Tribunal dismisses attempt by firm to reinstate tax appeal

Tuesday, September 15th, 2020 00:00 |
KRA headquarters. Photo/File

The Tax Appeals Tribunal (TAT) has dismissed an application by Muhugu Limited to reinstate a tax appeal which they had earlier withdrawn paving way for Kenya Revenue Authority (KRA) to collect Sh60 million from them.

TAT ruled that once an application has been withdrawn, it cannot be reinstated.

“The applicant herein exercised its rights to withdraw their appeal, which rights were not absolute and untrammelled,” the tribunal ruled.

However, TAT noted  that the firm can institute the matter afresh in future.

“We feel obligated to point out, in the interest of justice that it is not all doom and gloom for the Applicant.

A withdrawal of suit does not bar one from instituting a matter afresh in the future.

The Applicant has the option of instituting the matter a fresh, if only to exercise its right to be heard,” ruled the tribunal.

Muhugu Limited filed the certificate of urgency after KRA placed a caveat restriction over their property restricting the transfer of the property following the tax arrears.

The firm said they raised an objection to the charge on the property but KRA failed to respond to the same.

“The Agency Notice and the caveat on the property is still in force. The Appellant is thus apprehensive that unless the orders sought herein are granted promptly, the violation of rights  of property will be violated,” it argued.

KRA in response however argued that the application did not raise any urgent issues that warrant any immediate orders by the Tribunal.

According to KRA, the Notification of Charge was lawfully issued as the Appeal was withdrawn by the Muhugu Limited ’s tax agent.

“It is evidently clear that the application is brought in bad faith and solely because of the KRA’s quest for taxes that are otherwise due and owing from the Applicant,” argued KRA.

KRA will now enforce the collection of taxes which stood at Sh59,640,304 at the time of filing of the Application for reinstatement of the Appeal on the 15th March 2016.

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