https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/221

 REPUBLIC OF KENYA IN THE TRIBUNAL OF KENYA AT NAIROBI COUNTY COURT NAME: TAX APPEALS TRIBUNAL CASE NUMBER: TATC/E1427/2025 ALFONES COMMUNICATIONS SOLUTIONS LIMITED VS KENYA REVENUE AUTHORITY JUDGMENT # BACKGROUND 1. The Appellant is a limited liability company incorporated under the Companies Act operating in the communications and general trading. 2. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws. Under Section 5 (1) of the Act, the Kenya Revenue Authority is an agency of the Government for the collection and receipt of all tax revenue. Further, under Section 5(2) of the Act with respect to the performance of its functions 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 purposes of assessing, collecting and accounting for all revenues in accordance with those laws. 3. The Respondent determined that the Appellant had failed to declare Value Added Tax (VAT), PAYE and Income Tax for the period 2015, 2017 and 2018. Consequently, the Respondent issued Additional Assessments on 20th July 2020. The assessments were not filed. 1. The Appellant being dissatisfied with the Respondent's tax decision, lodged a late notice of Objection on 9 th October, 2020. The Respondent reviewed the Objection together with availed documents and issued the Objection decision dated 15th July 2021 wherein it partially amended the assessments from Kshs 12,601,831 to Kshs 1,340,612. 2. Aggrieved by the decision, the Appellant lodged this appeal vide Notice of appeal dated 9th December, 2025. # THE APPEAL 1. The Appellant lodged its Memorandum of appeal dated 9 th December, 2025 and filed on 10th December, 2025 wherein it raised the following grounds of appeal: 1. That the Respondent erred in fact and in law in assessing the tax payable. 2. That the Respondent erred in fact and in law in failing to consider the Appellant's nature of business. 3. That the Respondent erred in fact and in law in failing to consider the Appellant's allowable deductions incurred in generation of income for the period. 4. That the Respondent erred in fact and law for failing to accord the Appellant a fair hearing despite lodging an objection. # THE APPELLANT’S CASE 1. The Appellant’s case is premised on its Statement of facts dated 9 th December, 2025 and filed on 10th December, 2025. The Appellant did not file submissions. 2. The Appellant averred that it is registered for Income Tax – Company obligation effective 18th July 2008, Income Tax – PAYE obligation effective 1st October, 2012 and Value Added Tax (VAT) obligation effective 2nd September 2009 and PAYE obligation effective 18 th July 2008. 3. The Appellant stated that it filled various self-assessments return for the income tax – Company obligation for and was issued with acknowledgment receipt numbers. 4. The Appellant stated that it filled all self-assessments return for the Value Added Tax (VAT) obligation for year 2017 and 2018 and was issued with acknowledgement receipts. 5. The Appellant averred that the Respondent raised various additional assessments for the income tax company obligation for years of income. It stated that it objected to the additional assessments and was issued with the acknowledgements. 6. The Respondent issued an objection decision dated 15 th July, 2021, partially confirming the additional assessment. Having been dissatisfied with the Respondent’s decision, the Appellant filed a Notice of appeal under Section 52 of the Tax Procedures Act 2015 CAP 469B (TPA). 7. In support of its case, the Appellant filed the following documents: 1. Objection Application Acknowledgement Receipt dated 26th August 2020; and 2. The objection decision dated 15th July 2021. # Appellant’s Prayers 1. The Appellant prayed as follows: 1. This Appeal be allowed with costs. 2. The decision of the Respondent with regards to the tax payable by the Appellant be discharged and set aside with costs to the Appellant. 3. The additional assessments issued by the Respondent for the period under review, together with penalties and interest, were unlawful and improperly assessed and as such the same should be set aside. 4. The Honourable Tribunal be pleased to assess the tax payable by the Appellant to be commensurate with the actual transactions and the evidence tendered. 5. The additional assessments raised by the Respondent be vacated accordingly so that the going concern of the Appellant’s operations are not threatened. 6. That the objection decisions under review be declared null and void. 7. Any other relief that this Honourable Tribunal deems fit. # THE RESPONDENT’S CASE 1. The Respondent’s case was premised on its Statement of facts dated and filed on 12th February 2026. The Respondent also filed grounds of objection dated on 12th February 2026 and written submissions dated 26th February 2026 and filed on 27th February 2026. 2. In response to the assertion that the Respondent erred in law and fact in assessing the tax payable, the Respondent pleaded that the assessments in issue were lawfully raised in accordance with Section 29 of the TPA, which empowers the Commissioner to make assessments where a taxpayer fails to file returns or where incomplete/incorrect returns are submitted. 3. The Respondent asserted that the assessments were therefore, not arbitrary, but grounded on verifiable third-party information available to the Commissioner. The Respondent also stated that the Appellant did not file valid objections nor provide any documents to challenge the accuracy of the assessments. 1. In response to claim that the Respondent erred in fact and in law by failing to consider the Appellant's nature of business, the Respondent averred that Section 56(1) of the TPA requires the taxpayer to prove that a tax decision made by the Commissioner is incorrect. It maintained that the Appellant failed to discharge its statutory burden of proof despite being granted an opportunity to support the Objection. 2. The Respondent pleaded that the claim that it failed to consider the Appellant's nature of business was unfounded. The Respondent contended that it did consider the nature of the Appellant's business as captured in its iTax profile, namely "Undifferentiated goods-producing activities of private households for own use. 3. According to the Respondent, notwithstanding this classification, the assessments were triggered by Withholding Tax (WHT) certificates issued by Safaricom Limited for payments made to the Appellant for services rendered. It argued that the payments constitute taxable supplies, and the Appellant was required to declare the VAT arising. 4. Therefore, the Respondent maintained that the assessments took into account the taxpayer's operations and was based on actual economic activity reflected in third-party declarations, not merely the Appellant's self-reported sector classification. 5. The Respondent averred that it did not err in failing to consider the Appellant's allowable deductions incurred in generation of income for the period, the Respondent further pleaded that this allegation was not supported by facts. Instead, the Respondent argued that the Appellant did not lodge a valid objection within the prescribed timelines nor submit any supporting documents to demonstrate the existence of allowable input VAT or deductible expenses. 6. The Respondent reiterated that the Appellant did not provide supporting documents. It also stated that it did not consider allowable deductions because none were submitted by the Appellant. The Respondent stated that its rejection of the Objection was on the basis of a late objection lacking documentation. 7. According to the Respondent, at the assessment stage the Commissioner is required to rely on available information. In the absence of any evidence from the Appellant, the Respondent lawfully proceeded under Section 29 of the TPA, which allows the Commissioner to issue assessments based on available data, including third-party information. 8. In response to the claim that the Respondent erred in failing to accord the Appellant a fair hearing despite lodging an objection, the Respondent implored that this assertion is incorrect and misleading. Instead, the Respondent stated that the Appellant did not lodge a valid Notice of Objection as required under Section 51 of the TPA because the objection was filed out of time (lodged on 9th October 2020, yet the assessments were issued on 24th July 2020; and that the Appellant failed to provide any supporting documentation to support its objection. 9. The Respondent averred that although it exercised its discretion under Section 51(7) of the TPA to admit the Appellant's Notice of Objection out of time and subsequently issued an Objection Decision on 15th July 2021, the Appellant lodged the present Appeal out of time on 9th December 2025, being four (4) years, four (4) months and twenty-four (24) days outside the statutory timelines prescribed under Section 13(1) of the Tax Appeals Tribunal Act Cap 469A(TATA). 10. The Respondent further stated that the Appeal was filed without leave of this Honourable Tribunal as required under Section 13(3) of the TATA and is therefore incompetent and improperly before the Tribunal. 11. The Respondent maintained that the Appeal lacks merit as it does not meet the threshold and should therefore not be allowed because Appellant is guilty of undue delay. 1. The Respondent submitted that the assessment were well anchored in law, and that it considered the documents that the Appellant filed and noted that they were not sufficient therefore, it relied on third party information. 2. It submitted that it did not consider allowable deductions because none were submitted by the Appellant. The Respondent also stated that it granted the Appellant the right to fair hearing but the Appellant failed to prove its case. 3. The Respondent relied on the cases of **Stanbic Bank Kenya Limited v Kenya Revenue Authority [2009] eKLR**, and **Total Kenya Limited v Commissioner of Domestic Taxes [2018] eKLR** to submit that the burden of disproving an assessment lies with the taxpayer. 1. The Respondent submitted that the appeal is incompetent as the Appellant did not seek leave to appeal out of time. It cited the case of **Commissioner of** # Domestic Taxes v Menengai Oil Refineries Limited [2020] eKLR to submit that statutory timelines are mandatory and failure to comply renders an appeal incompetent 1. The Respondent also relied on the cases of **Jomusons Investment Limited v Commissioner of Domestic Taxes [20201 eKLR;** and **Commissioner of Domestic Taxes v Mayfair Insurance Company Limited (2017) eKLR Income Tax Appeal No.31 of 2017** to submit that the taxpayer has to obtain leave before filing an appeal out of time. # Respondent’s prayers 1. The Respondent prayed that the Honourable Tribunal upholds the confirmed assessments and dismisses the appeal with costs to the Respondent # ISSUES FOR DETERMINATION 1. The Tribunal has considered the pleadings and submissions made by the parties, and considers the issues for determination as follows: 2. Whether the appeal is valid; and 3. Whether the Respondent was justified in confirming the assessment. # ANALYSIS AND FINDINGS 1. Having identified the issues for determination, the Tribunal proceeds to analyse the same as hereunder; # a. Whether the appeal is valid 1. The Respondent in its Statement of facts and in grounds of objection filed on 12th February 2026 raised a preliminary objection that the appeal was filed out of time without leave of the Tribunal. The Appellant did not respond to this issue. 2. The Tribunal notes that that Objection decision is dated 15 th July 2021 while the notice of appeal was lodged on 9th December, 2025. 3. Section 13 of TATA provides for the procedures to be followed when filing an appeal. To be precise, Section 13(1) of TATA provides: *Procedure for appeal* 1. *A notice of appeal to the Tribunal shall—* 1. *Be in writing or through electronic means;* 2. *Be submitted to the Tribunal* ***within thirty days*** *upon receipt of the decision of the Commissioner.* 2. There is no doubt that the Appellant filed the Notice of appeal in contravention of Section 13(1) of TATA because it filed the notice beyond the statutory thirty days. Whereas Section 13(1) of TATA provides that the notice of appeal has to be filed within 30 days upon receipt of the decision of the Commissioner, the Act is alive to the fact that a taxpayer may be unable to comply with the said timeline. To this end, the law allows the taxpayer to seek leave from this Tribunal to appeal out of time. In this regard, Section 13(3) and 3. of TATA provides as follows: 1. *The Tribunal may, upon application in writing or through electronic means, extend the time for filing the notice of appeal and for submitting the documents referred to in subsection (2).* 2. *An extension under subsection (3) may be granted owing to absence from Kenya, or sickness, or other reasonable cause that may have prevented the applicant from filing the notice of appeal or submitting the documents within the specified period.* 4. Filing an appeal out of time without leave is detrimental and therefore such an appeal is irregular. In ***County Executive of Kisumu v County Government of Kisumu & 8 others (Civil Application 3 of 2016) [2017] KESC 16 (KLR)*** the Supreme Court had the following to say about filing appeals out of time without leave: *‘‘We are in total agreement with the respondent that an appeal filed in this Court out of time without leave of this Court is irregular and this Court will not invoke such ‘novel’ principles as urged by applicant so as to validate that petition and deem it as properly filed.’’* 1. In **Commissioner of Domestic Taxes v Lifecare International Brokers Limited [2020] eKLR** Majanja J (as he was then) observed as follows at paragraph 14: *"Failure to file an appeal within time and without complying with statutory conditions is not a mere technicality that can be overlooked, it goes to the competence of the appeal. Counsel for the Appellant valiantly addressed the court on why the court should validate the appeal. The issues raised are factual issues that call for the court to exercise its discretion and can only be addressed in an appropriate* *application which is not before the court."* 1. Whereas Article 159(2)(d) of the Constitution provides that justice shall be administered without undue regard to procedural technicalities, failure to seek leave to file appeal out of time negatively affects jurisdiction of this Tribunal. In # the case of Patrick Kiruja Kithinji v Victor Mugira Marete MRU CA Civil **Appeal No. 48 of 2014 [2015] eKLR** the Court of appeal had an opportunity to pronounce itself on a similar issue. The Court held that: ‘‘*It is our view, whether or not an appeal is filed on time goes to the jurisdiction of this Court. It is trite that this Court has jurisdiction to entertain appeals filed within the requisite time and/or appeals filed out of time with leave of the Court. To hold otherwise would upset the established clear principles of institution of an appeal in this Court. Consequently, we find that an appeal filed out of time is not curable under Article 159.’’* 1. The *locus classicus* case on jurisdiction is that of **Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1969] KLR,** wherein Nyarangi JA held, inter alia: *‘‘…Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of the proceedings pending other evidence. A court of law downs its tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction.”* 1. The Appellant filed the appeal late and without leave from the Tribunal. Consequently, the Tribunal finds and holds that it does not have jurisdiction to entertain the appeal any further. The appeal is therefore invalid and ought to be struck out. The analysis of the remaining issue for determination is hereby rendered moot. # FINAL DECISION 1. The upshot to the foregoing is that the Tribunal finds and holds that the Appeal is incompetent and makes the following orders; - 2. The Appeal be and is hereby struck out; and 3. Each party to bear its own costs. 4. It is so ordered. **DATED** and **DELIVERED** at **NAIROBI** this 19TH DAY OF MAY **2026** SIGNED BY/FOR: HON. ROBERT MUGAMBI MUTUMA (CHAIRPERSON) HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER HON. BILLY GRAHAM OKUMU MIJUNGU **★ TH E JUDICIAR Y O F KENY A ★** **HON. ROBERT MUGAMBI MUTUMA (CHAIRPERSON) HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER HON. BILLY GRAHAM OKUMU MIJUNGU** Tax Appeals Tribunal Tribunal Date: 2026-05-19 17:12:47