https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/258

 REPUBLIC OF KENYA IN THE TRIBUNAL OF KENYA AT NAIROBI COUNTY COURT NAME: TAX APPEALS TRIBUNAL CASE NUMBER: TATMISC/E046/2026 JOYSANDHOLDINGSLIMITED VS KENYA REVENUE AUTHORITY RULING 1. The Applicant moved this Tribunal through a Notice of Motion dated 17th June 2026 and filed on 22nd June 2026 under certificate of urgency and supported by affidavit sworn on 17th June 2026 by Sandra Cheruto Morogo who is the director of the Applicant, seeking the following Orders: 1. Spent 2. That this Honourable Tribunal be pleased to grant leave to the Applicant to file an Appeal out of time against the Respondent's objection decision. 3. That the annexed Memorandum of Appeal be deemed as duly filed and served upon payment of the requisite fees. 4. That costs of this Application be in the cause. # Grounds for the Application 1. The Application is based on the grounds that: 2. That the delay in filing the Appeal was not deliberate nor inordinate, but arose from circumstances beyond the Applicant's control. 3. That following the issuance of the Objection decision, the Applicant engaged the Respondent in good faith negotiations, with a view to amicably resolving the dispute. 4. That the ongoing negotiation process created a legitimate expectation that the matter would be resolved without recourse to litigation, thereby contributing to the delay. 5. That the assessment in dispute is complex and involves detailed reconciliation of VAT, withholding tax and allowable expenses, necessitating time to obtain and analyse supporting documentation. 6. That the Applicant experienced administrative and system-related challenges, including constraints in accessing and compiling critical financial records within the statutory timelines. 7. That the Applicant has a meritorious Appeal with high chances of success, raising substantial issues of law and fact including double taxation, erroneous disallowance of expenses, and misapplication of tax principles. 8. That no prejudice will be suffered by the Respondent that cannot be compensated by costs, whereas the Applicant stands to suffer substantial injustice if denied an opportunity to be heard. 9. That it is in the interest of justice and fairness, and in line with the principle of determining disputes on their merits, that this Application be allowed. # Respondent’s case 1. The Respondent did not file a response to the application. # Analysis and Findings 1. The Applicant sought leave to file an appeal out of time. Section 13(3) of Tax Appeals Tribunal Act (TATA) mandates this Tribunal to hear and determine application of this nature. It provides as follows: *The Tribunal may, upon application in writing, extend the time for filing the Notice of Appeal and for submitting the documents referred to in subsection (2).* 1. There are factors that the Tribunal has to evaluate before making determination on an application of this nature. In this regard, Section 13(4) of TATA provides that as follows: *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.* 1. Further, Rule 10 of the Tax Appeals Tribunal (Procedure) Rules (hereinafter referred to as the ‘TAT Rules’) reiterates the foregoing statutory provision in the following terms: 2. *The Tribunal may grant the extension of time if it is satisfied that the Applicant was unable to submit the documents in time for the following reasons –* 1. *Absence from Kenya;* 2. *Sickness; or* 3. *Any other reasonable cause.* 3. Pursuant to the foregoing provisions of the law, it is clear that under section 13 (3) and Rule 10 of the Rules, the power to extend time is discretionary and not a right to be granted to the Applicant. This position has been mirrored by the Supreme Court in the case of ***Nicholas Kiptoo Arap Korir Salat v Independent Electoral and Boundaries Commission & 7 others [2014] eKLR*** wherein the Supreme Court set out general considerations to guide the court in exercising its discretion in cases of this nature. The Court stated as follows: 4. *‘‘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;* 5. *A party who seeks for extension of time has the burden of laying a basis to the satisfaction of the court;* 6. *Whether the court should exercise the discretion to extend time, is a consideration to be made on a case-to-case basis;* 7. *Whether there is a reasonable reason for the delay. The delay should be explained to the satisfaction of the court;* 8. *Whether there will be any prejudice suffered by the respondents if the extension is granted;* 9. *Whether the application has been brought without undue delay; and* 10. *Whether in certain cases, like election petitions, public interest should be a consideration for extending time."* 11. In the case of **Wasike v Swala [1984] KLR 591** the Court provided the hierarchy of the factors to consider when considering an application for enablement of time. It held that: *“An applicant must now show, in descending scale of importance, the following factors:-* 1. *That there is merit in the appeal.* 2. *That the extension of time to institute and/or file the appeal will not cause undue prejudice to the respondent; and* 3. *That the delay has not been inordinate.”* 4. The Tribunal examined the Applicant’s application in light of the aforementioned provisions of the law and precedents. # Whether the appeal is merited 1. The Applicant has to demonstrate that the appeal is arguable. The Applicant has a duty to demonstrate that an application is not frivolous. In # Diplack Kenya Limited v William Muthama Kitonyi [2018] eKLR the Court stated that an applicant seeking enlargement of time to file an appeal or admission of an already filed appeal must show that he/she has a good cause for doing so. 1. The Court in **Stanley Kangethe Kinyanjui v Tony Keter and others** **(2013) eKLR**, had the following to say about whether an application was arguable. *“On whether the appeal is arguable, it is sufficient if a single bonafide ground of appeal is raised, an arguable appeal is not one which must necessarily succeed, but one which ought to be argued fully before the court: one which is not frivolous.”* 1. The High Court in **Githau v Kagiri & another (Civil Appeal 314 of** **2023) [2024] KEHC 6320 (KLR) (6 June 2024) (Ruling)** while rejecting an application to file an appeal out of time, observed as follows: *‘‘I have perused the intended Memorandum of Appeal and the judgment of the trial court and noted that the appeal does not raise pertinent issues of law. As such, the appeal cannot be said to be arguable.’’* 1. The Tribunal examined the draft memorandum of Appeal and noted that one of the grounds of appeal was that the Respondent subjected the Applicant to double taxation on income already declared and accounted for within tax system. The Applicant also raised a concern that the Respondent failed to appreciate timing differences in VAT and income tax reporting, thereby wrongly treating declared income as omitted income. 2. Having evaluated the grounds of appeal, the Tribunal was of the view that the Respondent ought to respond to the assertions in the draft memorandum of Appeal. Therefore, the intended appeal is arguable. # Whether there is a reasonable cause for the delay 1. The Applicant has to demonstrate reasonable grounds that led to the delay. In the case of **National Union of Mineworkers v Council for Mineral** **Technology [1998] ZALAC 22** the court had the following to say in relation to reasonable cause: *‘‘…There is a further principle which is applied and that is that without a reasonable and acceptable explanation for the delay, the prospects of success are immaterial, and without prospects of success, no matter how good the explanation for the delay, an application for condonation* *should be refused.”* 1. The Applicant herein sought leave to appeal out of time on basis that following the issuance of the objection decision, the Applicant engaged the Respondent in good faith negotiations, with a view to amicably resolving the dispute and that the negotiation process created a legitimate expectation that the matter would be resolved without recourse to litigation, thereby contributing to the delay. 2. The Respondent having failed to file a response to this application, the Applicant’s assertions remained unchallenged. # Whether the delay is inordinate 1. In matters of this nature, the Applicant has the mandate to establish that the delay is not inordinate and even if it is inordinate, it is explained satisfactorily. In the case of **Joseph Odide Walome v David Mbadi Akello** **[2022] eKLR**, the Court stated as follows in relation this issue:- ‘‘*Where a party is aggrieved and wishes to pursue an appeal, it would be fair to exercise discretion in his favour and especially where the delay in filing the appeal is not inordinate or even if the delay is inordinate, it is explained to the satisfaction of the court and the adverse party will not be prejudiced in any way*.’ 1. The Objection decision is dated 29th December 2025. The Applicant filed this application close to six months later. The Applicant explained that it engaged the Respondent with a view of settling the matter and before knowing it, time had run out. There is no doubt that the Applicant delayed to file the Appeal but the Tribunal was of the view that the delay was explained satisfactorily. # Whether the Respondent will be prejudiced if time is enlarged 1. In **Nicholas Kiptoo Arap Korir Salat** case (supra), the Supreme held that the decision maker has to consider whether the Respondent would be prejudiced should the application be allowed. Similarly, in the case of **Edith** **Gichungu Koine v Stephen Njagi Thoithi [2014] eKLR** the High Court held: ‘‘…*the degree of prejudice to Respondent if the application is granted should be considered.’’* 1. The Respondent did not file a response to this application therefore, it could not demonstrate whether it would be prejudice if the application was allowed. 2. The Respondent will not be prejudiced should this application be allowed because if the proposed appeal fails, the Respondent will recover the taxes in issue plus interests. # DISPOSITION 1. In the circumstances, the Tribunal makes the following orders: 2. The Application be and is hereby allowed; 3. The prayers in the notice of motion dated 17th June 2026 and filed on 22nd June 2026 are hereby allowed; 1. That this Honorable Tribunal grants leave to the Applicant to file an Appeal out of time against the Respondent's Objection decision. 2. That the annexed Memorandum of Appeal be deemed as duly filed and served upon payment of the requisite fees. 4. The Respondent is at liberty to put in its response, within statutory timelines; and 5. No orders as to costs. 6. It is so ordered. # DATED AND DELIVERED AT NAIROBI THIS 27TH DAY OF JULY, 2026 SIGNED BY/FOR: **★ TH E JUDICIAR Y O F KENY A ★** **HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER HON. SANKALE SPENCER OLOLCHIKE** **HON. BILLY GRAHAM OKUMU MIJUNGU** Tax Appeals Tribunal Tribunal Date: 2026-07-27 12:17:06