[2025] KETAT 257 (KLR)

Glosec Solutions Limited v Commissioner Legal Services And Board Coordination (Miscellaneous Tax Appeal E038 of 2025) [2025] KETAT 257 (KLR) (27 June 2025) (Ruling)

Neutral citation: [2025] KETAT 257 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Miscellaneous Tax Appeal E038 of 2025

CA Muga, Chair, AK Kiprotich & T Vikiru, Members

June 27, 2025

Between

Glosec Solutions Limited

Applicant

and

Commissioner Legal Services And Board Coordination

Respondent

Ruling

1. The Appellant vide a Notice of Motion application dated and filed on 22nd May, 2025 under certificate of urgency and supported by an affidavit of Ron Orlosky sought for the following Orders:a.Spent.b.That the intended Applicant be granted an extension of time with regard to filing Notice of Appeal and Memorandum of Appeal to the Tribunal.c.That the Tribunal do issue an order restraining the Respondent either by itself, its agents, employees, servants or through any other person at its behest, from issuing Agency Notices against the referred Bank Accounts, or any Account held and/or owned by the Appellant/ Applicant in any other company, and/or lift, vacate and set aside any other Agency Notice issued against any other Bank or other Account owned or held by the Appellant/ Applicant in any other company until this Application and the Main Appeal is heard and determined.d.That the cost of this Application be in the cause.e.That the Tribunal be pleased to issue any such orders as it deems just and expedient.

2. The Application was premised on the following grounds:a.That the Respondent issued the Applicant with an assessment on 30th September 2024. b.That the Applicant objected on 29th October 2024. c.That the Respondent later issued an objection decision on 6th December 2024. d.That the Applicant not being well versed with available and applicable procedures and having been misguided on the same was unable to lodge the appeal within time.e.That the Applicant's reason for delay in filing was not as a result of indolence on its part.f.That the intended Applicant has approached this Tribunal at the earliest juncture and failure to file the Notice of Appeal within the stipulated timelines is as a result of factors beyond its control.

3. On 30th May, 2025, the Tribunal directed the Respondent to file its response to the application on or before 3rd June 2025 and since it failed to do so, the Tribunal can infer that the Respondent is not opposed to this Application.

4. The Tribunal directed parties to file and serve their written submissions by the 9th June 2025 but since neither party complied, the Tribunal therefore will rely on the pleadings of the Applicant as filed.

Analysis and Findings 5. In spite of the application being unopposed on the part of the Respondent the Tribunal retains the residual authority to determine if the application satisfies the legal threshold for the grant of the orders sought on the part of the Appellant.

6. In determining whether to extend time, the Tribunal is guided by the decision in the case of Leo Sila Mutiso -vs- Rose Hellen Wangari Mwangi - Civil Application No. Nai. 255 of 1997 (unreported), where the Court expressed itself as thus:“It is now well settled that the decision whether or not to extend the time for appealing is essentially discretionary. It is also well settled that in general the matters which this court takes into account in deciding whether to grant an extension of time are: first, the length of the delay; secondly, the reason for the delay; thirdly (possibly), the chances of the appeal succeeding if the application is granted; and, fourthly, the degree of prejudice to the respondent if the application is granted.”

7. On the criteria of the issues to be considered when granting an extension to file an appeal out of time, the Tribunal referred to the case of Odek, JJ. A in Edith Gichugu Koine vs. Stephen Njagi Thoithi [2014] eKLR, where the Court laid out the following factors:“Nevertheless, it ought to be guided by consideration of factors stated in many previous decisions of this Court including, but not limited to, the period of delay, the reasons for the delay, the degree of prejudice to the respondent if the application is granted, and whether the matter raises issues of public importance, amongst others...”

8. The Tribunal was further guided by the principles set out in John Kuria v Kelen Wahito, Nairobi Civil Application Nai 19 of 1983 April 10, [1984] where the court used the following criteria to consider the application:a.Whether there is a reasonable cause for the delay?b.Whether the appeal is merited?c.Whether there will be prejudice suffered by the Respondent if the extension is granted?

9. On the reasons for delay, the Tribunal is enjoined to determine the length and reason for the delay when considering an application for the extension of time to appeal out of time. The power to extend time is discretionary and unfettered but the same must be exercised judiciously and it is not a right to be granted to the Applicant.

10. The Applicant contended that the delay in filing an appeal was occasioned by the fact that it was not well versed with available and applicable procedures and having been misguided on the same was unable to lodge the appeal within time. That the Applicant's reason for delay in filing was not as a result of indolence on their part.

11. In considering what constitutes a reasonable reason for the delay, the court in Paul Wanjohi Mathenge v Duncan Gichane Mathenge [2013] eKLR, held as follows:“...it is clear that the discretion to extend time is indeed unfettered. It is incumbent upon the applicant to explain the reasons for delay in making the application for extension and whether there are any extenuating circumstances that can enable the Court to exercise its discretion in favour of the applicant.”

12. The Tribunal notes that the objection decision in this matter was issued on 6th December 2024. The Applicant therefore ought to have lodged its Notice of Appeal on or before 5th January 2025. This Application was filed by the Applicant on 22nd May 2025 which is approximately 4 months late.

13. The Tribunal reiterates the finding in the Ugandan case of Ojara vs. Okwera (Miscellaneous Civil Application 2017/23) [2018] VGHCCD 42 where it was stated as follows:“An order for enlargement of time to file the appeal should ordinarily be granted unless the applicant is guilty of unexplained and inordinate delay in seeking the indulgence of the court.”

14. Although the Applicant’s reason for delay could not be supported by way of documentation, the Tribunal does not consider the delay to be inordinate and therefore allowable. On the issue of prejudice, the Applicant's only hope for justice lies in an appeal to the Tribunal. Thus, the Applicant would suffer prejudice if it is not granted leave to file its appeal considering that the Respondent would still collect the taxes plus interest and penalties should the Applicant be found to be at fault.

15. The Tribunal therefore finds that the Respondent will not suffer any prejudice. Regarding merits of the case it is the Tribunal’s position that an appeal being merited does not mean that it should necessarily succeed but rather it is arguable. The Tribunal was guided by the findings of the court in Kenya Commercial Bank Limited Vs Nicholas Ombija (2009) eKLR where it was held as follows:“an arguable appeal is not one which must necessarily succeed, but one which ought to be argued fully before the court.”

16. Given that the Memorandum of Appeal and Statement of Facts have not been filed by the Applicant, the Tribunal will not determine this at this stage but allow the Applicant the benefit to canvass its case in an appeal considering that it has already determined that the Application was filed without undue delay and there is no prejudice to be suffered by the Respondent.

Disposition 17. The Tribunal in the circumstances finds that the application has merit and the Orders that accordingly recommend themselves are as follows:a.The Applicant is hereby granted leave to file its Notice of Appeal, Memorandum of Appeal and Statement of Facts out of time.b.The Applicant’s Notice of Appeal dated 22nd May 2025 and filed with this Application is hereby deemed to have been duly filed and served.c.The Applicant to file and serve its Memorandum of Appeal and Statement of Facts within 7 days of the delivery of this Ruling.d.The Respondent to file its Statement of facts within 30 days of being served.e.No orders as to costs.

18. It is so ordered.

DATED AND DELIVERED AT NAIROBI ON THIS 27TH DAY OF JUNE, 2025. CHRISTINE A. MUGA - CHAIRPERSONABRAHAM K. KIPROTICH - MEMBERDR. TIMOTHY B. VIKIRU - MEMBER