Judgment summary
The appeal concerned income tax additional assessments issued to Dola Feeds (K) Limited for the years 2013, 2014, 2015, 2016 and 2017. The Commissioner declared the Appellant's objection invalidly lodged and issued confirmation assessment notices.
The Tribunal framed a single issue for determination, namely whether the appeal was against an appealable decision [65]. It examined the decision letter dated 24th May 2019 and found that the Commissioner had rejected the objection as invalid for failing to meet the requirements of Section 51(3) of the Tax Procedures Act [67].
The Tribunal held that an invalidation decision under Section 51(4) of the Tax Procedures Act is an administrative exercise of discretion and does not amount to an appealable decision [74]. It found there was no valid appeal on record and struck out the appeal, with each party to bear its own costs [75, 76].
Background
The Appellant is a private limited liability company [1]. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, Cap 469 Laws of Kenya [2].
The Respondent issued the Appellant with income tax additional assessments for the years 2013, 2014, 2015, 2016 and 2017 on 6th May 2019 [3]. The Appellant objected to the assessments on 25th March 2019 [4]. The Respondent issued an objection invalidation decision and confirmation assessment notices on 24th May 2019 [5].
Being dissatisfied, the Appellant filed its Notice of Appeal dated 3rd September 2025 on the same date, having been granted leave by the Tribunal to appeal out of time [6].
The judgment records differing dates for the assessments. The background states 6th May 2019 [3], while the Appellant's case and the Respondent's case refer to 6th March 2019 [9, 46].
Core dispute
The Appellant contended that the Respondent erred in declaring its objection as not validly lodged, and in confirming the assessments without considering allowable deductions under Section 15 of the Income Tax Act [7]. The Appellant argued that Section 51(7) of the Tax Procedures Act allowed the Commissioner discretion to admit a late objection where a taxpayer showed reasonable cause, including absence from Kenya, because its director had been out of the country [12, 13, 22, 23]. The Appellant also argued that the Respondent's conduct violated Article 47 of the Constitution on fair administrative action [19, 32].
The Respondent contended that the Appellant failed to provide documentary evidence requested, contrary to Section 56(1) of the Tax Procedures Act, and that the burden of proof lay on the Appellant to disprove the Respondent's position [49, 52]. The Respondent argued that the objection had to meet the validity requirements under Section 51(3) of the Tax Procedures Act [56].
The Tribunal, however, confined the matter to whether the appeal was against an appealable decision [65].
Court findings
The Tribunal examined the decision letter dated 24th May 2019 and found that the Respondent rejected the Appellant's objection as invalid for failing to meet the requirements of Section 51(3) of the Tax Procedures Act [67]. The letter stated that the reconciliations and explanation received on 23rd May 2019 did not include all the relevant documents relating to the objection [68].
The Tribunal clarified that, contrary to the Appellant's assertion, the decision was an objection invalidation decision and not a late objection rejection decision under Section 51(7) of the Tax Procedures Act [69].
The Tribunal noted that Section 51(4) of the Tax Procedures Act grants the Respondent discretion to determine and notify a taxpayer when a notice of objection has not been validly lodged. Where a notice is declared invalid, the taxpayer is regarded as not having filed a notice of objection at all and is barred from invoking the jurisdiction of the Tribunal under Section 51(1) of the Tax Procedures Act [72].
Relying on Commissioner of Investigations & Enforcement v Vyas t/a Rocon Enterprises (Income Tax Appeal E144 of 2021) [2022] KEHC 16027 (KLR), the Tribunal noted that it lacks jurisdiction to entertain decisions that are not appealable decisions [73].
The Tribunal found that the Respondent's refusal to admit an objection that is not validly lodged is an administrative exercise of discretion under Section 51(4) of the Tax Procedures Act, which does not amount to an appealable decision, and that an aggrieved taxpayer may challenge it through judicial review [74]. It concluded that the invalidation decision appealed against was not an appealable decision and there was no valid appeal on record [75].
Outcome
The Tribunal found that the appeal was incompetent. It ordered that the appeal be struck out and that each party bear its own costs [76].
Major issues / areas of contention
- Whether the appeal was against an appealable decision [65].
- Whether the Commissioner's decision declaring an objection invalidly lodged under Section 51(4) of the Tax Procedures Act amounts to an appealable decision [74].
- Whether the Tribunal had jurisdiction to entertain an appeal against an objection invalidation decision [72, 75].