Gichengo v Commissioner of Investigations and Enforcement [2024] KETAT 622 (KLR)

Gichengo v Commissioner of Investigations and Enforcement (Appeal E026 of 2023) [2024] KETAT 622 (KLR) (22 March 2024) (Ruling)

Neutral citation: [2024] KETAT 622 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Appeal E026 of 2023

E.N Wafula, Chair, M Makau, EN Njeru, E Ng'ang'a & AK Kiprotich, Members

March 22, 2024

Between

Jane Mary Muthoni Gichengo

Appellant

and

Commissioner of Investigations And Enforcement

Respondent

Ruling

1. The Appellant moved the Tribunal vide a Notice of Motion application dated and filed under a Certificate of urgency on 11th October 2023 and supported by an Affidavit sworn by the Applicant, herself, on the 11th October, 2023 seeking for the following Orders: -a.That the Honourable Tribunal make a declaration that the Appellant’s Memorandum of Appeal, Statement of Facts and attached documents dated and file on 12th February 2023 outside the stipulated time wereduly filed and the same to be deemed as properly filed and duly on record.b.That the Honourable Tribunal make a declaration that the Respondent has been since served with the Appellant’s Memorandum of Appeal, Statement of Facts and attached documents which were served on 12th February 2023.

2. The application was premised on, inter alia, the following grounds as contained in the Affidavit in support of the application:-a.That the Appellant objected to the Respondent’s additional assessments dated 16th December, 2021 on the 6th April, 2022. b.That the Appellant received the objection decision dated 17th August, 2022 on the 30th January, 2023 when she applied for a Tax Compliance Certificate.b.That the Appellant filed a Notice of Appeal and Appeal documents on the 2nd February, 2023.

3. The Respondent opposed the application through a Replying Affidavit sworn by Sheila Odawa, an officer of the Respondent, on 18th October 2023 and filed on an even date. The grounds of opposition as highlighted in the Replying Affidavit were as follows: -i.That the Appellant having filed its Notice of Appeal, Memorandum of Appeal and Statement of Facts on 2nd February 2023, has not given any valid reasons as to why she filed the Appeal out of time in accordance with Section 13 (4) of the Tax Appeals Tribunal Act.ii.That Appellant has equally not given reason why the Appeal was filed without seeking leave of the Tribunal expressly.iii.That the Respondent issued the Objection decision on the 17th August 2022 and the Appellant lodged its Appeal on 2nd February 2023. iv.That the Appellant stated the reasons for the delay in filing the Appeal as she became aware of the Objection decision on 30th January 2023 when she applied for her Tax Compliance Certificate, no material evidence has been adduced to that effect.v.That the Appellant’s delay in filing the Appeal is inordinate and no justifiable reason had been furnished to demonstrate the delay.vi.That equity aids the vigilant and not the indolent as demonstrated by the Appellant’s conduct in this matter.

4. The Respondent in its written submissions dated 24th October 2023 and filed on 25th October 2023 identified three issues for determination, namely;i.Whether the Appellant’s application has been brought without undue delay;ii.Whether there are reasonable circumstances demonstrated to warrant an order for enlargement of time; andiii.Whether the Respondent will suffer any prejudice if the application is allowed.

5. The Respondent submitted that the Appellant had 30 days of the Commissioner’s decision issued on 17th August 2022 to lodge its Appeal. The delay by the Appellant was inexcusable for the reason that the Appellant had all the time to lodge its Appeal but failed to so do.

6. The Respondent submitted that the Appellant has not given any valid reasons for her failure to file an Appeal within the statutory timelines.

7. The Respondent submitted that it is impractically impossible for the Appellant who actively trades in her name to have stayed for six (6) months without accessing her emails.

8. The Respondent relied on the provisions of Section 13 (3) and (4) of the TAT Act and Rule 10 of the Tax Appeals Tribunal (Procedure) Rules 2015 and submitted the Appellant has not complied with these provisions of the law.

9. The Respondent submitted that it would suffer great prejudice if the application is granted as the Appellant is guilty of indolence for a period spanning over one year.

10. The Respondent relied on the following case law;i.Income Tax Appeal No. 31 of 2017 Commissioner of Domestic Taxes vs. Mayfair Insurance Company Limited [2017] eKLR;ii.TAT No. 377 of 2019 Green County Construction Ltd vs. Commissioner of Domestic Taxes; andiii.TAT Appeal No. 107 of 2022 Sawa Sawa Company Limited vs. Commissioner of Domestic Taxes.

Analysis and Findings 11. The Appellant seeks for extension of time to file an Appeal out of time and to have the Notice of Appeal, Memorandum of Appeal and Statement of Facts together with the documents to be deemed as duly filed and served.

12. The Respondent issued its decision on 17th August 2022, however, the Appellant submitted that she learnt of the same on 30th January 2023 when she applied for the Certificate of Tax Compliance and subsequently filed the Notice of Appeal, Memorandum of Appeal and Statement of Facts on 12th February 2023.

13. Following the Appellant’s complaint of failure to receive the Objection decision issued on 17th August 2022, the Respondent did not indicate to the Tribunal how the said decision was served upon the Appellant, save the Respondent submitted that it was impractical for the Appellant not to have checked her emails for a period of six (6) months.

14. Accordingly, it would imply that the Respondent send the Objection decision or notified the Appellant via email. The Appellant’s email address to where the Objection decision was sent was neither indicated to the Tribunal nor in the Objection decision.

15. The Respondent has therefore not tendered any evidence to the satisfaction of the Tribunal to demonstrate how it served or notified the Appellant of the Objection decision considering the service or notification of the same is the core dispute herein.

16. Section 13 (3) and (4) of the Tax Appeals Tribunal Act, provide that:-“(3)The Tribunal may, upon application in writing, extend the time for filing the Notice of Appeal and for submitting the documents referred to in subsection (2).”“(4) An extension under subsection (3) may be granted owing to absence from Kenya, or sickness, or other reasonable cause that may have prevented the applicant from filing the notice of appeal or submitting the documents within the specified period.”

17. The Applicant’s application is premised on ground of ‘other reasonable grounds’, The Tribunal is persuaded that the failure to be served or being notified of the Objection decision is a reasonable ground that would prevent an Appellant from lodging an Appeal within the stipulated time.

18. Further, the Applicant stated that she lodged the Appeal on 12th February 2023 upon learning of the existence of the Objection decision on 30th January 2023. The Tribunal is persuaded that under the circumstances, the Appellant acted without undue delay.

19. It is noteworthy, that the Appellant cited the reason that it was not aware of the Respondent’s decision as the ground for failure to lodge its Appeal on time and/or make the present application sooner. The Tribunal, is persuaded that the grounds advanced by the Appellant are reasonable and excusable and deems the delay not to be inordinate.

20. The Tribunal noted that the Appellant had filed the Notice of Appeal, Memorandum of Appeal and Statement of Facts, in the Tribunal’s view, this does not render the Appeal as defective, since it’s either the granting of the leave or failure thereof that regularizes the Appeal and vice versa.

21. The Tribunal has powers within the law, on reasonable grounds being advanced to deem an Appeal that had been filed without leave as properly filed.

22. The Notice of Appeal and appeal documents were lodged by the Appellant in person and not by her appointed representative, whom is presumed to have command and understanding of the procedures before the Tribunal, unlike the Appellant and the Tribunal is minded to extend such benefit to the Appellant.

23. The Respondent submitted that it shall suffer prejudice if leave is granted, but has not demonstrated how it would suffer any prejudice.

24. It is the Tribunal’s considered view, that the Respondent shall not suffer any prejudice under the circumstances.

25. Consequently, the Applicant’s application is merited and therefore succeeds.

Disposition 26. Based on the afore mentioned, the Tribunal finds that the application dated 11th October 2023 is merited and accordingly makes the following orders: -a.That the Appellant be and is hereby granted leave to file the Appeal out of time.b.The Notice of Appeal, Memorandum of Appeal, and Statement of Facts all dated 1st February 2023 and filed on 2nd February 2023 be and are hereby deemed as properly filed and served.c.No orders as to costs.

27. It is so ordered.

DATED AND DELIVERED AT NAIROBI THIS 22ND DAY OF MARCH, 2024. ERIC NYONGESA WAFULA - CHAIRMANMUTISO MAKAU - MEMBERELISHAH N. NJERU - MEMBEREUNICE N. NG’ANG’A - MEMBERABRAHAM K. KIPROTICH - MEMBER