https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/96

Thermo Expert Construction Ltd v Commissioner of Legal Services and Board Services (Tax Appeal E1127 of 2025) [2026] KETAT 96 (KLR) (26 June 2026) (Judgment) Neutral citation: [2026] KETAT 96 (KLR) Republic of Kenya In the Tax Appeal Tribunal Tax Appeal E1127 of 2025 RO Oluoch, Chair, E Komolo & AM Diriye, Members June 26, 2026 Between Thermo Expert Construction Ltd Appellant and Commissioner of Legal Services and Board Services Respondent Judgment Background 1.The Appellant is a limited liability company incorporated in Kenya. 2.The Respondent is the principal officer appointed under Section 13 of the Kenya Revenue Authority Act. The Kenya Revenue Authority is an agency of the Government of Kenya mandated with the duty of collection and receipting of all tax revenue, and the administration and enforcement of all tax laws set out in Parts 1 & 2 of the First Schedule to the Act, including assessing, collecting, and accounting for all tax revenues in accordance with those laws. 3.On 30th November 2023, the Respondent issued the Appellant with additional VAT assessments for November 2021, December 2021, January 2022 and August 2024. 4.On 22nd May 2025, the Appellant objected to the Respondent’s additional VAT assessments. 5.On 30th June 2025, the Respondent issued its Objection Decision confirming the additional VAT tax assessments. 6.Aggrieved by this decision, the Appellant lodged this appeal. The Appeal 7.The Appellant in this appeal filed the Objection decision on 31st July 2025 as the basis of its appeal. 8.The matter was mentioned 7 times (14/10/25, 11/11/25, 18/1225, 28/01/26, 17/03/26, 11/03/26, 21/04/26) before the Tribunal and the Appellant’s representative. CPA Jeremiah only appeared once on the 28th of January 2026 to inform the Tribunal that consent was imminent in the matter. 9.The record also reflects that the mentioned dates were all served on the Appellant vide its provided email of cmtaxwxperts@gmail.com 10.The Tribunal sent it an email dated 2nd June 2026, requesting that it provides the Tribunal with any documents or pleadings in its possession other than the field objection decision. However, the said email did not elicit any response from the tax agent. 11.The Appellant failed to attend the hearing of the matter on 5th May 2026, and it did not also file its submission to the matter, contrary to the direction served on it by the Tribunal vide its email on 18th March 2026. Respondent’s Case 12.The Respondent filed its Statement of Facts dated 6th February 2026 and Written Submissions dated 4th May 2026, in opposition to the Appeal. 13.The Respondent stated thata.It verified the Appellant’s tax records and established that there was undeclared income during the period under review.b.It subsequently issued assessments dated 30th November 2023 and 23rd December 2024 in respect of VAT.c.It requested the Appellant to provide the following documents to support its objection:i.Copies of invoices.ii.Proof of payment.iii.Local Purchase Order (LPO).d.It upheld its assessment when the Appellant failed to provide the documents.e.The Appellant had failed to discharge its burden as required under the provisions of Sec 56(1) of the TPA, 2015. 14.The Respondent supported the confirmation of its assessment with the following cases:a.TAT NO. 28 of 2018 - Boycott General Contractors Limited v Kenya Revenue Authority.b.Commissioner of Domestic Taxes v Trical and Hard Limited (Tax Appeal E146 of 2020) [2022] KEHC 9927 (KLR)c.TAT No. E796 of 2023: Acrowood Imports & Exports Limited –Vs– Commissioner of Domestic Taxesd.Commissioner of Investigations & Enforcements V Dr. Evans Kidero (2022) eKLRe.Osho Drapers Limited v Commissioner of Domestic Taxes [2022] eKLR Respondent’s Prayers 15.The Respondent prayed that the Tribunal: -i.Upholds the Respondent’s objection decision dated 30th June 2025 confirming the demand for Kshs. 4,826,814.49 VAT (inclusive of interest and penalty).ii.Dismisses this Appeal with costs to the Respondent, as the same is without merit. Issues For Determination 16.The Tribunal, having considered the parties’ pleadings, submissions, and documents filed before it is of the view that the issue that falls for its determination is whether the Respondent’s Objection Decision dated 5th May, 2025 is justified. Analysis And Determination 17.This Appeal is premised on the Respondent’s Objection Decision dated 30th June 2025, which confirmed additional VAT assessments of the Appellant of Kshs. 4,826,814.49. The Respondent justified its Objection Decision on the single ground that the Appellant did not support its grounds of objection by providing the requested documents. 18.The Tribunal is guided on this issue by the applicable law, which the appellant to produce relevant documents in reviewing assessments. In particular, Section 59 of the Tax Procedures Act (cap 469B) provides as follows regarding the Appellant’s duty to produce documents and records as may be sought by the Respondent: - 1.For the purposes of obtaining full information in respect of the tax liability of any person or class of persons, or for any other purposes relating to a tax law, the Commissioner or an authorised officer may require any person, by notice in writing, to – a.produce for examination, at such time and place as may be specified in the notice, any documents (including in electronic format) that are in the person's custody or under the person's control relating to the tax liability of any person;b.furnish information relating to the tax liability of any person in the manner and by the time as specified in the notice; orc.attend, at the time and place specified in the notice, for the purpose of giving evidence in respect of any matter or transaction appearing to be relevant to the tax liability of any person. 19.Furthermore, Section 30 of the Tax Appeals Tribunal Act (cap 469A) provides as follows on the Appellant’s burden of proof: -In a proceeding before the Tribunal, the appellant has the burden of proving—(a)where an appeal relates to an assessment, that the assessment is excessive; or(b)in any other case, that the tax decision should not have been made or should have been made differently. 20.The Tribunal is also guided by its precedents on the production of documents and the obligation of the parties to discharge their burdens of proof in tax matters in Mugo -vs- Commissioner of Domestic Taxes (TAT E918 of 2024) KETAT 374 (KLR), where it held as follows:As noted herein above, the Appellant failed to adduce positive documents to demonstrate that the Respondent’s decision was incorrect. Consequently, the Tribunal finds and holds that the Respondent’s decision was justified and the Appellant failed to discharge its burden of proof contrary to Section 30 of the Tax Appeals Tribunal Act, 2013 (TATA) and Section 56(1) of the Tax Procedures Act; thus, the Appeals is not successful.” 21.The Tribunal having considered the pleadings and records before it in this Appeal, it is apparent that the Appellant did not provide the relevant documents requested by the Respondent to support its objection and discharge its burden of proof in the first instance in accordance with the above statutory provisions. Thus, the Respondent was justified to disallow the Appellant’s objection as outlined in its Objection Decision dated 5th May, 2025. Disposition 22.The upshot of the foregoing analysis is that the Tribunal finds and holds that the Appeal lacks merit and proceeds to issue the following orders: -a.The Appeal be and is hereby dismissed.b.The Respondent’s Objection Decision dated 30th June 2025 be and is hereby upheld.c.Each Party is to bear its own costs. 23.It is so ordered. DATED AND DELIVERED AT NAIROBI THIS 26TH DAY OF JUNE 2026............................……………………….DR. RODNEY ODHIAMBO OLUOCH -CHAIRPERSONDR. ERICK KOMOLO- MEMBERABDULLAHI DIRIYE - MEMBER