https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/8507

Madressa El-Mohammediah Education Society v Kenya Revenue Authority & another (Judicial Review Miscellaneous Application E073 of 2024) [2026] KEHC 8507 (KLR) (Judicial Review) (17 June 2026) (Judgment) Neutral citation: [2026] KEHC 8507 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Law Courts) Judicial Review Judicial Review Miscellaneous Application E073 of 2024 JM Chigiti, J June 17, 2026 Between The Madressa El-Mohammediah Education Society Applicant and Kenya Revenue Authority 1st Respondent The Commissioner Domestic Taxes 2nd Respondent Judgment 1.The application that comes up for determination is the one dated at Nairobi this 28 day of June 2024 wherein the applicant is seeking the following Orders:-1.An Order of Prohibition directed at the Kenya Revenue Authority, either by itself, its agents or employees restraining it from taking any steps, actions, measures to impose, or collect any taxes from the exparte Applicant for the period of 2011 to 2023 when the Commissioner of Domestic Taxes illegally and unreasonably denied the Applicant a Tax Exemption Certificate.2.An Order of Mandamus to compel the 1st and 2ndRespondents to comply with the terms of the Settlement Agreement dated 28 October 2021 in which the 1st Respondent undertook to issue the exparte Applicant with a Tax Exemption Certificate within 30 days of the exparte Applicant settling full taxes for 2019 and 2020 (which were settled in full) and not later than 30 days upon receipt of the exparte Applicant’s application for a Tax Exemption Certificate3.A Declaration that the failure by the Respondents to issue a Tax Exemption Certificate to the exparte Applicant in accordance with the Income Tax Act, Chapter 470 of the Laws of Kenya, the parent statute herein amounts to a violation of the exparte Applicant’s constitutional right to enjoy rule of law, fair administrative action and to a fair taxation burden guaranteed under Articles 10 (2) (a), 10 (2) (b), 47 and 48 of the Constitution of Kenya, 2010, respectively.4.The cost of this Application be provided for. DIVISION - The Applicant’s Case; 2.It is the applicant’s case that on 23 March 2011, the Applicant made an application to the 2nd Respondent for renewal of the Tax Exemption Certificate as its previous certificate had expired. 3.The 2nd Respondent reviewed the application making a requests for documentation and the Applicant providing all the information requested. 4.The 1st Respondent alleged it notified the Applicant via e-mail dated 18 April 2019, indicating that the application for a Tax Exemption Certificate was denied, as per a letter issued on 25 July 2012. 5.The Applicant avers that it neither received the letter nor the email notification that its application for a Tax Exemption Certificate was denied. 6.On 25th October 2019, the Respondents issued the Applicant with an assessment demanding corporate income tax of KES.2,885,788 for the year 2018. 7.The Applicant objected to the assessment on 1st November 2019. Subsequently, the Respondents issued the Applicant with a demand notice on 11th June 2020 for corporate tax of KES.3,319,799 for the year 2018. 8.The Applicant responded to the demand via a letter dated 30th July 2020 stating that the Respondents were statutorily time barred from issuing the demand by dint of the 5-year statutory limit under section 31 of the Tax Procedures Act, 2015 (TPA). 9.Further, the Applicant requested that the Respondents to process the Tax Exemption Certificate application.The Respondents issued an Objection Decision on 19 August 2020 stating that the Applicant was liable to pay taxes amounting to KES. 2,037,299. 10.The Applicant lodged an Appeal at the Tax Appeals Tribunal (the Tribunal) in Tax Appeal No.456 of 2020, The Madressa-El-Mohammediah Education Society vs Commissioner of Domestic Taxes (the Appeal). 11.A judgment was issued on 30th July 2021 allowing the appeal on the basis that the Respondents had issued an objection decision outside of the 60 days statutorily mandated period under section 51 of the TPA. 12.The effect of the Tribunal’s Judgment was that the Applicant’s Appeal as well as in its Notice of Objection were as deemed allowed by operation of law. 13.The Applicant continued to engage the Respondents on a good faith basis on the status of its Tax Exemption Certificate application. Pursuant to which the parties entered into the Settlement Agreement on 28 October 2021.It contained the following terms inter alia:a.“Paragraph 29(vi) of the Settlement Agreement:that upon settlement of the full amount of principal corporate income tax for 2019 and 2020, the Commissioner will issue the Society with a Tax Exemption Certificate (the TEC) immediately upon settlement of the full taxes for 2019 and 2020 and not later than thirty (30) days upon receipt of the Society’s application for a TEC. The issuance of the TEC shall be a fundamental precondition of the contractual settlement between the Commissioner and the Taxpayer;b.Paragraph 29(vii) of the Settlement Agreement: that upon issuance of the TEC by the Commissioner, the tax exemption status will be applicable to the Taxpayer for the year 2021 and the following five (5) years and the Commissioner will not demand any taxes for the years 2021 up to 2026 (both inclusive);c.Paragraph 30 of the Settlement Agreement: the ADR Agreement is legally binding and shall be the full and final settlement of the matter; andd.Paragraph 31 of the Settlement Agreement: The Parties undertake to act in good faith to do all acts, deeds and take such steps, including to execute all documents as may be necessary to finalise the Agreement and to facilitate the performance of the obligations contained therein.” 14.In a bid to comply with its part,the Applicant paid the principal corporation income tax in one payment on 28 October 2021. 15.Thereafter the Applicant requested the Respondents to issue a tax exemption certificate. In this regard, the Respondents advised the Applicant to make an application in order to be issued with the Tax Exemption Certificate. 16.In a letter dated 10th March 2022, the Applicant made a fresh application for a Tax Exemption Certificate.On 17th March 2022 an agent of the 2nd Respondent, visited the premises of the Applicant in Mombasa. 17.The purpose of the visit was to carry out an inspection and an interview after which a report would be sent to the 2nd Respondent’s offices in Nairobi regarding the application for a Tax Exemption Certificate. 18.Following the visit, the Respondent requested for information on 22nd March 2022 pertaining to the beneficiaries of the Applicant, the properties owned by the Applicant, the rent earned by the Applicant from its properties and an explanation in relation to the intended use of the surplus funds held by the Applicant in the years 2018, 2019 and 2020. 19.The Applicant responded via a letter dated 22th April 2022 and provided all the information requested for by the Respondents and explained the intended use of the surplus funds to refurbish the buildings whose structural integrity. 20.It argues that the 1st Respondent and 2ndRespondent have deployed a mechanism of repeatedly requesting for documents and posing inquiries regarding the utilization of excess funds, actions which appear to be strategically aimed at circumventing the issuance of the Tax Exemption Certificate to the Applicant. 21.On 4th October 2022, the Respondents requested for additional information relating to the expenditure of the Applicant for the years 2018 and again requested for an explanation on the retention of funds by the Applicant in the years 2018, 2019 and 2020.The Applicant responded via a letter dated 7th October 2022 setting out the details of its expenditure in 2018. 22.The Applicant informed the Respondent that the reason for the retention of funds was to repair the significantly old buildings from which the Applicant generates rental income which is applied towards alleviation of poverty. 23.In a letter dated 13th March 2023, the Respondents requested for information pertaining to the ownership of the Applicant’s buildings, which were destroyed by fire, whether there was compensation by insurance for the buildings destroyed by fire, an explanation for the retention of funds by the Applicant in the years 2018, 2019 and 2020 and details of how the bursaries are allocated by the Applicant. 24.The Applicant responded via a letter dated 16th March 2023 and provided all the information requested by the Respondents. 25.On 2nd May 2023 the Respondents issued a demand requiring the Applicant to pay corporate income tax of KES. 6,023,612 for the years 2018, 2019 and 2020. 26.The Applicant responded to the demand through its agents via an e-mail dated 16th May 2023 challenging the demand as the Applicant’s income is exempt from tax and requesting the Respondents to fulfill their obligations under the Settlement Agreement by issuing the Tax Exemption Certificate. 27.On 25th May 2023, the Respondents once again made a request via email to be provided with an analysis of the expenditure of the Applicant.The Applicant responded by providing the details of the payouts for the years 2018 and 2020 on 4 July 2023. 28.On 10th August 2023, the Respondents requested for further information relating to an impact report of the Applicants activities in the community and details of its beneficiaries via e-mail. The Applicant responded to this request on 13th October 2023 providing the Respondents with the information requested. 29.On 6th November 2023, the Respondents made another request for supplementary information regarding the bank statements of the Applicant. The Applicant once again complied with the request and supplied the requested information to the Respondents on 17 th November 2023. 30.On 29th January 2024, the 1st Respondent declined to issue the Applicant with a Tax Exemption certificate and instead directed the Applicant to resubmit its application with a clear demonstration of the utilization of its funds. 31.In the said Letter, the Respondent articulated that the basis for its refusal to issue the Tax Exemption Certificate to the Applicant was predicated upon the allegation that the Applicant's deployment of funds towards charitable endeavors failed to satisfy the stipulations set forth in Paragraph 10 of the ITA. 32.For the exemption to be granted, the charitable organization must expend its income towards its objective. 33.The ITA does not require all the income be expended toward the charitable objectives of the Applicant. 34.It is the Applicant’s case that The ITA also envisions that for the exemption to be granted the income can also be applied to either such business is carried on in the course of the actual execution of those purposes; or the work in connection with such business is mainly carried on by beneficiaries under those purposes; or such gains or profits consist of rents (including premiums or any similar consideration in the nature of rent) received from the leasing or letting of land and chattels leased or let therewith. The Applicant’s Submissions; 35.Frustrated by the Respondents’ bad faith and perpetual request for the same documents in support of the exemption, documents which the Applicant had provided severally to the 1st Respondent, the Applicant lodged this instant suit with a view of seeking to enforce the Settlement Agreement. 36.The Applicant submits that not only is judicial review the appropriate course of action but also the only avenue to remedy the conduct of the Respondents for the following reasons:a.The Respondents are a public body and its agent respectively, with the mandate of collecting taxes on behalf of the Government of Kenya. This mandate is administrative in nature thus making a judicial review court the appropriate court to adjudicate on the matter;b.The Tribunal became functus officio the moment it delivered its judgment finding that the Applicant’s Objection was deemed allowed by operation of the law. Therefore, the Applicant could not go back to the Tribunal considering that the Tribunal had already pronounced itself on the substratum of appeal;c.The Respondents entered into the Settlement Agreement with the Applicant in exercise of its administrative mandate thus making the Judicial Review court the only avenue to address non-compliance with the terms of the Settlement Agreement;d.In any event, the Applicant could not have appealed against the judgment of the TAT to the High Court considering the Tribunal ruled in the Applicant’s favour; ande.The Applicant exhausted all available remedies to address and resolve the matter before lodging its appeal. 37.In fact, the Settlement Agreement itself is a product of the Respondent’s internal remedy being ADR process. 38.The Applicant relies on Article 22(1) of the Constitution of Kenya, 2010 (CoK), which vests in this Court the power to hear and determine applications for redress of a denial, violation or infringement of, or threat to, a right or fundamental freedom in the Bill of Rights. Article 22 (3) further provides that in granting the appropriate relief, may issue an order for judicial review. 39.Article 47 (1) of the CoK provides that every person has the right to administrative action that is expeditious, efficient, lawful, reasonable and procedurally fair. 40.Sections 9 (1) and 9 (2) of the Fair Administrative Action Act, 2015 (the FAA Act) further buttresses the provisions of Article 47 (1) of the CoK as follows:9 (1)Subject to subsection (2), a person who is aggrieved by an administrative action may, without unreasonable delay, apply for judicial review of any administrative action to the High Court or to a subordinate court upon which original jurisdiction is conferred pursuant to Article 22(3) of the Constitution.9 (2)The High Court or a subordinate court under subsection (1) shall not review an administrative action or decision under this Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted. 41.The Applicant submits that the actions by the Respondents in this matter are administrative in nature as the Respondents have continually frustrated the Applicant’s application for a Tax Exemption Certificate, through a delay in procedure without making reference to the merits of the Applicant’s Application. Therefore, the Respondents have infringed the Applicant’s constitutional right of fair administrative action thus making this Honourable Court to remedy the Respondents’ conduct. 42.The 1st Respondent being an administrative body is enjoined by the requirements of Article 47 of the CoK. Article 47 not only has the element of procedural fairness but also provides that administrative action must be “expeditious, efficient, lawful and reasonable. 43.In Mbaabu v Cabinet Secretary in Charge of Lands & 5 others (Judicial Review Application E001 of 2023) [2023] KEELC 20512 (KLR) where the Environment and Land Court made reference to the Court of Appeal in Cortec Mining (K) Ltd vs Ministry of Mining and 9 others (2017) eKLR which held with reference to judicial review, that:“(to)succeed in any application for judicial review, the applicant has to show that the decision or act complained of is tainted with illegality, irrationality and procedural impropriety… Procedural impropriety is when there is a failure to act fairly on the part of the decision-making authority in the process of taking a decision. The unfairness may be in non-observance of the rules of natural justice or to act with procedural fairness toward one to be affected by the decision.” 44.In the context of this matter, the Applicant submits that the 1st Respondent’s refusal to issue the Applicant with TEC is irrational, unreasonable and procedurally unfair. Specifically, the Applicant submits that the Respondent’s refusal to issue the Applicant with the TEC and the repeated requests for the same documents that had already been provided by the Applicant is irrational, arbitrary and unreasonable. As outlined in great detail in the Verifying Affidavit and reinforced in the Supplementary Affidavit, the Applicant had complied with every request for document made by the 1st Respondent. 45.The 1st Respondent put the ex parte Applicant in a perpetual state of providing the exact set of documents only for the 1stRespondent to conclude that the Applicant did not qualify for a TEC despite the fact that this was not the Applicant’s first application to be granted a TEC. The Applicant had previous TECs and did not change its form, nor its operations to be disqualified from holding a TEC. Therefore, there was no justifiable reason for the 1stRespondent to deny the Applicant’s application. 46.In Republic v Were & 2 others; Makhanu & 8 others (Exparte) (Judicial Review E001 of 2024) [2024] KEHC 8139 (KLR), the High Court made reference to Section 9 of the Fair which provides that:“Subject to subsection 2, a person who is aggrieved by an administrative action may, without unreasonable delay apply for judicial review of any administrative action to the high court or a subordinate court upon which original jurisdiction is conferred pursuant to Article 22(3) of the constitution.” 47.In Capital Markets Authority v Ciano & another [2023] KECA 581 (KLR), the Court of Appeal held that:“Section 9(2) of the FAA Act reproduced earlier provides that the High Court or a subordinate court under sub-section (1) shall not review an administrative action or decision under the Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted.” 48.The Applicant acknowledges the doctrine of exhaustion of statutory remedies under section 9 (2) and (3) of the Fair Administration Act. 49.It submits that the Applicant has exhausted the procedures and remedies prescribed by the Income Tax Act by objecting to the Respondents’ assessment on 1st November 2019, and thereafter pursuing the Tax Appeals Tribunal (the Tribunal) regarding this dispute in Tax Appeal No. 456 of 2020, the Madressa-El-Mohammediah Education Society v Commissioner of Domestic Taxes (the Appeal) upon which both Applicant and Respondents entered into a Settlement Agreement. 50.The Applicant, in good faith and with utmost regard for the rule of law, duly complied and discharged its obligation under the Settlement Agreement by paying the principal corporation income tax in totality. However, the Respondents failed to discharge their obligation under the Settlement Agreement and the Respondents continue to frustrate the Applicant, directly and through their agents, by refusing to issue the Tax Exemption Certificate – a fundamental aspect of the Settlement Agreement. It is after these instances of breach of the Settlement Agreement that the Applicant has approached this court as a means of last resort. 51.The Court of Appeal in Capital Markets Authority v Ciano & another (supra) also reiterated that every person has the right to fair administrative action:“Article 47 of the Constitution codifies every person's right to fair administrative action that is expeditious, efficient, lawful, reasonable and procedurally fair. Section 4 of the FAA Act echoes Article 47 and reiterates the entitlement of every person to administrative action that is expeditious, efficient, lawful, reasonable and procedurally fair.” 52.The Applicant’s right to fair administrative action has been breached by the Respondents. Despite the terms agreed to in the Settlement Agreement, and the issuance of past Tax Exemption Certificates to the Applicant, the Respondents have continually and without reasonable justification, delayed the issuance of the Tax Exemption Certificate. 53.The Respondents’ conduct is irrational, arbitrary, in bad faith and contrary to the Applicant’s legitimate expectation. 54.The Applicant pleads that it is unfair, and it is also an abuse of power. As a result, the Applicant’s constitutional right to a fair administrative action has been infringed, thus leaving the Applicant with no option but to apply to this Honourable Court for judicial review. 55.In Speaker of the National Assembly v Karume, Civil Application No. NAI 92 of 1992, quoted with approval by the High Court in Havi v Kenya Revenue Authority (Judicial Review Application E129 of 2023) [2024] KEHC 3006 (KLR) which held that where there is a clear procedure for the redress of a particular grievance prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed. 56.The Applicant, having complied with the internal mechanisms under the ITA, to redress the unlawful, arbitrary, irrational, and unfair decision of the Respondents, has approached this court to redress the violation of their rights under Articles 10, 22, 23 and 47 of the Constitution pursuant to Article 22 (3) of the Constitution. 57.Therefore, this court exercising its jurisdiction will not be usurping any powers of anybody vested with any mandate as the Applicant has been both deliberate and intentional to explore all the available remedies. 58.It is submitted that The Respondents have continually acted unfairly towards the Applicant through the delay in the issuance of the Tax Exemption Certificate. Further, in certain instances, like on 18th April 2019, the Respondents refused to grant the Tax Exemption Certificate to the Applicant without any communicated reason whatsoever. 59.The Settlement Agreement entered into by the parties stipulated that a fundamental provision of the Settlement Agreement was the issuance of the Tax Exemption Certificate, upon compliance with the terms by the Applicant. 60.It submits that the Applicant has complied with the terms of the Settlement Agreement, thus there are no grounds for the Respondents to not issue the Tax Exemption Certificate. 61.In the context of this matter, the Applicant prays that 2ndRespondent, either by itself, its agents or employees restraining it from taking any steps, actions, measures to impose, or collect any taxes from the Applicant for the period of 2011 to 2023 when the 1st Respondent illegally and unreasonably denied the Applicant a Tax Exemption Certificate. 62.An order of prohibition looks to the future, to prevent an incorrect course of practice by an inferior tribunal or a wrong decision. It prevents an action before the action takes place and has no time dealing with the consequences of the prohibited action as the consequences never come to exist anyway. 63.In Kimani v Director of Public Prosecutions & 3 others (Judicial Review Application E062 of 2023) [2024] KEHC 3269 (KLR) (Judicial Review) (3 April 2024) the High Court made reference to Republic v Principal Kadhi, Mombasa Ex-parties Alibhai Adamali Dar & 2 others; Murtaza Turabali Patel (Interested Party) [2022] eKLR where the Court held that;“Although prohibition was originally used to prevent tribunals from meddling with cases over which they had no jurisdiction, it was equally effective and equally often used, to prohibit the execution of some decision already taken but ultra vires. So long as the tribunal or administrative authority still had power to exercise as a consequence of the wrongful decision, the exercise of that power could be restrained by prohibition.”(Emphasis ours). 64.As a result of the wrongful decision to not issue the Tax Exemption Certificate, the Respondents may still be able to demand for the collection of taxes for the period stipulated above- a period that is outside the statutory limit of 5 years under the TPA, thereby circumventing the statutory demand limit. 65.An order of Prohibition would ensure that the Applicant is protected from the above potential retroactive actions of the 2nd Respondent as a result of the Respondents refusal to issue the Applicants with a Tax Exemption Certificate. 66.The non-issuance of the Tax Exemption Certificate impedes the rules of natural justice. In Esther Victoria Wanjiku Mahoro v Mary Wambui Githinji & 3 others [2021] eKLR, the Environment and Land Court made reference to the Court in Kenya National Examination Council…Vs…Republic Exparte Geoffrey Gathenji & 9 Others, Nairobi Civil Appeal No.266 of 1996where with respect to the Court making an order of Prohibition, that:“It is an order from the High Court directed to an inferior tribunal or body which forbids that tribunal or body to continue proceedings therein in excess of its jurisdiction or in contravention of the laws of the land. It lies, not only for excess of jurisdiction or absence of it but also for a departure from the rules or natural justice.” 67.It submits that as the 2nd Respondent has acted in a manner that has impeded natural justice in its continual delay and frustration of the issuance of the Tax Exemption Certificate, an order of Prohibition against the Respondents would ensure the restraint of further actions impeding the Applicant’s right to natural justice. 68.Reliance is placed in Republic v Governor Vihiga County Ex parte Amos Kutwa Koluwa, Pamella Mbagaya Kimwele, Kenneth Elvuna Keseko & Paul Jiseve Mbuni [2021] KEHC 2330 (KLR) quoted with approval the holding of the Court of Appeal in Kenya National Examination Council v Republic Ex Parte Geoffrey Gathenji Njoroge, N S, J W, R N, G W, A W, C W, B W, S N & J B [1997] KECA 58 (KLR) on a question of the obligation of the High Court to enhance the rules of natural justice, the High Court is entitled, indeed duty-bound to intervene and prohibit a body from acting in violation of the rules of natural justice. 69.In advancing the issue order of mandamus against the respondents reliance is placed in Kenya National Examination Council v Republic Ex Parte Geoffrey Gathenji Njoroge, N S, J W, R N, G W, A W, C W, B W, S N & J B (supra) the Court of Appeal acknowledged that an order of mandamus will compel the performance of a public duty which is imposed on a person or body where that body has failed to perform the duty to the detriment of a party who has a legal right to expect that duty to be performed. 70.This Court issues an order of Mandamus against the Respondents, to compel the Respondents to uphold the Settlement Agreement and issue the Tax Exemption Certificate following the settlement of the requisite taxes by the Applicant as per the Settlement Agreement. 71.In Kungu v County Government of Nairobi (Judicial Review Miscellaneous Application E034 of 2023) [2024] KEHC 3265 (KLR) (Judicial Review) (3 April 2024) the High Court made reference to Republic v Kenya National Examinations Council Ex Parte Gathenji & 8 Others Civil Appeal No 234 of 1996 where the Court of Appeal held that:“An order of mandamus compels the performance of a public duty which is imposed on a person or body of persons by a statute and where that person or body of persons has failed to perform the duty to the detriment of a party who has a legal right to expect the duty to be performed.” 72.It submits that an order of Mandamus to compel the Respondents to issue the Tax Exemption Certificate would ensure that the Applicant’s legal right derived from the ITA, FAA and the Settlement Agreement be upheld by the Respondents. The Respondents as public bodies have failed to perform their legal obligations as per the ITA, FAA and Settlement Agreement, to the detriment of the Applicant’s legal rights. As such, an order of Mandamus issued by this Court would ensure the protection of the Applicant’s legal rights. 73.The Applicant has also exhausted all avenues of resolving this dispute with the Respondents, and despite entering into a Settlement Agreement, parties have still not had a fruitful outcome due to the unreasonable delays by the Respondents. 74.In Kenya National Examination Council v Republic Ex Parte Geoffrey Gathenji Njoroge, N S, J W, R N, G W, A W, C W, B W, S N & J B (supra) the Court of Appeal held that:“The order of mandamus is of a most extensive remedial nature, and is, in form, a command issuing from the High Court of Justice, directed to any person, corporation or inferior tribunal, requiring him or them to do some particular thing therein specified which appertains to his or their office and is in the nature of a public duty. Its purpose is to remedy the defects of justice and accordingly it will issue, to the end that justice may be done, in all cases where there is a specific legal right and no specific legal remedy for enforcing that right; 75.The Court of Appeal went on further to analogize the importance of a compelling order of mandamus to a public body as follows:“if a party applies for a licence under section 8 (Liquor Licensing Act, Chapter 121 Laws of Kenya) and the licensing court simply refuses or neglects to consider and determine the application such a party would be entitled to come and ask the High Court for a mandamus, and if the High Court is satisfied that the licensing court has simply refused or neglected to consider and determine the “application” the High Court would be entitled to issue an order of mandamus, compelling the licensing court to consider and determine the application as it is bound by the law to do so.” (Emphasis ours) 76.The Applicant submits that it has no other avenue to remedy the violation of its constitutional rights by the Respondents. 77.The Applicant has exhausted potential dispute resolution processes, including entering into a Settlement Agreement with the Respondents (where the Applicant complied with their obligations under the Settlement Agreement). 78.Since the Settlement Agreement has not been contested by either party, it remains binding upon the parties. 79.In Brand Strategy & Design Limited & another v Pride Inn Hotels and Conferencing [2024] KEHC 9394 (KLR) the court acknowledged this position setting out that contracts are binding upon parties. 80.Relying on the decision in National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another [2001] eKLR, the court outlined that:“A court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved.” 81.The Respondents have, even remotely, suggested that the Settlement Agreement was because of the Applicant’s coercion, fraud or undue influence over them. They are therefore duty bound to satisfy their obligations as detailed in the Settlement Agreement. 82.In Republic v Director, Kenya School of Law & 2 others; Kitsao (Exparte Applicant) (Judicial Review Application E001 of 2024) [2024] KEHC 2975 (KLR) (22 March 2024) the High Court made reference to Articles 22 and 23 of the Constitution of Kenya, 2010 in that: “In any proceedings brought under Article 22, a court may grant appropriate relief, including–a.A declaration of rights;b.An injunction;c.A conservatory order;d.A declaration of invalidity of any law that denies, violates, infringes, or threatens a right or fundamental freedom in the Bill of Rights and is not justified under Article 24;e.An order for compensation; andf.An order of judicial review.” 83.The Applicant submits that the continued violation of the rule of law, and the Applicant’s right to fair and administrative action and a fair taxation burden as guaranteed under Articles 10 (2) (a), 10 (2) (b), 47 and 48 of the Constitution of Kenya, 2010 by the Respondents, requires intervention by this Court. 84.In Njagi v Muchiri & another (Judicial Review E006 of 2023) [2024] KEELC 1812 (KLR) the Environment and Land Court made reference to Masai Mara (SOPA) Limited v Narok County Government (2016) eKLR where the Court held that:“…since the promulgation of the Constitution in 2010, administrative law actions and remedies were also subsumed in the Constitution. This can be seen in the eyes of article 47 which forms part of the Bill of Rights.It is safe to state that there is now substantive constitutional judicial review when one reads article 47 as to the right to fair administrative action alongside article 23(3) which confers jurisdiction, on the court hearing an application for redress of a denial or violation of a right or freedom in the Bill of rights, to grant by way of relief an order for judicial review.” 85.The Applicant submits that the violation of the Applicant’s constitutional rights embedded within the Bill of Rights can be remedied through judicial review and a declaration by this Court. 86.The Applicant’s right to Fair Administrative Action has been continually violated by the Respondents in the delay and frustration of the issuance of the Tax Exemption Certificate. Further, despite the Applicant’s compliance with the Respondents numerous requests for more information and documentation, the Respondents non issuance of the Tax Exemption Certificate is likely to create an unjust tax burden on the Applicant’s if this Honourable Court does not issue a declaration of the violation of the Applicant’s constitutional rights. 87.In re of John Wacira Wambugu, For Leave To Apply For Orders Of Certiorari And Prohibition Directed To The Disciplinary Tribunal Of The Law Society Of Kenya (LSK) [2015] KEHC 4234 (KLR) , the court cited with approval KenyaBus Services Ltd & Others vs. Attorney General and Others [2005] 1 EA 111; [2005] 1 KLR 743 where the Court held:“Fundamental rights cannot be enjoyed in isolation and by selected few while they trample on others or tread upon their rights since the enjoyment of fundamental rights and freedoms contemplates mutuality and an atmosphere of respect for law and order including the rights of others and the upholding of the public interest…(emphasis ours).The function of the Court when faced with the task of establishing or determining the rights on the one hand and determining the limitation and restrictions on the other hand is to do a balancing act and in this balancing act are principle values, objectives to be attained, a sense of proportionality and public interest and public policy considerations.” 88.As a not-for-profit, the Applicant assists the less fortunate in the community by providing school fees, medication and other similar assistance to the vulnerable members of community. 89.The refusal of the Respondents to fulfil their terms of the Settlement Agreement and deny the Applicants a Tax Exemption Certificate, and continuously making unwarranted requests for additional documentation constitutes an abuse of process and inflicts unnecessary hardship not only to the Applicant. 90.The violation of the Applicant’s right to Fair Administrative Action is not just a violation of a constitutional right, but rather a Constitutional imperative. 91.In Saisi & 7 others v Director of Public Prosecutions & 2 others the Supreme Court of Kenya held that:“It is our considered opinion that the framers of the Constitution when codifying judicial review to a constitutional right, the intention was to elevate the right to fair administrative action as a constitutional imperative not just for state bodies, but for any person, body or authority. It was a clarion call to ensure that the constitutional right to fair administrative actions permeated every aspect of the lives of Kenyans…” 92.It submits that the violation of the Applicant’s right to fair administrative action by the Respondents has breached the Applicant’s Constitutional imperative through the Respondents’ refusal to honour and uphold the Settlement Agreement obligating the Respondents to issue the Tax Exemption Certificate. Therefore, a declaration by this Court would provide the recognition that the Applicant’s constitutional right has been violated. The Respondent’s Case; 93.Paragraph 10 of Part I of the First Schedule to the Income Tax Act expressly exempts the income of an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of the poverty or distress of the public, or for the advancement of religion or education. 94.Pursuant to Paragraph 10 of the First Schedule to the Income Tax Act, the said institution, body of person or irrevocable trust must be established in Kenya or have its regional headquarters in Kenya. 95.The Commissioner must be satisfied that the income is to be expended either in Kenya or in circumstances in which the expenditure of that income is for purposes which result in the benefit of the residents of Kenya. 96.Any such income which consists of gains or profits from a business shall not be exempt from taxunless those gains or profits are applied solely to those purposes and either –i.The business is carried on in the course of the actual execution of those purposes; orii.The work in connection with the business is mainly carried on by beneficiaries under those purposes; oriii.Such gains or profits consist of rents (including premiums or similar consideration in the nature of rent) received from the leasing or letting of land and any chattels leased or let therewith and provided further that an exemption under this paragraph-A.shall be valid for a period of five years but may be revoked by the Commissioner for any just cause; andB.shall, where an applicant has complied with all the requirements of this paragraph, be issued within sixty days of the lodging of the application. 97.To obtain a tax exemption a taxpayer must apply for an exemption to the Commissioner, where after, the Commissioner must satisfy himself that the applicant has complied with all the requirements of the paragraph prior to issuance of the exemption. 98.Section 13(1) as read together with Paragraph 10 of the First Schedule to the Income Tax Act does not provide for issuance of express exemptions to taxpayer without meeting the conditions laid down therein. 99.An exemption certificate granted under paragraph 10 of the First Schedule to the Income Tax Act is time bound and renewed periodically. 100.Any taxpayer in possession with an exemption certificate must continuously comply with the provisions of paragraph 10 of the First Schedule to the Income tax Act as read together with section 13(1) of the Income Tax Act. 101.The renewed for the exemption status is not automatic. The Commissioner has to assess and satisfy itself that such a taxpayer meets such requirements through an analysis of the documentation provided by a taxpayer in support of its application for a tax exemption certificate. 102.The Ex parte Applicant has applied for a tax exemption since the year 2011 pursuant to section 13(1) as read together with Paragraph 10 of the First Schedule to the Income Tax Act, to which applications the Respondent has always responded providing reasons for denial of the exemption certificate. 103.Since the Appellant first applied for a tax exemption certificate, the Respondent has constantly engaged the Appellant advising it on the incompletion of its application and requesting for documentation to enable it respond to the Application. 104.It is its case that on 23rd March 2011, the Applicant requested for an exemption certificate under paragraph 10 of the First Schedule to the Income tax Act. 105.On 24th March 2011, the 1stRespondent respondent requesting for the Applicant to provide the necessary documents for the 1st Respondent to consider the Applicant’s application as a result of which The Applicant respondent and availed some of the requested documents vide the letter dated 28th July 2011. 106.On 29th September 2011, the 1st Respondent requested the Applicant to provide additional documents that were necessary for the consideration of the application for a certificate of tax exemption. 107.On 28th March 2012, the Respondents reminded the Applicant to provide the additional documents requested as per the letter of 28thSeptember 2011. 108.Upon failure by the Applicant to provide the additional documents requested, the 1stRespondent declined the Applicant’s application for issuance of a certificate of exemption. 109.The 1stRespondent advised the Applicant that its application was closed and can only be addressed through a fresh application accompanied by the information/documents previously sought. 110.The application was declined through the letter dated 25th July 2012. 111.In its letter dated 15th October 2012, the Applicant referred to the 1st Respondent’s previous letter of 29th September 2011 and informed the 1st Respondent that it had now gathered all documents and requested for a tax exemption certificate. 112.There was correspondence with the Applicant in the year 2013, and in the year 2014 which resulted in the Applicant availing incomplete documents that the Respondent noted were not signed and as such could not be authenticated. The 1st Respondent consequently advised the Applicant to re-lodge the Application for exemption. 113.The 1st Respondent further requested for additional documents from the Applicant vide a letter dated 8th May 2015.The Taxpayer re-lodged the Application vide the letter dated 16th November 2015. 114.The parties continued exchanging correspondence in the years 2016 and 2017, whereby the 1st Respondent continued requesting documents from the Applicant to enable it make a decision on the application for exemption certificated under paragraph 10 of the First Schedule to the Income tax Act. 115.By providing incomplete documents, the Applicant’s application could not be acted upon by the 1st Respondent in accordance with section 13(1) of the Income tax Act as read together with paragraph 10 of the First Schedule to the Income tax Act and as a result, was declined severally. 116.The Applicant restarted the application process again and vide a letter dated 18thMarch 2019, the 1st Respondent informed the Applicant that its Application was incomplete and requested the Applicant to provide the following information that would enable the 1st Respondent to process the application:-a.Tax exemption application letterb.Evidence of the projects carried out including sample pictures with narrations for the last (3) years 2015 – 2017.c.Detailed list of beneficiaries for the last (3) years 2015 – 2017.d.Detailed list of donors for the last (3) years 2015 -2017.e.General Ledgers for the last (3) years 2015 – 2017.f.Bank statements for the last (3) years 2015 – 2017.g.Income tax returns and signed audited accounts for the last (3) years 2015 -2017.h.Evidence of payment for the years 1994 – 2014 amounting to 4, 225,771.i.Evidence of payment for commercial rent income.j.General Ledger for 2015 – 2017. 117.On 7th August 2019, the 1stRespondent declined the Applicant’s application for failure to provide the documents requested for processing of tax exemption request. The 1st Respondent issued a follow up email of 15th August 2019 informing it of the outcome of its application. 118.As part of review of the Applicant’s application for exemption certificate, the 1st Respondent noted that the Appellant has been a non-filer since 2015. 119.This prompted the Respondent to raise a default assessment for 2018 vide KRA201914911536 based on commercial VAT output. 120.The Applicant objected to the 1st Respondent’s assessment vide its objection letter dated 1st November 2019, and vide another letter of 30th July 2020.The 1st Respondent issued its objection decision dated 19th August 2020. 121.The Applicant appealed against the decision in Nairobi TAT Appeal No. 456 of 2020: The Madressa-El-Mohammediah Education Society vs Commissioner of Domestic Taxes at the Tax Appeals Tribunal.The Tax Tribunal rendered its decision vide its ruling dated 30th July 2021. 122.Notably, the Honourable Tax Tribunal upheld the Appeal, finding that the 1st Respondent’s objection decision had been issued out time. 123.Further, the Honourable Tax Tribunal did not pronounce itself on other issues framed in the ruling including the issues of “whether the Respondent delayed in rendering a decision of the Applicant’s application for a Tax exemption certificate; and whether a legitimate expectation was created by the 1st Respondent that the Applicant would be issued with a Tax exemption certificate.” 124.It is its case that in view of the Tribunal’s ruling of 30th July 2021, the Respondents could not issue the Applicant with the tax exemption certificate for the various reasons:-a.The Applicant had not met the requirements of section 13(1) of the Income Tax Act as read together with paragraph 10 of the First Schedule to the Income Tax Act.b.The Tribunal did not make a finding disapproving the Respondents’ finding that the Applicant failed to meet the requirements under paragraph 10 of the First Schedule to the Income Tax Act. 125.Pursuant section 56(1) of the Tax Procedures Act, the burden is on a taxpayer to prove that a tax decision is incorrect. 126.On The issue of the Settlement agreement dated 28th October 2021 it is the respondents case that Section 13(1) of the Income Tax Act as read together with paragraph 10 of the First Schedule to the Income Tax Act lays down the only conditions to be fulfilled for a taxpayer that claims to be an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of the poverty or distress of the public, or for the advancement of religion or education to be issued with an exemption certificate exempting its income from tax under the Act. 127.Parties cannot enter into an agreement to circumvent the express provisions of the law, in this instance Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act. 128.While the Settlement agreement provided that the 1st Respondent was to issue the Applicant with a Tax exemption certificate, the issuance of the same could only be within the strict confines of the law, in this instance Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act. 129.The 1st Respondent communicated to the Applicant the implication of the Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act to its request for a tax exemption certificate. 130.Pursuant to the said explanation, the Applicant agreed and vide a letter dated 10th March 2022 provided documents necessary for determination of whether the Applicant meets the requirements under section 13(1) of the Income tax Act as read together with paragraph 10 of the First Schedule of the Income tax. 131.On 17th March 2022, one of the Respondent’s officers visited the Applicant’s premises for interviews and inspection of the Applicant’s premises as part of the procedural requirements for issuance of a tax Exemption Certificate and thereafter requested for additional documents on 22nd March 2022 namely:-a.A list of beneficiaries of the Society for the periods 2018 and 2020.b.A rent schedule for the periods 2018, 2019 and 2020.c.A list of properties owned by the society with locations; andd.An explanation of the surplus capital held by the society and the intended use. 132.The requirements were in line with the requirements under paragraph 10 of the first schedule to the Income tax Act of establishing whether the Applicant is established solely for purposes for the alleviation of pain and suffering of the vulnerable members of the society, and whether its gains or profits are solely utilised to those purposes. 133.On 22nd April 2022, the Applicant responded to the 1st Respondent’s request where the Applicant explained to the 1st Respondent inter alia that a rent schedule of the society for the periods 2018, 2019, and 2020 of the various properties owned by the Society. 134.It explained that the reserves for each year accumulates in the Balance Sheet, and that not all reserves are available for distribution. 135.The Applicant plans to utilise the surplus for each passing financial year and any available portion of the accumulated reserves to maintain the society’s properties and for internal reorganization which involves hiring of professionals to run the society, modernizing the operations of the society and investing in information technology. 136.Upon being issued with a tax exemption certificate the society intend to remain true to its founding vision which is to utilise as much as possible of the available surplus. 137.Vide an email dated 4th October 2022, the 1st Respondent sought an explanation from the Applicant with respect to the huge withdrawals in the year of income of 2018 which did not have any narration indicating the beneficiaries/pay-outs for the said withdrawals and the 1st Respondent questioned the Applicant’s reasons for the huge accumulation of funds, which were not being utilised for projects under paragraph 10 of the First Schedule to the Income tax Act. Specifically, the 1st Respondent noted that the amount in the fixed deposit account, cash at bank and in hand for the last three years (from 2022) is Kshs. 15,543,823 in 2020, Kshs. 12,352,481 in 2019 and Kshs. 8,320,463 in 2018 while the amount utilised for the advancement of education in 2020 is Kshs. 1,090,320; Kshs. 2,991,914 in 2019 and Kshs. 1,823,498 in 2018. 138.Vide a letter dated 7th October 2022 responded to the Respondents email of 4thOctober 2022 and requested the Respondent to finish processing the Applicant’s application. 139.Parties continued corresponding both on email and over phone call and till December 2022 and vide a letter dated 13th March 2023 requested the Applicant to provide additional documents which were necessitated by the further explanations given to the Respondent. 140.Noteworthy, the said information had not be previously adduced to the Respondent and included inter alia:-a.Title deeds for the property destroyed by fire.b.Confirmation on whether the Trust was compensated by the Insurance company for the property destroyed by fire with details in relation to the same.c.Explanation as to why the Applicant had huge accumulated funds at the end of the year as per the financial accounts and why the funds were not utilised fully according to its objectives.d.A breakdown of how bursaries and scholarships are allocated. 141.The Applicant respondent vide its letter dated 16th March 2023.The Applicants indicated that they were available to discuss the matter. 142.The 1st Respondent to the Applicant vide its email of 10th May 2023 requesting for inter alia additional documents on analysis of pay-outs in the year 2019 and 2020. 143.The Applicant wrote to the Respondents vide an email of 16th May 2023 reiterating inter alia the request for issuance of a tax exemption certificate. 144.On 25th may 2023, the Respondent through email reiterated that an exemption is granted upon application and review of the documents submitted and in accordance with the requirements of paragraph 10 of the first schedule to the Income Tax Act, and that the Applicant was yet to provide further requested documents to enable the Respondent review its application. 145.The Applicant was reminded to provide the additional requested documents on 13thJune 2023, which resulted in a further exchange of correspondence and documents between parties for the period between July and end of November 2023. 146.On 29th January 2024, the Respondents issued its decision to the Applicant on its application for a tax exemption certificate under paragraph 10 of the First Schedule to the Income Tax Act, declining the said application for the following reasons:-a.The Applicants’ application of funds to charitable activities in relation to the total income in the years in review was 17%, 21% and 8% in 2018, 2019 and 2020 respectively.b.The bulk of income that was retained in the three years and the proposed expenditure was not based on the charitable activities.c.The Applicant’s application of funds towards charitable activities as depicted in the analysis of program expenses did not meet the requirements under paragraph 10 of the first schedule to the Income Tax Act. 147.The Applicant was further advised to re-apply in line with paragraph 10 of the First Schedule to the Income tax Act requirements with a clear demonstration of funds towards charitable activities. 148.From the settlement agreement dated 28th October 2021 to the Respondents issuance of its decision of 28th June 2024 shows the following:-a.Pursuant to the execution of the settlement agreement dated 28th October 2021, the Applicant was explained to and understood that a tax exemption certificate could only be issue to it upon meeting the requirements of paragraph 10 of the First Schedule to the Income tax Act.b.The Applicants provided further documents post the settlement agreement as evidenced in the exchange of correspondence above with a view of supporting its application under paragraph 10 of the First Schedule to the Income tax Act.c.The Applicant was and is aware that a tax exemption certificate can only be granted to a taxpayer upon meeting the requirements of paragraph 10 of the first schedule to the Income tax Act, hence the reasons why they sought to explain how and whether they meet the said requirements.d.The Applicant has not met the threshold set out under paragraph 10 of the first schedule to the Income tax Act, for the reasons explained to its by the Respondents decision of 29th January 2024.e.The Respondents have been consistent in explaining to and requiring the Applicant to meet the requirements under paragraph 10 of the first schedule to the Income tax Act, prior to issuance of a tax exemption certificate for all the period when the Applicant requested for the same.f.That based on the Applicant’s conduct, it is estopped from relying on the settlement agreement to compel the Respondents to issue it with a tax exemption certificate. 149.Contrary to the Applicant’s averments in its Application, Statement and Replying Affidavit, Section 13(1) of the Income tax Act as read together with paragraph 10 of the First schedule to the Income Tax Act expressly requires that the income an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of the poverty or distress of the public, or for the advancement of religion or education must be expended solely to those purposes. 150.The Applicant does not meet the threshold laid out under paragraph 10 of the First Schedule to the Income Tax Act. 151.The Respondents have not illegally or unreasonably denied the Applicant a tax exemption certificate. On the contrary, the Applicant does not meet the requirements to be granted a tax exemption certificate under paragraph 10 of the First schedule to the Income tax Act. 152.It would be contrary to Article 210 of the Constitution and the express provisions of the Income Tax Act for this Court to issue the prayers sought by the Applicant to the effect that the Respondents are prohibited from assessing and calling for taxes due from the Applicant on income accruing to it under the Income Tax Act. 153.The Role of a Judicial Review Court is to adjudicate on whether due process was followed by the Respondent as an administrative body in issuance of the administrative decision under review pursuant to article 47 of the Constitution as read together with the provisions of the Fair administrative actions Court. 154.The Applicant’s prayer for this Court to adjudicate as to whether or not the Applicant met the requirements of paragraph 10 of the First Schedule to the Income Tax Act would amount to this Honourable Court sitting as an appellate court on the Respondents decision of 29th January 2024. 155.The Court should not issue any order compelling the Respondents to honour the terms of the settlement agreement, as the terms therein are in express contravention of the law. 156.An order of mandamus ought not be granted by this Honourable Court as to do so will be in express contravention of the provisions of section 13(1) of the Income tax Act as read together with paragraph 10 of the first schedule to the Income Tax Act. 157.The Applicants by their very own actions are estopped from praying to this Court to uphold the terms of the settlement agreement dated 28th October 2021, which terms seek to circumvent the express provisions of the law. 158.The Respondents’ decision to decline the Applicant’s application for a tax exemption certificate are informed by the express provisions of the Income tax Act, meet the threshold of Article 47 of the Constitution, and do not infringe on any rights of the Applicant. 159.It is their case that they have followed due process in arriving at the decision dated 29th January 2024. The Respondents’ Submissions 160.The Applicant restarted the application process again and vide a letter dated 18th March 2019, the 1stRespondent informed the Applicant that its Application was incomplete and requested the Applicant to provide the following information that would enable the 1st Respondent to process the application:-a.Tax exemption application letterb.Evidence of the projects carried out including sample pictures with narrations for the last (3) years 2015 – 2017.c.Detailed list of beneficiaries for the last (3) years 2015 – 2017.d.Detailed list of donors for the last (3) years 2015 -2017.e.General Ledgers for the last (3) years 2015 – 2017.f.Bank statements for the last (3) years 2015 – 2017.g.Income tax returns and signed audited accounts for the last (3) years 2015 -2017.h.Evidence of payment for the years 1994 – 2014 amounting to 4, 225,771.i.Evidence of payment for commercial rent income.j.General Ledger for 2015 – 2017. 161.The Applicant’s contention is that pursuant to the agreement of 28th October 2021, the Respondent ought to grant it with a tax exemption certificate. 162.On its part, the Respondent maintains that a tax exemption certificate is a document issued based on a taxpayer’s compliance with statutory provisions of the Income tax Act, and not pursuant to an agreement that bypasses the same. 163.The factual circumstances post the execution of the said agreement shows that the Applicants were and are aware that a tax exemption under the Income tax Act can only be issued once a taxpayer complies with the statutory requirements. 164.When the Applicant sought to enforce the settlement agreement dated 28th October 2021, the 1stRespondent communicated to the Applicant the implication of the Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act to its request for a tax exemption certificate. 165.Pursuant to the said explanation, the Applicant agreed and vide a letter dated 10th March 2022 provided documents necessary for determination of whether the Applicant meets the requirements under section 13(1) of the Income tax Act as read together with paragraph 10 of the First Schedule of the Income tax . 166.On 17th March 2022, the Respondents representative visited the Applicant’s premises for interviews and inspection of the Applicant’s premises as part of the procedural requirements for issuance of a tax Exemption Certificate and thereafter requested for additional documents on 22nd March 2022 namely:-a.A list of beneficiaries of the Society for the periods 2018 and 2020.b.A rent schedule for the periods 2018, 2019 and 2020.c.A list of properties owned by the society with locations; andd.An explanation of the surplus capital held by the society and the intended use. 167.The requested documents were in line with the requirements under paragraph 10 of the first schedule to the Income tax Act of establishing whether the Applicant is established solely for purposes for the alleviation of pain and suffering of the vulnerable members of the society, and whether its gains or profits are solely utilised to those purposes. Further, the requested documents were different from those provided by the Applicant vide its letter of 10th March 2022. 168.Vide a letter dated 22nd April 2022, the Applicant responded to the 1st Respondent’s request where the Applicant explained to the 1st Respondent inter alia that:-a.Provided a rent schedule of the society for the periods 2018, 2019, and 2020 of the various properties owned by the Society.b.Explained that the reserves for each year accumulates in the Balance Sheet, and that not all reserves are available for distribution.c.That the Applicant pans to utilise the surplus for each passing Financial year and any available portion of the accumulated reserves to maintenance of the society’s properties and for internal reorganisation (which involves hiring of professionals to run the society, modernising the operations of the society and investing in information technology.d.That upon being issued with a tax exemption certificate the society intend to remain true to its founding vision which is to utilise as much as possible of the available surplus…..towards charities…., 169.Vide an email dated 4th October 2022, the 1stRespondent sought an explanation from the Applicant with respect to:-a.The huge withdrawals in the year of income of 2018 which did not have any narration indicating the beneficiaries/pay-outs for the said withdrawals.b.The 1st Respondent questioned the Applicant’s reasons for the huge accumulation of funds, which were not being utilised for projects under paragraph 10 of the First Schedule to the Income tax Act. Specifically, the 1st Respondent noted that the amount in the fixed deposit account, cash at bank and in hand for the last three years (from 2022) is Kshs. 15,543,823 in 2020, Kshs. 12,352,481 in 2019 and Kshs. 8,320,463 in 2018 while the amount utilised for the advancement of education in 2020 is Kshs. 1,090,320; Kshs. 2,991,914 in 2019 and Kshs. 1,823,498 in 2018. 170.Vide a letter dated 13th March 2023 requested the Applicant to provide additional documents which were necessitated by the further explanations given to the Respondent. Noteworthy, the said information had not be previously adduced to the Respondent and included inter alia:-a.Title deeds for the property destroyed by fire.b.Confirmation on whether the Trust was compensated by the Insurance company for the property destroyed by fire with details in relation to the same.c.Explanation as to why the Applicant had huge accumulated funds at the end of the year as per the financial accounts and why the funds were not utilised fully according to its objectives.d.A breakdown of how bursaries and scholarships are allocated. 171.On the face of the Notice of Motion Application dated 28th June 2024, the Application is brought under the following laws;-a.Articles 10(1)(b), 10(2)(a), 10(2)(b), 47 and 48 of the Constitution.b.The Income tax Act.c.The Fair Administrative Actions Act.d.Order 53 Rule (3)(1) of the Civil Procedure Rules. 172.Article 10 of the Constitution speaks to the national values and principles of governance; article 47 speaks to fair administrative Action while article 48 speaks to access to justice. 173.The Fair Administrative Actions Act was enacted to give effect to Article 47 of the Constitution; while Order 53 of the Civil Procedure Rules 2010 provides for Applications for judicial review. 174.Part III of the Fair Administrative Actions Act speaks to Judicial review, wherein section 7 provides for institution of proceedings. 175.The role of the income Tax Act in these proceedings can only be to shed light on the guidelines for issuance of an exemption certificate under the Income tax Act. 176.This is evident on the Applicant’s very own pleadings, where all references to the Income tax Act relates to a tax exemption certificate under the Income Tax Act. 177.The case of Republic v Nairobi City County Ex parte Registered Trustees of Sir Ali Muslim Club [2017]KEHC 2864 (KLR), is a good starting point with respect to the purpose of a judicial review court. In this Case, the Hon. J.V. Odunga stated as follows with respect to the purpose of a judicial review Court:-“ 43.The first issue I wish to deal with is the scope of judicial review remedies. The purpose of judicial review is to check that public bodies do notexceed their jurisdiction and carry out their duties in a manner that is detrimental to the public at large. It is meant to uplift the quality of public decision making, and thereby ensure for the citizen civilised governance, by holding the public authority to the limit defined by the law. Judicial review is therefore an important control, ventilating a host of varied types of problems. The focus of cases may range from matters of grave public concern to those of acute personal interest; from general policy to individualised discretion; from social controversy to commercial self-interest; and anything in between. As a result, judicial review has significantly improved the quality of decision making. It has done this by upholding the values of fairness, reasonableness and objectivity in the conduct of management of public affairs. It has also restrained or curbed arbitrariness, checked abuse of power and has generally enhanced the rule of law in government business and other public entities. Seen from the above standpoint it is a sufficient tool in causing the body in question to remain accountable.Judicial review is a constitutional supervision of public authorities involving a challenge to the legal validity of the decision. It does not allow the court of review to examine the evidence with a view of forming its own view about the substantial merits of the case. It may be that the tribunal whose decision is being challenged has done something which it had no lawful authority to do. It may have abused or misused the authority which it had. It may have departed from procedures which either by statute or at common law as a matter of fairness it ought to have observed. As regards the decision itself it may be found to be perverse, or irrational, or grossly disproportionate to what was required. Or the decision may be found to be erroneous in respect of a legal deficiency, as for example, through the absence of evidence, or through a failure for any reason to take into account a relevant matter, or through the taking into account of an irrelevant matter, or through some misconstruction of the terms of the statutory provision which the decision maker is required to apply. While the evidence may have to be explored in order to see if the decision is vitiated by such legal deficiencies, it is perfectly clear that in a case of review, as distinct from an ordinary appeal, the court may not set about forming its own preferred view of the evidence. See Reid vs. Secretary of State for Scotland [1999] 2 AC 512.” 46.However, it is important to remember that Judicial Review is a special supervisory jurisdiction which is different from both (1) ordinary (adversarial) litigation between private parties and (2) an appeal (rehearing) on the merits. The question is not whether the judge disagrees with what the public body has done, but whether there is some recognisable public law wrong that has been committed. Whereas private law proceedings involve the claimant asserting rights, judicial review represents the claimant invoking supervisory jurisdiction of the Court through proceedings brought nominally by the Republic. See R vs.Traffic Commissioner for North Western Traffic Area ex parte Brake [1996] COD 248. 178.The Supreme Court in the case of Dande & 3 others v Inspector General, National Police Service & 5 others (Petition 6 (E007), 4 (E005) & 8 (E010) of 2022 (Consolidated)) [2023] KESC 40 (KLR) (16 June 2023) (Judgment), has also laid out the purpose of a judicial review court as follows:-“6The entrenchment of judicial review under the Constitution of Kenya, 2010 elevated it to a substantive and justiciable right under the Constitution. Accordingly, judicial review was no longer a strict administrative law remedy but also a constitutional fundamental right enshrined in the Constitution. Thus, article 47 of the Constitution provided that every person had a right to an administrative action that was expeditious, efficient, lawful, reasonable and procedurally fair.7The entrenchment of judicial review in the Constitution had led to the emergence of divergent views on the scope of judicial review. The first group postulated that judicial review was concerned with the process a statutory body employed to reach its decision and not the/ merits of the decision itself while the second group opined that under the current constitutional dispensation, courts could delve into both procedural and merit review in resolving disputes.8When a party approached a court under the provisions of the Constitution then the court ought to carry out a merit review of the case. However, if a party filed a suit under the provisions of order 53 of the Civil Procedure Rules and did not claim any violation of rights or even violation of the Constitution, then the court could only limit itself to the process and manner in which the decision complained of was reached or action taken and not the merits of the decision per se.9The appellants invoked the judicial review jurisdiction of the High Court alleging that their rights to among others, fair administrative action under article 47 of the Constitution were violated, and applied for judicial review orders under article 23 of the Constitution. The appellants had clothed their grievances as constitutional questions believing that their fundamental rights had been violated. Therefore, that required the superior courts to conduct a merit review of the questions before them and dismissal of their plea as one requiring no merit review was misguided.” 179.In the case of Civil Appeal No. 84 of 2010; Republic vs. National Environmental Management Authority, where the Court of Appeal held that:“...where there was an alternative remedy and especially where Parliament had provided a statutory appeal process, it is only in exceptional circumstances that an order for judicial review would be granted, and that in determining whether an exception should be made and judicial review granted, it was necessary for the court to look carefully at the suitability of the statutory appeal in the context of the particular case and ask itself what, in the context of the statutory powers, was the real issue to be determined and whether the statutory appeal procedure was suitable to determine it. – see for example R v BIRMINGHAM CITY COUNCIL, ex parte FERRERO LTD case. The Learned judge, in our respectful view, considered these strictures and come to the conclusion that the Appellant had failed to demonstrate to her what exceptional circumstances existed in its case which would remove it from the appeal process set out in the statute with respect we agree with the judge.” 180.Judicial review Remedy should not be preferred where there is a clear statutory appeal process. 181.Further, with respect to the role of a judicial review Court, jurisprudence explains that a judicial review court is concerned with the process a statutory body employed to reach its decision and not the/ merits of the decision itself (except in exceptional circumstances). 182.In the case of Owners Of The Motor Vessel “Lillian S v Caltex Oil (Kenya) Ltd [1989] KECA48 (KLR). In this case, the Court stated that:-“I think that it is reasonably plain that a question of jurisdiction ought to be raised at the earliest opportunity and the court seized of the matter is then obliged to decide the issue right away on the material before it. 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 down tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction. Before I part with this aspect of the appeal, I refer to the following passage which will show that what I have already said is consistent with authority: “By jurisdiction is meant the authority which a court as to decide matters that are litigated before it or to take cognisance of matters presented in a formal way for its decision. The limits of this authority are imposed by the statute, charter, or commission under which the court is constituted, and may be extended or restricted by the like means. If no restriction or limit is imposed the jurisdiction is said to be unlimited. A limitation may be either as to the kind and nature of the actions and matters of which the particular court has cognisance, or as to the area over which the jurisdiction shall extend, or it may partake of both these characteristics. If the jurisdiction of an inferior court or tribunal (including an arbitrator) depends on the existence of a particular state of facts, the court or tribunal must inquire into the existence of the facts in order to decide whether it has jurisdiction; but, except where the court or tribunal has been given power to determine conclusively whether the facts exist. Where a court takes it upon itself to exercise a jurisdiction which it does not possess, its decision amounts to nothing. Jurisdiction must be acquired before judgement is given”See Words and Phrases Legally defined – Volume 3: I – N Page 113” 183.In the instant case, the Applicant seeks this Court’s intervention for the Respondent to comply with the settlement agreement; and secondly, issuance of a tax exemption certificate in accordance with the provisions of the Income tax Act. 184.The Respondent submits that the prayers sought are outside the purview of this Honourable Court but clothed as judicial review remedies for the following reasons:-Prayer 1 and 3 while clothed as judicial review remedies require an enquiry into the merits of the Applicant’s compliance with Income tax Act in relation to issuance of a tax exemption certificate, which is a purview of the Tax Appeals Tribunal. 185.This Court to prohibit the Respondents in terms of prayer 1 of the Applicant’s application, it must interrogate factual issue as to whether the Respondent has illegally and unreasonably denied the Applicant a tax exemption certificate. Further, for the Honourable court to consider and determine whether the Respondent’s actions are illegal or unreasonable, this Honourable Court must analyse the merits and procedural aspect of issuance of a tax exemption certificate. 186.For the Court to grant Prayer 1 to the Applicant as prayed in its application, this Honourable Court must make a finding that the Applicant merits to be issued with a tax exemption certificate in accordance with the provision of section 13 of the Income tax Act as read together with paragraph 10 of the First Schedule to the Income Tax Act. 187.Prayer 3 of the Applicant’s Notice of Motion Application seeks a declaration that failure by the Respondent to issue a tax exemption certificate in accordance with the Income tax Act is a violation of the Applicant’s rights. 188.For this Honourable Court to grant the said prayer, it must interrogate the following questions:-a.How are tax exemption certificates issued under the Income tax Act?b.Why did the Respondent fail to issue an exemption certificate to the Applicants? And whether such an action amounts to a violation of a legal right?c.What is the effect of the letter dated 29th January 2024?d.What are the statutory remedies available to the Applicants with respect to the letter dated 24thJanuary 2024? 189.The interrogation of the said questions amounts to going into the merits of the issuance of a tax exemption certificate, especially in view of the letter dated 24th January 2024 issued by the Respondents to the Applicant. 190.On the issue of How are tax exemption certificates issued under the Income tax Act, Article 210 of the Constitution is clear that no tax or licensing fee may be imposed, waived or varied except as provided by legislation. 191.Exemptions issued by the Respondents in all the tax statutes must be applied for and an express exemption certificate issued to that effect. 192.Different tax statutes contain different mandatory requirements that must be met by a taxpayer seeking to obtain a tax exemption under the said statute. 193.With regard to the Income Tax Act, section 13 of the Income Tax Act provides for two types of exemptions namely:-a.Express exemptions under section 13(1) of the ITA, where all the Incomes specified under Part I of the First Schedule to the ITA which accrued in or was derived from Kenya is exempt from tax to the extent so specified.b.Exemptions provided for under a gazette notice published by the Cabinet Secretary and subsequently passed by a resolution of the National assembly as provided for under section 13(2) & (3) of the Income tax Act. 194.Part I of the First Schedule of the Income Tax Act specifically provides for types of income that are exempted from taxation under the Income Tax. 195.Paragraph 10 of Part I of the First Schedule to the Income Tax Act expressly exempts the income of an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of- the poverty or distress of the public, or for the advancement of religion or education. 196.Further, pursuant to Paragraph 10 of the First Schedule to the Income Tax Act, the said institution, body of person or irrevocable trust must be established in Kenya or have its regional headquarters in Kenya. 197.Pursuant to Paragraph 10 of the First Schedule to the Income Tax Act the Commissioner must be satisfied that the income is to be expended either in Kenya or in circumstances in which the expenditure of that income is for purposes which result in the benefit of the residents of Kenya. 198.Proviso to paragraph 10 further provides that any such income which consists of gains or profits from a business shall not be exempt from tax unlessthose gains or profits are applied solely to those purposes and either –i.The business is carried on in the course of the actual execution of those purposes; orii.The work in connection with the business is mainly carried on by beneficiaries under those purposes; oriii.Such gains or profits consist of rents (including premiums or similar consideration in the nature of rent) received from the leasing or letting of land and any chattels leased or let therewith and provided further that an exemption under this paragraph-A.Shall be valid for a period of five years but may be revoked by the Commissioner for any just cause; andB.Shall, where an applicant has complied with all the requirements of this paragraph, be issued within sixty days of the lodging of the application. 199.To obtain a tax exemption pursuant to paragraph 10 of the First Schedule to the Income tax Act, a taxpayer must apply for an exemption to the Commissioner, where after, the Commissioner must satisfy himself that the applicant has complied with all the requirements of the paragraph prior to issuance of the exemption. 200.Section 13(1) as read together with Paragraph 10 of the First Schedule to the Income Tax Act does not provide for issuance of express exemptions to taxpayer without meeting the conditions laid down therein. 201.An exemption certificate granted under paragraph 10 of the First Schedule to the Income Tax Act is time bound and renewed periodically, in view of the fact that the Taxpayer to whom such an exemption has been granted is at all times required to be in compliance with the provisions of paragraph 10 of the First Schedule to the Income Tax Act. 202.It is also not automatic that a taxpayer who has been granted an exemption certificate under paragraph 10 of the first schedule to the Income tax Act will automatically be renewed for the exemption status, or automatically qualify for an exemption in the next period of application. 203.The Commissioner is mandated under the Income Tax Act paragraph 10 of the First Schedule to assess and satisfy itself that such a taxpayer meets such requirements and where in the negative, the Commissioner shall decline any renewal of an exemption certificate under paragraph 10 of the First Schedule to the Income tax act if the taxpayer has failed to meet the conditions therein. 204.The Respondents can only satisfy themselves as to a taxpayer meeting the requirements under paragraph 10 of the first schedule to the Income Tax Act through an analysis of the documentation provided by a taxpayer in support of its application for a tax exemption certificate. 205.A settlement agreement is not one of the recognised criteria under the law for the issuance of a tax exemption certificate. 206.In its decision of 29th January 2024, the Respondents issued its decision to the Applicant on its application for a tax exemption certificate under paragraph 10 of the First Schedule to the Income Tax Act, declining the said application for the following reasons:-a.The Applicants’ application of funds to charitable activities in relation to the total income in the years in review was 17%, 21% and 8% in 2018, 2019 and 2020 respectively.b.The bulk of income that was retained in the three years and the proposed expenditure was not based on the charitable activities.c.The Applicant’s application of funds towards charitable activities as depicted in the analysis of program expenses did not meet the requirements under paragraph 10 of the first schedule to the Income Tax Act. 207.The Applicant was further advised to re-apply in line with paragraph 10 of the First Schedule to the Income tax Act requirements with a clear demonstration of funds towards charitable activities. 208.The decision of 29th January 2024 is an Appealable decision as defined under section 2 of the Tax Procedures Act, and the decision stands with respect to the Applicant’s exemption status unless challenged by the Applicant before the Tax Appeals Tribunal as provided for under section 52 of the Tax Procedures Act and Section 12 of the tax Appeals Tribunal Act. 209.The Respondent vide its letter dated 29th January 2024 issued its decision with reasons declining issuance of a tax exemption certificate, and stating. 210.This decision amounts to a decision of the Commissioner, which under section 12 of the Tax Appeals Tribunal Act, appealable to the Tax Appeals Tribunal Act. The said section states that;“A person who disputes the decision of the Commissioner on any matter arising under the provisions of any tax law may, subject to the provisions of the relevant tax law, upon giving notice in writing to the Commissioner, appeal to the Tribunal, 211.The Income Tax Act is one of the laws recognised under section 2 of the Tax Procedures Act as a “tax Law”. 212.Section 13 of the Tax Appeals Tribunal Act then provides for the procedure on Appeal as follows:-“ 13.Procedure for appeal(1)A notice of appeal to the Tribunal shall—(a)be in writing;(b)Be submitted to the Tribunal within thirty days upon receipt of the decision of the Commissioner.(2)The appellant shall, within fourteen days from the date of filing the notice of appeal, submit enough copies, as may be advised by the Tribunal, of—(a)a memorandum of appeal;(b)Statements of facts; and(c)The appealable decision; and(d)Such other documents as may be necessary to enable the Tribunal to make a decision on the appeal. [Act No.4 of 2023 s 39]” 213.It is within this Appeal that the tax Appeals Tribunal would interrogate the provisions of the Income tax Act on the issuance of a tax exemption certificate as against the Applicant’s evidence adduced to the Respondents and determine whether the Respondent’s decision of 29th January 2024 was proper. 214.The Tax Tribunal has jurisdiction over the above matter and has in the past dealt with similar matters.In the case of Samaj v Commissioner of Domestic Taxes [2024] KETAT 1121 (KLR), the Tax Tribunal correctly found that it is clothed with jurisdiction to determine the Respondent’s decision declining to issue a tax exemption certificate in line with section 13(1) of the Income Tax Act as read together with paragraph 10 of the first schedule to the Income tax Act. 215.It is the preserve of the tax Appeals Tribunal to interrogate whether the Respondent’s decision of 29thJanuary 2024 was issued in line with the provision of the Income tax Act. 216.It was therefore not open for the Applicant to seek judicial review orders upon being issued with the decision of 29th January 2024, and this action amounts to an abuse of the Court process. 217.The tax Appeal’s Tribunal Act and the tax Procedures Act provides for not only appeals to the Tax Appeals Tribunal but also appeals to the High Court if a party is dissatisfied with the Tax Appeals’ Tribunal’s decision.Consequently, the High Court’s jurisdiction ought to have only been invoked as an appellate court, not a judicial review court. 218.The Applicant has erroneously stated that the Tax Appeals Tribunal is functus officio hence the reason for the Judicial review Application. 219.Notably, the Application herein was filed almost six months upon issuance of the Respondent’s decision of 29th January 2024, which means that the real reason the Applicant approached the judicial review Court is because they were late in appealing to the tax Appeals Tribunal in line with section 13 of the tax Appeals Tribunal Act and section 52 of the tax Procedures Act. 220.The only decision that is functus officio before the Tax Appeals Tribunal is the Commissioner’s decision that was subject to the Tax Tribunal’s decision of 30th July 2021. This is the letter of 19th August 2020, which is adduced as part of Annexure KRA 14 to the Respondent’s Replying Affidavit dated 5th November 2024. 221.The issue of the Tax Exemption certificate was not determined by the tax Appeals Tribunal then, for reasons stipulated in the judgement. This does not means that that issue is functus officio. 222.It is submitted that the Applicant knew that the Tax Exemption issue had not been determined by the Tax Appeals Tribunal,and approached the Respondent. 223.All the correspondences adduced by the Respondent in its Affidavit of 5th November 2024 from annexure KRA 15 to KRA 24 speaks to the fact that the Respondent kept on advising the Applicant to adduce documents that show compliance with paragraph 10 of the First Schedule to the Income tax Act, which is the statutory requirement for issuance of the Tax Exemption certificate. 224.Those correspondence culminated in the letter of 29th January 2024, which has not been subjected to appeal before the tax Appeals Tribunal. 225.It is therefore not correct for the Applicant to suggest that the reason they have approached the review Court is because the tax Appeals Tribunal is functus officio. 226.The main issue is because they are late in appealing the Respondent’s decision of 24th January 2024 to the tax Appeals Tribunal. 227.In determining prayers 1 and 3 of the Notice of Motion, this Honourable Court must determine whether the Respondent’s letter of 29th January 2024 was issued in accordance with the statutory provisions of the Income tax Act in relation to issuance of the tax Exemption Certificate. 228.It submits that this court cannot do so without stepping into the purview of the tax Tribunal. 229.Further, any attempts by the Applicant to state that they have met the requirements of the Income tax Act and as such, this Honourable Court is clothed with jurisdiction to compel the Respondent to issue the Applicants with a Tax Exemption certificate, is still within the purview of the tax Appeals Tribunal act to determine whether the same is correct or not. 230.Without prejudice to the foregoing, following the jurisprudence in the Dande case(supra), this Honourable Court’s interrogation of the merits of whether the Applicant merits to be granted tax exemption certificate will still arrive at the conclusion that they did not meet the threshold of section 13 of the Income Tax Act as read together with paragraph 10 of Part I of the First schedule to the Income Tax Act, as explained in the Respondent’s letter of 29thJanuary 2024. 231.Lastly, in view of the fact that they failed to appeal the decision of 29th January 2024 at the tax Appeals Tribunal Act, then their approach to the Judicial Review Court is misuse(abuse) of the Court process to obtain orders that they should not be granted. 232.The Applicants have not questioned any procedural flaw with respect to the Respondent’s issuance of the letter of 29th January 2024. 233.Prayer 2 of the Applicant’s Notice of Motion Application seeks to compel the Respondent to comply with the settlement agreement of 28thOctober 2021. 234.Section 13(1) of the Income Tax Act as read together with paragraph 10 of the First Schedule to the Income Tax Act lays down the only conditions to be fulfilled for a taxpayer that claims to be an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of the poverty or distress of the public, or for the advancement of religion or education to be issued with an exemption certificate exempting its income from tax under the Act. 235.Parties cannot enter into an agreement to circumvent the express provisions of the law, in this instance Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act. 236.While the Settlement agreement provided that the 1st Respondent was to issue the Applicant with a Tax exemption certificate, the issuance of the same could only be within the strict confines of the law, in this instance Section 13(1) of the Income Tax as read together with paragraph 10 of the First Schedule to the Income tax Act. 237.The avenue available for the Applicant to seek to enforce performance of the said agreement is not a Judicial review Court since this amount to a private contract and not an administrative decision. 238.Halsbury’s Law of England, 4th Edition Volume 1 at Page 111 from Paragraph 89. States as follows with respect to an order of Mandamus:-“The order of mandamus is of a most extensive remedial nature, and is, in form, a command issuing from the High Court of Justice, directed to any person, corporation or inferior tribunal, requiring him or them to do some particular thing therein specified which appertains to his or their office and is in the nature of a public duty. Its purpose is to remedy the defects of justice and accordingly it will issue, to the end that justice may be done, in all cases where there is a specific legal right and no specific legal remedy for enforcing that right; and it may issue in cases where, although there is an alternative legal remedy, yet that mode of redress is less convenient, beneficial and effectual.” At paragraph 90 headed “the mandate” it is stated:“The order must command no more than the party against whom the application is made is legally bound to perform. Where a general duty is imposed, a mandamus cannot require it to be done at once. Where a statute, which imposes a duty leaves discretion as to the mode of performing the duty in the hands of the party on whom the obligation is laid, a mandamus cannot command the duty in question to be carried out in a specific way.” 239.In the case of Kenya National Examination Council v Republic Ex Parte Geoffrey Gathenji Njoroge & 9 others [1997] KECA 58 (KLR) the Court of Appeal further analysed the scope of mandamus as follows:-“What do these principles mean? They mean that an order of mandamus will compel the performance of a public duty which is imposed on a person or body of persons by a statute and where that person or body of persons has failed to perform the duty to the detriment of a party who has a legal right to expect the duty to be performed.We can do no better than give examples. The Liquor Licensing Act, Chapter 121 Laws of Kenya, by section 4(1) creates a licensing court for every licensing area and provides that the licensing court, chaired by the District Commissioner of each area, is to consider and determine applications for and the cancellation of liquor licences. Section 8 of the Act provides the manner and procedure to be followed by those who desire to acquire liquor licences. The duty imposed on the licensing court is “to consider and determine applications and the cancellation of licences”-section 4(1)Now, if a party applies for a licence under section 8 and the licensing court simply refuses or neglects to consider and determine the application such a party would be entitled to come and ask the High Court for a mandamus, and if the High Court is satisfied that the licensing court has simply refused or neglected to consider and determine the “application” the High Court would be entitled to issue an order of mandamus, compelling the licensing court to consider and determine the application as it is boundby the law to do so. The High Court would, in those circumstances, be compelling, through the remedy of mandamus, the licensing court to perform its public duty imposed on it by section 4(1) of the Liquor Licensing Act, and the public duty imposed by that section is the consideration and determination of the application for a licence. The High Court cannot, however, through mandamus, compel the licensing court to either grant or refuse to grant the licence. The power to grant or refuse a licence is vested in the licensing court and unless there is a right of appeal, the High Court cannot itself grant a licence. 240.They also places reliance in the case of R (Regina) vs. Dudsheath, ex parte, Meredith [1950] 2 ALL E.R. 741, the case of Shah vs. Attorney General (No. 3) Kampala HCMC No. 31 of 1969 [1970] EA 543,the case of Republic v Attorney General & another Exparte James Alfred Koroso [2013] KEHC 90(KLR), the High Court stated as follows:-“In mandamus cases it is recognised that when statutory duty is cast upon a Public Officer in his official capacity and the duty is owed not to the State but to the public any person having a sufficient legal interest in the performance of the duty may apply to the Courts for an order of mandamus to enforce it. In other words, mandamus is a remedy through which a public officer is compelled to do a duty imposed upon him by the law. It is in fact the State, the Republic, on whose behalf he undertakes his duties, that is compelling him, a servant, to do what he is under a duty, obliged to perform.” 241.It submits that the above authorities’ confirm that vide an order of mandamus, a public body is compelled to perform its public duty. Consequently, the question to be answered by this Honourable Court is what is the Respondent’s Public Duty in so far as issuance of a tax exemption is concerned? 242.The Respondent submits that its public duty under Section 13 of the Income Tax Act as read together with paragraph 10 of the First schedule to the Income Tax Act is to determine the Appellant’s application for issuance of a tax exemption and issuance of a decision on the same. The Respondent has carried out this public duty and issued a decision dated 29th January 2024. 243.In the instant case, the prayer for mandamus is for the Respondent’s issuance of a tax exemption certificate pursuant to a Settlement agreement. 244.The Respondent’s compliance with the settlement agreement is not a public duty but rather a contractual obligation, whose enforcement mechanism would be outside the judicial review realm. 245.The Applicant is estopped from seeking to enforce the settlement agreement vide its very own actions. 246.The Respondent explained to the Applicant that the Tax Exemption Certificate can only be issued upon compliance with paragraph 13 of the Income tax Act as read together with paragraph 10 of the First schedule to the Income tax Act. The Appellant tried to provide documents to ensure compliance, however, the said documentation was not sufficient to be granted a tax exemption certificate. The reasons for the Respondent’s decline in issuance of a tax exemption certificate is explained in its decision of 29th January 2024. 247.The Appellant is estopped from seeking to enforce the said settlement agreement since the same has been set aside by the Parties very own conduct. 248.In the case of Tarmal Industries Ltd cv Commissioner of Customs & Excise [1968] E.A. 471, the High Court of Tanzania (Georges, C.J) held that there was no estoppel against statute and that although Commissioner initially erred in deciding the substance was not dutiable and possibly was negligent not to have analyzed the sample the Commissioner was bound under the law to correct the matter and levy duty on the basis that the substance had always been dutiable. The Courts stated as follows at page 482 of the judgement:-“In this case there is a statutory duty imposed on the Commissioner of Customs and Excise by s. 105 of the East African Customs Management Act 1952. It is the duty, where the goods can be reasonably classifiable under two or more name, classes or descriptions, to classify them under the name, class or description which results in such goods being liable to duty or being liable to the higher or highest rate of duty, as the case may be. If the substance here imported could be classified both under the heading soap tariff item 105, and under the item chemicals not elsewhere specified such as may be. If the substance here imported could be classified both under the heading soap, tariff item 105, and under item chemicals not elsewhere specified such as may be admitted by the Commissioner under tariff item 108(k) which does not.The fact that he failed to do so on the authorities above cited cannot bar him from carrying out his duty when he discovers the original error. Indeed, his earlier classification under item 108 (k) was in breach of S. 195 of the East African Customs Management Act. It was a breach of statutory duty and in that sense, it was not lawful, and estoppel cannot be raised against him to prevent him from correcting that act. Naturally one reaches such conclusion with a certain measure of reluctance as it is undoubtedly hard on the defendant company to be called upon long after the event to find such a substantial sum, which would not have been payable but for the plaintiff’s negligence in the first instance in not having pellets which were sent to him for examination properly tested. One can well understand, however, that on balance it is preferable that the law should be as it is. It is not in the interest of consistent application of the law that errors should be sanctified as principle..." 249.In the case of Republic v Kenya Revenue Authority Ex- ParteAberdare Freight Services Ltd & 2 others [2004]KEHC 1238 (KLR) held as follows:-“One important aspect of this matter which was not addressed by counsel and which the court cannot overlook is the effect of advance payment in law. Did it create any estoppel or any enforceable right?What is the applicable principle?De Smith Woolf and Jowell Judicial Review of Administration Action 5th Edition has brought out the principle very well at pages 567 and 568. In these words“The general principle remains however, that a public authority may not vary the scope of its statutory powers and duties as a result of its own errors or the conduct of others. Judicial resort to estoppel in these circumstances may prejudice the interests of third parties”.In the same authoritative book (supra) at page 566 the following principle is also brought out“Purported authorization, waiver, acquiescence and delay do not preclude a public body from reasserting its legal rights or powers against another party if it has no power to sanction the conduct in question or to endow that party with the legal right or inventory that he claims”It is therefore clear to the court that the advance payment of duty and clearance cannot be a ground for estoppel against the respondent or any other statutory body.If full duty have not been paid and is legally due a public authority cannot bind itself to accept anything other than full duty.The respondent and the 1st interested parties cannot be prevented from enforcing the statutory duties given to them by an Act of Parliament.” 250.In Aberdares Freight Services (Supra) stated as follows:-“It is clear to the Court that the order of Mandamus sought does not and would not lie because there is no public duty or statutory power which the Respondent has failed to exercise. Similarly, prohibition operates as to the future to prohibit unlawful acts on the part of approved body. I find no unlawful acts to be prohibitory.” 251.The writ of mandamus is not available to the Appellants because there is no statutory duty that the Respondents have failed to perform. If anything, by issuance of its decision of 29th January 2024, the Respondent has performed its statutory duty with respect to issuance on a decision on the Applicant’s application for a tax exemption in accordance with the provision of section 13 of the Income tax Act as read together with paragraph 10 of the First schedule to the Income tax Act. Enforcement of the settlement agreement by the Applicant cannot be made through the Judicial review process since the said agreement is outside the realm on the Respondent’s public duty. 252.With respect to the Respondent’s compliance with the settlement agreement, the jurisprudence in the Tarmal Case and the Aberdare Freight Services case clearly shows that there is no estoppel against statute. This means that the settlement agreement was void ab initio in so far as it sought to circumvent the express provision of the income tax act on provision of a tax exemption. Notably, the Respondent redeemed itself after the settlement agreement by following the law and advising the Applicant in various correspondence on the need to comply with the income tax provision prior to issuance of the tax exemption certificate, the Applicant failed to comply. 253.If the Court is of a contrary view, then the Applicant’s very own action of applying for the tax exemption certificate pursuant to the Income Tax Act provisions, post the settlement agreement, which application resulted in the decision of 29thJanuary 2025 are estopped them from asking for prayer 2. Analysis and determination:The following are the issues for determination;1.Whether the court has jurisdiction.2.Whether the Application has merit.3.Who shall bear costs.Whether the court has jurisdiction. 254.In Samuel Kamau Macharia & anor vs Kenyac Commercial Bank Ltd & 2 Others [2012] Eklr, the Supreme Court held:“A Court’s jurisdiction flows from either the Constitution or legislation or both. Thus, a Court of law can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate to itself jurisdiction exceeding that which is conferred upon it by law.” 255.In Kenya Power & Lighting Company Limited v Benzene Holdings Limited t/a Wyco Paints [2016] eKLR the Court quoted from Halsbury’s Laws of England 4th Edn. Vol. 37 Para. 14 inherent jurisdictions. It is stated therein:“The jurisdiction of the court which is comprised within the term “inherent” is that which enables it to fulfil itself, properly and effectively, as a court of law. The overriding feature of the inherent jurisdiction of the court is that it is part of procedural law, both civil and criminal, and not part of substantive law; it is exercisable by summary process, without plenary trial; it may be invoked not only in relation to the parties in pending proceedings, but in relation to anyone, whether a party or not, and in relation to matters not raised in litigation between the parties; it must be distinguished from the exercise of judicial discretion; it may be exercised even in circumstances governed by rules of court. The inherent jurisdiction of the court enables it to exercise control over process by regulating its proceedings, by preventing the abuse of the process and by compelling the observance of the process … In sum, it may be said that the inherent jurisdiction of the court is a virile and viable doctrine and has been defined as being the reserve or fund of powers, a residual source of powers, which the court may draw upon as necessary whenever it is just or equitable to do so, in particular to ensure the observance of the due process of law, to prevent improper vexation or oppression, to do justice between the parties and to secure a fair trial between them. 256.In its decision of 29th January 2024, a decision was made determining the application for a tax exemption certificate under paragraph 10 of the First Schedule to the Income Tax Act, declining the said application giving the following reasons;1.The Applicants’ application of funds to charitable activities in relation to the total income in the years in review was 17%, 21% and 8% in 2018, 2019 and 2020 respectively.2.The bulk of income that was retained in the three years and the proposed expenditure was not based on the charitable activities.3.The Applicant’s application of funds towards charitable activities as depicted in the analysis of program expenses did not meet the requirements under paragraph 10 of the first schedule to the Income Tax Act. 257.The Applicant was further advised to re-apply in line with paragraph 10 of the First Schedule to the Income tax Act requirements with a clear demonstration of funds towards charitable activities. 258.In the case of Geoffrey Muthinja Kabiru & 2 Others v Samuel Munga Henry & 1756 others [2015] eKLR the Court of Appeal stated that: -“It is imperative that where a dispute resolution mechanism exists outside Courts, the same be exhausted before the jurisdiction of the Courts is invoked. Courts ought to be of last resort and not the first port of call the moment a storm brew… The exhaustion doctrine is a sound one and serves the purpose of ensuring that there is a postponement of judicial consideration of matters to ensure that a party is first of all diligent in the protection of his own interest within the mechanisms in place for resolution outside the Courts...These accords with Article 159 of the Constitution which commands Courts to encourage alternative means of dispute resolution." 259.Justice Mativo in Republic v Kenyatta University Ex parte Ochieng Orwa Domnick & 7 others [2018] eKLR held as follows:“Section 9 (2) of the Fair Administrative action Act provides that the High Court or a subordinate court under subsection (1) shall not review an administrative action or decision under this Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted. Also relevant is sub-section (3) which provides that "the High Court or a subordinate Court shall, if it is not satisfied that the remedies referred to in sub-section (2) have been exhausted, direct that applicant shall first exhaust such remedy before instituting proceedings under sub-section (1). The use of the word shall in the above provisions is worth noting. The classification of statutes as mandatory and directory is useful in analyzing and solving the problem of what effect should be given to their directions. There is a well-known distinction between a case where the directions of the legislature are imperative and a case where they are directory. The real question in all such cases is whether a thing has been ordered by the legislature to be done and what is the consequence if it is not done. The general rule is that an absolute enactment must be obeyed or fulfilled substantially. Some rules are vital and go to the root of the matter, they cannot be broken; others are only directory and a breach of them can be overlooked provided there is substantial compliance.It is the duty of Courts of justice to try to get at the real intention of the Constitution or legislation by carefully attending to the whole scope of the Constitution or a statute to be considered. The Supreme Court of India has pointed out on many occasions that the question as to whether a statute is mandatory or directory depends upon the intent of the Legislature and not upon the language in which the intent is clothed. The meaning and intention of the Legislature must govern, and these are to be ascertained not only from the phraseology of the provision, but also by considering its nature, its design and the consequences which would follow from construing it in one way or the other.The word "shall" when used in a statutory provision imports a form of command or mandate. It is not permissive, it is mandatory. The word shall in its ordinary meaning is a word of command which is normally given a compulsory meaning as it is intended to denote obligation. The Longman Dictionary of the English Language states that "shall" is used to express a command or exhortation or what is legally mandatory. Ordinarily the words ‘shall’ and ‘must’ are mandatory and the word ‘may’ is directory. A proper construction of section 9 (2) & (3) above leads to the conclusion that they are couched in mandatory terms. The only way out is the exception provided by 9 (4) which provides that:-"Notwithstanding subsection (3), the High Court or a subordinate Court may, in exceptional circumstances and on application by the applicant, exempt such person from the obligation to exhaust any remedy if the court considers such exemption to be in the interest of justice.Two requirements flow from the above sub-section. First, the applicant must demonstrate exceptional circumstances. Second, on application by the applicant, the Court may exempt the person from the obligation. The ex parte applicants counsel made a statement that there are exceptional circumstances in this case after the Court drew his attention to the above sections. He however did not provide specific cases that bring this case under the exceptions, except stating that the applicants are young which to me does not fit into the definition of "exceptional circumstances" discussed below.It is settled that the impugned decision constitutes administrative action as defined in section 2 of the Fair Administrative Action Act.Therefore, an internal remedy must be exhausted prior to Judicial Review, unless the appellant can show exceptional circumstances to exempt him from this requirement.What constitutes exceptional circumstances depends on the facts and circumstances of the case and the nature of the administrative action in issue.Factors taken into account in deciding whether exceptional circumstances exist are whether the internal remedy is effective, available and adequate. An internal remedy is effective if it offers a prospect of success, and can be objectively implemented, taking into account relevant principles and values of administrative justice present in the Constitution and our law, and available if it can be pursued, without any obstruction, whether systemic or arising from unwarranted administrative conduct. An internal remedy is adequate if it is capable of redressing the complaint.This exception to the exhaustion requirement is particularly likely where a party pleads issues that verge on Constitutional Interpretation especially in virgin areas or where an important constitutional value is at stake. Indeed, in this case, no such argument was advanced before me nor can I discern any virgin argument touching on Constitutional interpretation.The principle running through decided cases is that where there is an alternative remedy or where Parliament has provided a statutory appeal process, it is only in exceptional circumstances that an order for Judicial Review would be granted, and that in determining whether an exception should be made and Judicial Review granted, it is necessary for the Court to look carefully at the suitability of the appeal mechanism in the context of the particular case and ask itself what, in the context of the internal appeal mechanism is the real issue to be determined and whether the appeal mechanism is suitable to determine it.” 260.The applicant's case was that they moved to this court under Section 9 for the Fair Action Act because in their opinion they had exhausted all the alternative resolution mechanisms. 261.Section 9(4) of The Fair Administrative Actions Act provides that notwithstanding the provisions of Section 9(2) and (3) of the Fair Administrative Actions Act on exhaustion of available alternative remedies, the High Court or the Subordinate Court may in exceptional circumstances and on application by the applicant exempt such a person from the obligation to exhaust any remedy if the court considers such exemption to be in the interest of justice. 262.It is categorical that the High Court may in exceptional circumstances and on application by the applicant exempt such a person the applicants did not make an application for exemption and Section 9(4) of the fair administrative action act. 263.The Act uses the word “and” which means there are two conditions that an applicant for exemption of the application of the doctrine of exhaustion must fulfill. 264.There is justification and a rationale for the requirement for an application to be made for leave to be exempted by the court before the exemption can be granted. 265.The reason behind having this requirement is for purposes of ensuring that Article 159 of the Constitution is promoted. 266.The decision of 29th January 2024 is an Appealable decision as defined under section 2 of the Tax Procedures Act, and the decision stands with respect to the Applicant’s exemption status unless challenged by the Applicant before the Tax Appeals Tribunal as provided for under section 52 of the Tax Procedures Act and Section 12 of the tax Appeals Tribunal Act. 267.This decision amounts to a decision of the Commissioner, which under section 12 of the Tax Appeals Tribunal Act, appealable to the Tax Appeals Tribunal Act. 268.The said section states that;-“A person who disputes the decision of the Commissioner on any matter arising under the provisions of any tax law may, subject to the provisions of the relevant tax law, upon giving notice in writing to the Commissioner, appeal to the Tribunal,The Income Tax Act is one of the laws recognised under section 2 of the Tax Procedures Act as a “tax Law”.Section 13 of the Tax Appeals Tribunal Act then provides for the procedure on Appeal as follows:-“ 13.Procedure for appealA notice of appeal to the Tribunal shall—(a)be in writing;(b)be submitted to the Tribunal within thirty days upon receipt of the decision of the Commissioner.The appellant shall, within fourteen days from the date of filing the notice of appeal, submit enough copies, as may be advised by the Tribunal, of—(a)a memorandum of appeal;(b)statements of facts; and(c)the appealable decision; and(d)such other documents as may be necessary to enable the Tribunal to make a decision on the appeal.[Act No.4 of 2023 s 39]” 269.It is within this Appeal that the tax Appeals Tribunal would interrogate the provisions of the Income tax Act on the issuance of a tax exemption certificate as against the Applicant’s evidence adduced to the Respondents and determine whether the Respondent’s decision of 29th January 2024 was proper. 270.The Tax Tribunal has jurisdiction over the above matter and has in the past dealt with similar matters. In the case of Samaj v Commissioner of Domestic Taxes [2024] KETAT 1121 (KLR), the Tax Tribunal correctly found that it is clothed with jurisdiction to determine the Respondent’s decision declining to issue a tax exemption certificate in line with section 13(1) of the Income Tax Act as read together with paragraph 10 of the first schedule to the Income tax Act. 271.It is the preserve of the tax Appeals Tribunal to interrogate whether the Respondent’s decision of 29thJanuary 2024 was issued in line with the provision of the Income tax Act. 272.It was therefore not open for the Applicant to seek judicial review orders upon being issued with the decision of 29th January 2024, and this action amounts to an abuse of the Court process. 273.The tax Appeal’s Tribunal Act and the tax Procedures Act provides for not only appeals to the Tax Appeals Tribunal but also appeals to the High Court if a party is dissatisfied with the Tax Appeals’ Tribunal’s decision. 274.Consequently, the High Court’s jurisdiction ought to have only been invoked as an appellate court, not a judicial review court. 275.Related to the issue of jurisdiction,The Applicant has erroneously stated that the Tax Appeals Tribunal is functus officio hence the reason for the Judicial review Application. 276.Notably, the Application herein was filed almost six months upon issuance of the Respondent’s decision of 29th January 2024, which means that the real reason the Applicant approached the judicial review Court is because they were late in appealing to the tax Appeals Tribunal in line with Section 13 of the tax Appeals Tribunal Act and section 52 of the tax Procedures Act. 277.The issue of the Tax Exemption certificate was not determined by the tax Appeals Tribunal then, and the Tribunal cannot be said to be functus officio. 278.All the correspondences adduced by the Respondent in its Affidavit of 5th November 2024 from annexure KRA 15 to KRA 24 speaks to the fact that the Respondent kept on advising the Applicant to adduce documents that show compliance with paragraph 10 of the First Schedule to the Income tax Act, which is the statutory requirement for issuance of the Tax Exemption certificate. 279.Those correspondence culminated in the letter of 29th January 2024, which has not been subjected to appeal before the tax Appeals Tribunal. 280.It is therefore not correct for the Applicant to suggest that the reason they have approached the review Court is because the tax Appeals Tribunal is functus officio. 281.The Supreme Court in the case of Raila Odinga & 2 others v Independent Electoral & Boundaries Commission, Ahmed Issack Hassan, Uhuru Kenyatta & William Samoei Ruto (Petition 5, 4 & 3 of 2013) [2013] KESC 8 (KLR) (Civ) (24 October 2013) (Ruling)held as follows on the doctrine of functus officio;“ 18.We, therefore, have to consider the concept of “functus officio,” as understood in law. Daniel Malan Pretorius, in “The Origins of the functus officio Doctrine, with Specific Reference to its Application in Administrative Law,” (2005) 122 SALJ 832, has thus explicated this concept: “The functus officio doctrine is one of the mechanisms by means of which the law gives expression to the principle of finality. According to this doctrine, a person who is vested with adjudicative or decision-making powers may, as a general rule, exercise those powers only once in relation to the same matter.… The [principle] is that once such a decision has been given, it is (subject to any right of appeal to a superior body or functionary) final and conclusive. Such a decision cannot be revoked or varied by the decision-maker.” 19.This principle has been aptly summarized further in Jersey Evening Post Limited v A1 Thani [2002] JLR 542 at 550:“A court is functus when it has performed all its duties in a particular case. The doctrine does not prevent the court from correcting clerical errors nor does it prevent a judicial change of mind even when a decision has been communicated to the parties. Proceedings are only fully concluded, and the court functus, when its judgment or order has been perfected. The purpose of the doctrine is to provide finality. Once proceedings are finally concluded, the court cannot review or alter its decision; any challenge to its ruling on adjudication must be taken to a higher court if that right is available” [emphasis supplied].” 282.In determining prayers 1 and 3 of the Notice of Motion, this Honourable Court must determine whether the Respondent’s letter of 29th January 2024 was issued in accordance with the statutory provisions of the Income tax Act in relation to issuance of the tax Exemption Certificate. 283.The Honourable Court cannot do so without stepping into the jurisdiction of the tax Tribunal as read alongside the finding that the doctrine of exhaustion is alive. 284.It is the court’s finding that the tax Tribunal is not functus officio given that the decision that brought the applicant to court is different from the one that was already determined earlier as read alongside the finding on the doctrine of exhaustion. 285.In the instant case, the applicant appreciates that there were alternative dispute resolution mechanisms.This was after they engaged the respondent towards resolving the dispute. 286.It is not for parties to determine or to decide that they have exhausted alternative these resolution mechanisms. It is the Court that decides. 287.Having found that the applicant did not exhaust the doctrine of exhaustion that ultimately takes away this courts power. As such the other issue of merit cannot be determined with given that the court lacks jurisdiction and I so hold. 288.Having found as I have above, this court has to down its tool in line with the principles as settled in the Supreme Court Case of Dickson Ngigi Ngugi v Commissioner of Lands S.C Petition No. 9 of 2019 [2019/ eKLR/36) wherein it was observed that,“Jurisdiction goes to the root of any cause or dispute before a court of law. A court must exercise restraint to avoid overstepping its constitutional role in order to maintain its legitimacy. If a court has no jurisdiction, a judgment rendered therein does not adjudicate the dispute. It does not bind the parties, nor can it be made the foundation of any right. It is a nullity without life or authority. In short, it is coram non judice and amounts to a millity because, as Nyarangi, JA famously said in the locus classicus, Owners of the Motor Vessel"Lillian S" Caltex Oil, (Kenya) Ltd [1989) KLR 1, "jurisdiction is everything. Without it, a court has no power to make one more step".Costs; 289.The Supreme Court in the case of Jashir Singh Rai & Others vs. Tarlochan Rai & Others observed that;'In the classic common law style, the courts have to proceed on a case-by-case basis, to identify "good reasons" for such adeparture. An examination of evolving practices on this question shows that, as an example, matters in the domain of public interest litigation tend to be exempted from award of costs…” 290.The interested parties are entitled to costs of the suit. Determination: 291.The lacks jurisdiction to hear and determine the Application. Order:The suit is struck out costs be borne by the applicant. DATED, SIGNED AND DELIVERED VIRTUALLY FROM ELDORET THIS 17TH DAY OF JUNE 2026……………………………………J. CHIGITI (SC)JUDGE