https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/115

Imprimerie Nationale Kenya Ltd v Commissioner of Legal and Board Co-Ordination (Tax Appeal E518 of 2026) [2026] KETAT 115 (KLR) (26 June 2026) (Ruling) Neutral citation: [2026] KETAT 115 (KLR) Republic of Kenya In the Tax Appeal Tribunal Tax Appeal E518 of 2026 RM Mutuma, Chair, G Ogaga, E Ng'ang'a & JM Malla, Members June 26, 2026 Between Imprimerie Nationale Kenya Limited Applicant and Commissioner Of Legal And Board Co-Ordination Respondent Ruling 1.The Applicant filed a Notice of Motion dated 29th April 2026 and filed on 30th April 2026 seeking the following Orders: -a)Spent.b)That the Honorable Tribunal does extend the time to the Appellant to file a Notice of Appeal against the Respondent’s decision of 29th October 2025.c)That the Appellant do file the Memorandum of Appeal, Statement of Facts, and all supporting documents within 14 days of the filing of the Notice of Appeal;d)That pending the hearing and determination of this application, the Respondent be restrained from issuing any enforcement measures against the bankers and or other creditors of the Appellant.e)That pending the hearing and determination of the intended appeal, the Respondent be hereby restrained from recovering the tax amounts subject to the intended appeal. 2.The Application which is supported by an Affidavit sworn by Charles Gathuto, on 29th April 2026 and filed on 30th April 2026 is premised on the following grounds:a)That on 2nd October 2024, the Respondent issued an Additional Corporate Income Tax Assessment for the year of income 2020 assessing principal tax of KES 5,979,173.75, penalties of KES 90,694.29, and interest of KES 761,832.02, amounting to a total of KES 6,831,700.06 (Assessment No. KRA202459720861).b)That the additional assessment sought to disallow business expenses amounting to KES 30,568,254, which the Appellant contends were incurred wholly and exclusively in the production of income.c)That the assessment notice was erroneously served via iTax to the email address of a former director of the Appellant who had exited the organisation prior to issuance of the assessment and consequently did not come to the Appellant's attention within the statutory timelines.d)That the Appellant only became aware of the assessment during a routine audit conducted by its external auditors, at which point the statutory objection period had already lapsed.e)That upon discovery, the Appellant promptly engaged the Respondent through its appointed tax agents and applied for leave to lodge a late objection, which leave was granted by the Respondent.f)That pursuant to the leave so granted, the Appellant lodged a Notice of Objection on 22nd August 2025 and thereafter engaged substantively with the Respondent's Independent Review of Objections (IRO) Unit.g)That the Respondent issued an Objection decision dated 29th October 2025, which decision was communicated to the Appellant on the same date and partially allowed the objection.h)That although the objection was admitted and determined by the IRO, the delay giving rise to the present Application relates specifically to the filing of an appeal before this Honourable Tribunal following the Objection decision.i)That the issues forming the subject matter of the intended Appeal arise from transactions linked to a sensitive contractual arrangement between the Appellant's parent company and the Government of Kenya, which required careful validation before any decision to escalate the matter to litigation could be made.j)That further, the Appellant is part of a multinational group whose management and key decision-making functions are based in France. That upon receipt of the Objection decision, the Appellant was therefore required to obtain group-level approvals, retrieve relevant historical documentation held outside Kenya, and align internally on the legal, regulatory, and commercial implications of pursuing an appeal.k)That this process was complex, time-intensive, and unavoidable, and did not cease upon issuance of the Objection decision. That as a result, the Appellant was unable to file a Notice of Appeal within the statutory thirty-day period, despite acting diligently and in good faith.l)That the delay in filing the appeal was therefore not occasioned by indolence or wilful inaction, but arose from circumstances beyond the Appellant’s control, including the sensitivity of the underlying Government-related contract and the necessity of obtaining multinational group approvals.m)That once the requisite information and authorisations were secured, the Appellant moved with dispatch to bring the present Application. The resultant delay of approximately 125 days is reasonable, sufficiently explained, and excusable.n)That the intended Appeal raises serious and arguable issues of law and fact, including unlawful disallowance of expenses incurred wholly and exclusively in the production of income, as well as erroneous computation and imposition of penalties and interest.o)That the Respondent shall suffer no prejudice if the extension sought is granted, as any tax ultimately confirmed to be payable shall remain recoverable together with interest and penalties, and any inconvenience occasioned may be adequately compensated by an award of costs.p)That conversely, unless the orders sought are granted, the Appellant stands to suffer substantial prejudice, having been denied an opportunity to ventilate its dispute on the merits, contrary to the principles of fair administrative action and access to justice.q)That it is therefore in the interest of justice, fairness, and proportionality, and in furtherance of the Appellant’s constitutional rights under Articles 40, 47, and 48 of the Constitution, that this Honourable Tribunal exercises its discretion in favour of extending time. 3.The Appellant did not file any written submissions. 4.The Respondent did not file a response to the Application. Analysis And Findings 5.The Appellant/Applicant is primarily seeking leave of the Tribunal to file its Notice of Appeal, Memorandum of Appeal and Statement of Facts out of time. 6.Section 13(4) of the Tax Appeals Tribunal Act provides the legal test for grant of an application to file an appeal out of time. The Tribunal may grant extension of time to file an appeal due to an Applicant’s absence from Kenya, sickness or other reasonable cause. 7.The Tribunal is enjoined to determine the length and reason for the delay when considering an application for the extension of time to file an 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. 8.In determining whether to extend time, the Tribunal was guided by the Court in Charles Karanja Kiiru v Charles Githinji Muigwa [2017] eKLR, where the learned Judge stated that: -“It is trite that extension of time is not a right of a party. It is an equitable remedy that is only available to a deserving party, at the discretion of the Court” 9.The Tribunal, guided by the principles set out in John Kuria v Kelen Wahito, Nairobi Civil Application Nai 19 of 1983 April 10, 1984, referred to by the Judges in the cases of Wasike V Swala [1984] KLR 591, Sammy Mwangi Kiriethe & 2 others v Kenya Commercial Bank Ltd and Section 13 of the Tax Appeals Tribunal Act 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 the application for extension has been brought without undue delay.d.Whether there will be prejudice suffered by the Respondent if the extension is granted. Whether there is a reasonable cause for the delay 10.In considering what constitutes a reasonable cause for delay, the court in Silas Kanyolu Mwatha v Josephine Kavive James [2021] eKLR, held that: -“The time stipulation is a requirement of the law as clearly stated ... In short, parties cannot, either unilaterally or by agreement between them, metaphorically, waive away the rules of the court. The rules of the Court are meant to achieve timely and orderly commencement, progress, and proper determination of litigation of proceedings. Given the statutory limit, principally, the delay is inexcusable unless the applicant shows sufficient cause to justify the delay and that any such extension shall not prejudice the respondent.” 11.The statutory timelines and provisions to file an appeal have been clearly set out in the Tax Appeal Tribunal Act. Section 13 of the Act provides as follows with regard to the statutory timelines in commencing an appeal process:-“ 13. (1)A notice of appeal to the Tribunal shall—(a)be in writing;(b)be submitted to the Tribunal within thirty days upon receipt of the decision of the Commissioner. (2)The appellant shall, within fourteen days from the date of filing the notice of appeal, submit enough copies, as may be advised by the Tribunal, of—(a)a memorandum of appeal;(b)statements of facts; and(c)the appealable decision; and(d)such other documents as may be necessary to enable the Tribunal make a decision on the appeal.” 12.For a taxpayer who has not met the timelines as provided in the above provision of the law, Section 13(4) of the Tax Appeals Tribunal Act provides the conditions that the taxpayer ought to meet to enable the Tribunal to exercise its discretion to extend time to appeal under Section 13(3) which provides as follows: -“ 13. (3)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). (4)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 giving notice of appeal within the specified period.” 13.The Appellant/Applicant provided the following reasons for the delay in filing its intended Appeal:a.That the issues forming the subject matter of the intended Appeal arise from transactions linked to a sensitive contractual arrangement between the Appellant's parent company and the Government of Kenya, which required careful validation before any decision to escalate the matter to litigation could be made.b.That further, the Appellant is part of a multinational group whose management and key decision-making functions are based in France. That upon receipt of the Objection decision, the Appellant was therefore required to obtain group-level approvals, retrieve relevant historical documentation held outside Kenya, and align internally on the legal, regulatory, and commercial implications of pursuing an appeal.c.That this process was complex, time-intensive, and unavoidable, and did not cease upon issuance of the Objection decision. That as a result, the Appellant was unable to file a Notice of Appeal within the statutory thirty-day period, despite acting diligently and in good faith. 14.Gleaning through the documents tabled by the Appellant/Applicant and arguments proffered in its pleadings in their entirety, the Tribunal notes that the Appellant/Applicant failed to produce documentary evidence of its assertions that delayed group-level approvals regarding filing an appeal, retrieval of relevant historical documentation held outside Kenya, and internal alignment on the legal, regulatory and commercial implications of pursuing an appeal were the cause for its delay to file its intended appeal. 15.The Appellant/Applicant failed to provide proof of whether any of these purported actions actually occurred. Additionally, the Appellant/Applicant did not submit any evidence of the timeframes of occurrence of the purported actions in relation to the statutory timeline for filing an appeal to the Tribunal. The Appellant/Applicant’s averments in no way satisfied its assertions without documentary proof of the reasons for delay. 16.Having examined the first test and found that there was no demonstrated reasonable cause for the Appellant/Applicant’s delay, the Tribunal sees no need in embarking in an academic exercise by analysing the remaining tests, as the same have been rendered moot. Disposition 17.Based on the foregoing, the Tribunal finds that the Application is unmeritorious and accordingly proceeds to issue the following Orders: -a.The Notice of Motion Application dated 29th April 2026 and filed on 30th April 2026 be and is hereby dismissed.b.No order as to costs. 18.It is so ordered. DATED AND DELIVERED AT NAIROBI THIS 26TH DAY OF JUNE 2026.……………………………..…ROBERT M. MUTUMACHAIRMAN……………………………… …….GLORIA A. OGAGAMEMBER.….……..……………..EUNICE N. NG’ANG’A MEMBER……………………………..….JIMMY M. MALLAMEMBER