[2024] KETAT 1443 (KLR)

Westlands Trading Limited v Commissioner of Customs and Border Control (Tax Appeal E191 of 2024) [2024] KETAT 1443 (KLR) (4 October 2024) (Judgment)

Neutral citation: [2024] KETAT 1443 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Tax Appeal E191 of 2024

RM Mutuma, Chair, T Vikiru, Jephthah Njagi, M Makau & D.K Ngala, Members

October 4, 2024

Between

Westlands Trading Limited

Appellant

and

Commissioner of Customs and Border Control

Respondent

Judgment

Background 1. The Appellant is a private limited liability company duly incorporated in Kenya under the Companies Act. Its principal business activity is sourcing, importing and supplying various goods from foreign sources into the country.

2. The Respondent is a principal officer appointed pursuant to Section 13 of the Kenya Revenue Authority Act (KRA), Act No. 2 of 1995, and KRA is empowered to enforce and administer provisions of written laws set out in Section 5 as read together with the First Schedule of the KRA Act.

3. The Respondent sought to check the Appellant’s compliance with import duty and VAT for the period 2018 to 2023. The Respondent’s review revealed a short levy of taxes as a result of application of a duty rate of 0% instead of 35%.

4. The Respondent’s review established that the Appellant’s import under the brand name aji-nomoto umami seasoning had been declared under HS Code 2922. 42. 00 instead of HS Code 2103. 90. 00.

5. The Respondent issued the Appellant with a demand notice for short-levied taxes of Kshs. 17,102,703. 00 on 7th December 2023.

6. The Appellant lodged an application for review vide a letter dated 19th December 2023, to which the Respondent issued a Review Decision on 19th January 2024.

7. The Appellant dissatisfied with the decision filed this Appeal at the Tribunal dated and filed on 16th February 2024

The Appeal 8. The Appeal is premised on the following grounds as stated in the Appellant’s Memorandum of Appeal filed on 29th February 2024 on the following grounds;a.That the Respondent erred in law and fact by reclassifying the Appellant’s consignments of Monosodium Glutamate (MSC) from HS Code No. 2922. 42. 00, which is zero-rated to HS Code No. 2103. 90. 00 and which attracts import duty at the rate of 35%.b.That the Respondent misdirected itself by upholding its demand for short levied duties despite acknowledging that the Appellant’s consignment of Aji Nomoto Umami is essentially MSG, which is classifiable under HS Code No. 2922. 42. 00. c.That the Respondent erred in law and in fact by ignoring certified chemical analysis issued by the manufacturer of the product, Ajinomoto Do Brasil lndustria E Comercio De Alimentos Ltda, Kenya Bureau of Standards (KEBS) Certificate of Conformity and that of KRA laboratory. in reclassifying the Appellant’s goods from declared HS Code No. 2922. 42. 00 to HS Code No. 2103. 90. 00. d.That the Respondent erred in law and fact, by reclassifying the Appellant’s goods as HS Code No. 2103. 90. 00 of the EAC CET on the basis of physical labeling on the goods instead of empirically establishing the nature and chemical composition of the goods by way of laboratory analysis of the samples taken.e.That the Respondent erred in law and fact by presuming that the Appellant’s goods as presented in its packages with intended use were “other mixed condiments and mixed seasonings” and therefore falling under HS Code Tariff Classification No. 2103. 90. 00 but failing to empirically establish or prove the assumption by way of laboratory analysis.f.That the Respondent’s Review Decision on 19th January 2024 is arbitrary, unfair, unjust, and devoid of due process, thus illegal in so far as it is ignored the results or findings of scientific chemical analysis of the samples or the goods under review by various agencies including KRA’s Laboratory that confirmed that the goods were Monosodium Glutamate.g.That the Respondent erred in law and fact, by failing to adhere to the General Interpretation Rules for the Classification of goods of the EAC CET by classifying the Appellant’s consignment under review under a generalized Heading (HS Code 2103. 90. 00) and ignoring a more detailed, specific and descriptive Heading (HS Code 2922. 42. 00).h.That the Respondent erred in law and fact, by openly manifesting bias and unfairness by classifying the Appellant’s competitors’ imported goods as zero-rated while imposing a 35% import duty on the Appellant's products.i.That the Respondent’s Review Decision of 19th January 2024 is unjust and in breach of Article 47 of the Constitution of Kenya and the Appellant’s right to legitimate expectation.

The Appellant’s Case 9. The Appellant’s case is premised on its;a.Statement of Facts filed on 29th February 2024, together with the documents attached thereto; and,b.Written submissions dated and filed on 29th July 2024.

10. The Appellant averred that the consignment of Ajinomoto imported by the Appellant is clearly and conspicuously labelled as “Monosodium Glutamate” in its packaging. Therefore, it submitted that the identification helps customers distinguish it from other products and make informed choices on whether or not to purchase it.

11. The Appellant averred that MSG has various uses; it is mainly used to enhance the umami flavour in foods, which intensifies the savoury taste.

12. The Appellant submitted that Section 10 of the Standards Act, Chapter 496 of Laws of Kenya, empowers KEBS to inspect and confirm whether the imported goods comply with the provisions of the law dealing with standards of quality and description. Therefore, the Appellant averred that in every importation of Ajinomoto, KEBS conducted its laboratory test, which confirmed that the consignment imported is MSG and issued a Certificate of Conformity.

13. The Appellant averred that the consignment manufacturer, Ajinomoto Do Brasil Ind.E Com.De. Alimento Ltda issued a Certificate of Analysis of the imports, which confirms that Ajinomoto is MSG.

14. The Appellant submitted Section 157 (2) of EACCMA provides that“customs officers may take and retain reasonable samples of any good or material necessary for the performance of his or her duties.”

15. The Appellant averred that a chemical analysis is conducted on samples collected through various laboratory techniques and methods to ascertain the product’s chemical composition, properties and characteristics, whose purpose is to determine the essential character of the article to reveal its intended use and function.

16. The Appellant averred that the Respondent through its Strategy, Innovation & Risk Management Department (SI & RMD), carried out an independent laboratory analysis on the samples of Ajinomoto collected to establish its nature and tariff classification.

17. The Appellant averred that the laboratory test established that:a.The sample tested was a crystalline white powder with typical physical characteristics of pure monosodium glutamate.b.The sample tested was monosodium glutamate, which enhances flavour in food classified in EAC/CET HS Code 2922. 42. 00.

18. The Appellant submitted that chemical analysis of imported articles resolves disputes or discrepancies where there is ambiguity in a product's tariff classification while scientific analysis provides objective data to support proper tariff classification. Therefore, it submitted that the Respondent’s laboratory findings confirmed that the consignment is MSG and that it was correctly classified it.

19. The Appellant averred that despite the overwhelming evidence and confirmation, the Respondent ignored, refused and neglected such findings without any colour of right and reclassified the Appellant’s consignment of Ajinomoto as mixed seasoning under HS Code 2103. 90. 00.

20. The Appellant’s relied on the case of Republic vs. Public Procurement Administrative Review Board & 2 others Ex-Parte Pelt Security Services Limited [2018] eKLR as follows:“Reaching a decision on the basis of irrelevant considerations or by disregarding relevant considerations is one of the manifestations of irrationality. So, as stated in the case R v Secretary of State for Social Services, ex parte Welcome Foundation Ltd, it is a reviewable error either to take account of irrelevant considerations or to ignore relevant ones, provided that if the relevant matter has been considered or the irrelevant one is ignored, a different decision or rule might (but not necessarily would) have been made. Many errors of law and fact involve ignoring relevant matters or taking into account irrelevant ones. Ignoring relevant considerations or taking account of irrelevant ones may make a decision or rule unreasonable.”

21. The Appellant further relied on the High Court case in Republic vs. Kenya Revenue Authority Ex parte Jaffer Mujtab Mohamed [2015] eKLR:“46. Therefore, whereas this Court is not entitled to question the merits of the decision of taxing authority, that authority must exercise its powers fairly, and there ought to be a basis for the exercise of such powers. A taxing authority is not entitled to pluck a figure from the air and impose it upon a taxpayer without some rational basis for arriving at that figure and not another figure. Such action would be arbitrary, capricious and in bad faith. It would be an unreasonable exercise of power and discretion and that would justify the Court in intervening. In Republic vs. Institute of Certified Public Accountants of Kenya ex parte Vipichandra Bhatt T/A J V Bhatt & Company Nairobi HCMA No. 285 of 2006, it was held that in the absence of a rational explanation, one must conclude that the decision challenged can only be termed irrational within the meaning of the Wednesbury unreasonableness, was in bad faith and constitutes a serious abuse of statutory power since no statute can ever allow anyone on whom it confers a power to exercise such power arbitrarily and capriciously or in bad faith.”

22. The Appellant submitted that the first principle of GIRs to EAC CET provides that:“The titles of Sections, Chapters, and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the following provisions.” Emphasis Added.

23. The Appellant submitted that Note 1 (a) to Chapter 29 of the EAC CET provides that:“Except where the context otherwise requires, the headings of this Chapter apply only to:a.Separate chemically defined organic compounds, whether or not containing impurities”

24. The Appellant averred that goods are classified into HS Codes based on their objective properties and characteristics as defined by the wordings of the relevant tariff headings.

25. The Appellant averred that various chemical and scientific laboratory analyses, including one by the Respondent, on the consignments of Aji Nomoto imported by the Appellant are essentially MSG, thus classifiable as an organic chemical.

26. The Appellant submitted that the Heading 29. 22 provides for the Oxygen-function amino compounds. It provides the following:“29. 22 Oxygen-function amino-compounds Amino-alcohols, others than those containing more than one kind of oxygen function, their ethers, and esters, salts thereof,”

27. The Appellant submitted that the correct tariff classification of MSG (Appellant’s consignment) is HS Code 2922. 42. 00, which covers and bears the description of “Glutamic acids and its salts.” whose applicable rate of import duty is 0%.

28. The Appellant submitted that contrary to Respondent’s assertion, Ajinomoto is not a sauce, mixed condiments or mixed seasoning, however, the chemical composition of the Ajinomoto, its manufacturing process, and the results of the test samples confirm that it is MSG.

29. The Appellant submitted that that tax laws must be construed strictly in accordance with the express statutory provisions and there is no room for intendment or implication.

30. The Appellant submitted that Article 210(1) of the Constitution of Kenya instructs that:“no tax or licensing fee may be imposed, waived or varied except as provided by legislation.”

31. The Appellant relied on the holding in Cape Brandy Syndicate v I.R. Commissioners [1921] 1KB, where it was held that:“… in the Tax Act, one must look at what is clearly said. There is no room for any intendment. There is no equity in tax. There is no presumption as to a tax. Nothing is to be read in; nothing is to be implied. One can only look fairly at the language used.”

32. The Appellant submitted that the heading 2103 only applies to “sauces, mixed condiments, and mixed seasoning,” and it does not extend to chemically defined organic compounds such as MSG, which are expressly covered under the heading 29. 22.

33. The Appellant submitted that Article 47 of the Constitution provides“that every person has the right to administrative action that is expeditious, efficient, lawful, reasonable, and procedurally fair.”

34. The Appellant submitted that the Respondent as a statutory body empowered under Section 5 (1) of the EACCMA, as read together with Section 13 of the Kenya Revenue Authority Act, is required to exercise its power to administer custom law and collect customs duties on behalf of the Government of the Republic of Kenya in a manner that does not violate the Appellant’s right to fair administrative action, such as legitimate expectation.

35. The Appellant relied on the South African case of National Director of Public Prosecutions v Phillips and Others 2002 (4) SA 60 (W) where Heher J said as follows:“The law does not protect every expectation but only those which are 'legitimate'. The requirements for the legitimacy of the expectation include the following:i.The representation underlying the expectation must be 'clear, unambiguous and devoid of relevant qualification': De Smith, Woolf and Jowell (op cit [Judicial Review of Administrative Action 5th ed] at 425 para 8-055). The requirement is a sensible one. It accords with the principle of fairness in public administration, fairness both to the administration and the subject. It protects public officials against the risk that their unwitting ambiguous statements may create legitimate expectations. It is also not unfair to those who choose to rely on such statements. It is always open to them to seek clarification before they do so, failing which they act at their peril.ii.The expectation must be reasonable: Administrator, Transvaal v Traub (supra [1989 (4) SA 731 (A)] at 756I - 757B); De Smith, Woolf and Jowell (supra at 417 para 8-037).iii.The representation must have been induced by the decision-maker: De Smith, Woolf, and Jowell (op cit at 422 para 8-050); Attorney General of Hong Kong v Ng Yuen Shiu [1983] 2 All ER 346 (PC) at 350h - j.iv.The representation must be one which it was competent and lawful for the decision-maker to make without which the reliance cannot be legitimate: Hauptfleisch v Caledon Divisional Council 1963 (4) SA 53 (C) at 59E - G.”

36. The Appellant further relied on the case of Republic v Kenya Revenue Authority Ex Parte M-Kopa Kenya Limited [2018] eKLR that expounded on the principle of legitimate expectation as was appreciated in Keroche Breweries Limited vs Kenya Revenue Authority & 5 Others Nairobi HCMA No. 743 of 2006[2007) KLR 240 wherein it was held that:“…. Legitimate expectation is based not only on ensuring that legitimate expectations by parties are not thwarted but on a higher public interest beneficial to all, including the Respondents, which is the value or the need of holding authorities to promises and practices they have made and acted on and by so doing upholding responsible public administration. This enables people affected to plan their lives with a sense of certainty, trust, reasonableness, and reasonable expectation. An abrupt change, as was intended in this case, targeted at a particular company or industry is certainly an abuse of power. Stated simply, legitimate expectation arises, for example, when a member of the public, as a result of a promise or other conduct, expects that he will be treated in one way and the public body wishes to treat him or her in a different way…Public authorities must be held to their practices and promises by the courts, and the only exception is where a public authority has a sufficient overriding interest to justify a departure from what has been previously promised….To ascertain whether or not the respondent’s decision and the intended action is an abuse of power, the court has taken a fairly broad view of the major factors such as abruptness, arbitrariness, oppressiveness, and the quantum of the amount of tax imposed retrospectively and its potential to irretrievably ruin the applicant. All these are traits of abuse of power. Thus, I hold that the frustration of the applicant’s legitimate expectation based on the application of tariff amounts to abuse of power.”

37. The Appellant submitted that the Respondent issued a Tariff Classification Ruling No. 2016/CUS/V&T/TAR1/RUL/645, which provided that MSG is classifiable under HS Code 2922. 42. 00. The Appellant averred that the ruling was clear and unambiguous.

38. The Appellant submitted that by dint of the said Ruling, the Respondent committed itself to classify MSG under HS Code 2922. 42. 00.

Appellant’s Prayers 39. The Appellant prays for orders that:a.The Appeal be and is hereby allowed;b.The Respondent’s decision under review of upholding its demand for short levying of taxes dated 19th January 2024 be and is hereby set aside in its entirety;c.That the costs of the Appeal be awarded to the Appellant; and,d.That any other or further remedies the Tribunal deems just and reasonable.

The Respodent’s Case 40. The Respondent’s case is premised on its;a.Statement of Facts dated and filed on 28th March 2024 together with the documents attached thereto; and,b.Written submissions dated 31st July 2024 and filed on 2nd August 2024.

41. The Respondent averred that it is settled law that tax statutes must be interpreted strictly. The Respondent relied in the case of Cape Brandy Syndicate vs. Inland Revenue Commissioners (1920) 1 KB 64 stated at page 240: notes;“..in a taxing Act, one has to look merely at what is clearly said. There is no room for intendment as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used ...If a person sought to be taxed comes within the letter of the law he must be taxed; however great the hardship may appear to the judicial mind to be. On the other hand, if the Crown, seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however apparently within the spirit of the law the case might otherwise appear to be.”

42. The Respondent submitted that the legal regime guiding the HS classification of goods in East Africa is the East Africa Community Common External Tariff as read together with the World Customs Organisation Explanatory Notes.

43. The Respondent submitted that this position was upheld by this Honorable Tribunal who quoted the CET and WCO Explanatory Notes ·with acceptance in Engineering Supplies 2001 Limited v Commissioner Domestic Taxes and Keroche Breweries Limited vs. Commissioner of Domestic Taxes.

44. The Respondent further relied on the case of Wiener S.I. GmbH vs. Hauptzollamt Emmerich wherein it was noted,“the classification of goods in the Common Customs Tariff is guided by some basic principles of interpretation to which the Court consistently and constantly refers: in the interests of legal certainty and ease of verification, the decisive criterion for the classification of goods for customs purposes is in general to be sought in their objective characteristics and properties, as defined in the relevant headings of the Common Customs Tariff and the notes to sections or chapters …….however, ... There are some further criteria which may, or may not, be relevant for classification purposes....One such criterion is the intended use of a product…..the intended use of a product may constitute an objective criterion for classification if it is inherent in the product, and if that inherent character can be assessed on the basis of the product's objective characteristics.”

45. The Respondent also relied on the case of the Indian case of AjiNomoto India Private Limited vs. Commissioner of Central Excise, Chennai-II where the court noted,“it is an accepted principle of classification that the goods should be classified according to their popular meaning or as they understood in their commercial sense and not as per the scientific or technical meaning." That is..."how is the product identified by the class or section of people dealing with or the product is also a test”

46. The Respondent averred that in AjiNomoto India Private Limited the issue in contention was whether Ajitide was classifiable as a food additive or as a food preparation and therefore, whether intended use was an appropriate and objective parameter to informing the classification exercise.

47. The Respondent submitted that the application of intended use in classification was recognized in Tax Appeal 1 of 2012 Proctor & Allan (E.A) Limited vs. Commissioner of Income Tax [2014] eKLR (1), where the court in evaluating the appropriate heading where there is a conflict between use of a product and the objective characteristics and properties noted,“It is the conclusion of this court that in the light of the Certificate of Analyses that were submitted by both the Appellant and the Respondent, the court had little choice but to look at the intended purpose of the vitamin premix with a view to establishing whether it had been classified under the correct Heading.”

48. The Respondent averred that in Proctor & Allan (E.A) Limited, the court considered the peculiarities of the case and determined that the intended use of the product was the most effective examination criteria for determining the appropriate HS code.

49. The Respondent further relied on the case of Tat No. 1317 of 2022 Coffee Management Services Limited vs. Commissioner of Domestic Taxes which also recognized the intended use principle as a good is understood in its commercial sense writes;“it is the Tribunal’s view that the inclusion of boron and zinc in Biofol Triple Max and Biofol Boron Max as part of the fortification for the fertiliser does not change the use of the products ...... based on the foregoing, the Tribunal finds that the Respondent was not justified in re-classifying both Biofol Triple Max and Biofol Boron Max.”

50. The Respondent averred that the Appellant admitted that Aji Nomoto is used to enhance umami flavor in foods making them taste savorer and more delicious intensifying umami test without adding its own distinct taste.

51. The Respondent submitted that Heading 21. 03 covers:“Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard.”

52. The Respondent submitted that contrary to the Appellant’s assertion, it arrived at the classification by applying GIR 1 and using the heading under 21. 03 as a guide, specifically, the phrase ‘preparations thereof’.

53. The Respondent submitted that the GIR rules notes in a sequential manner as applicable to the dispute at hand, as herein below:i.Rule 1 begins therefore by establishing that the titles are provided ‘for ease of reference only’. They accordingly have no legal bearing on classification.ii.The rule provides that classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes.

54. The Respondent submitted that the Collins dictionary defines preparation as“the process of getting something ready for use or for a particular purpose or malting arrangements for something.”

55. The Respondent submitted that the intended applicably of Aji Nomoto is inherent in the product. That is, the umami characteristic of the Aji Nomoto is an inherent characteristic of product.

56. The Respondent averred that to promote consistency in customs and furtherance of the public interest as espoused in Coffee Management case (supra) that common and commercial sense shall prevail in classification disputes under the harmonized system.

The Respondent’s Prayers 57. The Respondent prayed that the Tribunal;a.Upholds that the Respondent’s decision to uplift taxes was proper and in conformity with the provisions of the Law; and,b.That the Appeal be dismissed with costs.

Issues For Determination 58. The Tribunal having considered the pleadings of both parties, the testimony of the Respondent’s witness and submissions made by both parties, is of the view that the issue that calls for its determination is:Whether the Respondent erred in reclassifying the Appellant’s imports from HS Code 2922. 42. 00 to 2103. 90. 00.

Analysis And Findings 59. The Respondent carried out a review of the Appellant’s imports to ascertain compliance with import duty and VAT.

60. The Respondent averred that its review revealed a short levy of taxes as the Appellant had classified the imports under Tariff 2922. 42 which attracts 0% duty instead of Tariff 2103. 90. 00 which attracts 35% duty rate.

61. The Appellant Countered that the Respondent failed to adhere to the General Interpretation Rules for the classification of goods when it sought to classify the Appellant’s consignment in a generalized Heading HS 2103. 90. 00 instead of properly classifying the consignment under a more specific and descriptive code HS 2922. 42. 00

62. The crux of the matter is the determination of the correct classification of the Appellant’s import, while the Respondent contends that classification of the product should be based on the intended use, the Appellant posits that the imports should be classified in accordance with their composition as determined by laboratory test results.

63. The Respondent posited that based on the product label, the intended use of Aji Nomoto is to enhance umani flavour in food. That consequently, from a commercial lens, the purposes of Aji Nomoto for both the importer and its local users is categorically and unequivocally to intensifying umami test in food without adding its own distinct taste.

64. The Appellant submitted that its consignment was properly classified under Tariff 2922. 42. 00 given that the chemical analysis issued by the manufacturer Ajinomoto Do Brasil industria E Comercio De Alimentos Ltd, the certificate of conformity issued by the Kenya Bureau of Standards (KEBS) and the laboratory test results from the KRA laboratory performed on an earlier consignment of similar products confirmed that the imported product was Monosodium Glutamate MSG. That MSG is classifiable under HS Code 2922. 42. 00.

65. The Appellant averred that the Respondent had through its Manager Inspection and Testing Centre conducted an analysis of the Appellant’s import and vide a report dated 1st September 2023 advised that the imported product was found to be crystalline white powder with typical characteristics of a pure monosodium glutamate covered under Heading 29. 22 which covers Oxygen-function amino-compounds. The Appellant wondered why the Respondent was departing from its own finding without providing a reasonable basis for the departure.

66. During the hearing, the Respondent’s witness Ms. Stella Wangeci testified that based on the product label of the Appellant’s import and the directions of use thereof, it was established that Ajinomoto Umami Seasoning is a food seasoning added when preparing or serving the dish. That it is used to season meat soups, fish, salads and any salted dishes.

67. It was the Respondent’s witness further testimony that based on the product description it was determined that the appropriate classification for the imports was under Tariff 2103. 90. 00 which covers sauce and preparations thereof, mixed condiments and mixed seasonings mustard flour and meal and prepared mustard.

68. The Tribunal sighted the product label and noted that the product was described as Ajinomoto umami seasoning, the Tribunal further noted that the same label had the product composition indicated as Monosodium glutamate.

69. The Tribunal further noted that the Respondent’s laboratory analysis report dated 1st September 2023 and attached in evidence by the Appellant stated in part:“Based on the above information, the samples tasted are therefore considered to be Monosodium glutamate used to enhance flavour in some food items, classified in EAC/CET HS Code 2922. 42. 00. In this regard, the declared EAC/CET HS Code 2922. 42. 00 is in agreement with laboratory findings.”

70. The Tribunal therefore applied the rules of interpretation of the Harmonized System to determine the correct classification of the imports. In the cascade of Rules provided in the GIRs, where 2 or more Headings seem to apply, the one which provides the most specific description of the product in question should be used. This means that a Heading which names the actual product should be used in preference to one which only names a category to which the product could belong. The Rule to be considered by the Tribunal in this case is Rule 3(a), which provides that:“..the Heading which provides the most specific description shall be preferred to headings providing a more general description.”

71. The Respondent’s preferred HS Code 2103. 90. 00 provides a generalized description of the Appellant’s product, placing the product under ‘Other’ within Heading 2103 which states:“Sauces and preparations therefor; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard.”

72. The Appellant’s imports having been ascertained to be Monosodium Glutamate by the manufacturer’s chemical analysis as well as the Respondent’s own laboratory report, the Tribunal is persuaded that HS Code 2922. 42 provides a more specific description of the Appellant’s import based on its established composition, as it covers Glutamic acid and its salts.

73. The Tribunal reiterates the finding in the case of Beta Health Care International Ltd vs. Commissioner of Customs Services (Misc. App. No.4 of 2009) where the court emphasized that in classification of a product, its active ingredients should be of paramount consideration. The court stated thus;“Having evaluated the opposing positions taken by the Applicant and the pharmaceutical products ..” Respondent in regard to whether the pharmaceutical products that are subject of this ruling are medicaments or food supplements, I am of the considered opinion that in determining whether the pharmaceutical products are medicines or nutritional supplements, what should be of paramount consideration is the active ingredients that constitute the said pharmaceutical products”

74. In light of the above, it is the Tribunal’s finding that the Respondent erred in reclassifying the Appellant’s imports form Tariff 2922. 42. 00 which provides a more specific description of the imports to Tariff 2103. 90. 00 which provides a generalized categorization of the imports without reasonable cause.

Final Decision 75. The upshot of the foregoing is that the Appeal succeeds, consequently, the Tribunal makes the following Orders: -a.The Appeal be and is hereby allowed;b.The Respondent’s Review Decision dated 19th January 2024 be and is hereby set aside; and,c.Each Party to bear its own costs.

76. It is so ordered.

DATED AND DELIVERED AT NAIROBI THIS 4TH DAY OF OCTOBER 2024ROBERT M. MUTUMA- CHAIRMANDR. TIMOTHY B. VIKIRU - MEMBERJEPHTHAH NJAGI - MEMBERMUTISO MAKAU - MEMBERDELILAH K. NGALA - MEMBER