Mwangi v Commissioner of Domestic Taxes [2022] KEHC 16026 (KLR)

Mwangi v Commissioner of Domestic Taxes (Income Tax Appeal E071 of 2021) [2022] KEHC 16026 (KLR) (Commercial and Tax) (2 December 2022) (Ruling)

Neutral citation: [2022] KEHC 16026 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Income Tax Appeal E071 of 2021

A Mabeya, J

December 2, 2022

Between

Ismael Gaite Mwangi

Appellant

and

Commissioner of Domestic Taxes

Respondent

Ruling

1. This ruling is with respect to the application dated 19/1/2020 by the appellant. The same was brought under sections 1A,1B, 3,3A and 78(1)(d) of the Civil Procedure Act, Order 42 rule 27, Order 51 of the Civil Procedure rules, Section 53 of the Tax Procedures Act 2015, section 32(1) of the Tax Appeals Tribunal Act 2013, rule 51 Tax Appeals Tribunal (appeals to the high court) Rules 2015 and all other enabling provisions of the law.

2. The application seeks leave to file and adduce additional evidence as per the supporting affidavit at paragraph 15. The application is supported by the affidavit sworn by the appellant Ismael Gaite Mwangi as is premised on the grounds on the face of the application.

3. The applicant’s case was that, since his case at the Tribunal was heard virtually, his assistant was denied enough time to present all the evidence to the Tribunal. That he did not have advice from legal counsel on the importance of production of documents and witness statements. That his business would suffer irreparable harm as the Tribunal had upheld the respondent’s assessment of Kshs. 58,480,032/- which he could not raise.

4. The application was opposed. The respondent filed grounds of opposition dated 8/3/2022 stating that the appellant had raised the same prayer which the Court had declined to grant. That provision of a witness statement or additional evidence in this Court is not provided for by the law. That the application was highly prejudicial as there would be no room for the respondent to review the document’s authenticity and that it would be a violation of section 56(2) of the tax procedures Act, 2015 (“the Act”).

5. The application was canvassed by way of written submissions which I have considered. The main issue for determination is whether the applicant has made out a case for grant of the orders sought.

6. It was the applicant’s submission that the Court has the discretion to grant leave to adduce new evidence in accordance to section 78 of the Civil Procedure Act. That the additional evidence was not prejudicial as the intention was to assist the Court reach a just and fair determination. Counsel submitted that the new evidence was not allowed before Tribunal owing to the manner in which the appeal was conducted.

7. On his part, the respondent submitted that contrary to the applicant’s assertions, the applicant was granted an opportunity to adduce evidence and call witnesses at the Tribunal but failed to do so. That this being a second appeal, the Court was limited to issues of law only in terms of section 56 of the Act and thus could not review the evidence.

8. The appellant invoked section 78 of the Civil Procedure Act Cap 21 Laws of Kenya which provides that:“(1)Subject to such conditions and limitations as may be prescribed, an Appellate Court shall have power;(d)To take additional evidence or to require the evidence to be taken;” 9. Rule 15 of the Tax Appeals Tribunal (Appeals to the High Court) Rules, 2015 provides:“The Court may, at the time of hearing of an appeal, admit other documentary or oral evidence not contained in the statement of facts of the appellant or respondent should it consider it necessary for determination of the appeal”.

10. It is clear from the foregoing, that there is jurisdiction to allow the admission of evidence in an appeal. This being a second appeal, the question is whether the court is limited to matters of law only in terms of section 56 of the Act. That section provides: -“An appeal to the High Court or to the Court of Appeal shall be on a question of law only.”

11. What amounts to matters of law was considered inJohn Munuve Mati v Returning Officer Mwingi North Constituency & 2 others [2018] eKLR where the court held as follows: -“As far as facts are concerned, our engagement with them is limited to background and context and to satisfy ourselves, when the issue is raised, whether the conclusions of the trial judge are based on the evidence on record or whether they are so perverse that no reasonable tribunal would have arrived at them. We cannot be drawn into considerations of the credibility of witnesses or which witnesses are more believable than others; by law that is the province of the trial court.”

12. The applicant’s reasons for seeking leave for additional evidence was that he was unable to adduce the same as his appeal before the Tribunal was heard virtually and that he was not represented by Counsel. The respondent submitted that the appellant was accorded sufficient opportunity to adduce evidence and call witnesses.

13. In Wanjie & Others v. Sakwa & Others [1984] KLR 275, Chesoni JA observed that: -“This rule is not intended to enable a party who has discovered fresh evidence to import it nor is it intended for a litigant who has been unsuccessful at the trial to patch up the weak points in his case and fill up omissions in the Court of Appeal. The Rule does not authorize the admission of additional evidence for the purpose of removing lacunae and filing in gaps in evidence. The appellate court must find it needful. Additional evidence should not be admitted to enable a plaintiff to make out a fresh case in appeal. There would be no end to litigation if the rule were used for the purpose of allowing the parties to make out a fresh case or to improve their case by calling further evidence. It follows that the power given should be exercised very sparingly and great caution should be exercised in admitting fresh evidence”.

14. In view of the foregoing, leave to grant additional evidence is at the court’s discretion. I have noted the reasons advanced by the appellant and note that the said evidence was in the possession of the appellant during the trial at the Tribunal. The failure to have Counsel is not sufficient reason. There was no evidence that the applicant was prevented from seeking legal counsel before the trial. Further, virtual hearing is nowadays the preferred mode of disposing disputes. There is no evidence that the applicant sought physical hearing and was denied the same.

15. The Court has also considered the nature of the evidence sought to be introduced. The same is meant to bolster the applicant’s case. The view the Court takes is that, allowing the introduction of the expert evidence, the respondent would not have a right of reply and the same would be highly prejudicial to the respondent’s case. In the same breadth allowing the respondent to file a reply would be akin to starting a new trial all over again at the appellate stage.

16. In the premises, I find no merit in the application and the same is dismissed with costs.

17It is so ordered.

DATED AND DELIVERED AT NAIROBI THIS 2ND DAY OF DECEMBER, 2022. A. MABEYA, FCIArbJUDGE