Pirmohammed Enterprises Limited v Commissioner of Legal Services & Board Coordination (Tax Appeal E1160 of 2025) [2026] KETAT 279 (KLR) (14 August 2026) (Judgment)

**REPUBLIC OF KENYA** **IN THE TAX APPEALS TRIBUNAL AT NAIROBI** **TAX APPEAL NO. E1160 OF 2025** **PIRMOHAMMED ENTERPRISES LIMITED APPELLANT** **-VERSUS-** **COMMISSIONER OF LEGAL SERVICES & BOARD COORDINATION RESPONDENT** **JUDGMENT** **BACKGROUND** 1. The Appellant is a private limited liability company incorporated in the Republic of Kenya and carrying on business in Mombasa. 2. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, Cap 469 Laws of Kenya (KRA Act). Under Section 5 (1) of the Act, KRA is an agency of the Government for the collection and receipt of all revenue. For the performance of its function under Subsection (1), the Authority is mandated under Section 5(2) of the Act to administer and enforce all provisions of the written laws as set out in Parts I and II of the First Schedule to the KRA Act to assess, collect, and account for all revenues under those laws. 3. The Respondent issued the Appellant with Value Added Tax (VAT) additional assessments for the tax period of November 2019 on 23rd December 2020. 4. The Appellant lodged a late objection against the assessments on 5th February 2021, citing the sickness of its director as the reason for the delay, and received objection acknowledgement number KRA202101626491. 5. The Respondent issued a decision dated 3rd March 2021 rejecting the Appellant’s objection in full on the ground that all the relevant documents relating to the objection, and which had been requested for, had not been availed. 6. The Appellant, being dissatisfied with the Respondent’s decision, filed its Notice of Appeal dated 14th October 2025 having been granted leave by the Tribunal to file its appeal out of time. **THE APPEAL** 1. The Appeal is premised on the Memorandum of Appeal dated 14th October 2025, which raised the following grounds of appeal: - a) That the Respondent erred in law and in fact by declaring the Appellant’s objection as not validly lodged against the VAT assessments for the period of November 2019; b) That the Respondent erred in law and fact by confirming the assessments as issued without considering the fact of whether the supplies were vatable or not; c) That the Respondent erred in law and fact by disregarding the supporting information and documents provided by the Appellant in making its decision; d) That the Appellant provided reasonable grounds as required by Section 51(7) of the Tax Procedures Act; and e) That the Respondent’s actions have amounted to gross violations of Article 47 of the Constitution of Kenya, which guarantees the Appellant a right to fair administrative action that is reasonable and procedurally fair. **APPELLANT’S CASE** 1. The Appellant’s case is premised on its Statement of Facts dated 14th October 2025, together with the documents attached thereto. 2. The Appellant stated that the Respondent issued it with VAT assessments for the period of November 2019 on 10th December 2020 and 23rd December 2020 for Kshs. 363,104.00 and Kshs. 842,400.00 respectively. 3. That it lodged its objection on 5th February 2021 and received objection acknowledgment number KRA202101626491, whereafter the Respondent issued its objection decision on 3rd March 2021. 4. The Appellant averred that its director had been sick, hence it was unable to object to the Respondent’s assessments within the stipulated timelines. In support thereof, the Appellant annexed its director’s medical report dated 10th February 2021. 5. The Appellant contended that Section 51(7) of the Tax Procedures Act (TPA) provides a cure for a situation such as the Appellant’s by allowing a taxpayer who was prevented by sickness from lodging a notice of objection within the prescribed time to make an application for extension of time. 6. The Appellant maintained that it did not unreasonably delay in lodging its objection but rather had a reasonable cause for the delay, and that it had already demonstrated the desire to challenge the assessments when it lodged its application for extension of time to lodge a notice of objection with the Respondent. 7. The Appellant asserted that the Respondent denied it a chance to a fair hearing, and that the Respondent’s actions amounted to gross violations of Article 47 of the Constitution of Kenya, which guarantees the Appellant a right to fair administrative action that is reasonable and procedurally fair, as the Appellant stood condemned unheard. 8. The Appellant further indicated that the sums involved are colossal such that they would negatively affect its business if the dispute is not heard on merit, and that the dispute herein is purely a reconciliation one which it intended to pursue through Alternative Dispute Resolution (ADR). **Appellant’s prayers** 1. The Appellant prayed that the Tribunal grants the following orders: - a) That the Appeal be allowed; b) That the Objection decision as contained in the letter dated 3rd March 2021 be set aside; c) That the Respondent’s actions to demand additional taxes be declared arbitrary, unreasonable, unfair, and contrary to the fair administration of justice and legitimate expectation of the taxpayer; d) That the costs of this Appeal be awarded to the Appellant; and e) Any other remedies that the Tribunal deems just and reasonable to the Appellant. **RESPONDENT’S CASE** 1. The Respondent’s case is premised on its Written Submissions dated 16th June 2026 and filed on even date. 2. The Respondent considered the main issue falling for determination to be whether the Appeal is merited. 3. The Respondent reiterated the contents of its decision dated 3rd March 2021, and in particular paragraphs 2 and 3 thereof, pointing out that the Appellant’s objection was invalidated for want of the relevant supporting documentation relating to the objection, which the Respondent had requested for to no avail. 4. The Respondent placed reliance on Section 56(1) of the TPA, which provides that in any proceedings under that Part, the burden shall be on the taxpayer to prove that a tax decision is incorrect. 5. On the burden of proof, the Respondent relied on the decision of the Tribunal in **Nairobi TAT Appeal No. 55 of 2018: Boleyn International Limited v Commissioner of Investigations and Enforcement**, where it was held as follows: - *“We find that the Appellant’s at all times bore the burden of proving that the Respondent’s decisions and investigations were wrong. The Tribunal is guided by the provisions of section 56(1) of the Tax Procedures Act, 2015 which states: In any proceedings under this part, the burden shall be on the taxpayer to prove that a tax decision is incorrect. Further the Tribunal finds the following paragraphs from Pierson V Belder (H.M. Inspector of Taxes) (1956 – 1960) 38 TC 387 to be instructive; but the matter may be disposed of, I think even more shortly in this way: there is an assessment made by the Commissioner upon the Appellant; it is perfectly clearly settled by cases such as in the case of Norman V Golder 26 T.C. 293, that the onus is upon the Appellant to show that the assessment made upon him is excessive or incorrect; and of course he has completely failed to do so. That is sufficient to dispose of the Appeal, which is I accordingly dismiss with costs.”* 1. The Respondent maintained that the Appellant fatally failed to discharge this burden both at the objection stage and in the instant Appeal, and that consequently, the assessments and the confirmation thereof cannot be faulted at all. **Respondent’s prayers** 1. The Respondent urged the Tribunal to find in its favour and prayed as follows: a) That the Appeal be dismissed and the decision dated 3rd March 2021 be confirmed; and b) That the costs of the Appeal be awarded to the Respondent. **ISSUE FOR DETERMINATION** 1. The Tribunal has considered the pleadings and the submissions made by the Parties, and considers the singular issue falling for its determination as follows: ***Whether the Respondent was justified in invalidating the Appellant’s objection.*** **ANALYSIS AND FINDINGS** 1. Having identified the issue for determination, the Tribunal proceeds to analyse the same as hereunder. 2. Before turning to that issue, the Tribunal must satisfy itself that the decision appealed against is an appealable decision. Jurisdiction is a threshold question which must be resolved *in limine*, for where jurisdiction is wanting, an adjudicating body must down its tools. This principle was settled by the Court of Appeal in **Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] KLR 1**, where Nyarangi, JA held as follows: - *“Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of proceedings pending other evidence. A court of law downs tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction.”* 1. The Tribunal examined the decision contained in the letter dated 3rd March 2021 and noted that the Respondent therein rejected the Appellant’s objection, declaring it invalid for failure to meet the requirements of Section 51(3) of the TPA. Although the letter was styled an “Objection Decision”, it is trite that substance prevails over form, and its substance was a declaration that the objection had not been validly lodged. 2. Whether such a decision is appealable has now been settled by the Court of Appeal in **Geo Chem Middle East v Commissioner for Domestic Taxes (Civil Appeal No. E581 of 2024) [2026] KECA 1531 (KLR)**, in a judgment that was delivered on 31st July 2026. The Court in that case held that a decision of the Commissioner invalidating a notice of objection is one that is appealable. 3. The Court of Appeal further drew a careful distinction between the decisions open to the Commissioner under Section 51 of the TPA. It held that a decision under Subsection (4) is not a merit decision but a validity decision, which pronounces only whether the notice of objection meets the statutory criteria under Subsection (3) so as to enable the Commissioner to make an informed merit decision under Subsection (11). 4. The Tribunal is bound by that pronouncement, which is dispositive of the threshold question. This Appeal therefore lies against an appealable decision, and the Tribunal is clothed with jurisdiction to determine it. The Tribunal departs from its earlier decisions to the extent that they held an objection invalidation decision made under Section 51(4) of the TPA to be non-appealable. 5. That same pronouncement delimits the scope of this Appeal. The Tribunal is not called upon to pronounce itself on whether the supplies in issue were vatable, or on the correctness of the sums assessed. Those are merit questions arising under Section 51(11) of the TPA. The Tribunal’s task is confined to determining whether the Respondent was justified in declaring the Appellant’s objection invalid. 6. Turning to that question, the Tribunal sets out the governing framework. Section 51(1) of the TPA obliges a taxpayer who wishes to dispute a tax decision to first lodge an objection against that tax decision under that section before proceeding under any other written law. Section 51(3) of the TPA in turn prescribes the conditions which a notice of objection must satisfy before it is treated as validly lodged, as follows: - *“(3) A notice of objection shall be treated as validly lodged by a taxpayer under subsection (2) if—* *(a) the notice of objection states precisely the grounds of objection, the amendments required to be made to correct the decision, and the reasons for the amendments;* *(b) in relation to an objection to an assessment, the taxpayer has paid the entire amount of tax due under the assessment that is not in dispute or has applied for an extension of time to pay the tax not in dispute under section 33(1); and* *(c) all the relevant documents relating to the objection have been submitted.”* 1. The conditions set out in Section 51(3) of the TPA are cumulative and not alternative. The word “and” appearing at the close of paragraph (b) admits of no other construction. A notice of objection which fails any one of the three limbs is not a validly lodged notice of objection, and the Commissioner is entitled to say so. 2. Section 51(4) of the TPA vests in the Commissioner the power to determine that a notice of objection has not been validly lodged. The Tribunal is alive to the fact that this provision has undergone successive amendments. The version in force as at 3rd March 2021, being the date of the impugned decision, provided as follows: - *“(4) Where the Commissioner has determined that a notice of objection lodged by a taxpayer has not been validly lodged, the Commissioner shall immediately notify the taxpayer in writing that the objection has not been validly lodged.”* 1. The current reading of Section 51(4) of the TPA, which requires the Commissioner to notify the taxpayer within fourteen days and to request the specified information within seven days, was introduced by later amendments and did not govern the decision under challenge. The Respondent’s obligation in March 2021 was confined to notifying the Appellant in writing that its objection had not been validly lodged. 2. The Tribunal finds that the Respondent discharged that obligation. The letter dated 3rd March 2021 was in writing, was addressed to the Appellant, identified the tax head and the period concerned, reproduced the governing statutory provision, and stated the reason for the invalidation, namely that the relevant documents relating to the objection which had been requested for had not been availed. 3. The Tribunal has not overlooked that the Respondent’s letter reproduced Section 51(3)(a) of the TPA whereas the reason given falls under Section 51(3)(c). That mis-citation reflects imprecision on the Respondent’s part and is regrettable. It did not, however, occasion the Appellant any prejudice, the operative reason having been stated in the body of the letter in plain and unambiguous terms. 4. The Appellant’s complaint under Article 47 of the Constitution must be assessed against that background. That Article, as given effect by Section 4 of the Fair Administrative Action Act, entitles a person adversely affected by administrative action to written reasons. The Appellant was given written reasons and was thereby placed in a position to cure the defect identified. It did not do so. 5. The Tribunal now turns to the evidence. Section 56(1) of the TPA provides that in any proceedings under that Part, the burden shall be on the taxpayer to prove that a tax decision is incorrect. The Respondent correctly invoked that provision, together with the holding of this Tribunal in **Boleyn International Limited v Commissioner of Investigations and Enforcement (TAT Appeal No. 55 of 2018)**. 6. The burden which the Appellant bore in this Appeal was a specific and narrow one. It was to demonstrate that the notice of objection it lodged on 5th February 2021 satisfied each of the conditions prescribed by Section 51(3) of the TPA, and in particular that all the relevant documents relating to the objection had been submitted to the Respondent. 7. The Appellant’s Statement of Facts annexed two documents only, being the objection application acknowledgement receipt dated 5th February 2021 and the Respondent’s decision dated 3rd March 2021. The notice of objection itself was not placed before the Tribunal. 8. The consequence of that omission is decisive. Absent sight of the notice of objection and its enclosures, the Tribunal has no means of establishing what grounds were stated, what amendments were sought, what reasons were given for them, or what documents accompanied the objection. The Tribunal cannot find compliance with Section 51(3) of the TPA on the strength of assertion alone. 9. The third Ground of the Memorandum of Appeal asserts that the Respondent disregarded the supporting information and documents provided by the Appellant. However, the Tribunal notes that no such information or documents appear anywhere on the record. Nor did the Appellant produce any correspondence identifying what documents the Respondent had called for, when the request was made, or what response, if any, the Appellant furnished. 10. The Tribunal is fortified in this approach by the settled principle that pleadings and submissions do not constitute evidence. An averment in a statement of facts, however emphatically expressed, cannot supply the evidential deficit which Section 56(1) of the TPA requires a taxpayer to fill. It is proof, and not assertion, that discharges the statutory burden. 11. For completeness, the Tribunal observes that the Respondent’s own case was presented sparingly. The Respondent adduced no evidence of the request for documents upon which it relies, and rested instead upon its Written Submissions dated 16th June 2026 and upon the terms of the impugned decision. That approach is not to be commended. 12. The Tribunal has cautioned before, and reiterates, that the Respondent ought to place before it the material upon which the decision under challenge was founded. Nonetheless, the statutory burden imposed by Section 56(1) of the TPA does not shift by reason of the Respondent’s evidential parsimony. That burden rests on the taxpayer throughout the proceedings. 13. In any event, the record is not wholly silent on the question of a request. The objection application acknowledgement receipt issued to the Appellant on 5th February 2021 expressly directed the Appellant to follow the instructions given in the electronic mail and to produce the necessary documents. The Appellant has at no point denied that documents were called for. 14. The Tribunal further finds that the Appellant’s reliance on Section 51(7) of the TPA is misconceived. That provision governs an application for extension of time within which to lodge a late notice of objection. The Respondent admitted and acknowledged the Appellant’s late objection, the acknowledgement receipt recording sickness as the late objection reason. The extension having been allowed, nothing turns on that ground. 15. The Tribunal further notes a discrepancy in the scope of the dispute as pleaded. The Statement of Facts refers to two assessments, being one dated 10th December 2020 for Kshs. 363,104.00 and another dated 23rd December 2020 for Kshs. 842,400.00, and prays for the vacation of principal tax, penalties and interest amounting to Kshs. 1,205,504.00. 16. The objection acknowledgement receipt and the impugned decision both relate exclusively to the additional VAT assessment of Kshs. 842,400.00 for the period November 2019. Nothing on the record shows that an objection was lodged against the assessment of Kshs. 363,104.00, and no decision in respect of it is before the Tribunal. This Appeal is therefore confined to the decision that arose in respect of the objection against the former assessment. 17. Weighing the whole of the material on record, the Tribunal finds that the Appellant has not discharged the burden placed upon it by Section 56(1) of the TPA. It has not demonstrated that its notice of objection lodged on 5th February 2021 satisfied the requirements of Section 51(3), and in particular Section 51(3)(c), of the TPA. 18. The Tribunal accordingly finds that the Respondent was justified in invalidating the Appellant’s objection, and that the decision dated 3rd March 2021 was properly made and adequately communicated to the Appellant. The grounds of appeal advanced by the Appellant must therefore fail. 19. Having so found, the Tribunal makes no pronouncement upon whether the supplies in issue were vatable or upon the quantum of the assessment. Those are merit questions which the Respondent has never determined under Section 51(11) of the TPA, and which, on the authority of **Geo Chem Middle East (supra)**, do not arise for determination in this Appeal. **FINAL DECISION** 1. The upshot of the above analysis is that the Tribunal finds that the Appeal lacks merit. The Tribunal accordingly proceeds to issue the following Orders: - a) The Appeal be and is hereby dismissed. b) The Respondent’s decision dated 3rd March 2021 be and is hereby upheld. c) Each party to bear its own costs. 1. It is so ordered. **DATED AND DELIVERED AT NAIROBI THIS 14TH DAY OF AUGUST 2026.** **……………………………..….** **ROBERT M. MUTUMA** **CHAIRMAN** **……………………………… ……..….……..……………..** **GLORIA A. OGAGA DR. TIMOTHY B. VIKIRU MEMBER MEMBER** **………………………………** **JIMMY M. MALLA** **MEMBER**