https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/235

 REPUBLIC OF KENYA IN THE TRIBUNAL OF KENYA AT NAIROBI COUNTY COURT NAME: TAX APPEALS TRIBUNAL CASE NUMBER: TATC/E546/2025 QIU LIMITED VS KENYA REVENUE AUTHORITY JUDGMENT # BACKGROUND 1. The Appellant is a is a limited liability company incorporated under the Companies Act. 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 Sub section (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 undertook tax return review of the Appellant for the years 2020 and 2023. Consequently, the Respondent issued assessment order for excise duty dated 18th January 2021 for the period 1 st November 2020 to 30th November 2020 for Kshs 3,925,759.92. The Respondent further raised Income tax default assessments on 13th December 2024 for Kshs 7,214,193. The assessment dated 13th December 2024 was not on record. 1. The Appellant lodged late notice of objection for the assessment dated 18th January 2021 and an application for extension of time to lodge a notice of objection dated 28th January 2025 for the assessment dated 13th December 2024. 2. Upon receipt of the said notice of the objection for the assessment dated 18th January 2021, the Respondent, directed the Appellant to validate its notice of objection so as to comply with the provisions of Section 51(3) of the Tax Procedures Act Cap 469B(TPA). In the absence of any action from the Appellant, the Respondent issued an invalidation notice dated 21st June, 2022 and a late objection rejection notice dated 1st July 2022. 3. Further, upon receipt of the application for the extension of time to lodge a notice of objection dated 28th January 2025 for the assessment dated 13 th December 2024, the Respondent requested the Appellant via email dated 30th December 2024 to provide proof of sickness and a further email remainder dated 7th February 2025 to validate the notice of objection so as to comply with the provisions of Section 51(3) of the TPA. In the absence of any action from the Appellant, the Respondent proceeded to issue an invalidation notice dated 11th February 2025. 4. The Appellant being dissatisfied by the Respondent's decision lodged notice of appeal dated 28th May 2025 and filed on 29th May 2025. # THE APPEAL 1. The Appellant lodged a Memorandum of Appeal filed on 29 th May 2025 raising the following grounds of Appeal; 1. The assessment done on one side entries and enable us not to filled the transaction by closing our accounts to be filled. 2. The Appellant stopped selling of water and excise stamps we allocated to its account whereby the cases was handle by Branch manager Mrs. Consalata. # THE APPELLANT’S CASE 1. The Appellant lodged its statement of facts which was filed on 29 th May 2025 which the same grounds as the Memorandum of Appeal. The Appellant did not file submissions. # Appellant’s prayers 1. The Appellant requested that the matter to be heard by the Alternative Dispute Resolution. # THE RESPONDENT’S CASE 1. The Respondent case is premised on its statements of facts dated and filed on 8th August, 2025 and its written submissions dated 18th March 2026 and filed on 23rd March 2026. 2. The Respondent relied on Section 51 (7) of the of the TPA which grants power to the Respondent to allow an application for the extension of time to file a notice of objection if the Appellant was prevented from lodging the notice of objection within the required period because of an absence from Kenya, sickness or other reasonable cause; and that the Appellant did not unreasonably delay in lodging the notice of objection. 3. The Respondent averred that in the instant case, the Appellant lodged the notices of objection beyond the statutory prescribed timelines. It noted the first assessment for the year 2020 was issued on 18th January, 2021 whilst the notice of objection was lodged on 20th May, 2021, which is three (3) months late. The Respondent further averred that the second assessment for the year 2023 was raised on iTax on 13th December, 2024 whilst the application for extension of time to lodge a notice of objection was lodged on 28th January, 2025, which was fifteen (15) days late. 4. The Respondent asserted that the period within which a notice of objection should be lodged is within thirty days as prescribed under the provisions of Section 51 (2) of the TPA. 5. It stated that the Appellant can make an application to the Commissioner for extension of time within which to lodge a notice of objection but the Appellant must demonstrate the reasons that occasioned such delay. According to the Respondent, the Appellant alleged that it was not able to lodge the objection within the statutory timelines on account of "sickness" but it did provide any proof. 1. The Respondent stated that vide the emails dated 30 th December, 2024 and a further reminder dated 7th February, 2025, requested the Appellant to avail documents in support of the objection but the Appellant failed. 2. The Respondent relied on the provisions of Section 109 of the Evidence Act which provides that the burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person. 3. It asserted that the Appellant did not satisfy the criteria set out under the provisions of Section 51 (7) of the TPA. 4. It also stated that the Appellant failed to provide documents to support the objection which was contrary to Section 51(3) of the TPA. 5. It stated that whereas Section 24 of the TPA allows a taxpayer to submit tax returns in the approved form and manner prescribed by the Respondent, the Respondent is not bound by the information provided therein and can assess for additional taxes based on any other available information and to the best of the Commissioner's judgement. 6. The Respondent stated that the assessment by the Respondent was in accordance with Section 31 of the TPA which gives the Respondent leeway to issue additional assessments based on the available information and best of judgement. 7. The Respondent also averred that pursuant to Section 56 of the TPA and Section 30 of the Tax Appeals Tribunal Act Cap 469A (TATA), the burden of proof lies on the Appellant to demonstrate that it discharged its tax liability. The Respondent maintained that this burden was never discharged as no documentary evidence was availed to the Respondent to enable it render a meritorious decision in the circumstances. 1. The Respondent submitted that the rejection of the Appellant's Application to file a late objection on the excise duty and Income tax was merited in law on the basis that the Appellant did provide proof of sickness and that it did provide documents to support the notice of objection. 2. It cited the case of **Far East Connection Limited v Commissioner of Domestic Taxes** which the Tribunal held that: *"...the Appellant having failed to disclose any reasonable cause that could have possibly preventing it in lodging the notice of objection within the statutory timelines, the Respondent cannot be conceivably faulted in any manner for disallowing the application for lodging a late notice of objection...’’* 1. The Respondent also submitted that the Appellant's Notice of Appeal and every other subsequent pleading before the Tribunal are incurably defective and should be struck out. It submitted that the Appellant's appeal is riddled with contravention of express provisions of the law. # Respondent’s prayers 1. The Respondent prayed that its decision to reject the late objection and the consequent confirmation of the assessment of Kshs 7, 214,193 being the Appellant's Income Tax liability and Kshs 3,811,417.40 being Appellant's Excise Duty liability was proper in law and in conformity with the ITA and the TPA. The Respondent therefore urged the Tribunal to dismiss the Appeal with costs since the same is devoid of merit. # ISSUES FOR DETERMINATION 1. Having considered the parties’ pleadings, the Tribunal identified the following issues for determination: 2. Whether the Tribunal has jurisdiction to determine the appeal; and 3. Whether the Respondent erred in confirming the assessments. # ANALYSIS AND FINDINGS 1. It is to these issues that the Tribunal will turn within as hereunder: - # a. Whether the Tribunal has jurisdiction to determine the appeal 1. The Respondent asserted that the appeal was not valid on the basis that the Appellant filed invalid objections as they were filed out of time without leave. 2. The Respondent issued two sets of assessments. The first set was issued vide assessment order dated 18th January 2021 for excise duty against which the Appellant filed objection on 20th May 2021. It appears from the Respondent’s pleadings that it issued a second set assessment on income tax on 13th December 2024 against which the Appellant objected against on 28 th January 2025. 3. It is also noted that the Appellant sought leave to file notices of objection out of time but the Respondent disallowed the applications vide decisions dated 21st June 2022 and 11th February 2025 under Section 51(7) of the TPA. The Appeal is based on those two decisions. 4. The TPA mandates the taxpayer to file Notice of objection within 30 days. In particular, Section 51(2) of the TPA provides as follows: *(2) A taxpayer who disputes a tax decision may lodge a notice of objection to the decision, in writing, with the Commissioner* ***within thirty*** *days of being notified of the decision.* 1. There is no doubt that the Appellant delayed to file the notices of objection. When a taxpayer delays to object to the assessment, the law allows the taxpayer to lodge an application with the Respondent seeking leave to file notice of objection out of time. In this regard, Section 51(6) of TPA provides as follows: *A taxpayer may apply in writing to the Commissioner for an extension of time to lodge a notice of objection.* 1. The Applicant herein utilised the provisions under Section 51(6) of the TPA. However, the Respondent declined to allow the applications under Section 51(7) of the TPA on the basis that the Appellant did not provide documents to support the applications. 2. Section 51(7) of the TPA provides as follows: 3. *The Commissioner may allow an application for the extension of time to file a notice of objection if—* 1. *the taxpayer was prevented from lodging the notice of objection within the period specified in sub section (2) because of an absence from Kenya, sickness or other reasonable cause; and* 2. *the taxpayer did not unreasonably delay in lodging the notice of objection.* 4. Section 51(7) of the TPA grants the Respondent the discretion to allow or not to allow the application. However, we hasten to add that the discretion must be exercised fairly. 5. When the Respondent rejects the application for enlargement of time, the legal consequence is that the Applicant is regarded as not having filed a notice of objection at all and the taxpayer is bared from invoking the jurisdiction of this Tribunal under the Tax Appeals Tribunal Act Cap 469A(TATA). In other words, filing an objection to assessment is a condition precedent to approaching this Tribunal. Indeed Section 51(1) to the TPA provides as follows: *A taxpayer who wishes to dispute a tax decision shall first lodge an objection against that tax decision under this Section* ***before proceeding under any other written law.*** 1. Pursuant to Section 51(1) of the TPA, and in absence of a valid notice of objection, the Applicant cannot invoke the powers of this Tribunal under the TATA which then means that the Tribunal would not have jurisdiction to entertain the Appeal. 2. The High Court has held that the Tribunal lacks jurisdiction to decide on matters arising from the provisions of Section 51(7) of the TPA. In particular, the High Court in the case of **Commissioner of Investigations &** **Enforcement v Vyas t/a Rocon Enterprises (Income Tax Appeal E144 of 2021) [2022] KEHC 16027 (KLR)** observed that the Tribunal does not have jurisdiction to entertain decisions under Section 51(7) of the TPA for the reason that the decision is not an appealable decision. The High Court noted that such decisions are subject to judicial review proceedings not appealable to the Tribunal. 1. The decisions against which the Appellant filed this appeal are not appealable decisions. The Appellant having not been granted leave to file notices of objection, it means that the Appellant did not object to the assessments which then means that this appeal cannot arise hence the Tribunal lacks jurisdiction to entertain it. 2. We are fully aware that this Tribunal cannot proceed in absence of jurisdiction. In the case of **Owners of Motor Vessel “Lilian S” v Caltex Oil** **(K) Limited [1989] eKLR** observed that, jurisdiction is everything without it, a court must down its tools. 1. In the circumstances, it is the Tribunal’s considered view that the Applicant approached the wrong forum. # FINAL DECISION 1. The upshot to the foregoing is that the Tribunal finds and holds that the Appeal is incompetent and makes the following orders:- 2. The Appeal be and is hereby struck out; and 3. Each party to bear its own cost. 4. It is so ordered. **DATED** and **DELIVERED** at **NAIROBI** this 19TH DAY OF MAY **2026** SIGNED BY/FOR: HON. ROBERT MUGAMBI MUTUMA (CHAIRPERSON) HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER HON. BILLY GRAHAM OKUMU MIJUNGU **★ TH E JUDICIAR Y O F KENY A ★** **HON. ROBERT MUGAMBI MUTUMA (CHAIRPERSON) HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER HON. BILLY GRAHAM OKUMU MIJUNGU** Tax Appeals Tribunal Tribunal Date: 2026-05-19 16:59:03