Automated Summary
Key Facts
The Appellant, Greatway Logistics Kenya Limited, a registered petroleum products trader, was issued an additional VAT assessment of Kshs. 4,893,588.57 for January 2021 on 15 September 2021. The Appellant lodged an objection on 18 July 2022, which was rejected by the Respondent (Commissioner of Domestic Taxes) on 7 September 2022. The Appellant then filed a Notice of Intention to Appeal on 3 October 2022 but failed to submit a formal Notice of Appeal as required by Section 13(1) of the Tax Appeals Tribunal Act. The Tribunal determined that the appeal was incompetent due to non-compliance with procedural requirements, specifically the absence of a Notice of Appeal preceding the Memorandum of Appeal filed on 6 December 2022.
Tax Type
Value Added Tax (VAT)
Issues
- The Tribunal must assess whether the Respondent's rejection of the Appellant's input VAT for January 2021, based on claims made outside the 6-month statutory period under Section 17 (2) of the VAT Act 2013, was legally justified. The Appellant argued the inputs were genuine and timely, while the Respondent cited procedural non-compliance and insufficient documentation to rectify income variances.
- The Tribunal must determine if the Appellant's appeal was properly lodged in accordance with the procedures outlined in Section 13 of the Tax Appeals Tribunal Act. The Appellant filed its Memorandum of Appeal on 6th December 2022 without first submitting a Notice of Appeal within the 30-day statutory period following the Respondent's decision on 7th September 2022, rendering the appeal potentially invalid.
Tax Years
2021
Holdings
The Tribunal determined that the appeal was invalidly lodged as the Appellant failed to submit a Notice of Appeal within the required 30 days of the Respondent's decision rejecting the objection on 2022-09-07, per Section 13(1) of the Tax Appeals Tribunal Act. The appeal was struck out due to non-compliance with statutory procedures.
Remedies
- The Appeal be and is hereby struck out.
- Each party to bear its own costs.
Tax Issue Category
- Input Vs. Output Vat
- Other
Legal Principles
The Tribunal applied the Literal Rule in interpreting Section 13 of the Tax Appeals Tribunal Act, emphasizing strict adherence to the statutory language without room for implication or equitable construction. It cited the principle that taxing legislation must be construed with perfect strictness, as established in Cape brandy Syndicate vs. LR. Commissioners [1921] 1KB and Equity Group Holdings Limited vs. Commissioner of Domestic Taxes [2021] eKLR.
Disputed Tax Amount
4893588.57
Precedent Name
- Commissioner of Income Tax vs. Lerematesho Ltd
- Kenya Revenue Authority vs. Man Diesel & Turbo Se, Kenya
- Highlands Mineral Water Limited vs. Commissioner of Domestic Taxes
- Digital Box Limited vs. Commission of Investigations and Enforcement
Cited Statute
- Value Added Tax Act, 2013
- Kenya Revenue Authority Act, 1995
- Tax Appeals Tribunal Act
- Tax Procedures Act
Judge Name
- Mutiso Maku
- Robert M. Mutuma
- Elishah N. Njeru
- Boniface K. Terer
- Dr. Walter Ongeti
Passage Text
- In a taxing Act one has to look at what is clearly said. There is no room for any intendment. There is no equity about a tax.
- the Tribunal finds that the Appeal herein is incompetent and untenable in law.
- the instant Appeal before it cannot be deemed as valid unless the same is instituted by lodging of a Notice of Appeal, such failure is fatal on the Appeal.