https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/99

Pelt Security Services Ltd v Commissioner Legal & Board Services (Tax Appeal E391 of 2025) [2026] KETAT 99 (KLR) (2 June 2026) (Judgment) Neutral citation: [2026] KETAT 99 (KLR) Republic of Kenya In the Tax Appeal Tribunal Tax Appeal E391 of 2025 RM Mutuma, Chair, T Vikiru & JM Malla, Members June 2, 2026 Between Pelt Security Services Limited Appellant and Commissioner Legal & Board Services Respondent Judgment Background 1.The Appellant is a limited liability company incorporated under the Companies Act whose principal business activity is in the security services industry. 2.The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws. 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 Respondent conducted a review of the Appellant's returns and indicated that it had noted discrepancies whereupon it raised additional VAT assessments on 30th January 2025. 4.The Appellant objected to the said assessment, on 6th March 2025. 5.Consequently, the Respondent issued an objection decision on 3rd April 2025 confirming the assessment. 6.The Appellant being dissatisfied by the Respondent's decision filed the notice of appeal dated 24th April 2025. The Appeal 7.The Appellant lodged amended memorandum of appeal dated 30th January 2026 raising the following grounds of appeal:a.The Respondent erred in law and in fact by mischaracterizing the Appellant’s entire receipts as taxable supplies for VAT purposes, without appreciating that the Appellant’s operations generate a composite stream of receipts arising from both VAT-able manned guarding services and VAT-exempt training services.b.The Respondent erred in law and in fact by failing to recognize that training of security guards constitutes an exempt supply under Paragraph 9 of the First Schedule to the Value Added Tax Act, 2013 (as amended).c.The Respondent erred in law and in fact by subjecting the Appellant’s entire turnover to VAT and thereby inflating the Appellant’s output VAT base.d.The Respondent erred in law and in fact by failing to segregate taxable and exempt supplies before undertaking any comparison of input VAT claimed against turnover, resulting in a distorted conclusion that the Appellant had over-claimed input VAT.e.The Respondent erred in law and in fact by treating alleged input VAT inconsistencies in isolation, without first determining the correct characterization and composition of the Appellant’s output supplies.f.The Respondent erred in law and in fact by disregarding the Appellant’s business model in which a substantial portion of the client payments represent pass-through wage reimbursements for individual security guards, with the Appellant’s true commercial income being the management and administration mark-up.g.The Respondent erred in law and in fact by treating gross client payments as the Appellant’s taxable turnover, contrary to the economic substance of the transactions.h.The Respondent erred in law and in fact by failing to consider and/or properly evaluate the Appellant’s explanations and documentary evidence furnished at the objection stage.i.The Respondent erred in law and in fact by concluding that the Appellant had failed to discharge its burden of proof under Section 56(1) of the Tax Procedures Act, while at the same time declining to consider relevant records that demonstrate the composite nature of the Appellant’s supplies.j.The Respondent erred in law and in fact by confirming VAT assessments that are excessive, arbitrary and disproportionate for failure to apportion turnover between taxable and exempt supplies.k.The Respondent erred in law and in fact by confirming withholding VAT deductions on amounts attributable to exempt training services contrary to the VAT Act.l.The Respondent erred in law and in fact by issuing and confirming assessments that do not reflect the Appellant’s true tax liability.m.The Respondent erred in law and in fact by issuing objection decisions dated 1st April 2025 and 16th January 2026 that are unreasonable, procedurally unfair and contrary to the principles of fair administrative action. Appellant’s Case 8.The Appellant relied on its statement of facts dated 24th April 2025 and its amended statement of facts dated and filed on 30th January 2026. The Appellant also placed reliance on its Written Submissions dated 31st March 2026. 9.The Appellant averred that it operates in the security services industry and undertakes two complementary but distinct commercial activities, namely the provision of manned guarding services to clients and the continuous training, retraining and certification of security guards prior to and during their deployment. That its clientele comprises individual clients, corporate entities and government agencies. 10.The Appellant averred that under its business model, it recruits persons interested in becoming security guards, undertakes their training and thereafter deploys them to clients’ premises depending on the number of guards requested by each client. 11.The Appellant stated that its clients are billed founded on the number of guards deployed at their premises in any particular month. That it manages the deployment of guards, shift rotations, replacements and logistical coordination and ensures uninterrupted security coverage at clients’ premises. 12.The Appellant stated that it issues monthly invoices to its clients which comprise amounts representing the guards’ wages payable to individual guards together with a marginal management and administration mark-up payable to the Appellant. That it remits the guards’ salaries and accounts for statutory payroll deductions, and its true commercial income consists of the management and administration mark-up component. 13.The Appellant averred that the Respondent conducted investigations into its affairs and issued VAT assessments dated 7th February 2025, 11th February 2025 and 18th February 2025 covering the period October 2022 to December 2024 based on alleged inconsistencies between input VAT claimed in VAT returns and figures reflected in the Respondent’s CSV data. That the assessments treated the entirety of the Appellant’s receipts as taxable supplies for VAT purposes. 14.The Appellant asserted that the Respondent erred by treating as taxable income all amounts deposited in the Appellant’s bank accounts and proceeding to raise assessments premised on these transactions which ultimately led to the impugned objection decision. 15.The Appellant contended that it lodged Notices of Objection and provided explanations and documentation in support thereof but the Respondent rejected its objections in totality stating that it had provided limited documentation and that the assessments related solely to over-claimed input VAT. 16.The Appellant stated that owing to the statutory thirty-day window for filing appeals, it initially relied on preliminary accounting reports at the time of filing the appeal. That thereafter it undertook an extensive review of its voluminous records including client contracts, invoices, bank statements, trained guard lists and guard service numbers and consequently applied for leave to amend its pleadings and to introduce additional documents. 17.That in its Ruling dated 17th December 2025, the Tribunal affirmed that the burden of proof lies upon the taxpayer under section 56(1) of the Tax Procedures Act and allowed amendment of pleadings and admission of additional documents. 18.That the Respondent pursuant to the Tribunal’s Orders issued a fresh Objection Decision dated 16th January 2026 which again fully rejected the Appellant’s documents. 19.The Appellant averred that its operations generate a composite stream of receipts arising from VAT-able manned guarding services and VAT-exempt training services. That Training of guards constitutes an exempt supply under Paragraph 9 of the First Schedule to the Value Added Tax Act, 2013 (as amended). 20.That the Respondent failed to segregate these streams and instead subjected the Appellant’s entire receipts to VAT. That this mischaracterization directly inflated the Appellant’s output VAT base. 21.The Appellant asserted that input VAT is legally claimable only to the extent that it relates to taxable supplies. That where output supplies include exempt components, any mechanical comparison of total inputs against total turnover without segregation inevitably produces distorted “over-claim” results. 22.The Appellant stated that the Respondent’s approach ignored this fundamental relationship and produced assessments that do not reflect the Appellant’s true VAT position. 23.The Appellant stated further that some of the its clients erroneously issued withholding tax certificates on the gross amounts paid, which amounts predominantly represented guards’ wages. The Appellant contended that these certificates do not represent the its true commercial income and cannot lawfully convert pass-through wage reimbursements into taxable turnover. The Appellant posited that it has no control over how its clients process their internal tax documentation. 24.The Appellant relied on client contracts distinguishing trained guard lists, guard service numbers and deployment records, guarding and training obligations, its bank statements evidencing receipts and invoices issued to clients. It averred that the said documents demonstrate the existence of training activities, the composite nature of the Appellant’s supplies and the factual basis for segregation between taxable and exempt components. 25.The Appellant stated that from its business model, its clients actually pay the salaries of each individual guard through the Appellant’s account and the Appellant thereafter settles the respective salaries of the individual guards. The Appellant maintained that only the management mark-up and guarding component constitutes taxable turnover, while training revenue is exempt. 26.The Appellant further maintained that the Respondent’s assessments overstated output VAT and that any alleged input VAT inconsistency must be reassessed after proper segregation of taxable and exempt supplies. The additional VAT assessments therefore do not represent the its true tax liability. 27.The Appellant filed written submissions dated 31st March 2026 wherein it submitted the Respondent erred in failing to apportion the Appellant’s revenue between taxable and exempt supplies. It further submitted that it discharged its burden of proof under Section 56 of the TPA. It therefore, maintained that the Respondent’s Objection Decisions was unsustainable in law and fact. 28.The Appellant relied on the case of Kenya Revenue Authority v Export Trading Company Limited Civil Appeal No. 41 of 2017 [2018] eKLR to submit that the Court of Appeal emphasized that tax liability must be grounded on a proper appreciation of the nature and substance of the underlying transaction. 29.It relied on the case of Republic v Kenya Revenue Authority Ex-parte Unilever Kenya Limited [2016] eKLR, where the High Court affirmed that tax administration must reflect the economic and commercial reality of a taxpayer’s operations. 30.It cited the case of Republic v Commissioner of Domestic Taxes Ex-parte Barclays Bank of Kenya Limited [2016] eKLR, where the Court held that a tax decision that ignores relevant factors or adopts an unreasonable methodology is liable to be quashed. 31.The Appellant also cited the case of Kenya Revenue Authority v Man Diesel & Turbo SE Civil Appeal No. 255 of 2019 [2021] eKLR, where the Court of Appeal held that the Commissioner cannot simply rely on the presumption of correctness once credible evidence has been tendered by the taxpayer. The Appellant’s Prayers 32.The Appellant prayed as follows:i.The Respondent’s Notice of Tax Assessments dated 18th February 2025, 11th February 2025 and 7th February 2025 and the Objection Decision dated 1st April 2025 be struck out in their entirety;ii.The Respondent’s actions to demand additional taxes be declared arbitrary, unreasonable, unfair and contrary to the administration of justice and legitimate expectation of the Appellant;iii.The Respondent, its employees, agents or other person purporting to act on its behalf be barred and/or estopped from demanding or taking any further steps towards enforcement or recovery of principal tax, penalties and interest on the Respondents’ demand;iv.The costs of the appeal; andv.Any other remedies that the Honourable Tribunal deems just and reasonable. Respondent’s Case 33.The Respondent relied on its statement of facts dated 22nd May 2025 as well as its supplementary statement of facts dated 9th March 2026. 34.According to the Respondent, the Appellant offers security services, which are taxable under the VATA. The Respondent asserted that payments received from clients constitute consideration for taxable supplies. Further, the Respondent contended that i-Tax's inability to auto-pull certain entries does not relieve the taxpayer from the burden of proving the input claim. 35.The Respondent pointed out that the Appellant's assertion that input VAT was omitted due to the iTax system and that the Appellant does not make taxable supplies was misleading. 36.The Respondent asserted that the Appellant did not satisfy the requirements outlined under Section 17 of the VATA for claiming input VAT and emphasized that the responsibility to provide the necessary supporting documents rests solely with the Appellant. 37.The Respondent stated that the VAT assessment giving rise to this Appeal was strictly based on input VAT inconsistencies identified during review of the Appellant's filed VAT returns. It stated that whereas the Appellant has based its amended Appeal on issues such as adjustment of sales income; reconstruction of output VAT; withholding VAT certificates; or any determination regarding exemption of services, the Respondent stated that the assessment was not based on the foregoing those issues. 38.The Respondent asserted that upon review, the Respondent compared purchases declared in the Appellant's VAT returns; and purchases declared in the purchase CSV file submitted by the Appellant. The analysis revealed that the purchases declared in the VAT returns exceeded those disclosed in the purchase CSV file. Consequently, the input tax claimed in the VAT returns was higher than that supported by the underlying purchase data. The Respondent therefore, asserted that the assessment arose from over-claimed input VAT and was confined strictly to that issue. 39.The Respondent reiterated that the declared sales remained as per the VAT returns filed by the Appellant and were not varied in any manner. It averred that the assessment was not based on sales adjustments and further stated that:i.The tax adjustment arose solely from discrepancies in purchases claimed;ii.The purchases declared in the VAT returns exceeded those in the purchase CSV file;iii.The assessment did not rely on WVAT certificates; andiv.The sales figures as declared were not altered. 40.Upon review of the Appellant's Amended Memorandum of Appeal and the additional documents provided, the Respondent noted that the same do not relate to the dispute as emanating from the assessments. The Respondent further noted that the grounds raised and documents provided by the Appellant relate to exempt supplies as it argues on its business model where it offers security guards services. 41.The Respondent stated that the dispute that should be before the Tribunal as per the assessment, concerns input VAT over-claiming arising from discrepancies between VAT returns and the purchase CSV data. However, the Appellant's amended arguments primarily address:i.Training of guards;ii.Alleged exemption of such training services; andiii.Matters relating to the VAT treatment of those services. 42.The Respondent stated that the issue of guard training and whether such services are exempt or taxable relates to output VAT, not input VAT to which the Respondent did not assess or make any determination regarding exemption of training services in the impugned assessment. 43.The Respondent stated that the documents now relied upon by the Appellant concerning training services and alleged exemption were not the subject of the compliance review and do not align with the basis of the assessment. The Respondent therefore, stated that the Appellant's amended Appeal and statement of Facts introduce new issues that were neither assessed nor determined at the objection stage. 44.The Respondent stated that an Appeal before this Honourable Tribunal must arise from the assessment and objection decision issued by the Commissioner. It added that the Appellant cannot properly found an appeal on matters that were never:i.The subject of the assessment;ii.Raised and determined during the compliance review; oriii.Addressed in the objection decision. 45.It asserted that to the extent that the Appellant now seeks to introduce arguments relating to exemption of training services, the same fall outside the scope of the impugned assessments. 46.It cited section 56 (3) of the TPA which states that;“In an appeal by a taxpayer to the Tribunal, High Court or Court of Appeal in relation to an appealable decision, the taxpayer shall rely only on the grounds stated in the objection to which the decision relates unless the Tribunal or Court allows the person to add new grounds.’’ 47.In line with the impugned assessments, the Respondent stated that the Appellant's objection and the issued objection decision, the Respondent maintained that under the VATA and the TPA:i.Input tax is only deductible where properly supported by valid documentation;ii.The burden of proof lies on the taxpayer to demonstrate that an assessment is excessive or incorrect:iii.Where discrepancies exist between declared VAT returns and underlying purchase data, the Commissioner is empowered to adjust the input tax claimed. 48.The Respondent stated that the Appellant has not demonstrated that the purchases declared in its VAT returns are supported by corresponding purchase records. The Respondent noted that the Appellant has introduced arguments relating to exemption of services, which are unrelated to the basis of the assessment. 49.The Respondent stated that the fresh objection decision properly addressed the dispute within the scope of the assessment and lawfully confirmed the tax due. 50.The Respondent also lodged written submissions dated 8th October, 2025 and filed on 9th October 2025. It also filed supplementary submissions dated 24th May 2026. In summary, the Respondent submitted that the Appellant failed to discharge its burden of proof as required under Section 56(1) of the TPA; that the Respondent's assessment was proper in law; and that the objection lodged by the Appellant did not meet the threshold under section 51(3) of the TPA. 51.The Respondent cited the case of Commissioner of Domestic Services v Galaxy Tools Limited [2021] eKLR, wherein the court emphasized that a taxpayer claiming input VAT must maintain and produce primary records to verify the claim. 52.It relied on other cases of George v Federal Commissioner of Taxation; Ushindi Limited v Commissioner of Investigation; Enforcement [2020] eKLR; and Republic v KRA: Proto Energy Limited [2022] eKLR; Kenya Revenue Authority v Man Diesel& TurboSe, Kenya [2021] eKLR; and PZ Cussons East Africa Limited v Kenya Revenue Authority [2013] eKLR, to submit that the Taxpayer has a duty to prove that the assessments were incorrect but the Appellant failed. 53.In its supplementary written submissions, the Respondent submitted that the Appellant cannot introduce new issues relating to exemption of training services when the impugned assessment strictly concerned over-claimed input VAT. It relied on the case of Commissioner Investigation & Enforcement v Marylebone Properties Limited (Income Tax Appeal E204 of 2023) [2025] to submit that the High Court affirmed that Section 56(3) of the TPA binds the taxpayer to the grounds of objection submitted to the Commissioner and that the taxpayer must prove the tax decision is wrong and must provide supporting evidence during the objection phase. Respondent’s Prayers 54.The Respondent prayed the Tribunal for orders that:a.The appeal be dismissed with costs;b.The assessment and objection decision dated 1st April 2025 be upheld. Issue for Determination 55.Having considered the parties’ pleadings and submissions, the Tribunal identified the following issue for determination:Whether the Respondent erred in confirming the assessment Analysis and Findings 56.It is to this issues that the Tribunal will turn within as hereunder: - 57.The Appellant contended that training of guards constitutes an exempt supply under Paragraph 9 of the First Schedule to the VATA. It argued that the Respondent failed to segregate training of guards from other vatable taxable services and instead subjected the Appellant’s entire receipts to VAT. It argued that this mischaracterisation directly inflated the Appellant’s output VAT base. 58.It asserted that input VAT is legally claimable only to the extent that it relates to taxable supplies, and that where output supplies include exempt components, any mechanical comparison of total inputs against total turnover without segregation inevitably produces distorted “over-claim” results. 59.On the other hand, the Respondent argued that the issue on exempt supplies was not part of the assessment therefore, cannot be part of this appeal. It stated that the Appellant introduced this issue upon filing amended statement of facts. The Respondent contended that the dispute that should be before the Tribunal as per the assessment, concerns input VAT over-claiming arising from discrepancies between VAT returns and the purchase CSV data. 60.To determine the gravamen of the dispute, the Tribunal analysed the preassessment notice, the assessment orders, the appellant’s notice of objection and the impugned objection decisions. The Tribunal established that the assessments were not premised on whether or not the services of the Appellant were exempt supplies, the dispute revolved around variances in the Appellant’s VAT returns claimed by the Respondent. 61.Having established that the issue of whether the Appellant’s services were VAT exempt did not form the basis of the disputed assessments, the Tribunal finds that the parties’ contentions on this issue are not relevant to the determination of the dispute at hand. 62.The Tribunal then turned its focus to the determine whether the Appellant discharged its burden of proof to demonstrate that the Respondent erred in confirming the assessments which were premised on VAT variance analysis. 63.It was the Appellant’s contention that it incurred input VAT which was not considered by the Respondent as the iTax system did not pull out all the purchases during filing of the monthly VAT returns thereby denying the Appellant input VAT claim which would have reduced the Appellant’s tax liability. The Respondent asserted that errors in the iTax system do not relieve the Appellant of its duty to prove that it incurred claimable input VAT. 64.The Tribunal observed that the dispute at hand had resulted in two objection decisions, in the initial objection decision dated 1st April 2025, the Respondent had determined that the Appellant failed to validate its objection in accordance with Section 51(3) by failing to provide supporting documents. The Appellant thereafter obtained leave from the Tribunal to adduce documents on the basis of which the Tribunal directed the Respondent to review the documents so provided and if need be issue a fresh objection decision. The Respondent issued a fresh objection decision dated 16th January 2026 again confirming the assessments in full. 65.The Tribunal observed that the Respondent in its statement of facts described the events leading to the issuance of the objection decision stating that it initially invalidated the Appellant’s objection on 1st April, 2025 for having failed to meet the requirements of Section 51(3) of the TPA on documentation. That however, upon obtaining leave from the Tribunal the Appellant adduced the above listed documents in support of its objection. The Respondent thereafter confirmed the assessments fully. 66.The Tribunal notes that in the fresh objection decision dated 16th January 2026, the Respondent acknowledged receipt of the following documents form the Appellant;i.Contracts between Pelt Security services and various clients,ii.Bank statements for the period under reviewiii.Copies of invoicesiv.Copies of receiptsv.Trained guard listvi.Guard service numbers. 67.The Respondent’s admission that it indeed received the said documentation which in fact occasioned the validation of the Appellant’s objection signalled the shifting of the burden of proof to the Respondent to demolish the evidence so provided by the Appellant with precision. 68.It is trite law that the evidentiary burden of proof as to whether Respondent’s assessments were inaccurate, excessive or could have been made differently rests with taxpayer as provided by Section 56(1) of the TPA which states thus:“In any proceedings under this Part, the burden shall be on the taxpayer to prove that a tax decision is incorrect.” 69.It has been established by courts that this burden may however shift to the Respondent if the Appellant has made a prima facie case. Where the Appellant has provided relevant evidence to disturb the presumption of correctness of the Respondent’s assessment, the onus may then shift to the Respondent to rebut the prima facie case failure to which the taxpayer succeeds. 70.The concept of the swinging pendulum in tax disputes holds that while the law anchors the legal burden on one side, the evidentiary burden constantly shifts back and forth between the taxpayer and the tax authority as arguments and evidence are introduced. The legal burden of proof rarely moves. It rests squarely on the tax payer. Under section 56(1) of the TPA and Section 30 of the TATA the taxpayer bears the overall responsibility to prove that an assessment is excessive or that a tax decision is incorrect. This rationale is grounded on the fact that the taxpayer is the custodian of their own financial data and transaction history. The tax authority cannot prove a negative, the taxpayer must prove the positive substance of their transactions. 71.The High Court in affirming the Tribunal’s position on the shifting burden of proof in tax cases stated as follows in Commissioner Investigation & Enforcement v Marylebone Properties Limited (Income Tax Appeal E204 of 2023) [2025] KEHC 3314 (KLR)“The burden of proof articulated under Section 56(1) of the Tax Procedures Act is not permanently fixated upon the taxpayer. Upon the production of the requisite supporting documents by a taxpayer, the Burden of proof shifts. It shifts to the Appellant to demolish with precision the evidence availed.” 72.Further, in the case of Kenya Revenue Authority v Maluki Kitili Mwendwa [2021] eKLR Mativo J ( as he then was) adopted the doctrine in the Canadian Supreme Court case of Johnston v Minister of National Revenue the court {1948} S.C.R. 486 decided that:“… the onus is on the taxpayer to “demolish the basic fact on which the taxation rested.” Again, the Supreme Court of Canada provided guidance on this issue in Hickman Motors Ltd. v Canada which held that the onus is met when a Taxpayer makes out at least a prima facie case. Prima facie is another legal term that literally means “on its face.” To prove a case “on its face” you must provide evidence that, unless rebutted, would prove your position. According to the said decision, a prima facie case is made when the taxpayer can produce unchallenged and uncontradicted evidence. Once the taxpayer has made out a prima facie case to prove the facts, the onus then shifts to the Revenue Authority to rebut the prima facie case. If the Revenue Authority cannot provide any evidence to prove their position, the taxpayer will succeed” 73.In the above case the High Court affirmed that KRA’s assessments carry a presumption of correctness. To displace this presumption and shift the evidentiary burden, the taxpayer must present competent, verifiable data. If evidence on both sides remains equally balanced, the taxpayer fails because the legal burden never left their shoulders. Once the taxpayer places a credible paper trail on the table, the pendulum swings to the revenue authority. The tax authority cannot simply reject documents because they feel like it, they bear the evidentiary burden of rebuttal. 74.This was vividly articulated in the landmark case of Commissioner of Investigations and Enforcement v Pearl Industries Limited [2022] KEHC 51(KLR). The High Court explicitly used the pendulum analogy to describe how the burden shifted; Pearl industries provided all the transaction documents requested by the Commissioner satisfying their initial burden. The burden shifted to the commissioner to review, analyse and concretely challenge the validity or authenticity of those documents. If the tax authority successfully punches holes in the taxpayer’s initial evidence by proving fraud, showing inconsistent data or showing that a transaction lacks commercial substance the pendulum swings right back to the taxpayer. 75.In the instant case, the pendulum swings for the first time when a tax authority issues an additional assessment or disallows a deduction and the taxpayer fights back. To push the pendulum toward the taxman, the taxpayer cannot rely on mere denials or verbal assertions. They must present robust, verifiable documentary evidence such as invoices, bank statement, contracts and ledger reconciliations to establish a prima facie case. 76.The Tribunal noted that the documents adduced by the Appellant included Invoices, receipts, bank statements, client contracts and schedules of trained guards, documents which have probative value in determination of VAT disputes. The Respondent instead of demolishing the Appellant’s evidence with precision and stating with specificity the insufficiency in the documents provided by the Appellant merely stated the documents provided were not relevant to the assessments. 77.A generalised assertion by the Respondent that the Appellant’s documents were irrelevant without a thorough examination of the evidence backed by specific rebuttals as to each set of evidence provided meant that the Respondent failed to discharge the burden of proof that had been swung to it. 78.The Tribunal wishes to reiterate its holding in Tax Appeal No. 435 of 2022 Abyssina Iron and Steel Ltd v Commissioner of Customs and Border Control wherein it stated that:“From the foregoing decision of the superior court, it is apparent that the Appellant was required to present a minimum amount of information necessary to support its position. This safety valve seems to place the burden of proof on the Appellant without completely relieving the Respondent of its fair share of the burden of proof. The bottom line is that once the Appellant has provided evidence that the Respondent’s assessment was wrong, then the Respondent must push back and show that its assessment was not arbitrary, capricious or imagined. The onus will then shift back to the Appellant once the Respondent has discharged its burden on a balance of convenience to discharge the prima facie case that has been presented by the Respondent.” 79.In view of the foregoing, the Tribunal finds that the Respondent erred in confirming the assessments. Final Determination 80.The upshot to the foregoing is that the Tribunal finds and holds that the Appeal is meritorious and makes the following orders:-a.The appeal be and is hereby allowed;b.The Respondent’s objection decision dated 1st April 2025 and 16th January, 2026 be and are hereby set aside.c.Each party to bear its own cost. 81.It is so ordered. DATED AND DELIVERED AT NAIROBI THIS 2ND DAY OF JUNE 2026………………………………ROBERT M. MUTUMACHAIRMAN………………………………DR. TIMOTHY B. VIKIRUMEMBER………………………………JIMMY M. MALLAMEMBER