Tetra Pak Limited v Kenya Revenue Authority [2020] eKLR

Key Facts

Tax Type

Issues

• The court examined the Petitioner's delay in filing the amendment. The Petitioner attributed the delay to ongoing negotiations and a prior judge's ruling (Bwonong'a J) allowing urgent prosecution of the petition from 15th September, 2019. The court found the delay reasonable, as the Respondent did not demonstrate prejudice, and the amendment was necessary to resolve all grievances in a single proceeding, avoiding the need for a new case.
• The court considered whether the amendment changing the rate of interest constitutes a new issue. Counsel for the Respondent conceded that the Petitioner had initially requested interest, so the court ruled that the rate adjustment is not a new issue but a matter to be resolved during the hearing. The amendment was deemed necessary to clarify the terms of the refund agreement.
• The court addressed whether the amendment to include Hellmann Worldwide Logistics as a second respondent, in response to Kenya Revenue Authority's fraud allegations, is permissible under the Mutunga Rules. The Petitioner argued that the new respondent is necessary to respond to the fraud claims, supported by a prior case (Total Kenya Limited v Kenya Revenue Authority [2018] eKLR). The Respondent opposed, claiming it introduces a new cause of action, but the court allowed the amendment as the respondent is a necessary party to address the fraud allegations.

Holdings

• Costs shall abide the outcome of the petition.
• The Petitioner is allowed to amend his petition dated 28th September, 2012 in the terms of the draft amended petition dated 10th December, 2019 annexed to the application dated 10th December, 2019.
• The amended petition shall be deemed duly filed upon payment of the necessary court fees which should be done within 7 days from the date of the delivery of the ruling. The amended petition to be filed through the Judiciary E-filing System.
• This being an old matter, the parties are directed to take a mention date for issuance of further directions on the date of the delivery of the ruling.
• Upon being served with the amended petition, the Respondent will, if need be, file and serve a response to the same within 14 days.

Remedies

• Parties are directed to take a mention date for issuance of further directions on the date of the delivery of the ruling.
• The Petitioner is allowed to amend his petition dated 28th September, 2012 in the terms of the draft amended petition dated 10th December, 2019 annexed to the application.
• The amended petition shall be deemed duly filed upon payment of the necessary court fees within 7 days from the date of the delivery of the ruling. The amended petition to be filed through the Judiciary E-filing System.
• Costs shall abide the outcome of the petition.
• Upon being served with the amended petition, the Respondent will, if need be, file and serve a response to the same within 14 days.

Tax Issue Category

Legal Principles

• The court applied Rule 18 of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedures Rules (Mutunga Rules) to allow amendment of pleadings in constitutional petitions, emphasizing that amendments should be permitted if they assist the court in determining the real questions in controversy without introducing new or inconsistent causes of action.
• The court referenced the necessity of joining a party (Hellmann Worldwide Logistics) to address allegations of fraud, citing the principle that a party accused of fraud must be included in proceedings to respond to such claims, as established in Total Kenya Limited v Kenya Revenue Authority [2018] eKLR.

Precedent Name

• Lalji t/a Vakkep Building Contractors v Carousel Limited
• Elijah Kipngeno Arap Bii v Kenya Commercial Bank Limited
• Isaac Awuodo v Surgipharm Limited & another
• Dolphin Transporters Limited v Bank of India Limited
• Merry Beach Limited v Barclays Bank of Kenya Limited & another
• Total Kenya Limited v Kenya Revenue Authority
• Joseph Ochieng & 2 others v First National Bank of Chicago

Cited Statute

Judge Name

Passage Text

• "(a) The Petitioner is allowed to amend his petition... (b)... deemed duly filed upon payment of fees... (c)... file a response within 14 days... (d) Costs abide the outcome... (e)... parties are directed to take a mention date for further directions."
• "...powers of the court to allow amendment is to determine the true, substantive merits of the case; amendments should be timeously applied for; power to so amend can be exercised by the court at any stage of the proceedings (including appeal stages); that as a general rule, however late, the amendment is sought to be made it should be allowed if made in good faith provided costs can compensate the other side; that the proposed amendment must not be immaterial or useless or merely technical; that if the proposed amendments introduce a new case or new ground of defence it can be allowed unless it would change the action into one of a substantially different character which could more conveniently be made the subject of a fresh action; that the plaintiff will not be allowed to reframe his case or his claim if by an amendment of the plaint the defendant would be deprived of his right to rely on Limitation Acts."
• "In this case there is no doubt at all that the respondent in its replying affidavit to the motion brought to the fore, in great details and specificity the allegations of fraud... the appellant did not bother to enjoin in the proceedings its agent who was in a better position to counter, if at all, the allegations of fraud attributed to it as the appellant by the respondent."