Standard Chartered Bank Kenya Limited v Commissioner of Domestic Taxes [2025] KETAT 170 (KLR)

Standard Chartered Bank Kenya Limited v Commissioner of Domestic Taxes (Tax Appeal E402 of 2024) [2025] KETAT 170 (KLR) (14 March 2025) (Judgment)

Neutral citation: [2025] KETAT 170 (KLR)

Republic of Kenya

In the Tax Appeal Tribunal

Tax Appeal E402 of 2024

CA Muga, Chair, BK Terer, EN Njeru & SS Ololchike, Members

March 14, 2025

Between

Standard Chartered Bank Kenya Limited

Appellant

and

Commissioner of Domestic Taxes

Respondent

Judgment

1. The Appellant is a limited liability company duly incorporated and registered in Kenya under the Companies Act. Its principal activity is provision of banking and financial services.

2. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws (hereinafter “the Act”). Under Section 5 (1) of the Act, the Kenya Revenue Authority is an agency of the Government for the collection and receipt of all tax revenue. Further, under Section 5(2) of the Act with respect to the performance of its functions under subsection (1), the Authority is mandated to administer and enforce all provisions of the written laws as set out in Part 1 and 2 of the First Schedule to the Act for the purposes of assessing, collecting and accounting for all revenues in accordance with those laws.

3. The Respondent carried out a returns review and during the process, it performed an analysis of purchases claimed by purchasers and sales declared by suppliers for the period 2019 to 2020. During the review, the Respondent discovered that there were inconsistencies between the returns filed by the Appellant's suppliers and invoices claimed by the Appellant for the period under review. In particular, the Respondent noted that the Appellant only paid Kshs 134,838,074. 00 instead of the actual amount Kshs 976,340,304. 00 leading to an underpayment of Kshs 841,502,229. 00.

4. Consequently, the Respondent vide a demand letter dated 26th June 2020 informed the Appellant that instalment taxes are imposed under Section 12 of the Income Tax Act, CAP 470 of the Laws of Kenya (hereinafter “ITA”) as read together with the Twelfth Schedule to the ITA and the total tax so estimated is payable in four (4) equal instalments in each respective due date. The Appellant lodged an objection to the demand vide a letter dated 29th June 2020.

5. The Respondent reviewed the Appellant's objection and issued its findings through a letter dated 27th February 2024 wherein it allowed Kshs 868,078,738. 00 but found that Kshs 1,492,415. 00 was due for payment. The Appellant being dissatisfied by the Respondent’s decision, lodged this Appeal vide a Notice of Appeal dated and filed on 28th March 2024.

The Appeal 6. The Appellant filed its memorandum of appeal dated 11th April 2024 on even date raising the following as its grounds of appeal:a.That the Respondent erred in fact and in law by recovering late payment penalties and interest of Kshs 45,489,854. 00 from an overpayment without communicating to the taxpayer of the liability in contravention of Section 89 of the Tax Procedures Act, CAP 469B of the Laws of Kenya (hereinafter “TPA”);b.That the Respondent erred in fact and in law by recovering penalties and interest from an overpayment that had not been ascertained in accordance with Section 47 of the TPA; andc.That the Respondent erred in fact and in law by denying the Appellant its right to apply for a waiver of the penalties and interest in contravention of Section 89(6) of the TPA.

Appellant’s Case 7. The Appellant relied on its statement of facts dated and filed on 11th April 2024 and also filed written submissions dated 12th November 2024 on even date.

8. The Appellant stated that it had a Corporate Tax (hereinafter “CIT”) overpayment of Kshs.832,944,755. 00 as per its 2019 self-assessment return filed on i-Tax on 19th June 2020. The Appellant, via an electronic mail dated 22nd June 2020 informed the Respondent its intention to utilize the overpayment to partially offset its second instalment tax liability for the year 2020.

9. According to the Appellant, the Respondent vide its demand notice dated 26th June 2020 contended that the Appellant could not utilize the 2019 overpayment unless and until the Appellant applied for a refund and the Respondent validated the application pursuant to Section 47 of the TPA. The Respondent therefore disregarded the Appellant’s utilization of the 2019 overpayment and demanded the full second instalment tax payable.

10. The Appellant responded to the demand notice vide a letter dated 29th June 2020 through which it conveyed its disagreement with the Respondent’s advice on the treatment of the 2019 overpayment based on its apparent misapprehension of Section 47 of the TPA and reiterated its right to utilize the overpayment against its 2020 second instalment liability. The Appellant further requested the Respondent to set aside the demand notice and update its tax records to reflect that the 2020 second instalment tax liability had been fully paid within the due date taking into account the utilisation of the 2019 overpayment to settle the same.

11. According to the Appellant, the Respondent failed to respond to the Appellant’s letter of 29th June 2020 and ceased to engage further on the matter. As a result of the Respondent’s failure to respond to the Appellant letter dated 29th June 2020, the Appellant was of the view that its position had prevailed and further, that the Respondent agreed with the arguments raised therein.

12. The Appellant filed it’s 2020 returns on i-Tax a year later, on 23rd June 2021. The returns reflected the Appellant’s overpayment of Kshs 80,623,837. 00 for the year 2020. Despite the Appellant’s position as outlined above with respect to the Respondent’s failure to respond to the letter of 29th June 2020, the Appellant, out of an abundance of caution and being apprehensive that the Respondent would not honour its intention to utilize the 2019 overpayment of Kshs 832,944,755. 00 against its 2020 second instalment liability, and, on a without prejudice basis, applied for a refund of both the 2019 and the 2020 overpayments of Kshs 832,944,755. 00 and Kshs 80,623,837. 00, respectively. Thus, the total amount sought through the refund application for both years was Kshs 913,568,592. 00.

13. It stated that the Respondent ascertained and approved a refund amount of Kshs 868,078,738. 00, out of the total claim of Kshs 913,568,592. 00. The Appellant established that the difference of Kshs 45,489,854. 00 not approved relates to penalties and interest imposed by the Respondent based on its perception that the Appellant had underpaid the 2020 instalment tax. Consequently, it emerged that the Respondent had disregarded the Appellant’s utilization of the 2019 overpayment against the 2020 instalment tax, and out of a total refund claim of Kshs 80,623,837. 00 for that year of income, the Respondent only approved an amount of Kshs 35,133,985. 00, net of penalty and interest computed on the perceived underpayment of instalment taxes. Aggrieved by the Respondent’s decision and reasons for disallowance of the CIT refund claim of Kshs 45,489,854. 00, the Appellant lodged this appeal.

14. As to whether the Respondent erred in fact and in law by recovering late payment penalties and interest of Kshs 45,489,854. 00 from an overpayment owed to the Appellant without due regard to Section 89 (3) of the TPA, the Appellant stated that section 89 of the TPA clearly outlines the procedure that applies to both the Commissioner and taxpayers in relation to penalties and interest imposed under tax laws. The Appellant observed that the Respondent failed to follow the procedure as stipulated under section 89(3) of the TPA which requires the Commissioner to communicate the demand in writing and further, to specify the due date for payment of the penalty, being at least 30 days after the date of the notification.

15. The Appellant stated that the Respondent failed to adhere to the provisions of the law. It relied on the case of Mangin v Inland Revenue Commissioner [1971] AC 739 where it was held as follows:‘...one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption so to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used.’ (Per Rowlatt, J in Cape Brandy Syndicate v Inland Revenue Commissioners [1921] 1 KB 64 at 71 approved by Viscount Simons LC in Canadian Eagle Oil Co. Ltd v Regeim [1945] 2 All ER 499, [1946] AC 119. ’

16. The Appellant maintained that the actions by the Respondent were therefore, not justified as they sought to deny the Appellant a portion of its validly claimed tax refund. It argued that the Respondent’s actions amount to unfair administrative action contrary to Article 47 of the Constitution of Kenya, 2010 (hereinafter “the Constitution”) which states that every person has the right to administrative action that is expeditious, efficient, lawful, reasonable and procedurally fair.

17. As to whether the Respondent erred in fact and in law by recovering penalties and interest from an overpayment that had not been ascertained in accordance with Section 47 (4) of the TPA, as it was then, the Appellant stated that the intention under Section 47 of the TPA was that taxpayers should only utilize overpayments after a refund application is ascertained in accordance with the relevant provisions therein, then it is only logical and procedurally fair that penalties and interest payable from overpayments would also only be due and recoverable once the refund is ascertained in line with Section 47 (4) of the TPA, as it was worded then.

18. The Appellant submitted that the Respondent misapprehended and misapplied Section 47 (4) of the TPA, as it was then, to the extent that it recovered penalties and interest from an overpayment that had not been ascertained.

19. The foregoing notwithstanding, the Appellant stated that at the time the Decision was communicated to the Bank in line with Section 47 (3) of the TPA, there was in place a tax amnesty under Section 37E of the TPA introduced by the Finance Act, 2023. It noted that the recently introduced Section 37E which came into effect on 1st September 2023 prohibits the Commissioner from recovering penalties and interest where all the principal tax due before 31st December 2022 has been settled.

20. According to the Appellant, penalties and interest amounting to Kshs 45,489,854. 00 qualified for remission under the tax amnesty. It added that in failing to ascertain the refund to the extent of the impugned penalty and interest, the Commissioner flagrantly disregarded the provisions of the law and recovered an amount that it was prohibited, in clear and unambiguous terms, from recovering. It asserted that in so doing, the Respondent infringed on the Appellant’s right to enjoy a benefit (amnesty) granted to it by law.

21. As to whether the Respondent erred in fact and in law by denying the Appellant its right to apply for a waiver of the penalties and interest in contravention of Section 89 (6) of the TPA, as it was then, the Appellant stated that the Respondent failed to allow the Appellant to challenge or seek recourse on the penalties and interest imposed by recovering the penalties and interest even before the overpayment was ascertained.

22. It argued that at the time when the penalties and interest were imposed, on 26th June 2021, it was an established practice that taxpayers could apply to the Commissioner for a waiver of the penalties and interest after settling the principal tax. It averred that this long-standing practice had been accepted by the Respondent and was indeed reasonable, fair and practical. The Appellant maintained that the Respondent undoubtedly created a legitimate expectation on the certainty of treatment of tax penalties and could not be allowed to give a contrary view unless there was an overriding change of law or other matters of inordinate public interest. It asserted that there had been no recent change in the law governing tax waivers which would warrant the Commissioner to deny the Appellant this right.

23. The Appellant asserted that Section 89 (6) the TPA, as it was then, granted taxpayers the right to seek a remission of penalties and interest imposed under a tax law, by providing as follows:“A person liable to a penalty or interest may apply in writing to the Commissioner for the remission of the penalty or interest payable and such application shall include the reasons for the application.’’

24. The Appellant noted that the above was the prevailing law prior to amendment by the Finance Act 2023 which repealed Section 37 and 89 (6) to 89 (8) of the TPA, and in effect abolished waivers of penalties and interest. The Appellant was of the view that the Respondent abrogated its right to pursue a waiver under Section 89 (6) of the TPA when the Respondent proceeded to recover the penalty and interest from the overpayment.

25. It argued that even if the penalties and interest were due and payable from the overpayment according to the decision, the same would have qualified for remission under the tax amnesty. Therefore, in the Appellant’s view, the Respondent’s actions are not justified as the Respondent seek to deny the Appellant its validly claimed CIT refund in contrast to the established practice and provisions of the law contrary to Article 47 of the Constitution.

26. In support of the appeal, the Appellant also relied on its written submissions wherein it submitted that the Respondent erred in fact and in law by recovering late payment penalties and interest of Kshs 45,489,854. 00 from an overpayment owed to it without due regard to Section 89 (3) of the TPA which requires the Respondent to notify a person liable to a penalty, in writing, specifying, inter alia, the due date for payment of the penalty being at least 30 days from the date of the notification. It cited the case of Republic v Commissioner of Domestic Taxes Exparte Sony Holdings Limited [2019] eKLR to submit that word "shall" when used in a statutory provision imports a form of command or mandate and it is not permissive. It also relied on the case of Mangin v Inland Revenue Commissioner [1971] AC 739 to submit that there is no presumption so to a tax and one has to look at the plain provision of the law.

27. The Appellant also submitted that the Respondent misapplied the law by recovering penalties and interest from an overpayment that had not been ascertained in accordance with Section 47 (4) of the TPA, as it was then. It relied on the case of Associated Provincial Picture Houses Limited v Wednesbury Corporation [1948] 1 KB 223, [1947] 2 All ER 680 and the case of Council of Civil Service Unions v Minister for the Civil Service (1985] AC374, (1984] 3 All ER 935 to support the position that an administrative decision should be reasonable and lawful but the Respondent’s decision failed to pass the test.

28. Finally, the Appellant cited the case of Keroche Industries Limited v Kenya Revenue Authority & 5 Others (2007) eKLR to support the position that administrative decision should not be characterised by abruptness, arbitrariness and oppressiveness.

29. Consequently, the Appellant prayed that the appeal be allowed; the impugned portion of the decision dated 27th February 2024 be set aside; and the costs of and incidental to this appeal be awarded to the Appellant.

Respondent’s Case 30. In response to the appeal, the Respondent filed its statement of facts dated 8th May 2024 on 9th May 2024. The Respondent also filed written submissions dated 9th October 2024 on even date.

31. The Respondent stated that it carried out a returns review and during the process, it performed an analysis of purchases claimed by purchasers and sales declared by suppliers were ran on the i-Tax system in respect of the period 2019 to 2020. During the said review, it discovered that there were inconsistencies between the returns filed by the Appellant's suppliers and invoices claimed by the company for the period 2019 to 2020.

32. The Respondent noted that the Appellant only paid Kshs 134,838,074. 00 instead of the actual amount Kshs 976,340,304. 00 leading to underpayment of Kshs 841,502,229. 00.

33. On 26th June 2020, the Respondent issued a demand notice reminding the Appellant that Instalment taxes are imposed under Section 12 of the ITA as read together with the Twelfth Schedule to the ITA and the total tax so estimated is payable in four (4) equal instalments in each respective due date. In addition, the Respondent stated that the provisions of section 12(3) of the ITA are also clear on the taxes that can be offset against the instalment taxes being the advance taxes paid under section 12A and the Withholding taxes paid under section 35 for corporate taxpayers.

34. The Appellant lodged an objection on 29th June 2020. The Respondent reviewed the Appellant's Objection and issued its decision dated 27th February 2024 wherein it allowed Kshs 868,078,738. 00 and found that Kshs 1,492,415. 00 was due for payment. The Appellant then filed a Notice of Appeal on 28th March 2024 against the decision of the Respondent disallowing the refund amounting to Kshs 45,489,854. 00.

35. In response to the grounds of Memorandum of Appeal and Statement of facts the Respondent avers that the decision was correctly issued and conforms to Section 47 of the TPA and the ITA. The Respondent stated that the bank offers custodial services. The amount of custodial service as per VAT returns was compared to Custodial fees as per Trial Balance (TB), for the period 2019 to 2020 and presented to the Appellant for reconciliation for identified variances.

36. The Respondent noted that whereas the Appellant provided reconciliations which demonstrated that VAT was actually paid on custodial fees. However, a variance of VAT of Kshs 1,492,415. 00 in the year 2019 was left unreconciled. Hence, the Appellant was to generate PRN and pay the unpaid VAT immediately. The Respondent averred that the Appellant is undeserving of the prayers sought due to the forestated reasons.

37. In its written submissions, the Respondent submitted that whereas the TPA places the onus of proof in tax objections on the taxpayer, the Appellant failed to avail evidence that would support a contrary assessment or that would have guided the Respondent at arriving to a different objection decision.

38. The Respondent cited the case of Monaco Engineering Limited v Commissioner Domestic Taxes TAT Appeal No. 67 of 2017; Osho Drappers Ltd v Commissioner of Domestic Taxes TAT No. 159 of 2018; Miao Yiv Commissioner of Investigations & Enforcement TAT no 441 of 2019; Kenya Revenue Authority v Man Diesel & Turbo Se, Kenya [2021] eKLR; and Commissioner of Domestic Taxes v Metoxide Limited [2021] to support the position that the taxpayer has to discharge the burden of proof.

39. The Respondent submitted that the Appellant had underdeclared income earned by not disclosing all the income earned and that the Appellant filed all necessary returns and paid what they had assessed themselves to be payable. The Respondent also submitted that the Appellant was uncooperative in the provision of relevant records and failed to respond to request of documents hence no relevant documents or records were provided to support the notice of objection. Consequently, the assessments were made based on the only available information based on the best judgement by the Respondent.

40. The Respondent cited the cases of Ritz Enterprises Limited v Commissioner of Investigations and Enforcement TAT No. 227 of 2018 and Dyer & DyerLimited v Commissioner of Domestic Taxes TAT 139 of 2020 to support the position that a taxpayer has to provide proof by providing relevant documentation but the Appellant herein failed to do so.

41. Therefore, the Respondent urged the Tribunal to dismiss the appeal with costs.

Issues For Determination 42. Having considered the parties’ pleadings, documents and submissions the Tribunal puts forth the following three (3) issues for determination:i.Whether the Appeal before the Tribunal is competent.ii.Whether tax overpayments can only be recovered through the refund process pursuant to the provisions of Section 47 of the TPA.iii.Whether the Respondent recovered late payment penalties and interest of Kshs 45,489,854. 00 from an overpayment contrary to Section 89 of the TPA;

Analysis And Findings 43. Before delving into the issue(s) that it has identified for determination, the Tribunal has observed that the Appellant herein annexed with its written submissions additional documentary evidence which it did not include as part of its record of Appeal as required by the law. Authoritative precedents and statute require that documentary evidence must be referenced and attached with a statement of facts. The tax procedure rules and statute provide a remedy for a taxpayer who may wish to adduce additional evidence. The Tribunal, adopted the written submissions of the Appellant. The adoption of the written submissions by the Appellant was not a presumption of leave having been granted to adduce additional documentary evidence. Tribunal frowns upon the attempt by the Appellant to introduce additional documentary evidence through its submissions.

44. The Tribunal will proceed to analyse the issues identified for determination hereinunder:i.Whether the Appeal before the Tribunal is competent.

45. The genesis of this dispute is a demand for payment of taxes amounting in the sum total to Kshs. 848,000,000. 00 by the Respondent on 26th June, 2020. The Appellant objected to this demand on 29th June, 2020 on the basis that it was not compelled by the provisions of Section 47 of the TPA to make an application for refund. The Respondent on the other hand argued that tax overpayment is only recoverable upon it being subjected to the process under Section 47 of the TPA. The contrary view of the Respondent was that the set off of taxes is only valid upon the approval of an application made under Section 47 of the TPA.

46. The Tribunal notes that the Respondent proceeded, after a consideration of the Appellant’s objection to allow an overpayment of Kshs. 868,078,038. 00 as outlined in a letter dated 27th February, 2024 and in addition, indicated that there was a tax payment due of Kshs. 1,492,415. 00 for which it demanded payment. The Appellant in its appeal opposed this finding stating that in fact its total claim was Kshs 913,568,592. 00 and that the Respondent applied penalties and interest on the disallowed amount which was the difference between its claim of Kshs 913,568,592. 00 and the overpayment allowed by the Respondent of approximately Kshs. 868,078,738. 00. The Appeal was based on the Appellant’s presumption that the Respondent was demanding Kshs. 45,489,854. 00 from it contrary to the provisions of Section 89 of the TPA in view of the fact that the full amount of Kshs. 45,489,854. 00 represented penalties and interest on an overpaid tax.

47. Section 47 of the TPA provided as follows as at the time when this dispute began:1. When a taxpayer has overpaid a tax under a tax law the taxpayer may apply to the Commissioner, in the approved form, for a refund of the overpaid tax within five years of the date on which the tax was paid.Provided that for value added tax the period of refund shall be as provided for under the Value Added Tax Act, 2013 (No. 35 of 2013).2. The Commissioner may, for purposes of ascertaining the validity of the refund claimed, subject the claim to an audit.3. The Commissioner shall notify in writing an applicant under subsection (1) of the decision in relation to the application within ninety days of receiving the application for a refund.4. Where, in relation to an application for a refund made under this section or made under any other tax law, the Commissioner is satisfied that a taxpayer has overpaid a tax, the Commissioner shall apply the overpayment in the following order—a.in payment of any other tax owing by the taxpayer under the tax law;b.in payment of a tax owing by the taxpayer under any other tax law; andc.any remainder shall be refunded to the taxpayer.(4A) Where the Commissioner notifies a taxpayer that an application for a refund has been ascertained in accordance with subsection (3), and applies the refund to the payment of an outstanding tax in accordance with subsection (4)(a) or (b), interest or penalties shall not accrue on the amount applied to the payment of the outstanding tax from the date of the notification.(4B) For the avoidance of doubt, where the Commissioner has applied a refund to the payment of an outstanding tax under subsection (4A), if there is any outstanding tax after such application, the outstanding tax shall accrue interest and penalties in accordance with this Act.(4C) Without prejudice to the provisions of this section, once the Commissioner notifies of a decision under subsection (3) and the Commissioner is satisfied that there is an overpayment of tax, the overpaid tax shall be deemed to have been offset against the taxpayer’s future tax liabilities.5. The Commissioner shall repay the overpaid tax within a period of two years from the date of application, failure to which the amount due shall attract an interest of 1% per month or part thereof of such unpaid amount after the period of two years.”

48. The Tribunal notes that pursuant to the cited provisions of Section 47 of the TPA, a taxpayer ‘may make an application for a refund’ and where a taxpayer elects to claim this particular right, pursuant to the provisions of Section 47 of the TPA, the Respondent may carry out an audit but, in any case, upon receiving such an application, it ought to notify the taxpayer of its decision within 90 days pursuant to the said provisions of the TPA and more particularly, Section 47 (3) of the TPA. The Tribunal observes that when the Respondent made a demand for taxes, the Appellant ought to have responded by making an application for a refund. The letter dated 29th June, 2020 was an objection to the demand. The Appellant stated as follows at paragraph 2. 0 of the said letter:“Based on the foregoing, it is clear that Section 47 of the TPA only comes to force where a taxpayer applies for a refund of tax overpaid which the Commissioner is then required to repay/refund unless there are other taxes owing to the taxpayer. Utilization of tax overpaid or paid in advance is permitted and has been the practice to date. Our client has opted to utilise the tax overpayment and will not be [emphasis ours] lodging an application for refund of the tax overpaid…”

49. The Tribunal reviewed the pleadings of the Appellant and having also reviewed the letter dated 29th June, 2020 notes that the Appellant was reluctant in acknowledging that the utilisation of overpaid tax or tax credit is in effect, a refund of overpaid tax and that in order to utilise overpaid tax or tax credit, the cited provisions of Section 47 ought to be complied with.

50. The Tribunal further notes that the Finance Act, 2022 expanded the provisions of Section 47 and that in addition the heading of Section 47 was amended from “Refund of overpaid tax” to “Offset and Refund of Overpaid Tax”. The view of the Tribunal is that this amendment merely clarified that overpaid tax can only be recovered through the procedure outlined in Section 47 of the TPA in view of the fact that the practice was that the set off of taxes was only valid upon the approval of an application made under Section 47 of the TPA.The Appellant held a contrary view of this established practice as outlined in its letter dated 29th June, 2020.

51. The Tribunal notes that other than a letter dated 27th February, 2024, which is a summary of the audit findings by the Respondent, there was no correspondence or other documentary evidence adduced by the Appellant to prove that it had made an application for the refund in an approved format and the Respondent could not therefore assert its obligations as outlined by the provisions of Section 47(3) of the TPA.

52. The Tribunal notes that the Appeal is against a decision of the Respondent dated 27th February, 2024 whose reference is “letter of findings on income tax refund application -2019-2020”. The Tribunal has not sighted any income tax refund application made by the Appellant. The Respondent, in the first paragraph refers to ‘income tax refund claims’, the Tribunal has not sighted any application or claim by the Appellant in that regard. Both parties allude to a refund application but none was sighted or adduced as evidence. In the said letter, dated 27th February, 2024, the Respondent also refers to an unexplained variance of Kshs. 1,492,415. 00 in respect of VAT on custodial fees which was left unreconciled and required immediate payment of the amount. The Appeal is predicated on the grounds that the Respondent erred in recovering late payment interest and penalties amounting to Kshs. 45,489, 854. 00 from an overpayment and in doing so contravened the provisions of Section 89 of the TPA.

53. The view of the Tribunal is that the grounds of the Appeal before it are not arguable on the basis that the issues raised for determination were not bonafide thereby making the instant Appeal incompetent. The Tribunal further notes that the incompetence can be said to be in layers in that, other factors also make this Appeal incompetent. The second factor is that prior to 2022 a refund decision was not an appealable decision and the third is that since there was no refund application made by the Appellant in the first place, the letter dated 27th February, 2024 is without basis. This Appeal is vexatious to the court process and the Tribunal does not have jurisdiction to determine an incompetent Appeal as held in the case of Bwana Mohamed Bwana vs. Silvano Buko Bonaya and 2 Others (2015) eKLR where the Court held as follows:“A Court cannot exercise its adjudicatory powers conferred by the law, or the Constitution where an appeal is incompetent. An incompetent appeal divests a court of the jurisdiction to consider factual or legal controversies embodied in the relevant issues.”

54. In Owners of the Motor Vessel “Lillian S” vs Caltex Oil (Kenya) Ltd [1989] KLR, Nyarangi JA held that where a court has no jurisdiction it has to down its tools. Consequently, the Tribunal downs its tools and will not delve into the other issues for determination as the same are rendered moot.

Final Decision 55. The upshot to the foregoing is that the Tribunal finds and holds that the Appeal is incompetent therefore, the Tribunal makes the following Orders:a.The Appeal be and is hereby struck out.b.Each party to bear its own cost.

56. It is so Ordered.

DATED AND DELIVERED AT NAIROBI ON THIS 14TH DAY OF MARCH, 2025. ………………………………….CHRISTINE A. MUGACHAIRPERSON………………………….. …………….……………..BONIFACE K. TERER ELISHAH N. NJERUMEMBER MEMBER……….……..…………….OLOLCHIKE S. SPENCERMEMBER