[2017] KEHC 9596 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

JUDICIAL REVIEW DIVISION

MISCELLANEOUS CIVIL APPL. NO. 471 OF 2016

IN THE MATTER OF AN APPLICATION FOR LEAVE TO APPLY FOR JUDICIAL REVIEW ORDERS OF CERTIORARI,PROHIBITION AND MANDAMUS

AND

IN THE MATTER OF CONSTITUTIONAL RIGHTS PURSUANT TO ARTICLES 21(1), 23(1) 23(3) (f), 25 (c), 27 (1), 47(1), 49(1)(d) & 50(2) OF THE CONSTITUTION OF KENYA, 2010

AND

IN THE MATTER OF THE LAW REFORM ACT, SECTION 8 AND 9 CAP 26 LAWS OF KENYA

AND

IN T HE MATTER OFTHE INCOME TAX ACT, CAP 470 LAWS OF KENYA

AND

IN THE MATTER OFTHE VALUE ADDED TAX ACT, 2013

AND

IN THE MATTER OF THE TAX PROCEDURES ACT, NO. 29 of 2015

AND

IN THE MATTER OFTHEADVOCATES ACT

BETWEEN

REPUBLIC......................................................................APPLICANT

VERSUS

THE KENYA REVENUE AUTHORITY......................RESPONDENT

EX PARTE:

PROFESSOR TOM ODHIAMBO OJIENDA SC

T/A PROF. TOM OJIENDA & ASSOCIATES

RULING

1. By a Motion on Notice dated 27th July, 2017, the ex parte applicant herein, Professor Tom Odhiambo Ojienda, in substance seeks, apart from the usual order for costs, the following orders:

1)The Honourable Court do and hereby issue an order compelling the respondent to delete the illegal entries in the Respondent’s tax ledger held in the names of the Ex-Parte applicant at Nakuru indicating that the Ex-Parte applicant owes the respondent a total of Kshs.148,120,928. 00as tax due and payable by the Ex-Parte Applicant for the taxable period of between 1995 to 2014.

2)The Honourable Court do and hereby issue an order compelling the respondent to issue the Ex-Parte Applicant’s law firm of Odhiambo & Odhiambo Advocates a tax compliance certificate.

3)Any other or further relief that this Honourable Court may deem fit to grant.

2. The application was based on the following grounds:

1)On 4th October 2016, the Ex-Parte Applicant moved this honourable court and obtained, amongst others an order thatthe Leave so granted do operate as a stay of thepurported illegal amended assessment made on 5th September, 2016 by theRespondent, its agents, employees and/or servants demanding the payment for the sum of Kshs. 378,682,140. 00 as total tax due and owing to the Respondent by the applicant for the period 2011-2016 and of all the illegal entries in the Respondent’s tax ledger held in the names of the applicant at Nakuru.

2)In blatant violation of this honourable court’s valid order, the respondent loaded the illegal entries in the Respondent’s tax ledger held in the names of the Ex-Parte applicant at Nakuru for prior years between the years 1995 to 2014 to which tax was already assessed, paid and compliance certificates issued. The said illegal entries indicate that the Ex-Parte applicant owes the respondent a total of Kshs.148,120, 928. 00 as tax due and payable by the Ex-Parte Applicant for the said period.

3)As a result of the said illegal entries entered in defiance of the Honourable Justice Odunga’s orders issued on 4th October 2016, the respondent failed/neglected and/or refused to issue a compliance certificate to the Ex-Parte applicant’s law firm, Odhiambo & Odhiambo Advocates in Nakuru, whose compliance certificate expired on 25th May 2017.

4)The said illegal entries are not only contemptuous but are also prejudicial since the tax liability of the Ex-Parte applicant is the subject of these proceedings.

5)The illegal entries further offend section 23(1)(c) of Tax Procedure Act, 2015 provides that a “A person shall—(c) subject to subsection (3), retain the document for a period of five years from the end of the reporting period to which it relates or such shorter period as may be specified in a tax law”.

6)Unless therefore this honourable court intervenes and compels the respondent to delete the illegal entries in the Respondent’s tax ledger held in the names of the Ex-Parte applicant at Nakuru, and the Ex-Parte Applicant’s law firm is issued with a compliance certificate, the Ex-Parte Applicant would be forced to close down its law firm business of Odhiambo & Odhiambo Advocates, not only to his detriment but also to the detriment of many employees that the law firm has retained and the many clients that the law firm represents.

3. These grounds were reiterated in the supporting affidavit sworn by the applicant rein on 27th July, 2017.

4. In his further affidavit, the applicant averred that he applied for the compliance certificate for Odhiambo & Odhiambo Advocates online as it is required but his application was rejected because of the illegal entries in the Respondent’s tax ledger held in his names at Nakuru for prior years between the years 1995 to 2014.

5. In support of his case the applicant submitted that in present application the applicant seeks orders in the nature of mandatory injunction and that the law in this area is fairly settled as expressed in inter alia Kenya Breweries Limited & Anothervs.Washington O. Okeyo [2002] eKLR.

6. According to the applicant, he only needs to satisfy any one of the principles to be entitled for grant of Mandatory Injunction orders.

7. In this case it was submitted that this Court is yet to determine the legality or otherwise of the impugned assessment and therefore the respondent cannot purport to charge interest and penalties on the disputed amount as averred in paragraph 10 of the Replying Affidavit. This is not only prejudicial to the court process but also an attempt by the respondent to still a match from the applicant. Further, the court order that was issued on 4th October 2017 was very clear and unambiguous. It stayed entering of all the illegal entries by the respondent in its tax ledger held in the names of the applicant.

8. In the applicant’s view, the said complained of entries by the respondent, whether penalties and/or interests are thus not only contemptuous of the court order but also manifestly illegal and hence it is a clear case which the Court can decide once and compel the deletion of the said entries.

9. As regards the issuance of Tax Compliance Certificate, it was averred that the duty to collect taxes is a preserve of the Respondent but that duty must be carried out in accordance with the law and without a violation of the Ex Parte Applicant’s rights as enshrined under the Constitution. In this respect the applicant relied on Samura Engineering Limited and Others vs. Kenya Revenue Authority,Nairobi Petition No. 54 of 2011 [2012] eKLR where Majanja, J opined at paragraph 58 as follows:

“...Kenya Revenue Authority as the State agency charged with the collection of taxes is bound by the provisions of the Bill of Rights to the fullest extent in the manner in which it administers the laws concerning the collection of taxes. The values contained in Article 10 must at all times permeate its functions and activities which it is mandated to carry out by statute”

10. It was further submitted that whereas this Court appreciates the need for taxes due to be paid, even where the taxes are due and there is no dispute with respect to the same, its collection must be in accordance with the law as was correctly put by Nyamu, J (as he then was) in Keroche Industries Limited vs. Kenya Revenue Authority & 5 Others Nairobi HCMA No. 743 of 2006 [2007] KLR 240 that:

“It is no good answer for the taxman to proclaim that Kshs 1 billion (appx) is intended to swell the public treasury because due to the application of the above principles that money is not lawfully due… Applying the same reasoning, to the matter before this court, it does not matter that the respondents say and think they are owed over a billion Kenya shillings - what matters is whether the amount is lawfully due and whether the law allows its recovery? It is not a question of impression or perception of what is owed, instead it is what if anything, is owed under the relevant law and whether its assessment and recovery is permitted by the applicable law. If rightly due, the huge amount notwithstanding the court must uphold the right of recovery regardless of its consequence to the applicant and if not due under the law it must not hesitate to disallow it and must disallow it to among other things to uphold both the law the integrity of the rule of law.”

11. It was submitted that It is now trite law that a compliant certificate alone is not a conclusive evidence of complying with one’s tax obligation. The same can be withdrawn upon sufficient evidence to the contrary. In this respect the applicant relied on Republic vs. Kenya Revenue Authority Ex ParteTradewise Agencies [2013] eKLR, and Republic vs.Kenya Revenue Authority Ex Parte Cooper K-Brands Limited [2016] eKLR.

12. It was the applicant’s case that compelling the respondent to issue the Tax Compliance certificate as sought therefore would not be prejudicial to this case since the Tax Compliance certificate alone is not conclusive evidence that the tax payer has fully complied with the tax obligation.

13. To the applicant, in conducting his self tax assessment, the Ex Parte Applicant herein was complying with his tax obligations under the law and as such had legitimate expectation that after such compliance, the Respondent herein would issue him with a Compliance certificate and reliance was placed on Republic vs. Kenya Revenue Authority ex parte Shake Distributors Limited Hcmisc. Civil Application No. 359 of 2012 where the court held thus with regards to legitimate expectation:

“According to Harry Woolf, Jeffrey Jowell and Andrew Le Sueur at page 609 of the 6th Edition of DE SMITH’S JUDICIAL REVIEW, ‘Such an expectation arises where a decision maker has led someone affected by the decision to believe that he will receive or retain a benefit or advantage (including that a hearing will be held before a decision is taken)’. It follows therefore that the cornerstone of legitimate expectation is a promise made to a party by a public body that it will act or not act in a certain manner. For the promise to hold, the same must be made within the confines of law. A public body cannot make a promise which goes against the express letter of the law.

14. The applicant insisted that the Respondent would not suffer any prejudice should it grant the Ex parte Applicant the compliance certificate pending the determination of the substantive Notice of Motion since in the event that this court finds that the Ex Parte Applicant has not met the necessary compliance, the Respondent has the powers under section 72(3) of the Tax Procedures Act to revoke a Tax Compliance Certificate issued earlier.

15. According to the applicant, his law firm of Odhiambo & Odhiambo Advocates in Nakuru has many employees working for gain in the law firm. It has also retained many clients to which it represent in many matters. It is therefore in the interest of the large public that it be issued with the tax compliance certificate so that it remains in operation. Otherwise, the clients, especially those with active cases in court, would be fundamentally prejudiced and their constitutional right to representation by an advocate of their choice violated if the Tax Compliance Certificate is not issued as prayed under prayer 3.

Respondent’s Case

16. The application was opposed by the Respondent.

17. According to the Respondent, the instant application was filed in the middle of the hearing of the main suit herein with a view to interrupting the hearing of the main suit on the erroneous and unfounded belief that the Respondent has breached an order of this Honourable Court dated 5th October 2017.

18. It was averred that the ex parte Applicant was under investigation by the Respondent which investigations revealed that the Ex Parte Applicant had a tax liability following which an assessment issued pursuant to the provisions of section 31 of the Tax procedures Act. The Ex Parte Applicant raised an objection to the assessments and the Respondent adjusted the assessment accordingly. Consequently, on 5th September, 2016 the Respondent served an Objection decision upon the Ex parte Applicant for an assessment of KSHS. 378, 682, 140/-. Having received the assessment, the Ex parte Applicant filed a Judicial Review Application and simultaneously obtained a Stay Order the subject of these proceedings. The said Order issued on 5th October, 2016 granted leave to the ex parte Applicant to institute Judicial Review proceedings and was also a Stay of the assessment of 5th September, 2016 made by the Respondent for the sum of Kshs. 378, 682, 140/-.

19. According to the Respondent, it has continued to obey the Court Order and has not altered the status of the Applicant’s ledger at all as alleged by the Applicants. However, the statutory monthly interest and penalties continue to accrue on the assessment of Kshs. 378, 682, 140/- since the same amount has not been found not payable by any court or tribunal. The instant application is therefore challenging the statutory monthly penalties and interest accruing on the assessment of KSH. 378, 682, 140/-.

20. In support of its position the Respondent relied on section 31(9) of the Tax Procedures Act which provides in part that:

Despite any notification to a taxpayer under this section, the due date for the payment of the tax payable under assessment (referred to as the "original due date') shall not be altered and the late payment penalty and late payment interest shall also remain payable based on the original due date.

21. It also relied on section 38 of the Tax Procedures Act 2015 which provides that a person who fails to pay a tax on or before the due date for the payment of the tax shall be liable for late payment of interest at a rate equal to one per cent (1%) per month or part of a month on the amount unpaid for the period commencing on the date the tax was due and ending on the date the tax is paid.

22. It was submitted that the statutory requirements for penalties and interests were not stayed by the Honorable Court. The Court stayed the collection and assessment of Kshs 378, 682, 140/- until the suit is heard and determined. The assessment of Kshs.378, 682, 140/ has not been altered at all by the Respondent. The instant application is therefore based on an erroneous view of the ex parte Applicant.

23. It was similarly contended that since the provisions of section 31(9) and 38 of the Tax Procedures Act were not stayed by the Court, the ex parte Applicant has misinterpreted the Order of the Court to mean that the court suspended the impugned sections of the Tax Procedures Act. To the Respondent, the entries of penalties and interest in the ex parte Applicants ledger are therefore legal and undisputedly in line with the provisions of sections 31(9) and 38 of the Tax Procedures Act since penalties and interests are statutory and will be cleared off if the Application’s application is successful and if not, the ex parte Applicant will be required to pay the amount assessed together with penalties and interest. The penalties and interests cannot therefore be stayed at all. Had the Court suspended the provisions of statute this ought to have been expressly prayed for by the Applicant and expressly relayed in the Court Order, both of which are not the case.

24. With respect to the grant of a tax compliance certificate, it was contended that the issuance of a TCC is provided by section 72(2) of the Tax Procedures Act which provides that:

TheCommissioner may issue a Tax Compliance Certificate, which shall be valid for the period specified in the certificate, upon the applicant fulfilling conditions that the Commissioner may impose.

25. The Respondent also relied on section 72(3) which provides that:

The Commissioner may revoke a Tax Compliance Certificate issued under sub-section (2) if the Commissioner finds that the person has failed to honour a demand for tax issued by the Commissioner or has violated the provisions of a tax law.

26. To the Respondent, a Tax Compliance Certificate just as the name suggests is therefore only issued when a taxpayer is tax compliant and the Commissioner has the discretion to reject an application for a Tax Compliance Certificate or withdraw an already issued Tax Compliance Certificate if it is established that the taxpayer is not compliant. A taxpayer is deemed to be non-compliant when after an investigation or audit, it is established that the taxpayer made incorrect statements in his/her returns which affected liability to tax, omitted certain income from returns or deliberately defaulted on any obligation imposed under a tax law. In this respect the Respondent relied on the decision of this case in Republic vs Kenya Revenue Authority &AnotherExparte Tradewise Agencies [2013] eKLR and contended that to compel the Respondent to issue a Tax Compliance Certificate (certificate) is not the proper thing to do because the Applicant is not compliant and has an assessment raised against his law firm the subject of these proceedings. Further, the law firm of Odhiambo and Odhiambo is not a party in these proceeding and the orders cannot therefore issue. The subject party of these proceedings is Professor Tom Odhiambo Ojienda Sc T/A Prof. Tom Ojienda & Associates and not the firm of Odhiambo and Odhiambo Advocates.

27. It was averred that indeed my Lord the prayers sought are a mandatory injunction to compel the Respondent to delete the penalties and interests in the ledger of the ex parte applicants and to compel the Respondent to issue Tax Compliance Certificate to the ex parte applicant yet for the grant of a Mandatory Injunction at an interlocutory stage, the applicants must show that there are special circumstances to warrant the order. In this regard the Respondent relied on Kenya Airports Authority vs. Paul Njogu Mungai Civil Application No. NAI 29 of 1997 where the Court of Appeal stated:

“…we would point out that the principles governing the grant of a mandatory as well as prohibitory orders pending hearing and determination of a suit in the High Court are the self same ones enunciated in the celebrated case of Giella vs Cassman Brown & co ltd …save that a mandatory injunction can only be granted in exceptional and in the clearest of cases.”

28. Reliance was also placed on Halsburys Lawsof England (4th edition) paragraph 948 which states that:

A mandatory injunction can be granted on an interlocutory application as well as at the hearing but, in the absence of special circumstances, it will not normally be granted. However, if the case is clear and which the Court thinks ought to be decided at once, or if the act done is simple and summary one which can be remedied, or if the defendant attempted to steal a match on the plaintiff…a mandatory injunction will be granted on an interlocutory application.

29. It was submitted that the test for granting a mandatory injunction has not been met by the Ex Parte applicant who has not demonstrated what special circumstance there is that would warrant having the Respondent compelled to issue a Tax Compliance Certificate to the firm of Odhiambo & Odhiambo Advocates in accordance with the provisions of the Tax Procedures Act. The ex parte Applicant has also not demonstrated any special circumstance at all that would warrant the deletion of the statutory penalties and interest accruing on the assessment made.

30. With respect to the allegation that the Respondent has attempted to steal a match from the Applicant, it was submitted that to steal a match is defined as to get an advantage over by secret or underhand enterprise. The Respondent submits that it has not taken any advantage of the Ex Parte Applicant, except to enforce the provisions of statute. Enforcing statute by charging penalties and interest on the assessment is not stealing a match, nor is refusal to issue a compliance certificate. The requirements for granting a mandatory injunction are therefore not been met by the Exparte Applicant.

31. It was reiterated that there are no special circumstances here that warrant the grant of the interlocutory mandatory injunction sought. This is not a clear case where to grant such relief. It is a case which ought to await trial of the action so that the court determines whether the assessment issued on the ex parte Applicant is due. The issue of penalties and interests and Tax Compliance Certificate is not a simple and summary act that can be easily remedied by the relief sought; on the contrary it is, prima facie, an act done by the Respondent in pursuance of its statutory mandate to charge and collect tax. There are not any exceptional circumstances disclosed that would justify an interlocutory mandatory injunction.

32. The Respondent therefore prayed that this Application be dismissed with costs to the Respondent on the basis that the same is without merit and is intended to frustrate and scuttle due process of tax administration.

Determination

33. I have considered the issues raised herein. It is true that on 4th October 2016, the Ex-Parte Applicant moved this Court, sought and was granted leave to commence these proceedings. The said leave, it was further directed would operate as a stay of the purported illegal amended assessment made on 5th September, 2016 by the Respondent, its agents, employees and/or servants demanding the payment for the sum ofKshs. 378,682,140. 00 as total tax due and owing to the Respondent by the applicant for the period 2011-2016 and of all the illegal entries in the Respondent’s tax ledger held in the names of the applicant at Nakuru.

34. It is however the applicant’s case that despite the existence of the said order and in blatant violation thereof, the respondent loaded the illegal entries in the Respondent’s tax ledger held in the names of the Ex-Parte applicant at Nakuru for prior years between the years 1995 to 2014 to which tax was already assessed, paid and compliance certificates issued. As a result of the said entries, it is now indicated that the Ex-Parte applicant owes the respondent a total of Kshs.148,120, 928. 00 as tax due and payable by the Ex-Parte Applicant for the said period. Based on the said action, the respondent failed/neglected and/or refused to issue a compliance certificate to the Ex-Parte applicant’s law firm, Odhiambo & Odhiambo Advocates in Nakuru, whose compliance certificate expired on 25th May 2017.

35. It is not in doubt that on 26th May, 2016, the Respondent issued the applicant with a Tax Compliance Certificate in which it was confirmed that the applicant, Odhiambo & Odhiambo Advocates had filed relevant tax returns and paid taxes due as provided by the law. The said certificate was to be valid for twelve (12) months up to 25th May, 2017. The effect of the issuance of a Tax Compliance Certificate has been the subject of determination by this Court. In Republic vs. Kenya Revenue Authority & Another ex parte Tradewise Agencies [2013] eKLR:

“Although the respondent contends that a person who complies with the provisions of the Seventh Schedule paragraph 7 is eligible for a Tax Compliance Certificate because the said person has filed tax returns and paid what he has assessed himself as due to the Commissioner and that a Tax Compliance Certificate does not mean that a person’s accounts are perfect or beyond reproach and only an audit conducted by the First Respondent can certify accounts to be beyond reproach for tax purposes the same certificates indicate that the authority reserves the right to withdraw the certificate if new evidence materially alters the tax compliance status of the recipient. Why would the certificate be withdrawn if it is not evidence of compliance? If it is only evidence of submission of remission of taxes in which event it is not binding on the authority there would be reason for it to be withdrawn by the authority. The only conclusion one would draw is that the certificate is prima facie evidence of compliance and until withdrawn the same is proof of fulfilment of the obligation to pay taxes...Whereas this Court cannot hold that the applicant was not obliged to pay any taxes, the 1st respondent was expected to notify the applicant of any discovery of new evidence which was likely to materially alter the applicant’s tax compliance status and hear the applicant’s side of the story before taking an action which was contrary to its earlier conduct.”

36. It is important to mention that there was attempt to appeal against the said decision vide Kenya Revenue Authority vs.Tradewise Agencies Limited & Consolidated Bank of Kenya 2014] eKLR. However on 28th day of February, 2014, Kihara Kariuki, PCA dismissed an application which was seeking to extend time or the filing of the Notice and the Record of Appeal thus sealing the fate of the appeal in so far as that ruling was concerned.

37. The same position was adopted in Republic vs.Kenya Revenue Authority Ex Parte Cooper K-Brands Limited [2016] eKLR,where it was held as follows:

“It bears repeating that Tax Compliance Certificates are not a final proof of payment of taxes. However, where there is evidence that the taxpayer did not actually pay the taxes, the tax authority ought to furnish the taxpayer with the grounds on the basis of which the tax authority believes that the information giving rise to the Certificate was incorrect before seeking to recover what in its view is the correct amount of tax due.”

38. In other words Tax Compliance Certificate is a rebuttable evidence that a person is tax compliant and to my mind the burden of rebutting that presumption falls on the Tax Authority.

39. The applicant has exhibited a copy of the document detailing charges loaded in his account by the Respondent which were allegedly due prior to the issuance of the said Tax Compliance Certificate. In my view without the withdrawal of the said Certificate, such charges would on the face of it be questionable and in light of this Court’s order of stay would be in bad faith. This is what is known as stealing a march by a party during the pendency of legal proceedings and in my view is what the Court had in mind in Kenya Breweries Limited & Anothervs.Washington O. Okeyo [2002] eKLR where it held as follows:

The test whether to grant a mandatory injunction or not is correctly stated in Vol. 24 Halsbury’s Laws of England 4th Edn. para 948 which reads:

“A mandatory injunction can be granted on an interlocutory application as well as at the hearing, but, in the absence of special circumstances, it will not normally be granted. However, if the case is clear and one which the court thinks it ought to be decided at once, or if the act done is a simple and summary one which can be easily remedied, or if the defendant attempted to steal a march on the plaintiff …a mandatory injunction will be granted on an interlocutory application”

40. In my view to set out to cripple a tax payer challenging a demand for taxes when there are conservatory orders in place can with due respect only be termed as mischievous.

41. Section 11 of the Fair Administrative Action Act, 2015 provides as follows:

(1) In proceedings for judicial review undersection 8 (1), the court may grant any order that is just and equitable, including an order-

(a) declaring the rights of the parties in respect of any matter to which the administrative action relates;

(b) restraining the administrator from acting or continuing to act in breach of duty imposed upon the administrator under any written law or from acting or continuing to act in any manner that is prejudicial to the legal rights of an applicant;

(c) directing the administrator to give reasons for the administrative action or decision taken by the administrator;

(d) prohibiting the administrator from acting in a particular manner;

(e) setting aside the administrative action or decision and remitting the matter for reconsideration by the administrator, with or without directions;

(f) compelling the performance by an administrator of a public duty owed in law and in respect of which the applicant has a legally enforceable right;

(g) prohibiting the administrator from acting in a particular manner;

(h) setting aside the administrative action and remitting the matter for reconsideration by the administrator, with or without directions;

(i) granting a temporary interdict or other temporary relief; or

(j) for the award of costs or other pecuniary compensation in appropriate cases.

42. This Court is now empowered pursuant to the above provisions to issue appropriate orders and reliefs including conservatory reliefs. A conservatory order is meant to preserve the status quo since as was held by a majority The Centre for Human Rights and Democracy & Others vs. The Judges and Magistrates Vetting Board & Others Eldoret Petition No. 11 of 2012:

“In our view where a legal wrong or a legal injury is caused to a person or to a determinate class of persons by reason of violation of any Constitutional or legal right or any burden is imposed in the contravention of any Constitutional or legal provision or without the authority of the law or any such legal wrong or injury is threatened, the High Court has powers to grant appropriate reliefs so that the aggrieved party is not rendered, helpless or hapless in the eyes of the wrong visited or about to be visited upon him or her. This is meant to give an interim protection in order not to expose others to preventable perils or risks by inaction or omission.”

43. As held by the High Court in Kaduna in Econet Wireless Limited vs. Econet Wireless Nigeria Ltd and Another [FHC/KD/CS/39/208] the decision to grant conservatory orders involves:

“a consideration of some collateral circumstances and perhaps in some cases inherent matters which may, unless the order of stay is granted, destroy the subject matter or foist upon the Court…a situation of complete hopelessness or render nugatory any order of the…Court or paralyse in one way or the other, the exercise by the litigant of his constitutional right…or generally provide a situation in which whatever happens to the case, and in particular even if the applicant succeeds…there would be no return to the status quo.”

44. I therefore agree that parties who have invited the Court to adjudicate on a matter which they are disputing over ought not to create a situation whereby the decision to be made by the Court would be of no use. In that event as held by the Nigerian Court of Appeal in United Cement Company of Nigeria versus Dangote Industries Ltd & Minister of Solid Mineral Development [CA/A/165/2005], the Court ought to ensure that:

“appropriate orders are made to prevent acts which will destroy the subject matter of the proceedings or foist upon the court a situation of complete helplessness or render nugatory any judgement or order.”

45. This Court appreciates that mandatory injunctions ought only to be granted in exceptional circumstances. In this case it is contended that the decision is in blatant violation of this Court’s orders and its effect would bring to a halt the operations of the applicant’s law firm. In my view this constitutes exceptional circumstances.

46. As this Court has held in the past a Tax Compliance Certificate may subject to the due process being followed be withdrawn. In my view nothing stops this Court pursuant to section 11 of the Fair Administrative Action, from issuing appropriate reliefs that would protect the parties before it.

47. In the premises whereas the prayer for an order compelling the respondent to delete the illegal entries in the Respondent’s tax ledger held in the names of the Ex-Parte applicant at Nakuru indicating that the Ex-Parte applicant owes the respondent a total of Kshs.148,120,928. 00 as tax due and payable by the Ex-Parte Applicant for the taxable period of between 1995 to 2014, ought to await the determination of these proceedings, I however direct that pending the hearing and determination of these proceedings the Respondent issues to the applicant’s law firm of Odhiambo & Odhiambo Advocates a tax compliance certificate for the current year. That Certificate will however be conditional on and subject to the determination of these proceedings.

48. The costs of these proceedings will be in the cause.

49. It is o ordered.

Dated at Nairobi this 15th day of November, 2017

G V ODUNGA

JUDGE

Delivered in the presence of:

Mr Ontweka for the Respondent

CA Ooko