Judgment summary
The Applicant filed a Notice of Motion dated 4th May 2026 under Certificate of Urgency, seeking orders restraining the Respondent from enforcing or issuing further agency notices in respect of a disputed tax assessment, compelling service of copies of agency notices, and related relief pending determination of an appeal.
The Respondent opposed the Application, arguing that the alleged Agency Notice had not been annexed, no date of issuance had been given, and the objection decision said to be under appeal had also not been attached.
The Tribunal considered the pleadings, the supporting affidavit of Alice Waithira Murage, the replying affidavit of Lilian Nyarigita, and the applicable law, and dismissed the Application in its entirety, declining the prayers to lift, suspend or vacate the alleged Agency Notice.
Background
The Applicant moved the Tribunal by Notice of Motion dated 4th May 2026, filed on the same date under Certificate of Urgency (paragraph 1). The Application sought to restrain the Respondent from enforcing or issuing further agency notices in respect of a disputed tax assessment pending determination of an Appeal, and to compel the Respondent to serve copies of all agency notices issued to the Applicant's bankers or agents other than the one annexed in the Applicant's affidavit (paragraph 1).
The Application was supported by a sworn affidavit of Alice Waithira Murage filed on 4th May 2026 (paragraph 2), asserting that an Agency Notice had been issued on the disputed assessment before determination of the objection, that this was premature and unlawful, that the tax liability was not final or due, and that the notice had disrupted the Applicant's business operations and cash flows (paragraph 2).
The Respondent filed a Replying Affidavit sworn by Lilian Nyarigita, dated and filed on 12th May 2026 (paragraph 3), contending that no Agency Notice had been attached to the Application, no date of issuance had been cited, and the Applicant had not discharged its evidentiary burden to prove the notice existed (paragraph 3).
Core dispute
The core dispute was whether the Tribunal should grant conservatory orders restraining the Respondent from enforcing or issuing further agency notices in respect of a disputed tax assessment, pending determination of an intended appeal (paragraph 4).
A related issue was whether the Applicant had established the existence of a competent appeal, given that its Notice of Appeal referred to an intention to seek leave to appeal out of time against an Objection Decision dated 6th June 2024, which had not been annexed, and given that no such prayer for extension of time had actually been sought in the Application (paragraphs 16 to 19).
Court findings
The Tribunal held that its jurisdiction to stay or affect implementation of a tax decision under Section 18 of the Tax Appeals Tribunal Act is predicated upon the existence of a tax decision under challenge and a competent appeal properly filed before it (paragraph 10).
The Tribunal found that despite the Agency Notice being central to the Application, the Applicant had not annexed it nor provided documentary evidence of its issuance or service on bankers, customers or agents (paragraph 11). Citing Section 56(1) of the Tax Procedures Act, 2015, the Tribunal held that the burden rested on the Applicant to prove the existence of the impugned enforcement action, and that mere allegations could not suffice (paragraphs 12 to 13).
In the absence of the Agency Notice, the Tribunal found it could not ascertain the date of issuance, the amount sought, the recipient, the assessment to which it related, or whether the notice existed at all, and held that the Applicant had failed to discharge its evidentiary burden (paragraphs 14 to 15).
The Tribunal further noted that although the Notice of Appeal indicated an intention to seek leave to appeal out of time against an Objection Decision dated 6th June 2024, no such prayer had been sought in the present Application and no Objection Decision had been annexed (paragraph 16). Referring to Section 13(1), (3) and (4) of the Tax Appeals Tribunal Act, and the principles applied in Jomaki Investments v Commissioner of Domestic Taxes and Nichola Kiptoo Arap Korir Salat v Independent Electoral and Boundaries Commission & 7 Others [2014] eKLR, the Tribunal found that the Applicant had not explained the delay of almost two years, had not sought extension of time, and had placed no material before the Tribunal to justify exercise of discretion under Section 13(4) (paragraphs 17 to 19).
Applying the principle that parties are bound by their pleadings, as stated in Independent Electoral and Boundaries Commission & Another v Stephen Mutinda Mule & 3 Others [2014] eKLR, the Tribunal held it could not grant relief for extension of time that had not been pleaded (paragraphs 20 to 21). The Tribunal concluded that the Applicant had not established the existence of a competent appeal capable of invoking its jurisdiction under Section 19 of the Tax Appeals Tribunal Act, and that in the absence of proof of the enforcement action and a properly constituted appeal, there was no basis to grant the conservatory orders sought (paragraphs 23 to 24).
Outcome
The Tribunal dismissed the Notice of Motion dated 4th May 2026 as devoid of merit (paragraph 25(a)).
The prayers seeking the lifting, suspension or vacation of the alleged Agency Notice were declined (paragraph 25(b)).
No orders were made as to costs (paragraph 25(c)).
Major issues / areas of contention
- Whether the Applicant had established the existence of the alleged Agency Notice by producing evidence of its issuance or service.
- Whether the Applicant had discharged its evidentiary burden under Section 56(1) of the Tax Procedures Act, 2015 to prove the tax decision or enforcement action complained of.
- Whether a competent appeal existed before the Tribunal, given the absence of the Objection Decision dated 6th June 2024 from the pleadings.
- Whether the Applicant could be granted an extension of time to appeal out of time under Section 13(4) of the Tax Appeals Tribunal Act without having pleaded such relief.
- Whether the Tribunal's jurisdiction under Section 18 of the Tax Appeals Tribunal Act to stay implementation of a decision could be invoked absent a properly filed appeal.