Kusasa Refining (Proprietary) Limited v Commissioner for the South African Revenue Services (56820/2021) [2023] ZAGPPHC 640; [2023] 4 All SA 459 (GP); 86 SATC 494 (1 August 2023)

Kusasa Refining (Proprietary) Limited v Commissioner for the South African Revenue Services (56820/2021) [2023] ZAGPPHC 640; [2023] 4 All SA 459 (GP); 86 SATC 494 (1 August 2023)

The court found that SARS had a statutory duty under section 42 of the Tax Administration Act to keep the applicant informed of the audit's progress and to provide a report indicating the stage of completion. The respondent failed to provide any feedback or progress updates to the applicant after 22 June 2021, despite repeated requests. This failure constituted an unreasonable delay and a failure to take a decision, which is reviewable under section 6(2)(g) of PAJA. The court held that the respondent's conduct adversely affected the applicant's rights, including the suspension of VAT refunds and severe financial prejudice. The principles of natural justice and procedural fairness require...

Citation
[2023] ZAGPPHC 640
Parties
Applicant: Kusasa Refining (Proprietary) Limited; Respondent: Commissioner for the South African Revenue Services
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
1 August 2023
Case Number
56820/2021
Procedural Posture
Review Application / Judgment
Outcome
Application granted. The respondent's failure to take a decision to finalise the VAT audit is reviewed and set aside.
Judges
Sardiwalla
Legal Topics
Tax Administration Act, Vat Audit, Judicial Review, Procedural Fairness, Unreasonable Delay
Tax Law Administrative Law Tax Administration Act Vat Audit Judicial Review Procedural Fairness Unreasonable Delay

Case Brief

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Parties

Kusasa Refining (Proprietary) Limited

Applicant

Commissioner for the South African Revenue Services

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the respondent's failure to take a decision to finalise the VAT audit constitutes administrative action subject to judicial review.
  2. 2 Whether the respondent complied with its statutory duty to keep the applicant informed of the audit's progress under section 42 of the Tax Administration Act.
  3. 3 Whether the delay in finalising the audit and withholding VAT refunds prejudiced the applicant's rights and business operations.

Ratio Decidendi

The court found that SARS had a statutory duty under section 42 of the Tax Administration Act to keep the applicant informed of the audit's progress and to provide a report indicating the stage of completion. The respondent failed to provide any feedback or progress updates to the applicant after 22 June 2021, despite repeated requests. This failure constituted an unreasonable delay and a failure to take a decision, which is reviewable under section 6(2)(g) of PAJA. The court held that the respondent's conduct adversely affected the applicant's rights, including the suspension of VAT refunds and severe financial prejudice. The principles of natural justice and procedural fairness require...

Court Disposition

Application granted. The respondent's failure to take a decision to finalise the VAT audit is reviewed and set aside.

Orders

  • The respondent's failure to take a decision whether to finalise the VAT audit of the applicant's 01/2019 to 02/2021 VAT periods is reviewed and set aside.
  • The matter is referred back to the respondent with direction that he must within ten days take a decision whether or not to finalise the audit.