[2024] KETAT 481 (KLR)

Kariuki v Commissioner of Domestic Taxes (Miscellaneous Application E175 of 2023) [2024] KETAT 481 (KLR) (22 March 2024) (Ruling)

Neutral citation: [2024] KETAT 481 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Miscellaneous Application E175 of 2023

E.N Wafula, Chair, M Makau, EN Njeru, E Ng'ang'a & AK Kiprotich, Members

March 22, 2024

Between

David Wariuru Kariuki

Applicant

and

Commissioner of Domestic Taxes

Respondent

Ruling

1. The Applicant moved the Tribunal vide the application dated on 11th November 2023 and filed under a certificate of urgency on 15th November 2023 and supported by an Affidavit sworn by the Applicant, himself, on the 11th November, 2023, seeking the following Orders: -a.That the Tribunal be pleased to extend the time for the filing a Notice of Appeal against the Respondent’s inadequate decisions or no decision on Assessment Orders (KRA201915638899, KRA201915644672, KRA201915636700 and KRA201915635656).b.That the costs of this application be provided for.

2. The application is premised on the grounds, that: -i.The Respondent rendered its inadequate decisions or no decision to the Applicant on assessment orders.ii.The parties reached an agreement during the Objection review stage that the Applicant files his Objection out of time.iii.The Applicant provided documents upon the request by the Respondent vide the letter dated 25th January 2022, which documents the Applicant provided, but the same were never validated by the Respondent.iv.The Applicant could not file the Appeal in time for the reason of the pandemic which has hit the Country in 2020 and 2021 and his mother had been admitted in hospital rendering the business to temporary closure as the Applicant was the primary caregiver till she passed on.v.The Applicant filed its Notice of Appeal on 8th August 2022, delay whereof was occasioned by the fact that the Applicant was engaging the Respondent on its Objection validation on the expectation of a tax decision was to be made to enable him file an Appeal.vi.The Applicant pursued TAT Appeal No. 836 of 2022, till 10th November 2023 when the same was struck out on account of the Notice of Appeal having been filed out of time.vi.The Applicant is desirous of challenging the Respondent’s inadequate tax decisions on its assessment orders.

3. The Respondent opposed the application through its Grounds of Opposition dated and filed on 15th November 2023, which raised the following grounds in opposition: -i.That the Tribunal is functus officio thus lacks jurisdiction to hear and determine the Applicant’s application.ii.That the Honourable Tribunal delivered judgement on 10th November 2023 in TAT Appeal No. 836 of 2022 David Waruiru Kariuki vs. Commissioner of Domestic Taxes dismissing the Applicant’s Appeal.iii.That the Applicant ought to prefer an Appeal against the Judgment of the Tribunal to the High Court pursuant to Section 53 of the Tax Procedures Act 2015.

Submissions of Parties 4. The Applicant in its written submissions dated 17th November, 2023 and filed on 29th November 2023 argued as hereunder.

5. The Applicant submitted that the Tribunal’s jurisdiction did not cease on its Judgment as the matter of the Applicant was struck out. The Applicant further stated that it had crucial information that would aid the Tribunal in making it decision on merit.

6. The Respondent in its written submissions dated on 22nd November 2023 and filed on 23rd November, 2023 established three issues for determination, namely;i.Whether the Applicant’s application has been brought without delay;ii.Whether there are reasonable circumstances demonstrated to warrant an order for enlargement of time; andiii.Whether the Respondent will suffer any prejudice of the application is allowed.

7. The Respondent submitted that the Applicant did not lodge it Notice of Appeal with the stipulated timelines of 30 days of the Respondent’s decision issued on 12th April 2022, instead lodged the same on 8th August 2022 without leave.

8. The Respondent submitted that the Applicant pursed its Appeal being TAT No. 836 of 2022 which was struck out on 10th November 2023 for not having been lodged within the statutory timelines.

9. The Respondent submitted that the Applicant’s delay of over one year is unreasonable and has not been explained.

10. The Respondent relied on Section 13 (3) and (4) of the TAT Act, Rule 10 of the Tax Appeals Tribunal (procedure) Rule 2015 and stated that the Tribunal whilst granting orders of such nature ought to satisfy itself of the grounds set out therein.

11. The Respondent submitted that the Appellant has not met the criteria to warrant the orders sought to be granted.

12. The Respondent submitted that it would suffer prejudice and prayed for the Tribunal to make an order for deposit for security in the event it is inclined to grant the orders sought.

13. The Respondent relied of the following case law;i.Income Tax Appeal No. 31 of 2017 Commissioner for Domestic Taxes vs. Mayfair Insurance Company Limited [2017] eKLR;ii.TAT No. 377 of 2019 GreenCounty Constuction Ltd vs. Commissioner of Domestic Taxes;iii.Nichola Kiptoo Arap Korir Salat vs. Independent Electoral and Boundaries Commission & 7 Others [2014] eKLR;iv.TAT No. 107 of 2022 Sawa Sawa Company Ltd vs. Commissioner of Domestic Taxes.

Analysis and Findings 14. The Applicant seeks for extension of time to file an Appeal out of time in his application filed on 15th November 2023.

15. It is worth noting that the Applicant herein had moved the Tribunal in TAT Appeal No. 836 of 2022 which was struck out on 10th November 2023 on the ground that the Appeal lodged on 8th August 2022 was filed out of the statutory timelines without leave of the Tribunal.

16. The Respondent in its Grounds of Opposition alluded to the fact that the Tribunal was functus officio in the instant application having dealt with the Appeal No. 836 of 2022 and the only recourse in law available to the Applicant herein was to prefer an Appeal to the High Court.

17. The Tribunal has had the opportunity to perusal the said decision delivered on 10th November 2023 in TAT Appeal No. 836 of 2022 and it observes that the Appeal was struck out and not dismissed. Further, the Tribunal in its decision did no delve into the merits and demerits of the Appeal, however, on a fundamental principle of non-observance of statutory timelines, the Appeal was struck out.

18. Accordingly, it would not be proper in law to infer that the Appeal was substantively dealt with by the Tribunal, in such instances where an Appeal is struck out, the aggrieved party still retains its right in law to regularize the legal anomaly and institute a fresh Appeal or move the Tribunal appropriately on such sound grounds as may be subsequently considered by the Tribunal.

19. It is therefore the Tribunal’s position that premised on the decision made in TAT Appeal No. 836 of 2022, the Tribunal is not functus official and the Applicant retained the right to appropriately move the Tribunal.

20. The Tribunal is therefore, invited to interrogate the grounds and the reasonability of the delay of the Applicant in lodging the Appeal.

21. Section 13 (4) provides for the grounds to be relied upon by such a party in making an application of the instant nature, it provides;“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.”

22. The Applicant submitted that he was prevented from filing the Appeal within the statutory timelines on the ground of sickness of his mother and that he was the primary caregiver to her till her moment of demise, further that the Applicant having filed an Appeal before the Tribunal was pursuing the same under the mistaken belief it was validly lodged.

23. Consequently, the Applicant relied on sickness and other reasonable ground, both of which are provided under Section 13 (4) of the TAT Act.

24. Flowing from the documentation presented, the Tribunal noted that the Applicant was issued with a decision by the Respondent on the 12th April 2022 and lodged it Notice of Appeal on the 8th August 2022 (without leave). Thereafter the Applicant went on to prosecute his Appeal till its determination on 10th November 2023.

25. The period between 12th April 2022 and 8th August 2022 was less than four months, which in the Tribunal’s view would not have constituted an unreasonable delay, certainly if the Applicant had moved the Tribunal at that point with the instant application. However, the Applicant engaged with the prosecution of his Appeal in TAT Appeal No. 836 of 2022.

26. The Tribunal notes that the Appellant has not gone out of its way to establish any extra ordinary circumstances that occasioned in its default in the filing of the initial appeal in time and how it was otherwise unable to determine that the previous Appeal had been filed out of time during the pendency of the Appeal.

27. The Applicant has not demonstrated any cause for absence of knowledge in timelines for commencing appeals against objection decision and neither does he hold any other independent third party culpable for the lapse in filing the appeal in time.

28. The Tribunal is not at all persuaded that the Applicant has attempted to advance any reasonable grounds to warrant the granting of the orders sought herein.

29. Consequently, the Applicant’s application dated 15th October 2023 succeeds.

Disposition 30. Premised on the foregoing analysis, the Tribunal finds that the application lacks merit and accordingly makes the following Orders:-a.The application be and is hereby dismissed.SUBPARA -b.No orders as to costs.

31. It is so ordered.

DATED AND DELIVERED AT NAIROBI THIS 22ND DAY OF MARCH, 2024ERIC NYONGESA WAFULA - CHAIRMANMUTISO MAKAU - MEMBERELISHAH N. NJERU - MEMBEREUNICE N. NG’ANG’A - MEMBERABRAHAM K. KIPROTICH - MEMBER