behalf of the Respondent that tax statutes are to be strictly interpreted and that the Appellant having failed to file a valid review or appeal against the Commissioner’s tariff classification decisions of 16th May 2023, the same stood allowed.
26. It was therefore the Respondent’s prayer that the appeal be dismissed with costs and that the judgment of the Tribunal dated 17th January 2025 be upheld.
Analysis and Determination
27. I have carefully considered the memorandum and record of appeal, submissions by the parties herein in support of their respective positions, and the applicable law. from the submissions, I discern that the central issue for determination in this appeal is whether the Tribunal erred in striking out the Appellant’s appeal for for want of compliance with Section 229(1) and 230 of the EACCMA, 2004.
Whether the Appellant’s appeal at the Tribunal was competent
28. Section 229(1) of EACCMA provides that a person directly affected by a decision or omission of the Commissioner may, within thirty days of the date of the decision, apply in writing to the Commissioner for a review of that decision.
29. Section 229 of the EACCMA provides as follows:
“(1) A person directly affected by the decision or omission of the Commissioner or any other officer on matters relating to customs shall within thirty days of the date of the decision or omission lodge an application for review of the decision or omission.
(2) The Application referred to under subsection (1) shall be lodged with the Commissioner in writing stating the grounds upon which it is lodged…
(3)…
(4) The Commissioner shall, within a period not exceeding thirty days of the receipt of the application under subsection (2) and any further information the Commissioner may require from the person lodging the application, communicate his or her decision in writing to the person lodging the application stating reasons for the decision.
(5) Where the Commissioner has not communicated his or her decision on the person lodging the application for review within the time specified in subsection (4) the Commissioner shall be deemed to have made a decision to allow the application.”
30. Further, Section 230(1) of EACCMA grants a person dissatisfied with the Commissioner’s decision under Section 229 the right to appeal to a tribunal established in accordance with Section 231.
31. Section 230(2) provides as follows: -
“A person intending to lodge an appeal under this section shall lodge the appeal within 45 days after being served with the decision, and shall serve a copy of the appeal on the Commissioner.”
32. In the present case, it is clear from the Appellant''s own pleadings (see page 23 of the ROA) that the Respondent reclassified the Appellant''s entries in question (the 18th September 2023 imports) on 20th September 2023. The Appellant therefore had 30 days from that date to apply to the Respondent for a Review of that decision.
33. Upon careful scrutiny of the record of appeal, there is no evidence that the Appellant lodged a formal application for review of the 20th September 2023 decision within the prescribed thirty-day period. While the Appellant relies on its letter of 29th September 2023, that correspondence primarily disputed laboratory results and referenced an earlier tariff ruling. It did not meet the threshold of a formal application for review under Section 229(1).
34. The said letter of 29th September 2023 from the Appellant, addressed to the Commissioner of Customs, provided in part as follows: -
“Dear Sir/Madam,
REF:DISPUTE ON LABORATORY TEST REPORT FOR NIAX SILICON L 580 AND L618ENTRY NO 23EMKIM400327190 REFERENCED KRA/C&BC/BIA/THQ/336/05/2023 AND KRA/C&BC/BIA/THQ/337/05/2023.
We are in receipt of your Lab lest report dated 16TH MAY 2023 regarding NIAX SILICONL 580 and L618 which was imported by us.
We are also unable to understand why the report was done on the 16th MAY 2023 and then released to us on 28TH SEPTEMBER 202.
We also kindly dispute the laboratory report on the same. You had already given us another report of the same item, which allowed us to use the HS code 3910.00.00, we also believe that there is no way the same item with the same chemical composition can have two different laboratory reports….”
35. From a plain reading of the letter, it is evident that what the Appellant seeks to do in the present appeal is to impugn the tariff rulings of 16th May 2023, which decisions, however, related to specific customs entries that are distinct from the entry the subject of the present tariff reclassification and duty uplift, namely the imports of 18th September 2023. It therefore follows that the Respondent’s tariff reclassification and duty uplift for the consignment of 18th September 2023 has not been challenged and therefore remains valid and could not therefore form the basis of an appeal at the Tribunal.
36. The doctrine of exhaustion is not a mere procedural technicality but a jurisdictional imperative. Article 159(2)(c) of the Constitution enjoins courts to promote alternative forms of dispute resolution, including statutory mechanisms established by Parliament. The Court of Appeal in the case of Geoffrey Muthinja & Another v Samuel Muguna Henry & 1756 Others [2015] eKLR held that where a statute provides a clear dispute resolution procedure, parties are bound to adhere to it before invoking the jurisdiction of the courts. The Court clarified that:
“It is imperative that where a dispute resolution mechanism exists outside Courts, the same be exhausted before the jurisdiction of the Courts is invoked. Courts ought to be the fora of last resort and not the first port of call the moment a storm brews… as is bound to happen. The exhaustion doctrine is a sound one and serves the purpose of ensuring that there is a postponement of judicial consideration of matters to ensure that a party is first of all diligent in the protection of his own interest within the mechanisms in place for resolution outside of Courts.”
37. Similarly, in Speaker of the National Assembly v Karume [1992] KLR 21, the Court of Appeal earlier emphatically stated that where there is a clear procedure prescribed by the Constitution or statute for redress of any grievance, that procedure should be strictly followed. The Court observed that: -
“In our view, there is considerable merit in the submission that where there is a clear procedure for the redress of any particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed. We observe without expressing a concluded view that order 53 of the Civil Procedure Rules cannot oust clear constitutional and statutory provisions.”
38. This principle has been consistently applied in tax disputes, where specialized procedures exist under the EACCMA and the Tax Procedures Act. In Krystalline Salt Limited v Kenya Revenue Authority [2019] eKLR, the Court observed that: -
“Section 9(2) of the Fair Administrative Action Act provides that the High Court or a subordinate court under subsection (1) shall not review an administrative action or decision under the Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted. Also relevant is sub-section (3) which provides that "the High Court or a subordinate Court shall, if it is not satisfied that the remedies referred to in sub-section (2) have been exhausted, direct that an applicant shall first exhaust such remedy before instituting proceedings under sub-section (1).”
39. Additionally, in the case of Wangari v Kenya Revenue Authority & another [2022] KEHC 411 (KLR) Joel Ngugu J (as he then was) held that: -
“In the circumstances of this case, I would conclude that this suit is not ripe: the Petitioner ought, in the first instance, to approach the Tax Appeals Tribunal as stipulated in section 52 of the Tax Procedures Act as read with section 12 of the Tax Appeals Tribunal Act, 2013, and only come to Court as a last resort. She has not demonstrated that the alternative forum created by statute is inaccessible, un-affordable, would amount to unreasonable delay or is otherwise ineffective.”
40. In the present case, Section 229 of EACCMA establishes a clear and mandatory review process before the Commissioner, which the Appellant failed to exhaust. Without compliance with that procedure, both the Tribunal and this Court lack jurisdiction to interrogate the merits of the tariff classification or the legality of the duty uplift.
41. On the issue of the Commissioner’s alleged failure to communicate within the timelines prescribed under Section 229(4), that argument cannot arise in the absence of a valid review application. The Appellant cannot rely on deemed allowance under Section 229(5) where the statutory review procedure was never properly triggered.
42. With regard to the Appellant’s argument that the Tribunal unreasonably failed to hear its application of 12th October 2023, the Appellant’s own Statement of Facts at page 23 of the Record of Appeal is explicit: “that after the Respondent had released the goods, the application dated 12th October 2023 became spent therefore creating way for this appeal.” Having made such an admission, the Appellant cannot now fault the Tribunal for failing to pronounce itself on an application it itself acknowledged had been overtaken by events.
43. The law is settled that a party cannot approbate and reprobate at the same time. See the case of Mombasa Cement Limited v Salim Masdud Abdalla & 4 others [2018] eKLR where it was held that:
“In this Application, the Applicant has taken a lot of contradictory positions in the same proceedings. In my view, a party cannot be allowed to take two contradictory positions in the same proceedings. In other words, one cannot approbate and reprobate at the same time in the same proceedings. The positions taken by the applicant have been inconsistent.”
44. In any event, the question of whether or not the Tribunal ought to have heard the said application (Notice of Motion Application dated 12th October 2023) was not an issue before the Tribunal and cannot therefore be validly raised as an appeal before this Court in the present proceedings.
45. In light of the foregoing findings, this Court considers it unnecessary to delve into the substantive question of tariff classification. The instant appeal therefore collapses on account of procedural incompetence and want of jurisdiction.
46. Consequently, the instant appeal is hereby dismissed and the judgment of the Tax Appeals Tribunal delivered on 17th January 2025 is accordingly upheld.
47. The Respondent shall have the costs of this appeal.
48. It is so ordered.
SIGNED, DATED, and DELIVERED IN VIRTUAL COURT THIS
11TH SEPTEMBER 2025
ADO MOSES
JUDGE
In the presence of: -
C/A – Moses
Mkan………………………..for the Appellant
Lemiso……………….…..... for the Respondent
'
1. This appeal arises from the judgment of the Tax Appeals Tribunal (the Tribunal) delivered on 17th January 2025 in Tax Appeal No. E672 of 2023, in which the Tribunal struck out the Appellant’s appeal on grounds that it was lodged in breach of Sections 229(1) and 230 of the East African Community Customs Management Act, 2004 (EACCMA).
2. The Tribunal in the said judgment also upheld the customs duties uplift in the sum of Kshs. 3, 112,231 by the Respondent (Commissioner) on account of what the Commissioner alleged to be a tariff misdeclaration by the Appellant.
Background
3. The factual background of the dispute is that on 18th September 2023 the Appellant imported five chemical components used in the manufacture of mattress under Import Entry No. 23EMKIM4010006729, namely: NIAX Silicone L-580 and NIAX Silicone L-618 both classified under HS Code 3910.00.00; SO NIAX Stannous Octoate declared under HS Code 2915.90.00; A33 NIAX Amine Catalyst declared under HS Code 3824.99.90; and NIAX Processing Additive DP-1022 declared under HS Code 2915.90.00.
4. Upon verification of the consignment, the Respondent, on 20th September 2023, in the exercise of its statutory powers, reclassified the goods and raised additional taxes. The Respondent contended that the Appellant had incorrectly classified the goods for customs purposes. The Respondent therefore reclassified the goods as follows: -
i. NIAX Silicone L-580 and NIAX Silicone L-618, declared under HS Code 3910.00.00, were reclassified under HS Code 3402.90.00.
ii. A33 NIAX Amine Catalyst, declared under HS Code 3824.99.90, was reclassified under HS Code 3815.90.00.
iii. NIAX Processing Additive DP-1022, declared under HS Code 2915.90.00, was reclassified under HS Code 3824.99.90.
5. As a result of the tariff reclassification by the Respondent, additional taxes in the sum of Kshs. 3, 112,231 was raised and demanded by the Respondent from the Appellant.
6. A dispute that ensued on the tariff classification between the parties was thereafter referred to the Tribunal by the Appellant. The Respondent raised a preliminary objection on the competence of the appeal at the Tribunal, arguing that the appeal was premature since np review application had been made by the Appellant within the timelines specified under 229(1) of the EACCMA, 2004. The Appellant, on the other hand, argued that the appeal was properly before the Tribunal.
7. On 17th January 2025, the Tribunal delivered its judgment and dismissed the Appeal, upholding the Respondent’s argument that the appeal had been filed in contravention of Section 229(1) of the Act. Specifically, the Tribunal found that the Appellant had proceeded to the Tribunal without first filing a review application under the Act.
The Appeal
8. Aggrieved by the Tribunal’s decision, the Appellant appealed to this Court vide its memorandum of appeal dated 29th January 2025, raising some eight (8) grounds of appeal. The core of the Appellant’s appeal is that the Tribunal erred at Paragraphs 48, 52, 53, and 54 of the judgment in stating that the Appellant failed to comply with section 229(1) of EACCMA, 2004.
9. The Appellant asserted that the Tribunal erred both in law and in fact at paragraphs 55 and 56 of its judgment, when it totally ignored the Appellant’s letter dated 4th May 2023, which disputed the tariff classification (HS Code 3402.90.00) by the Respondent regarding the goods in question.
10. The Appellant also contended that the Tribunal failed to hear and determine its urgent application dated 12th October 2023, in which it had sought release of the consignment under Section 122(3) pending resolution of the tariff dispute, thereby occasioning a miscarriage of justice.
11. The Respondent opposed the appeal vide her Statement of Facts (SoF) dated 16th April 2025. The Respondent’s position, as expressed in the SoF, is that the Tribunal was right in its decision striking out the appeal.
12. The Respondent maintained that the Tribunal was right since the Appellant had not applied for a Review of the Commissioner’s decision before lodging the appeal to the Tax Appeals Tribunal, contrary to the express provisions of Section 129(1) of the EACCMA, 2004.
13. According to the Respondent, the Appellant had on 18th September 2023 imported a consignment of silicone L580 and L618 and declared them under HS Code 3910.00.00 contrary to prior tariff classification ruling of 16th May 2023 by the Respondent which had placed the goods under HS Code 3402.90.00, hence the reclassification.
14. The Appeal was canvassed by way of written submissions. The Appellant, through the law firm of MKAN & Company Advocates, filed their submissions dated 26th June 2025, whilst the Respondent, through Triza Nyakundi, filed its submissions dated 4th July 2025.
Appellant’s Submissions
15. The Appellant submitted that the Tribunal’s finding was erroneous since the Appellant had by its letter dated 29th September 2023, objected to the Respondent’s reclassification of the goods in line with Section 229(1) and (2) of the EACCMA, 2004. The Appellant therefore asserted that contrary to the Tribunal’s findings, its appeal to the Tribunal was competent.
16. According to the Appellant, the Respondent retrospectively reclassified the goods on the basis of tariff ruling letters dated 16th May 2023, which were only disclosed to it on 28th September 2023. The Appellant asserted that its letter of objection dated letter of 29th September 2023 was well within the 30 days timeline provided under Section 229(1) and (2) of the EACCMA, 2004 and that the Tribunal therefore erred in holding otherwise.
17. The Appellant further argued that the Respondent failed to render such a decision on the Appellant’s Objection to the Tariff Classification with the thirty (30) days permitted under Section 229(4) and (5) of the Act which obliges the Commissioner to communicate a decision within thirty (30) days. In default, the law deems the application allowed. Reliance was placed on Republic v Kenya Revenue Authority Ex parte M-Kopa Kenya Ltd [2022] eKLR.
18. The Appellant further contended that the Respondent’s conduct of reclassification of the goods without prior notice and failure to communicate a decision in goods time constituted unfair administrative action and violated its constitutional rights under Article 47 of the Constitution and the Fair Administrative Action Act. Counsel cited the case of Republic v Commissioner of Customs Services Ex parte Unilever Kenya Ltd [2016] eKLR in support of this argument.
19. The Appellant also criticized the Tribunal in the way it handled the proceedings. According to the Appellant, the Tribunal failed to hear and determine its urgent Notice of Motion dated 12th October 2023, in which it had sought early release of the disputed consignment pending resolution of the Tariff dispute under section 122(3) of the EACCMA, 2004, so as to avoid the delay. This, Counsel submitted, violated the Appellant’s right to a fair hearing as recognized in among others, the decision in the case of Dry Associates Ltd v Capital Markets Authority [2012] eKLR.
20. Lastly, the Appellant faulted the Tribunal for upholding the Respondent’s tariff rulings of 16th May 2023 without addressing the earlier ruling of 18th November 2020 which favoured the Appellant. According to Counsel, this omission amounted to an error apparent on the face of the record as described in National Bank of Kenya Ltd v Ndungu Njau [1997] eKLR.
21. In conclusion, the Appellant urges this Court to set aside the judgment of the Tribunal, vacate the tariff rulings of 16th May 2023, quash the Respondent’s demand of Kshs. 3,112,231.00, and award costs of both the appeal and the Tribunal proceedings.
Respondent’s Submission s
22. The Respondent, on its part, opposed the appeal and urged the Court to uphold the judgment of the Tribunal. The Respondent, maintained that the Tribunal was correct in striking out the Appellant’s claim for having complied with the strict provisions of Section 229(1) and (2) of the EACCMA, 2004.
23. The Respondent explained that the Appellant, in September 2023, imported Niax Silicone L-580 and L-618 under HS Code 3910.00.00, contrary to the Commissioner’s earlier (16th May 2023) binding tariff rulings which had classified similar products under HS Code 3402.90.00. This the Commissioner asserted led to additional tax liability of Kshs. 3,112,231.00, hence the demand.
24. It is contended that under Section 229(1) of EACCMA, a person aggrieved by the Commissioner’s decision is required to lodge an application for review within thirty days. Section 229(4) obligates the Commissioner to communicate a decision within thirty days of receipt of the objection, while Section 230 allows an appeal to the Tribunal only against a decision properly made under Section 229.
25. Relying on among others, the celebrated case of Cape Brandy Syndicate v IRC (1921) 1 KB 64, it was submitted on behalf of the Respondent that tax statutes are to be strictly interpreted and that the Appellant having failed to file a valid review or appeal against the Commissioner’s tariff classification decisions of 16th May 2023, the same stood allowed.
26. It was therefore the Respondent’s prayer that the appeal be dismissed with costs and that the judgment of the Tribunal dated 17th January 2025 be upheld.
Analysis and Determination
27. I have carefully considered the memorandum and record of appeal, submissions by the parties herein in support of their respective positions, and the applicable law. from the submissions, I discern that the central issue for determination in this appeal is whether the Tribunal erred in striking out the Appellant’s appeal for for want of compliance with Section 229(1) and 230 of the EACCMA, 2004.
Whether the Appellant’s appeal at the Tribunal was competent
28. Section 229(1) of EACCMA provides that a person directly affected by a decision or omission of the Commissioner may, within thirty days of the date of the decision, apply in writing to the Commissioner for a review of that decision.
29. Section 229 of the EACCMA provides as follows:
“(1) A person directly affected by the decision or omission of the Commissioner or any other officer on matters relating to customs shall within thirty days of the date of the decision or omission lodge an application for review of the decision or omission.
(2) The Application referred to under subsection (1) shall be lodged with the Commissioner in writing stating the grounds upon which it is lodged…
(3)…
(4) The Commissioner shall, within a period not exceeding thirty days of the receipt of the application under subsection (2) and any further information the Commissioner may require from the person lodging the application, communicate his or her decision in writing to the person lodging the application stating reasons for the decision.
(5) Where the Commissioner has not communicated his or her decision on the person lodging the application for review within the time specified in subsection (4) the Commissioner shall be deemed to have made a decision to allow the application.”
30. Further, Section 230(1) of EACCMA grants a person dissatisfied with the Commissioner’s decision under Section 229 the right to appeal to a tribunal established in accordance with Section 231.
31. Section 230(2) provides as follows: -
“A person intending to lodge an appeal under this section shall lodge the appeal within 45 days after being served with the decision, and shall serve a copy of the appeal on the Commissioner.”
32. In the present case, it is clear from the Appellant''s own pleadings (see page 23 of the ROA) that the Respondent reclassified the Appellant''s entries in question (the 18th September 2023 imports) on 20th September 2023. The Appellant therefore had 30 days from that date to apply to the Respondent for a Review of that decision.
33. Upon careful scrutiny of the record of appeal, there is no evidence that the Appellant lodged a formal application for review of the 20th September 2023 decision within the prescribed thirty-day period. While the Appellant relies on its letter of 29th September 2023, that correspondence primarily disputed laboratory results and referenced an earlier tariff ruling. It did not meet the threshold of a formal application for review under Section 229(1).
34. The said letter of 29th September 2023 from the Appellant, addressed to the Commissioner of Customs, provided in part as follows: -
“Dear Sir/Madam,
REF:DISPUTE ON LABORATORY TEST REPORT FOR NIAX SILICON L 580 AND L618ENTRY NO 23EMKIM400327190 REFERENCED KRA/C&BC/BIA/THQ/336/05/2023 AND KRA/C&BC/BIA/THQ/337/05/2023.
We are in receipt of your Lab lest report dated 16TH MAY 2023 regarding NIAX SILICONL 580 and L618 which was imported by us.
We are also unable to understand why the report was done on the 16th MAY 2023 and then released to us on 28TH SEPTEMBER 202.
We also kindly dispute the laboratory report on the same. You had already given us another report of the same item, which allowed us to use the HS code 3910.00.00, we also believe that there is no way the same item with the same chemical composition can have two different laboratory reports….”
35. From a plain reading of the letter, it is evident that what the Appellant seeks to do in the present appeal is to impugn the tariff rulings of 16th May 2023, which decisions, however, related to specific customs entries that are distinct from the entry the subject of the present tariff reclassification and duty uplift, namely the imports of 18th September 2023. It therefore follows that the Respondent’s tariff reclassification and duty uplift for the consignment of 18th September 2023 has not been challenged and therefore remains valid and could not therefore form the basis of an appeal at the Tribunal.
36. The doctrine of exhaustion is not a mere procedural technicality but a jurisdictional imperative. Article 159(2)(c) of the Constitution enjoins courts to promote alternative forms of dispute resolution, including statutory mechanisms established by Parliament. The Court of Appeal in the case of Geoffrey Muthinja & Another v Samuel Muguna Henry & 1756 Others [2015] eKLR held that where a statute provides a clear dispute resolution procedure, parties are bound to adhere to it before invoking the jurisdiction of the courts. The Court clarified that:
“It is imperative that where a dispute resolution mechanism exists outside Courts, the same be exhausted before the jurisdiction of the Courts is invoked. Courts ought to be the fora of last resort and not the first port of call the moment a storm brews… as is bound to happen. The exhaustion doctrine is a sound one and serves the purpose of ensuring that there is a postponement of judicial consideration of matters to ensure that a party is first of all diligent in the protection of his own interest within the mechanisms in place for resolution outside of Courts.”
37. Similarly, in Speaker of the National Assembly v Karume [1992] KLR 21, the Court of Appeal earlier emphatically stated that where there is a clear procedure prescribed by the Constitution or statute for redress of any grievance, that procedure should be strictly followed. The Court observed that: -
“In our view, there is considerable merit in the submission that where there is a clear procedure for the redress of any particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed. We observe without expressing a concluded view that order 53 of the Civil Procedure Rules cannot oust clear constitutional and statutory provisions.”
38. This principle has been consistently applied in tax disputes, where specialized procedures exist under the EACCMA and the Tax Procedures Act. In Krystalline Salt Limited v Kenya Revenue Authority [2019] eKLR, the Court observed that: -
“Section 9(2) of the Fair Administrative Action Act provides that the High Court or a subordinate court under subsection (1) shall not review an administrative action or decision under the Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted. Also relevant is sub-section (3) which provides that "the High Court or a subordinate Court shall, if it is not satisfied that the remedies referred to in sub-section (2) have been exhausted, direct that an applicant shall first exhaust such remedy before instituting proceedings under sub-section (1).”
39. Additionally, in the case of Wangari v Kenya Revenue Authority & another [2022] KEHC 411 (KLR) Joel Ngugu J (as he then was) held that: -
“In the circumstances of this case, I would conclude that this suit is not ripe: the Petitioner ought, in the first instance, to approach the Tax Appeals Tribunal as stipulated in section 52 of the Tax Procedures Act as read with section 12 of the Tax Appeals Tribunal Act, 2013, and only come to Court as a last resort. She has not demonstrated that the alternative forum created by statute is inaccessible, un-affordable, would amount to unreasonable delay or is otherwise ineffective.”
40. In the present case, Section 229 of EACCMA establishes a clear and mandatory review process before the Commissioner, which the Appellant failed to exhaust. Without compliance with that procedure, both the Tribunal and this Court lack jurisdiction to interrogate the merits of the tariff classification or the legality of the duty uplift.
41. On the issue of the Commissioner’s alleged failure to communicate within the timelines prescribed under Section 229(4), that argument cannot arise in the absence of a valid review application. The Appellant cannot rely on deemed allowance under Section 229(5) where the statutory review procedure was never properly triggered.
42. With regard to the Appellant’s argument that the Tribunal unreasonably failed to hear its application of 12th October 2023, the Appellant’s own Statement of Facts at page 23 of the Record of Appeal is explicit: “that after the Respondent had released the goods, the application dated 12th October 2023 became spent therefore creating way for this appeal.” Having made such an admission, the Appellant cannot now fault the Tribunal for failing to pronounce itself on an application it itself acknowledged had been overtaken by events.
43. The law is settled that a party cannot approbate and reprobate at the same time. See the case of Mombasa Cement Limited v Salim Masdud Abdalla & 4 others [2018] eKLR where it was held that:
“In this Application, the Applicant has taken a lot of contradictory positions in the same proceedings. In my view, a party cannot be allowed to take two contradictory positions in the same proceedings. In other words, one cannot approbate and reprobate at the same time in the same proceedings. The positions taken by the applicant have been inconsistent.”
44. In any event, the question of whether or not the Tribunal ought to have heard the said application (Notice of Motion Application dated 12th October 2023) was not an issue before the Tribunal and cannot therefore be validly raised as an appeal before this Court in the present proceedings.
45. In light of the foregoing findings, this Court considers it unnecessary to delve into the substantive question of tariff classification. The instant appeal therefore collapses on account of procedural incompetence and want of jurisdiction.
46. Consequently, the instant appeal is hereby dismissed and the judgment of the Tax Appeals Tribunal delivered on 17th January 2025 is accordingly upheld.
47. The Respondent shall have the costs of this appeal.
48. It is so ordered.
SIGNED, DATED, and DELIVERED IN VIRTUAL COURT THIS
11TH SEPTEMBER 2025
ADO MOSES
JUDGE
In the presence of: -
C/A – Moses
Mkan………………………..for the Appellant
Lemiso……………….…..... for the Respondent
'