Registered Trustees of the Association of the Jehova's Witness of Malawi v Malawi Revenue Authority (Civil Cause 84 of 2015) [2023] MWHCRev 3 (15 February 2023)

MART tras cnet ey IN THE HIGH COURT OF MALAWI LILONGWE DISTRICT REGSTRY REVENUE DIVISION CIVIL CAUSE NUMBER 84 OF 2015 BETWEEN: THE REGISTERED TRUSTEES OF THE ASSOCIATION OF THE JEHOVA’S WITNESS OF MALAWI APPELLANT AND MALAWI REVENUE AUTHORITY RESPONDENT CORAM: HON. JUSTICE JOSEPH CHIGONA 1, MRS. OTTOBA, ADVOCATE FOR THE APPELLANT MRS, LINDA KAMBUWA, ADVOCATE FOR THE RESPONDENT MR. FELIX KAMCHIPUTU, LAW CLERK ORDER ON APPEAL The Appellant, being dissatisfied with the Order made by the Special Arbitrator, extending time within which to file an appeal, lodged the present appeal. The facts of the matter are that the Chief Resident Magistrate, sitting as a Special Arbitrator under section 98 of the taxation Act, delivered his judgment on appeal reversing the Respondent’s decision to continue collecting Pay-As-You-Earn (PAYE) from members of the Worldwide Order of Special Full-Time Servants of Jehovah’s Witness, On 6'" September, 2019, the Respondent filed an appeal against the decision in the High Court, which according to the Appellant, was outside the prescribed 14-day appeal period. The High Court, the Appellant submits, on 13" March 2020, dismissed the appeal for non- compliance with the mandatory requirements under Order XXXII of the Courts 1 (Subordinate Court) Rules. On 5\" Tune, 2020, the Respondent filed before the Special Arbitrator an application for extension of time, which the lower court granted on condition that the Appeal be filed within 7 days from the date of the Order, The Respondent, as per the Appellant, did not file the Appeal as ordered by the Special Arbitrator, Instead, the Appeal was lodged on 3 December 2020 with grounds of Appeal. On 28" January 2021, the Chief Resident Magistrate dismissed the Respondent’s application for stay of execution of the judgment. On 1 March 2021, the Respondent filed an interpartes summons for Stay of execution of the judgment which the Appellant objected since there was no appeal in the High Court and that the court was fumetus officio since a similar application was dismissed. On 30" June 2021, the Chief Resident Magistrate Court upheld the Appellant’s preliminary objection and set aside the order extending time made on 21" September 2020 on the ground that the Respondent did not comply with the Order and that there was no Appeal in the High Court. On 6 May 2022, the lower court granted an order extending time within which the Respondent was to lodge the Appeal. Aggrieved with the decision of the lower court, the Appellant lodged the present appeal on the following grounds: - The learned Magistrate exred in law in assuming jurisdiction over the application for extension of time against the decision of the Special Arbitrator following the striking out of the notice of appeal by the High Court. - The learned Magistrate erred in law and in fact in holding that the Respondent gave satisfactory explanation for the delay for failure to file the appeal within time - The learned Magistrate erred in law in failing to hold that the Respondent’s application to extend time was an abuse of the court process, the High Court having dismissed the Respondent’s appeal for failure to comply with the Rules of Procedure for appeals - The learned Magistrate erred in law in failing to consider arguments raised by the Appellant in relation to the Application for extension of time - Inall the circumstances of the case, the decision of the learned Magistrate was wrong in law, against the weight of evidence and against settled legal principles, . The Respondent filed skeleton arguments in opposition to the present application. In essence, the Respondent argues that the High Court did not adjudicate on the merits of the appeal. The Respondent argues that the High Court refused to entertain the Appeal since time for filing such an appeal expired and ordered the Respondent to first apply for extension of time in the lower court. The Respondent submitted that the lower court appreciated the reasons for the delay and subsequently granted the order extending time, The Respondent submitted that there is nothing irregular or illegal in the Order granted by the lower court. . The Respondent also argues that there was no abuse of the court process since the order of the High Court being relied upon by the Appellant only directed the Respondent to seek extension of time in the lower court and that the High Court did not deal with the merits of 2 the Appeal. In other words, the Respondent argues that there was no final settlement of the appeal in the High Court. 8. The Respondent also submitted that the assertion that the lower court did not take into account all arguments raised by the Appellant is disturbing. To the Respondent, the lower court (Chief Resident Magistrate) took into account all arguments from both parties before making the decision. DISPOSAL OF THE APPEAL 9. Let me take this opportunity to express my gratitude to both parties for their industrious research and submissions on the appeal before me. ] would like to assure them that I took considerable time to read their submissions and case authorities therein. However, let me mention that for the sake of the present appeal, I will only refer to relevant portions or arguments. 10. On the first ground of appeal, as already alluded to, the Appeilant argues that the learned magistrate erred in law in assuming jurisdiction over the application for extension of time within which to appeal against the decision of the Special Arbitrator following the striking out of the Notice of Appeal by the High Court. I find the argument of the Appellant rather strange. In the first place, the Order of the High Court striking out the Notice of Appeal for being irregular in that it was filed out of time, is clear as to what the Respondent was supposed to do. The order required the Respondent to seek an extension of time within which to file the appeal. The Respondent, in compliance with that Order, filed the application that was entertained by the lower court. I am of the view that the learned Magistrate did not err in law in assuming jurisdiction over the application to extend time. The Respondent was to seck extension of time before the lower court/Magistrate. The Appellant unfortunately has not mentioned the forum that could have entertained the application to extend time if not the lower court/Magistrate. It is clear to me that the Appellant is under a wrong assumption that the High Court dismissed the Appeal on merits, which is not the case. | totally agree with the Respondent that the High Court did not dispose of the appeal on merits. I therefore hold that this ground of appeal has no merit and is therefore dismissed in Its entirety. 11. On the second ground of appeal, the Appellant argues that the learned Magistrate erred in law and fact when he held that the Respondent provided satisfactory reasons for the delay. Tam at pains to fault the learned Magistrate. | am not convinced that the learned Magistrate (His Worship Patrick Chirwa, as he then was) abused his discretion. [have read the Ruling of the lower court to appreciate its reasoning. The lower court correctly applied the law on this issue of extension of time and correctly cited cases of SCHAFFER V BLYTH! and HTD LIMITED V IMRAN NAWAB t/a BUILDER CIRTY? where it was held that before granting extension of time within which to appeal, the court must first be satisfied 1 [1920] 3 K. B. 143 2 Civil Cause Number 1230 of 1999 that there was an acceptable explanation for the delay. The lower court also correctly cited CHIUME V THE ATTORNEY GENERAL? where it was held that the issue of extension of time is a matter of discretion. | do not think that at this juncture as an appellate court I have valid and compelling reasons to fault the exercise of jurisdiction by the learned Magistrate. The lower court in its Ruling, indicates that there was no objection to the fact that there were communication glitches between the office of the Clerk of the former Chief Resident Magistrate and the Respondent on the granting of the 7-day extension. The lower court also indicates in its Ruling that there was no dispute that the Respondent became aware of the existence of the order extending time after expiry of 7 days. In these circumstances, | find it interesting that after failing to raise objections in the lower court, the Appellant is raising these issues as grounds of appeal. 12. Further, the lower court indicated that the Respondent did not fold their arms but rather were up and about filing processes even after mere verbal communication of the existence of the Order and after notice that the court file has gone missing. The lower court concluded that the Respondent was/is a party desirous to prosecute the appeal. I am of the considered view that the lower court reasoning cannot be faulted by this court. The lower court made a factual finding that there were communication glitches between the Respondent and the Court. Ido not see any valid and compelling reason that this court should fault this finding. Based on the foregoing, I also find that this ground of appeal lacks merit. I therefore proceed to dismiss the same in its entirety. 13. On the third ground of appeal, the Appellant argues that the lower court erred in law in failing to hold that the Respondent’s application to extend time was an abuse of the court process, the High Court having dismissed the Respondent’s appeal for failure to comply with the Rules of Procedure for appeals. As already alluded to by this court on the first ground, the Appellant: has misconstrued the Order this Court granted. I ordered the Respondent first to seek an extension of time in the lower court before filing the Notice of Appeal in the High Court. At this juncture, one cannot reasonably state that the High Court disposed of the Appeal on merits. It was a procedural issue. Moreover, the lower court was exercising jurisdiction as ordered by the High Court. Assuming the lower court did not exercise its jurisdiction in favour of the Respondent, the Appeal process could not have proceeded. Hence, I do not find anything irregular or illegal or abuse of the court process as the Appellant would want this court to believe. For any avoidance of doubt, there was no abuse of the court process. I therefore hold that this ground of appeal lacks merit and is hereby dismissed in its entirety. 14. On ground four, the Appellant argues that the learned Magistrate erred in law in failing to consider arguments raised by the Appellant in relation to the Application for extension of time. With due respect to the Appellant, I do not think that this ground of appeal is worth commenting by this court. It is a ground of appeal without any substance in it, It is a fishing ground of appeal. I agree with the Respondent that the lower court/learned magistrate 3 {2000-2001] MLR 102 (MSCA} commended the industry of both parties in bringing what he called ‘well-argued skeleton arguments’ that assisted the court in arriving at a just and fair determination, What this means is that the lower court/learned magistrate took time to go through both sets of skeleton arguments. I have also done the same in the present Order (see paragraph 9 above). I therefore hold that this ground of appeal lacks merit and I dismiss the same in its entirety. 15. On the last ground, the Appellant argues that in all the circumstances of the case, the decision of the learned Magistrate was wrong in law, against the weight of evidence and against settled legal principles. This ground of appeal lacks merit. There are no any valid and compelling reasons to hold that the Order of the lower court is wrong in law and against the weight of evidence and against the settled legal principles, What I have noted is that the Appellant is the one who has misconstrued the Order of the lower court and the Order of the High Court. Had the Appellant correctly interpreted the High Court Order and the lower court order, they could not have lodged the present appeal. I therefore dismiss this ground of appeal. 16. On the argument that the Chief Resident Magistrate was functus officio when he made the Order extending time, | am of the view that the Appellant misunderstood the application of this principle. As has been stated in a litany of cases, this principle only applies where there is final determination of the issues. In the present matter, the issues were already determined through the judgment dated 6" August 2019. I am of the considered view that the Chief Resident Magistrate when he granted the Order was not reopening issues as determined in the judgment. What the Chief Resident Magistrate was doing was to assist the parties lodge their appeal in the High Court. For instance, where a court has made a final determination, and a party applies for leave to appeal, | am of the view that the other party cannot advance the defence of functus officio. The same applies to applications such as stay of enforcement of yudgment. 17. The same arguments as above apply to the argument by the Appellant that the principle of res judicata acted as an estoppel on the part of the Chief Resident Magistrate. The Court in Malawi Communications Regulatory Authority (MACRA) V Joy Radio Limited!‘ stated as follows on this principle: “Chitty on Contracts (General Principles) Twenty Seventh Edition para. 25-011 identifies three requirements that must be satisfied for a plea of estoppel per rem judicanun to succeed: first, there must have been a final and conclusive judgment on merits by a court of competent jurisdiction in the earlier proceedings; secondly, there must be identity of parties in the two sets of proceedings or else the existence of probity between the respective plaintiffs or defendants in the earlier proceedings and those in the later proceedings; thirdly, there must be identity of subject matter in the two proceedings”. 4 MSCA, Civil Appeal, Cause Number 59 of 2009. 18, 19, 20. 21. 22. In my considered view, there was no final and conclusive judgment on merits made by the Special Arbitrator. The application that was before the Special Arbitrator was an application to extend time within which to lodge an appeal. The Special Arbitrator did not re-open the issues already decided as contained in the judgment dated 6 August 2019. What the Special Arbitrator was doing was to decide on an application facilitating an appeal to the High Court. I totally agree with the Respondent that the plea of res judicata cannot apply in these circumstances. All in all, the appeal is accordingly dismissed. On costs, I order that each party should bear its own costs. At this juncture, allow me to state the law governing appeals from the Special Arbitrator to the High Court. It is clear to me that both parties herein are not aware of this law. I have noted that both parties are referring to Subordinate Court Rules Especially Order XX XU. The law governing appeals to the High Court from Special Arbitrator is governed by the Taxation Act as read with 8" Schedule to the Taxation Act. Section 98 of the Taxation Act provides that a taxpayer aggrieved by a decision of the Commissioner General may appeal to the Special Arbitrator. Section 98(1) provides as follows: “A taxpayer aggrieved by a decision of the Commissioner General under section 97 may appeal in the prescribed manner to a Special Arbitrator appointed either generally or specificatly for the purpose by the President”. It is clear therefore that any appeal against decision of the Commissioner General may be lodged before a Special Arbitrator, The 8" Schedule to the Taxation Act defines who this Special Arbitrator is. The law provides that a Special Arbitrator shall be a Resident Magistrate. What this means is that when Resident Magistrates are exercising jurisdiction on these appeals, they are doing so as Special Arbitrators and not Resident Magistrates. Appeals from the Special Arbitrator are made to the High Court pursuant to section 1011) of the Taxation Act. The provision provides as follows: “Kither party to proceedings before a Special Arbitrator under section 98 or a Traditional Appeal Court under section 100 may appeal in the prescribed manner to the High Court on a point of law”. What this means is that only points of law are appealable to the High Court. One cannot appeal to the High Court on issues of facts as these are assumed to have been dealt with to finality by the Special Arbitrator. 23. 24. 25. What this means therefore is that appeals from the Special Arbitrator to the High Court are not governed by the Court (Subordinate Court) Rules, especially Order XXXII. To buttress this point, Courts (High Court) (Civil Procedure) Rules, 2017 (hereinafter referred to as Civil Procedure Rules), provides a guide on appeals from subordinate courts or tribunals. Order 21 provides as follows: “An appeal from a subordinate court or other tribunal and other judicial and quasi-judicial bodies shall, with the necessary adaptation, be governed by Order XXXII of the Subordinate Court Rules where there is no appellate procedure governing an appeal from that court or tribunal’, What this means is that where there is an appellate procedure governing appeals from a court or tribunal or any quasi-judicial body, Order XX XIII of the Subordinate Court Rules shall not apply. Reverting to the present case therefore, Order XX XIII of the Subordinate Court Rules shall not apply on appeals from the Special Arbitrator. Instead, the Taxation Act as read with 8" Schedule to the Taxation Act shall apply. The 8" Schedule to the Taxation Act, in Rule 16, governs appeals from the Special Arbitrator to the High Court. Rule 16(1) provides as follows: “A party to proceedings before a Special Arbitrator or a Traditional Appeal Court who desires to appeal to the High Court shall within 21 days from the date when the decision of the Special Arbitrator or Traditional Appeal Court was given lodge with the High Court in triplicate a notice of his intention to appeal...” So, the law provides for a 21-day time limit within which Notices of Appeal from a Special Arbitrator are to be lodged with the High Court. On lodging of grounds of Appeal, Rule 17 provides as follows: “Within 42 days from the date when the decision of the Special Arbitrator or Traditional Appeal Court was given the Appellant shall lodge with the High Court in quintuplicate a statement in writing to be headed “Grounds of Appeal’....” Hence, the 8" Schedule to the Taxation Act provides the procedure with time limits governing appeals from the Special Arbitrator to the High Court. Both parties in the present application either are not aware of this procedure or completely forgot the existence of this procedure under the 8" Schedule to the Taxation Act. Definitely, pursuant to Order 21 of the Civil Procedure Rules, the Subordinate Court Rules do not govern appeals from the Special Arbitrator to the High Court. I have noted that both parties made reference to Subordinate Court Rules, 26, a7. 28. Further, I have noted that applying the time limits as stipulated under the 8" Schedule to the Taxation Act, when the judgment was made on 6" August 2019, the Respondent was supposed to lodge a notice of appeal with the High Court by 27" August 2019. However, this did not happen as the Respondent filed the appeal on 5" September 2019, after the expiry of 21 days. However, I am of the view that the Order made by this Court directing the Respondent to first seek extension of time before the Special Arbitrator suffices, I take it that upon extension of such a period, the Respondent was now at liberty to file their Notice of Appeal in the High Court. I have taken the liberty to explain the procedure governing appeals from Special Arbitrator to the High Court as a guide to the parties for future cases. Leave to appeal well explained. MADE IN OPEN COURT THIS 15'™ DAY OF FEBRUARY, 2023 AT LILONGWE DISTRICT REGISTRY, REVENUE DIVISION, (| a JOSHRELCHICONA JUDGE