[2025] KETAT 242 (KLR)

Kenya Cuttings Limited v Commissioner of Domestic Taxes (Tax Appeal E982 of 2024) [2025] KETAT 242 (KLR) (Civ) (16 May 2025) (Judgment)

Neutral citation: [2025] KETAT 242 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Civil

Tax Appeal E982 of 2024

CA Muga, Chair, BK Terer, EN Njeru & E Ng'ang'a, Members

May 16, 2025

Between

Kenya Cuttings Limited

Appellant

and

Commissioner Of Domestic Taxes

Respondent

Judgment

1. The Appellant is a company incorporated in the Republic of Kenya whose principal business activity is to produce ornamental plant cuttings for export to the Netherlands.

2. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws (hereinafter “the Act”). 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 Appellant accumulated excess input tax owing to making exported taxable supplies taxable at the rate of 0% and lodged various VAT claims with the Respondent which the Respondent Acknowledged on 1st July, 2024 and rejected on 22nd and 23rd July, 2024.

4. Aggrieved by the refund decision of the Respondent, the Appellant filed its Notice of Appeal dated 21st August, 2024 on 23rd August, 2024.

The Appeal 5. The Appellant’s Memorandum of Appeal dated and filed on 4th September, 2024 was premised on the following grounds:i.That the Respondent erred in law and in fact by disallowing refund claims of Kshs. 7,734,332. 00 that had previously been allowed by Tribunal;ii.That the Respondent erred in law and in fact by rejecting claims of Kshs.7,342,452. 00 which it had previously allowed thereby violating the Appellant’s legitimate expectation; andiii.That the Respondent erred in law and fact by failing to ascertain the validity of the Appellant’s refund claims of Kshs. 28,478,288. 00 as is required by the provisions of Section 47 of the Tax Procedures Act, CAP 469B of the Laws of Kenya (hereinafter “TPA”) by rejecting them on the erroneous basis that the Appellant had pending debt related concerns.

Appellant’s Case 6. The Appellant’s relied on its statement of facts dated and filed on 4th September, 2024 wherein it stated the following:

7. It averred that its business model is one of an ‘independent contractors’. The Appellant was appointed by Syngenta B.V. as a non-exclusive producer of unrooted and rooted cuttings of flower varieties through a Production and Sale agreement dated 1st January 2019.

8. The Appellant averred that the production process involves the Appellant buying materials for production of the flower varieties from Syngenta B.V. These materials remain in the ownership of Syngenta B.V since they are the intellectual property of Syngenta B.V and are protected under various international conventions. The Appellant multiplies the materials received from Syngenta B.V to produce rooted plants from which it harvests unrooted cuttings for shipment to Syngenta B.V or re-roots them and exports them to Syngenta B.V as rooted cuttings.

9. The Appellant averred that it exports the rooted and unrooted cuttings and therefore, the production of rooted and unrooted cuttings by the Appellant were zero-rated under the Second Schedule to the Value Added Tax Act, CAP 476 of the Laws of Kenya (hereinafter “VAT Act”). The VAT Act allows for taxpayers to claim input VAT pursuant to Section 17(1) which provides for the offsetting of input tax against output tax but only to the extent that the supply or importation was incurred to make a taxable supply. A taxable supply is defined in Section 2 of the same act as any supply made in Kenya by a person in the course or furtherance of a business carried on by the person.

10. Section 17(5) of VAT Act provides as follows:“(5)Where the amount of input tax that may be deducted by a registered person under subsection (1) in respect of a tax period exceeds the amount of output tax due for the period, the amount of the excess shall be carried forward as input tax deductible in the next tax period:Provided that any such excess shall be paid to the registered person by the Commissioner where—the Commissioner is satisfied that such excess arises from making zero rated supplies; and the registered person lodges the claim for the refund of the excess tax within twelve months from the date the tax becomes due and payable.”

11. The Appellant asserted that the VAT refund claims arose as result of the costs it incurred in the procurement of goods and services in the course or furtherance of the business carried on by it and paid consideration and is therefore entitled to a VAT refund under section 17(1) as read with section 17(5) of the VAT Act. Considering the above, the Appellant asserted that it was provided goods and services in the course or furtherance of a business carried on by it and paid consideration and is therefore entitled to a VAT refund under section 17(1) as read with section 17(5) of the VAT Act.

12. The Appellant averred that in accordance with the provisions of Section 17(5) of the VAT Act, it lodged its VAT refund claims with the Respondent on 1st July 2024 amounting to Kshs. 43,555,072. 00 and thereafter, the Respondent rejected the Appellant’s VAT refund applications specified vide its rejection orders dated 22nd July 2024 and 23rd July 2024. The Respondent based its rejection on the basis that the Appellant had tax that was due and payable. Specifically, the Appellant stated that the Respondent responded by stating as follows:“…The claim has been rejected due to a pending debt related concern at the Refunds Debt Validation Unit. Kindly reapply once the matter is resolved”or“The claim has been rejected because there is pending debt related concern. Kindly reapply after clearance with the debt validation team based at JKUAT Towers 9th floor (Formerly ICEA Building).”

13. The Appellant asserted that the refund claim of May 2021 of Kshs. 3,342,168. 00 had been the subject of Tax Appeal No. 956 of 2022 wherein Judgment had been delivered on 24th November 2023 in favour of the Appellant. The refund claim of Kshs. 4,392,164. 00 was part of the subject of the dispute in TAT Appeal 1028 of 2022 wherein Judgment had been delivered on 8th December 2023 in favour of the Appellant. The Appellant outlined the various cases and the amount of refund claim allowed by the Tribunal Judgements.

14. The Appellant further averred that part of the refund claims amounting to Kshs. 7,342,452. 00 now rejected had been ascertained by the Respondent vide Audit findings dated 15th February 2023. The Appellant averred that the Respondent erred by failing to audit and validate the balance of the Kshs. 28,478,288. 00 disallowed that had not been subject of previous audits or dispute as is required of them pursuant to the provisions of Section 47 of the TPA.

15. Dissatisfied with the Respondent’s refund rejection orders and pursuant to the provisions of Section 47(13) and 52(1) of TPA, the Appellant notified the Respondent of its intention to appeal against the said orders through its Notice of Appeal filed on 21 August 2024.

16. The Appellant proceeded to outline in-depth, the grounds of its Appeal as follows:I. That the Respondent erred in law and in fact by disallowing refund claims of Kshs. 7,734,332. 00 that had previously been allowed by the Tribunal.

17. As noted under paragraph 13 above, the Appellant averred that the refund claim of May 2021 of Kshs. 3,342,168. 00 and the refund claim of July 2020 of Kshs.4,392,164. 00 (both totaling to Kshs. 7,734,332. 00) were the subject to two separate Tax Appeals disputes whose judgment was rendered in favour of the Appellant.

18. The Appellant averred that the refund claim of May 2021 of Kshs. 3,342,168. 00 had been part of the subject in dispute in Tax Appeal No. 956 of 2022 wherein Judgment had been dated 24th November 2023 in favour of the Appellant. The Tribunal at paragraph 86 of this Judgment ordered that the refund claim of May 2021 be allowed stating as follows:“From the analysis above, the Tribunal holds that this Appeal partly succeeds and consequently makes the following Orders: -a.The Appeal be and is hereby allowed.b.The orders of rejection issued on 21st July 2022, 22nd July 2022 and 25th July 2022 are hereby set aside.c.The refund claims for the period between January 2021 to July 2021 are hereby allowed.”

19. The Appellant further averred that the refund claim for the tax period July 2020 of Kshs. 4,392,164. 00 had been allowed by the Tribunal in Tax Appeal No. 1028 of 2022 wherein Judgment had been dated 8th December 2023 in favour of the Appellant. The Tribunal in paragraph 82 of its Judgment ordered that the refund claim of July 2020 be allowed stating as follows:“From the analysis above, the Tribunal holds that this Appeal succeeds and consequently makes the following Orders: -a.The Appeal be and is hereby allowed.b.The orders of rejection issued on 4th July 2022 and 5th July 2022 are hereby set aside.c.The matter is sent back to the Commissioner to review the Production and Sale Agreement dated 1st January 2019 and make a decision on the refund claim for September 2014, July 2019, October 2019, April 2020 and July 2020 within the next 60 days.”

20. The Appellant asserted that it followed up with the Respondent in accordance with the Judgment in Tax Appeal No. 1028 of 2022 and thereafter, the Respondent issued its findings vide letter dated 2nd February 2024, allowing for refund of the full amount for the tax period of July 2020. The Appellant asserted that to date, the Respondent had not lodged appeals to the Judgments in Tax Appeal No. 956 of 2022 and Tax Appeal No. 1028 of 2022.

21. The Appellant submitted that by rejecting refund claims that had been deemed allowed by a Judgment of this Tribunal, the Respondent stands in contempt of this Tribunal.

22. Section 21(d) and 29(7) of the Tax Appeals Tribunal Act, CAP 469A of the Laws of Kenya (hereinafter “TATA”) provides for the law on contempt of court. Section 21(d) of the TATA states as follows:“Any person who-does any other act or thing that would, if the Tribunal were a court of law, constitute a contempt of that court, commits an offence and shall be liable on conviction to a fine not exceeding one hundred thousand shillings or to imprisonment for a term not exceeding six months, or to both.”

23. Section 29(7) of the TATA provides as follows:“A decision of the Tribunal shall have effect as and be enforceable as if it were a decision of a Court.”

24. The Appellant submitted that the guiding principles that courts are to apply in determining contempt of court applications were well determined in the case of Kigio Group Company Limited v Kibaara & 8 others (Civil Appeal E193 of 2022) [2024] KECA 919 (KLR) (31 July 2024) (Ruling) as follows:“In order to succeed in an application for contempt of court, an applicant must therefore prove the terms of the order; knowledge of the terms by the respondent and failure by the respondent to comply with the terms of the order. These requirements were reiterated by this Court in Micheal Sistu Mwaura Kamau v Director of Public Prosecutions & 4 Others [supra] as follows:“It is trite that to commit a person for contempt of court, the court must be satisfied that he has willfully and deliberately disobeyed a court order that he was aware of”

25. The Appellant asserted that the Respondent was in contempt of court for the following reasons:i.The Tribunal was clear in its order as the Appellant had reproduced at paragraph 16 and 17 of its statement of facts.ii.The Respondent was fully aware of the Judgments issued given that the same were served by the Tribunal to the Respondent via its formal electronic mails lsbclitigation@kra.go.ke and/or legalServices@kra.go.ke ;andiii.Instead of processing the refunds as is required by the Tribunal, the Respondent instead proceeded to reject the refund claims.

26. The Appellant suffered a grave injustice in having two decisions issued by the Tribunal disregarded by the Respondent’s failure to process the refund claim. The delay and failure to process the refund claim was in contravention of the Appellant’s rights under Article 47 of the Constitution of Kenya, 2010 (hereinafter “the Constitution”) and Section 4 of the Fair Administrative Action Act , CAP 7L of the Laws of Kenya (hereinafter “FAAA”) which provides the right to administrative action that is expeditious, efficient, lawful, reasonable and procedurally fair.

27. The Appellant stated that by rejecting its refund claims amounting to Kshs. 7,734,332. 00, it was clear that the Respondent has no intention of obeying the Tribunal’s Orders although the only option available to the Respondent is to merely effect payment of the refund claims as so Ordered by this Tribunal. In TAT Appeal No. 286 of 2020 Morgan Air & Sea Freight Logistics Kenya Ltd v Commissioner of Domestic Taxes, a case based on similar facts, the Tribunal issued a ruling dated 17th February 2023 holding as follows:“8. It is manifestly clear that the Respondent intends to find a cause to re-open a tax dispute that has since been determined with finality by the Tribunal and that obviously is not available to the Respondent. The Respondent has a limited option of merely effecting payment of the refund claims that formed the basis of the notice of objection dated 26th July 2018. ”9. The Tribunal has powers under Section 21 of the Tax Appeals Tribunal Act to inquire into and make an appropriate determination in respect of any complaint relating to failure to comply with and/or disregard of its orders by any party subject to its jurisdiction.”

28. The Appellant asserted that the Respondent was and continued to be in contempt of the Tribunal’s Decisions for as long as no payments have been received by the Appellant.

29. From the foregoing, the Appellant prayed that the Tribunal would find the Respondent to be in contempt of the Tribunal’s decision and orders the Respondent to process the refund claim without any further delay.II. The Respondent has erred in law and in fact by rejecting claims of Kshs. 7,342,452. 00 which it had previously allowed thereby violating the Appellant’s legitimate expectation.

30. The Respondent conducted an audit reviewing the Appellant’s tax records in relation to various VAT refund claims that had been lodged. The audit process resulted in the issuing of audit findings vide letters dated 15th February 2023.

31. In the letters dated 15th February 2023, the Respondent approved the Appellant’s refund claim for the tax periods November 2021 and February 2022 amounting to Kshs. 7,342,452. 00 deeming them payable. The Appellant asserted that once it received the audit findings allowing the above referenced refund claims, the Appellant fully expected that the Respondent to then begin processing the refund payment as this has been the practice normalised by the Respondent previously.

32. The Appellant stated that the said practice was in alignment with the provisions of Section 47 of the TPA which provides that once a refund claim had been ascertained, the Respondent should proceed to process payment of the refund amount.

33. The Appellant asserted that this practice by the Appellant on processing of refund payments once the claims have been ascertained created a legitimate expectation that the Appellant should expect refund repayments and not rejections. The concept of legitimate expectation is well buttressed in the Supreme Court decision in the case Communication Authority of Kenya & 5 Others vs Royal Media Services Limited & 5 others [2014] eKLR. The doctrine of legitimate expectation as applied by the courts stipulates as follows:“a legitimate expectation may arise – either from an express promise given on behalf of a public authority or from the existence of a regular practice which the claimant can reasonably expect to continue.”

34. The Appellant asserted that the Respondent’s failure to pay out refund claims that it had ascertained goes against the doctrine of legitimate expectation. In TAT Appeal No. 156 of 2017 Unga Limited v Commissioner of Domestic Taxes, a decision that was upheld by the High Court in Commissioner of Domestic Taxes v Unga Limited [2021] eKLR, this Tribunal held as follows:“Accordingly, the Respondent's failure to process the VAT refunds after firming to the Appellant that the same was due and payable goes again the doctrine of legitimate expectation. The Respondent is hereby estopped from withdrawing its letter of 7 October 2014, in which it had confirmed the Appellant's VAT refund claim.”

35. From the foregoing, the Appellant contended that the Respondent is an administrative body required by law to act in good faith and adhere to the binding promises made to taxpayers and therefore prays for the Tribunal to direct the Respondent to process the Appellant’s refund as outlined in its letters dated 15th February 2023. III. The Respondent erred in law and fact by failing to ascertain the validity of the Appellant’s refund claim of Kshs. 28,478,288. 00 as is required by the provisions of Section 47 of the TPA by rejecting them on the erroneous basis that the Appellant allegedly had pending debt related concerns;

36. The Respondent rejected the Appellant’s refund claims on the basis that there was a pending debt related concern stating the following:“The claim has been rejected because there is pending debt related concern. Kindly reapply after clearance with the debt validation team based at JKUAT Towers 9th floor (Formerly ICEA Building).”

37. The Appellant asserted that the VAT refund claims lodged by it ought to have been reviewed on their merits and a decision as to their validity ought to have been delivered by the Respondent pursuant to Section 47 of the TPA which provides as follows:“(1)1) Where a taxpayer has overpaid a tax under any tax law, the taxpayer may apply to the Commissioner, in the prescribed form -a.to offset the overpaid tax against the taxpayer's outstanding tax debts and future tax liabilities; orb.for a refund of the overpaid tax within five years, or six months in the case of value added tax, after the date on which the tax was overpaid(2)The Commissioner shall ascertain and determine an application under subsection (1) within ninety days and where the Commissioner ascertains that there was an overpayment of tax -a.in the case of an application under subsection (1)(a), apply the overpaid tax to such outstanding tax debts or future tax liability; andb.in the case of an application under subsection (1)(b), refund the overpaid tax within a period of two years from the date of the application. six months from the date of ascertainment and, if the Commissioner fails to refund, the overpaid tax shall be applied to offset the taxpayer's outstanding tax debt or future tax liabilities.”

38. Further, as the refund claims relate to VAT, the Appellant asserted that it validly lodged its applications for a refund pursuant to the requirements of Section 17(5) of the VAT Act, which provides as follows:“(5)Where the amount of input tax that may be deducted by a registered person under subsection (1) in respect of a tax period exceeds the amount of output tax due for the period, the amount of the excess shall be carried forward as input tax deductible in the next tax period:Provided that any such excess shall be paid to the registered person by the Commissioner where the Commissioner is satisfied that such excess arises from making zero rated supplies; and the registered person lodges the claim for the refund of the excess tax within twelve months from the date the tax becomes due and payable."

39. The Appellant averred that its VAT refund claims were validly lodged as required under the provisions of Section 47 of the TPA and Section 17(5) of the VAT Act reproduced above. According to Section 47(4) and 4A of the TPA, the Respondent can opt to carry out an audit to ascertain the validity of the refund. However, such an audit must be concluded and a decision following the audit of the claim must be issued within one hundred and twenty (120) days.

40. The Appellant therefore averred that upon submitting of its valid refund application, the Respondent ought to have reviewed the refund claim and issued a decision on the application that would clearly state whether the refund claim was payable or not.

41. The Appellant further averred that it had a legitimate expectation of receiving a decision that communicates whether the refund claim has been deemed valid or not with the reasons for the decision expressly provided given that the Respondent has historically processed its refund claims by launching an audit and issued a decision as to the validity of the VAT refund claims. Legitimate expectation arises where a member of the public, as a result of a promise or other conduct of an administrative body expects that s/he will be treated in one way and the administrative body thereafter reneges and wishes to treat him/her in a different way.

42. Considering the above, the Appellant prayed that the Tribunal would find that the Respondent erred in law and in fact by rejecting its refund claim on the ground that there is debt related concern and failing to issue a decision on the validity of the refund claims.

43. Without prejudice to the above, the Appellant averred that it had previously lodged a number of refund claims earlier in the year that had not been processed. The Appellant made various enquiries as to the progress made on the refund claims lodged by the Appellant led to a verbal confirmation that the cause of delay was due to a debt related concern.

44. The Appellant through its tax agents, PricewaterhouseCoopers Limited, sent an electronic mail dated 30th May 2024 requesting that the Respondent clarify the nature of the debt concern issue that was delaying the processing of refund claims that had been raised.

45. The Respondent sent its response to the electronic mail on the same date stating that there was tax of Kshs.44,672,384. 48, that had not been paid off. The Appellant responded to the Respondent vide electronic mails dated 3rd June 2024, 5th June 2024 and 13th June 2024 stating that there were no valid debts owed by the Appellant by the taxpayer in view of the following issues:i.The Value Added Tax (VAT) of Kshs. 3,167,781. 48 averred tax payable was erroneous given that the taxpayer was in a credit position during that tax period. The same was evidenced using the September 2013 tax return;ii.The Withholding Income Tax of Kshs. 5,355,099. 00, WHT VAT of Kshs.147,666. 00 were both fully paid off with the proof of payment having been provided; andiii.The Legacy debts were erroneous given that the 2006 debt had already been paid and the company was in a tax loss position in 2013.

46. The Appellant averred that it continued to follow up with the Respondent and as of 18th July 2024, the Respondent had the debt status report prepared and was awaiting final approval .The Appellant averred that it confirmed, through its Tax Agents who visited the Respondent’s offices, that the debt status report clearing all liabilities had been approved by the Refund Debt Validation team as of 21st July 2024 and therefore, all debt related concerns had been fully settled as at this date.

47. In a turn of events a month after the debt related concerns had been settled, the Respondent issued the Refund Rejection Orders that are the subject matter of this appeal rejecting refund claims on the basis of pending debt related concerns that the Appellant believed had already been resolved.

48. The Appellant refuted the Respondent’s erroneous and misguided assertion that there is any pending debt related concern which would form the basis of the rejection orders dated 22nd July 2024 and 23rd July 2024. In view of the above, the Appellant prays that the Tribunal would see it fit to vacate these VAT claim rejection orders in their entirety as they are based on incorrect facts.

49. The Appellant sought the following reliefs:a.That the Appeal be allowed;b.That the Respondent’s decisions dated 22nd July 2024 and 23rd July 2024, be annulled and set aside;a.That the Respondent is in contempt of the Tribunal’s Orders and Judgments dated 8th December 2023 and 24th November 2023 in that being aware of the order made by this Court in the said Judgments has knowingly and wilfully violated and/or disregarded the said orders and/or knowingly and wilfully failed to take reasonable steps to ensure that the said orders were obeyed.b.The Appellant be paid VAT refund claims amounting to Kshs. 3,342,168. 00 relating to the period March 2021 and allowed in the Tribunal’s Judgment dated 24th November 2023 be paid to the Appellant within thirty (30) days of the date of this Tribunal’s decision in this Appeal.c.The Appellant be paid VAT refund claims amounting to Kshs. 4,392,164. 00 relating to the period July 2020 and allowed in the Tribunal’s Judgment dated 8th December 2023 be paid to the Appellant within thirty (30) days of this Tribunal’s decision in this Appeal.d.The Appellant be paid refund claims already approved via letter dated 15th February 2023 amounting to Kshs. 7,342,452. 00 relating to the tax periods February 2022 and November 2021 within thirty (30) days of this Tribunal’s decision in this Appeal.e.The Respondent erred in law and fact by rejecting the Appellant's refund application on the assertion that there were pending debt related concerns;f.The VAT refund claims amounting to Kshs. 28,478,288. 00 are due and payable;g.The costs of and incidental to this appeal be awarded to the Appellant; andh.Any other Orders that the Tribunal may deem fit.

Respondent’s Case 50. The Respondent replied to the case by filing its statement of facts dated and filed on 3rd October 2024 wherein it responded by stating the following:

51. The Section 47(4) of TPA provides as follows:“4. The Commissioner may, for purposes of ascertaining the validity of an application under subsection (1) subject the application to an audit.”

52. According to the Respondent, it has the authority pursuant to the said section 47 (4) of the TPA to conduct an audit in order to verify the validity of a tax refund application. This provision aims to ensure that all claims for refunds are thoroughly evaluated before any funds are disbursed.

53. The Respondent stated that the TPA outlines a clear timeline for processing refund claims, specifying a period of 90 days pursuant to Section 47(2) of the TPA. This timeframe is intended to provide timely resolutions for taxpayers seeking refunds, while also allowing the Respondent adequate time to assess the validity of each claim.

54. The Respondent relied on the provisions of Section 47(2) of TPA which provides as follows:“(2)The Commissioner shall ascertain and determine an application under subsection (!) within ninety days and where the Commissioner ascertains that there was an overpayment of tax-a.in the case of an application under subsection (!)(a), apply the overpaid tax to such future tax liability; andb.in the case of an application under subsection (l)(b), refund the overpaid tax within a period of two years from the date of the application.”

55. In the current situation, the Respondent was not able to unable complete the necessary audit within the stipulated 90-day period. As a result, the application for a tax refund was rejected, with the Respondent indicating that the audit was still pending. The Respondent had not completed the audit process of the Appellant's refund application; therefore, the application was rejected to avoid breaching Section 47(2) of the TPA.

56. The lapse of the 90-day period typically would result in the appellant's application for a tax refund being deemed allowed. However, the Commissioner rejected the application to avoid breaching Section 47(2) of the TPA, as the audit was still pending. This suggests that the Respondent aimed to prevent an automatic approval of the application due to the expired timeframe before completing the necessary audit.

57. The second issue pertained to the rejection of the claims by the processing officers due to the absence of a current Debt Status Report from the station. This report is crucial, as it provides an up-to-date overview of any outstanding debts or obligations related to the Appellant. Without this report, the processing officers lacked the necessary information to accurately assess the claims. Addressing this issue will be vital for the Appellant in moving forward with their claims and ensuring compliance with the requirements set forth by the processing officers.

58. The Appellant was advised in the rejection order that the claim was rejected due to a pending debt related concern and the Appellant should re-apply once the issue has been resolved. The Respondent averred that the debt issue has since been resolved and the Appellant is now at liberty to lodge a new application for refund for processing by the Respondent.

59. The Respondent sought the following reliefs from the Tribunal:i.Upholds the Respondent's decision as proper and in conformity with the provisions of the Law.ii.That the Appellant be directed to re-lodge its refund application afresh.

Parties’ Submissions 60. The Appellant’s written submissions dated 31st March, 2025 and filed on 1st April, 2025 were adopted by the Tribunal on 24th April, 2025 as were those of the Respondent dated and filed on 17th April, 2025.

61. In its submissions, the Appellant identified three issues for determination which were a reiteration of its three grounds of the Appeal. The Appellant delved into its view that the rejection of its refund applications amounted to contempt of the orders of the Tribunal. The Appellant submitted that the guiding principles that courts apply in determining contempt of court applications were well determined in the following cases: Lukano (Suing as The Legal Representative of The Estate of Evans Siema Lukano (Deceased)) v Director of Occupational Health and Safety;

Jamly Services & another (Interested Parties) (Judicial Review E133 of 2021) [2023] KEHC 21435 (KLR) (Judicial Review) (31 July 2023) (Ruling

Kigio Group Company Limited v Kibaara & 8 others (Civil Appeal E193 of 2022) [2024] KECA 919 (KLR) (31 July 2024) (Ruling)

62. In order to succeed in an application for contempt of court, an applicant must therefore prove the terms of the order; knowledge of the terms by the Respondent and failure by the Respondent to comply with the terms of the order. These requirements were reiterated by this Court in Micheal Sistu Mwaura Kamau v Director of Public Prosecutions & 4 Others [supra] as follows:“It is trite that to commit a person for contempt of court, the court must be satisfied that he has willfully and deliberately disobeyed a court order that he was aware of..”

63. From the foregoing jurisprudence, the Appellant submitted that in order to prove a case for contempt, the Appellant needed to prove the following:a.There is a court order that the Respondent has not complied with;b.The Respondent had full knowledge of the court/tribunal order; andc.The Respondent has failed to comply with orders.

64. The Appellant delved into the issue of contempt and cited Kenya Human Rights Commission v Attorney General and another where the Court held as follows:“Article 159 of the constitution recognizes the judicial authority of courts and tribunals established under the constitution. Courts and tribunals exercise this authority on behalf of the people. The decisions courts make are for and on behalf of the people and for that reason, they must not only be respected and obeyed but must also be complied with in order to enhance public confidence in the judiciary which is vital for the preservation of our constitutional democracy. The judiciary acts only in accordance with the constitution and the law (Article 160) and exercises its judicial authority through its judgments decrees orders and or directions to check government power, keep it within its constitutional stretch hold the legislature and executive to account thereby secure the rule of law, administration of justice and protection of human rights. For that reason, the authority of the courts and dignity of their processes are maintained when their court orders are obeyed and respected thus courts become effective in the discharge of their constitutional mandate." [Emphasis added]

65. The Appellant also cited the holding of the court at paragraph 65 where the following was held:“The fact that the power to punish for contempt is inherent and not granted by statute, follows the recognition by the constitution in Article 159 that judicial authority is derived from the people and vests in, and is exercised by the courts and tribunals established by or under the Constitution. Judicial authority having been derived from the people, the judiciary serves the public and courts make pronouncements for and on behalf of the people. In doing so, courts act only in accordance with the constitution and the law as demanded by Article 160(1) of the constitution. In that respect, therefore, the powers of the courts must be viewed from the supremacy clause in Article 2(1) of the constitution so that any attempt to limit the power to punish for contempt violates a foundational constitutional value on judicial authority. Any legislation on contempt must be in addition to but not in derogation of the constitution for such limitation or derogation will surely be unconstitutional."

66. The Appellant submitted that the Respondent was and continued to be in contempt of the Tribunal’s decisions as long as no payment were received by the Appellant and the Appellant therefore prayed that pursuant to the enabling provisions of the TATA, The Tribunal would declare that the Respondent was in contempt of its Judgement as issued.

67. As regards the second issue for determination which the Appellant identifies, it reiterated that the processing of refund payments once claims had been ascertained created a legitimate expectation that the Appellant should expect refund repayments and not rejection and that the concept of legitimate expectation is well buttressed in the case of Communication Authority of Kenya & Five Others v Royal Media Services Limited& 5 others. [2014] eKLR.

68. The Appellant further submitted that the doctrine of legitimate expectation as applied by courts stipulates that a legitimate expectation may arise from an express promise given on behalf of a public authority or from the existence of regular practice which the claimant can reasonably expect to continue. It submitted that there was a legitimate expectation held by members of the Public that the Respondent would act in a manner that was consistent, reasonable and procedurally fair and that legitimate expectation arose when a member of the public as a result of a promise or other conduct of an administrative body expects that he or she is treated one way and the administrative body reneges treating him/her in a different way. The Appellant cited the following other cases in this regard: East African Court of Appeal in Application 9 of 2020- Kioo Limited v Attorney General of Kenya

Tata Chemicals Magadi Limited v the Commissioner of Domestic Taxes

Republic v Kenya Revenue Authority ex-parte L.A.B International Kenya Limited

TAT 956 of 2022- Kenya Cuttings Limited v Commissioner of Domestic Taxes.

69. The Appellant submitted with regard to its third and final issue for determination that the debt related concern was fully resolved and the same was confirmed by the Respondent at Paragraph 22 of its Statement of Facts. It further submitted that refund claims of tax periods of May, 2020, August 2020, July 2023, October, 2022, November 2022 and August 2023 amounting to Kshs. 28,478,288. 00 not previously litigate or ascertained ought to have been delivered as is required by Section 47 of the TPA.

70. Th Appellant went on to submit that the Respondent can opt to conduct an audit to ascertain validity of the refund but that such an audit must be concluded and a decision following the suit of the claim issued in Ninety (90) days. It went on to outlined the Respondent’s core obligations under Section 47 of the TPA as being the following:a.Ascertaining and determining an application for refund of overpaid taxes within 90 days:b.Subjecting the application to an audit for purposes of ascertaining its validity, subject to issuing a decision within 120 days where an audit is carried out;c.Upon ascertaining an overpayment, applying the overpaid tax to offset any outstanding tax debts or future tax liabilities, and refunding any remaining overpaid taxes to the taxpayer; andd.Paying interest on the overpaid tax where the Respondent fails to issue a refund within the timelines prescribed under section 47 of the TPA.

71. The Appellant emphasized that pursuant to the provisions of Section 47 of the TPA the Respondent had the duty of ascertaining and determining the validity of the refund application and the Respondent’s decision must therefore address the merits of the refund application clearly indicating whether it is valid or not.

72. The Appellant submitted that the Respondent had acknowledged that it rejected the refund because it was running out of the statutorily mandated time to review the refund claim. The legislature is very explicit in its demand for efficiency by mandating that the refund decision regarding the refund application be issued within 90 days. It is a complete abuse of process, and the Respondent is attempting to circumvent the timelines provided by rejecting the refund and requesting the Appellant to re-apply so that they can restart the timeline.

73. The Appellant submitted that the Respondent’s guidance directing the Appellant to re-apply as is stated in its rejection decision and reiterated in Paragraph 21 and 22 of its Statement of Facts is grossly misleading given that the law is clear on the procedure to follow when dissatisfied with the Respondent’s refund decision issued under Section 47 of the TPA stating the following:“(13)A person aggrieved by a decision of the Commissioner under this section may appeal to the Tribunal within thirty days after being notified of the decision.”

74. The Appellant is guided by this Tribunal’s Judgment in TAT E351 of 2023 Pernod Ricard Limited v Commissioner Domestic Taxes (page 231 of the Appellant’s Bundle of Authorities) wherein the held that when a taxpayer receives a refund rejection decision, they must appeal as is required by Section 47 of the TPA in order to secure their rights to the claim and where a taxpayer fails to do so, the Commissioner’s decision prevails.

75. The law does not envision a scenario where the Respondent issues a refund decision simply to adhere to statutory timelines as the Respondent contended at paragraphs 16 and 17 of its Statement of Facts. Neither does the law envision a scenario where a taxpayer simply reapplies where a refund rejection decision is issued. However, the Respondent has made it a habit to encourage taxpayers to do so contrary to the law.

76. The Appellant submitted that the Respondent’s actions were punitive given that the taxpayer has had to incur costs to defend their refund claim by filing an appeal against the refund rejection decision before the Tribunal pursuant to Section 47(13) of the TPA to secure their rights to the refund claim.

77. The Appellant submitted that the rejection decisions dated 22nd July 2024 and 23rd July 2024 were issued less than a month after the Appellant lodged the refund claims on 1st July 2024 therefore, any concern as to the statutory timelines lapsing was about 60 days was premature. The Appellant further submitted that in response to the debt status query shared by the Respondent via electronic mail dated 30th May 2024, the Appellant submitted all documentation requested by the Respondent via electronic mails dated 3rd June 2024, 5th June 2024 and 13th June 2024 and therefore felt confident in lodging the refund claims on 1 July 2024.

78. From the foregoing, the Appellant submitted that it was clear that the 90-day time limit cannot be said to be a valid reason for issuing the decisions. From the foregoing, the Appellant submitted that the Respondent’s failure to consider the refund applications on merit and issue a refund decision that addresses the validity of the refund claim was prejudicial to the Appellant. Therefore, the refund claims ought to be allowed and deemed payable and the Rejection decisions ought to be set aside and annulled.

79. The Respondent’s submissions were a reiteration of its Statement of facts and accordingly, the Tribunal will not re-hash the same.

80. The Appellant’s written submissions dated 31st March, 2025 and filed on 1st April, 2025 were adopted by the Tribunal on 24th April, 2025 as were those of the Respondent dated and filed on 17th April, 2025.

81. In its submissions, the Appellant identified three issues for determination which were a reiteration of its three grounds of the Appeal. The Appellant delved into its view that the rejection of its refund applications amounted to contempt of the orders of the Tribunal. The Appellant submitted that the guiding principles that courts apply in determining contempt of court applications were well determined in the following cases: Lukano (Suing as The Legal Representative of The Estate of Evans Siema Lukano (Deceased)) v Director of Occupational Health and Safety;

Jamly Services & another (Interested Parties) (Judicial Review E133 of 2021) [2023] KEHC 21435 (KLR) (Judicial Review) (31 July 2023) (Ruling

Kigio Group Company Limited v Kibaara & 8 others (Civil Appeal E193 of 2022) [2024] KECA 919 (KLR) (31 July 2024) (Ruling)

82. In order to succeed in an application for contempt of court, an applicant must therefore prove the terms of the order; knowledge of the terms by the Respondent and failure by the Respondent to comply with the terms of the order. These requirements were reiterated by this Court in Micheal Sistu Mwaura Kamau v Director of Public Prosecutions & 4 Others [supra] as follows:“It is trite that to commit a person for contempt of court, the court must be satisfied that he has willfully and deliberately disobeyed a court order that he was aware of”

83. From the foregoing jurisprudence, the Appellant submitted that in order to prove a case for contempt, the Appellant needed to prove the following:a.There is a court order that the Respondent has not complied with;b.The Respondent had full knowledge of the court/tribunal order; andc.The Respondent has failed to comply with orders.

84. The Appellant delved into the issue of contempt and cited Kenya Human Rights Commission v Attorney General and Another where the Court held as follows:“Article 159 of the constitution recognizes the judicial authority of courts and tribunals established under the constitution. Courts and tribunals exercise this authority on behalf of the people. The decisions courts make are for and on behalf of the people and for that reason, they must not only be respected and obeyed but must also be complied with in order to enhance public confidence in the judiciary which is vital for the preservation of our constitutional democracy. The judiciary acts only in accordance with the constitution and the law (Article 160) and exercises its judicial authority through its judgments decrees orders and or directions to check government power, keep it within its constitutional stretch hold the legislature and executive to account thereby secure the rule of law, administration of justice and protection of human rights. For that reason, the authority of the courts and dignity of their processes are maintained when their court orders are obeyed and respected thus courts become effective in the discharge of their constitutional mandate." [Emphasis added]

85. The Appellant also cited the holding of the court at paragraph 65 where the following was held:“The fact that the power to punish for contempt is inherent and not granted by statute, follows the recognition by the constitution in Article 159 that judicial authority is derived from the people and vests in, and is exercised by the courts and tribunals established by or under the Constitution. Judicial authority having been derived from the people, the judiciary serves the public and courts make pronouncements for and on behalf of the people. In doing so, courts act only in accordance with the constitution and the law as demanded by Article 160(1) of the constitution. In that respect, therefore, the powers of the courts must be viewed from the supremacy clause in Article 2(1) of the constitution so that any attempt to limit the power to punish for contempt violates a foundational constitutional value on judicial authority. Any legislation on contempt must be in addition to but not in derogation of the constitution for such limitation or derogation will surely be unconstitutional."

86. The Appellant submitted that the Respondent was and continued to be in contempt of the Tribunal’s decisions as long as no payments were received by the Appellant and the Appellant therefore prayed that pursuant to the enabling provisions of the TATA, The Tribunal would declare that the Respondent was in contempt of its Judgement as issued.

87. As regards the second issue for determination which the Appellant identified, it reiterated that the processing of refund payments once claims had been ascertained created a legitimate expectation that the Appellant should expect refund repayments and not rejection and that the concept of legitimate expectation is well buttressed in the case of Communication Authority of Kenya & Five Others v Royal Media Services Limited & 5 others. [2014] eKLR.

88. The Appellant further submitted that the doctrine of legitimate expectation as applied by courts stipulates that a legitimate expectation may arise from an express promise given on behalf of a public authority or from the existence of regular practice which the claimant can reasonably expect to continue. It submitted that there was a legitimate expectation held by members of the Public that the Respondent would act in a manner that was consistent, reasonable and procedurally fair and that legitimate expectation arose when a member of the public as a result of a promise or other conduct of an administrative body expects that he or she is treated one way and the administrative body reneges treating him/her in a different way. The Appellant cited the following other cases in this regard: East African Court of Appeal in Application 9 of 2020- Kioo Limited v Attorney General of Kenya

Tata Chemicals Magadi Limited v the Commissioner of Domestic Taxes

Republic v Kenya Revenue Authority ex-parte L.A.B International Kenya Limited

TAT 956 of 2022- Kenya Cuttings Limited v Commissioner of Domestic Taxes.

89. The Appellant submitted with regard to its third and final issue for determination that the debt related concern was fully resolved and the same was confirmed by the Respondent at Paragraph 22 of its Statement of Facts. It further submitted that refund claims of tax periods of May, 2020, August 2020, July 2023, October, 2022, November 2022 and August 2023 amounting to Kshs. 28,478,288. 00 not previously litigated or ascertained ought to have been delivered as is required by Section 47 of the TPA.

90. The Appellant went on to submit that the Respondent can opt to conduct an audit to ascertain validity of the refund but that such an audit must be concluded and a decision following the suit of the claim issued in Ninety (90) days. It went on to outline the Respondent’s core obligations under Section 47 of the TPA as being the following:a.Ascertaining and determining an application for refund of overpaid taxes within 90 days:b.Subjecting the application to an audit for purposes of ascertaining its validity, subject to issuing a decision within 120 days where an audit is carried out;c.Upon ascertaining an overpayment, applying the overpaid tax to offset any outstanding tax debts or future tax liabilities, and refunding any remaining overpaid taxes to the taxpayer; andd.Paying interest on the overpaid tax where the Respondent fails to issue a refund within the timelines prescribed under section 47 of the TPA.

91. The Appellant was emphatic that pursuant to the provisions of Section 47 of the TPA the Respondent had the duty of ascertaining and determining the validity of the refund application and the Respondent’s decision must therefore address the merits of the refund application clearly indicating whether it is valid or not.

92. The Appellant submitted that the Respondent had acknowledged that it rejected the refund because it was running out of the statutorily mandated time to review the refund claim. The legislature is very explicit in its demand for efficiency by mandating that the refund decision regarding the refund application be issued within 90 days. It is a complete abuse of process, and the Respondent was attempting to circumvent the timelines provided by rejecting the refund and requesting the Appellant to re-apply so that they can restart the timeline.

93. The Appellant submitted that the Respondent’s guidance directing the Appellant to re-apply as is stated in its rejection decision and reiterated in Paragraph 21 and 22 of its Statement of Facts was grossly misleading given that the law is clear on the procedure to follow when dissatisfied with the Respondent’s refund decision issued under Section 47 of the TPA stating the following:“(13)A person aggrieved by a decision of the Commissioner under this section may appeal to the Tribunal within thirty days after being notified of the decision.”

94. The Appellant is guided by this Tribunal’s Judgment in TAT E351 of 2023 Pernod Ricard Limited v Commissioner Domestic Taxes (page 231 of the Appellant’s Bundle of Authorities) wherein it was held that when a taxpayer receives a refund rejection decision, they must appeal as is required by Section 47 of the TPA in order to secure their rights to the claim and where a taxpayer fails to do so, the Commissioner’s decision prevails.

95. The law does not envision a scenario where the Respondent issues a refund decision simply to adhere to statutory timelines as the Respondent contends in Paragraph 16 and 17 of its Statement of Facts. Neither does the law envision a scenario where a taxpayer simply reapplies where a refund rejection decision is issued. However, the Respondent has made it a habit to encourage taxpayers to do so contrary to the law.

96. The Appellant submitted that the Respondent’s actions were punitive given that it had to incur costs to defend their refund claim by filing an appeal against the refund rejection decision before the Tribunal pursuant to Section 47(13) of the TPA to secure their rights to the refund claim.

97. The Appellant submitted that the rejection decisions dated 22nd July 2024 and 23rd July 2024 were issued less than a month after the Appellant lodged the refund claims on 1st July 2024 therefore, any concern as to the statutory timelines lapsing was about 60 days was premature. The Appellant further submitted that in response to the debt status query shared by the Respondent via electronic mail dated 30th May 2024, the Appellant submitted all documentation requested by the Respondent via electronic mails dated 3rd June 2024, 5th June 2024 and 13th June 2024 and therefore felt confident in lodging the refund claims on 1st July 2024.

98. From the foregoing, the Appellant submitted that it was clear that the 90-day time limit cannot be said to be a valid reason for issuing the decisions. From the foregoing, the Appellant submitted that the Respondent’s failure to consider the refund applications on merit and issue a refund decision that addresses the validity of the refund claim was prejudicial to the Appellant. Therefore, the refund claims ought to be allowed and deemed payable and the Rejection decisions ought to be set aside and annulled.

99. The Respondent’s submissions were a reiteration of its Statement of facts and accordingly, the Tribunal will not re-hash the same.

Issues For Determination 100. The Tribunal having carefully considered parties’ pleadings documents and submissions is of the view that a single issue calls for its determination as follows:

Whether the Respondent erred in rejecting the Appellant’s refund claim. Analysis And Findings 101. The Tribunal will proceed to analyse the issue as hereinunder:

Whether the Respondent erred in rejecting the Appellant’s refund claims. 102. The genesis of the dispute against which the Appellant has appealed originated from rejected refund claims. The Respondent disallowed the Appellant’s refund claims amounting in the sum total to Kshs. 7,734,332. 00; which the Tribunal had allowed in TAT Appeal No. s 1028 and 956 of 2022 delivered on 8th December, 2023 and 24th November, 2023 respectively. The Tribunal is not at liberty to re-open both matters as the same have been decided. However, the Tribunal notes that the refunds allowed in both cases were rejected again through notices issued by the Respondent on 22nd July, 2024 and 23rd July, 2024 respectively. The Respondent also failed to ascertain the validity of the Appellant’s refund claim of Kshs. 28,478,288. 00 on the basis that there were debt related concerns.

103. The Tribunal notes that the Respondent ignored the Tribunal’s decisions in TAT Appeal No. s 1028 and 956 of 2022 respectively and proceeded to reject the refund claims made by the Appellant on the basis that it was trying to overcome a technicality in the law. The Tribunal however notes that though the Appellant sought for it to make a determination on whether or not the Respondent was a Contemnor, it does not have the power to make such a determination within the context of an appeal since pursuant to the provisions of TATA, it only has the mandate to determine appeals against decisions made by the Commissioner. Both the TATA and TPA provide for the decisions of the Commissioner against which a taxpayer can appeal.

104. The Tribunal notes that the Respondent rejected the Appellant’s claims of Kshs. 28,478,288. 00 on the basis that there was a debt status report it had not received and that in order to fulfil the strict requirements of the law regarding the period of time within which it ought to consider refund claims, it chose to reject the same on the basis that there was a debt related concern.

105. The Tribunal will limit itself to the Appeal against the refund rejection orders on 22nd and 23rd July, 2024 in respect of the amounts of Kshs. 7,342,452. 00 and Kshs. 28,478,288. 00. In this regard, the Tribunal notes that following provisions of Section 47 of the TPA:“(1)Where a taxpayer has overpaid a tax under any tax law, the taxpayer may apply to the Commissioner in the prescribed form—(a)to offset the overpaid tax against the taxpayer’s outstanding tax debts and future tax liabilities including instalment taxes and input value added tax; or(b)for a refund of the overpaid tax—(i)in the case of income tax, within five years from the date on which the tax was overpaid; or(ii)in the case of any other tax, within twelve months from the date on which the tax was overpaid.(2)The Commissioner shall ascertain and determine an application under subsection (1) within ninety days and where the Commissioner ascertains that there was an overpayment of tax—(a)in the case of an application under subsection (1)(a), apply the overpaid tax to such outstanding tax debts or future tax liability; and(b)in the case of an application under subsection (1)(b), refund the overpaid tax within a period of six months from the date of ascertainment and, if the Commissioner fails to refund, the overpaid tax shall be applied to offset the taxpayer’s outstanding tax debt or future tax liabilities.(3)Where the Commissioner fails to ascertain and determine an application under subsection (1) within ninety days, the same shall be deemed ascertained and approved.(4)The Commissioner may, for purposes of ascertaining the validity of an application under subsection (1), subject the application to an audit.(4A)Where an application under subsection (1) has been subjected to an audit under subsection (4), the Commissioner shall ascertain and determine the application within one hundred- and twenty-days failure to which, the application shall be deemed to have been ascertained and approved.(5)Where the application is for a refund of tax under subsection (1)(b), the Commissioner shall apply the overpayment in the following order—(a)in payment of any other tax owing by the taxpayer under the specific tax law;(b)in payment of a tax owing by the taxpayer under any other tax law; and(c)any remainder shall be refunded to the taxpayer.(6)Where the Commissioner fails to refund the overpaid tax within the period specified in subsection (2)(b), the amount due shall attract interest of one per cent for each month or part thereof during which the amount remains unpaid.(7)Where the Commissioner notifies a taxpayer that an application under subsection (1)(a) has been ascertained and applies the overpaid tax liability to offset an outstanding tax in accordance with subsection (2)(a), interest or penalties shall not accrue on the amount applied to offsetting the outstanding tax liability from the date of the notification.(8)Where the Commissioner has applied the overpaid tax to offset an outstanding tax liability under subsection (2)(a), any outstanding tax after such application shall accrue interest and penalties in accordance with this Act.(9)Notwithstanding any other provision of this section, where a person overpays an instalment tax due under section 12 of the Income Tax Act (Cap. 470), the Commissioner shall apply the overpaid tax to offset the taxpayer’s future instalment tax liability.(10)Where, after the application of the overpaid tax under subsection (9), the Commissioner later determines that there was no overpayment of instalment tax, the amount of the tax that was used to offset the taxpayer’s future instalment tax liabilities under subsection (9) shall be treated as a tax due to the Commissioner in the subsequent tax period.(11)The amount due under subsection (10) shall be due from the date that the Commissioner applied that amount to offset an instalment tax liability.(12)The Commissioner shall notify the taxpayer in writing of the amount due under subsection (10) and specify in the notification—(a)the interest on the amount due; and(b)any penalties due in respect of the amount due.(13)A person aggrieved by a decision of the Commissioner under this section may appeal to the Tribunal within thirty days after being notified of the decision.”

106. The Tribunal finds that the rejection orders in respect of Kshs. 7,342,452. 00 to be absurd in view of the fact that the Tribunal issued orders setting aside the rejection of refund orders issued and then determined that the Respondent was to issue a decision in 60 days in TAT NO. 1028 OF 2022 and 30 days in TAT 956 of 2022 respectively. The Respondent waited a year to reject the application contrary to the Orders issued in the two Judgements. Accordingly, the finding by the Tribunal is that the Appellant is entitled to the refund claims of Kshs. 7,342,452. 00 since the Tribunal had set aside the rejection orders on the same and also because a refund rejection order made more than 120 days after an audit has been carried out is deemed as having been ascertained and approved.

107. The Tribunal notes that the Appellant provided documentary evidence of its September, 2013 tax return and proof of payment of Withholding tax and Withholding VAT amounting to Kshs. 5,355,099. 00 and Kshs. 147,666. 00 respectively. The Respondent did not specify or provide proof of the nature or amount of debt due by the Appellant but merely made averments in its pleadings regarding the Appellant’s debt status. Once the Appellant provided proof that it was not in debt, the Respondent ought to have controverted the Appellant’s evidence by providing evidence. The pendulum swung to the Respondent but it failed to support its averments. In any case, the fact that the debt status report from the station was not produced is a matter which the Respondent ought to have managed internally rather than abuse its power by manipulating the law as it did. The action of the Respondent in this regard, undermines the integrity and fairness of the law as embodied by Section 47 of the TPA.

108. The Tribunal observes that the Respondent in failing to reveal or provide the documentary evidence to controvert that of the Appellant merely made unsupported averments and the Tribunal therefore finds that the Appellant was entitled to the refund of Kshs 28,478,288. 00.

109. Accordingly, the Tribunal finds that the Respondent erred in rejecting the Appellant’s refund claims.

Final Decision 110. The upshot of the foregoing is that the Appeal herein succeeds and accordingly the Tribunal proceeds to make the following Orders:a.The Appeal be and is hereby allowed.b.The Respondent’s refund rejection decisions dated 22nd July, 2024 and 23rd July, 2024 are hereby set aside.c.The Respondent to refund the Appellant (Kshs. 7,342,452. 00 and Kshs. 28,478,288. 00 respectively) within 30 days of delivery of this Judgment failure to which interest will begin to accrue on the unpaid amounts pursuant to the provisions of Section 47 (6) of the TPA until such time as the amounts are paid in full.d.Each party to bear its own cost.

111. It is so Ordered.

DATED AND DELIVERED AT NAIROBI ON THIS 16TH DAY OF MAY 2025. CHRISTINE A. MUGACHAIRPERSONBONIFACE K. TERER ELISHAH N. NJERUMEMBER MEMBEREUNICE N. NG’ANG’AMEMBER