Bidco Africa Limited v Commissioner of Customs and Border Control (Tax Appeal E179 of 2025) [2026] KETAT 17 (KLR) (9 February 2026) (Judgment)

Key Facts

Tax Type

Issues

• Whether the Respondent's demand for short levied taxes on crude sunflower oil was justified, considering the valuation method used, the Appellant's submission of transactional value evidence, and the Respondent's failure to substantiate its claimed variances under Section 122 of EACCMA and the Fourth Schedule.
• Whether the Respondent lawfully denied concessionary duty rates for 96 metric tonnes of white refined sugar imported on 26th October 2020 (outside the 8th October 2019 to 7th October 2020 DRS window), despite the Appellant's claim that delays were due to force majeure (e.g., COVID-19 restrictions) and its failure to apply for an extension under Regulation 6(3) of the EACCMA Duty Remission Regulations.
• Whether the Respondent lawfully demanded VAT on consignments the Appellant claimed were exported but for which official certificates (generated by the Respondent's iCMS/Simba systems) were missing, despite the Appellant providing supplementary documentation (invoices, bills of lading, etc.) and the Respondent's reliance on statutory requirements for zero-rating under the VAT Act and EACCMA Section 223.

Tax Years

• 2019
• 2020

Holdings

• The Tribunal set aside the assessment relating to undervaluation of crude oil, finding the Respondent's demand for short levied taxes on this issue was not justified due to unsubstantiated computations.
• The Tribunal upheld the VAT assessment on goods without proof of export, ruling the Appellant failed to provide statutory evidence (export certificates) to substantiate zero-rating claims despite supplementary documentation.
• The Tribunal upheld the assessment for importation of white refined sugar outside the DRS window, determining the Appellant cannot benefit from the duty remission scheme as the entry occurred after the statutory period expired without an extension.

Remedies

• The assessment relating to short levied taxes on importation of white sugar outside the DRS period is upheld.
• The assessment on VAT for goods without proof of export is upheld.
• The assessment relating to undervaluation of crude oil is set aside.
• Each party to bear its own costs.

Tax Issue Category

• Input Vs. Output Vat
• Other
• Customs Valuation / Classification

Legal Principles

• The decision upheld the Rule of Law by enforcing the legal requirement that duty remission under Legal Notice EAC/177/2019 was strictly time-bound (8 October 2019–7 October 2020). The Appellant's failure to apply for an extension despite delays (e.g., COVID-19) was deemed non-compliant with the law.
• The case examined whether the Appellant (importer) could be held vicariously liable for its licensed clearing agent's actions under EACCMA Section 148, which holds principals liable for agents' acts. The Tribunal found the Respondent justified in demanding taxes for some issues but not others.
• The Tribunal applied the burden of proof principle, noting the Appellant's provision of uncontradicted documentation (invoices, bank statements) to establish customs values, which shifted the onus to the Respondent to rebut. The Respondent failed to substantiate its claims, leading to the Tribunal's partial allowance of the appeal.

Disputed Tax Amount

Precedent Name

• Kenya Revenue Authority v Man Diesel & Turbo Se. Kenya
• Republic v Kenya Revenue Authority Ex-Parte: Cosmos Limited
• Republic v Kenya Revenue Authority Ex Parle Export Trading Company Limited
• Highlands Drinks Limited v Commissioner of Customs & Border Control
• PZ Cussoms East Africa Limited vs Kenya Revenue Authority
• PZ Cussons East Africa Ltd v Kenya Revenue Authority
• XRX Technologies Limited vs Respondent of Domestic Taxes
• Unilever Kenya Ltd v Commissioner of Domestic Taxes
• Commissioner of Customs v Doshi Ironmongers Ltd

Cited Statute

• Constitution Of Kenya, 2010
• Public Finance Management Act, 2012
• East African Community Customs Management (Remissions) Regulations, 2008
• Value Added Tax Act, Cap 476 Of The Laws Of Kenya
• Kenya Revenue Authority Act, Cap 469 Of The Laws Of Kenya
• East Africa Community Customs Management Act, 2004

Judge Name

• Billy Mijungu
• Dr. Timothy Vikiru Gitari
• Dominic K. Rono
• Bernadette
• Christine A. Muga

Passage Text

• The Tribunal therefore finds that the Respondent was justified in demanding for short levied taxes on the consignment imported out of the DRS window.
• The Tribunal finds and holds that the demand for short levied taxes based on unsubstantiated computations unsustainable in law and therefore the Respondent was not justified in demanding short levied taxes on undervaluation of crude sunflower oil.
• The Tribunal therefore finds that the Respondent was justified in its demand for short levied taxes on account of goods said to have been exported but whose proof of export was not established by the Appellant.