Judgment summary
The Tribunal at Nairobi heard an appeal by Pirmohammed Enterprises Limited against a decision of the Commissioner of Legal Services & Board Coordination dated 3rd March 2021, which had declared the Appellant's objection to VAT assessments for November 2019 invalid.
The Tribunal first satisfied itself of jurisdiction, holding, on the authority of Geo Chem Middle East v Commissioner for Domestic Taxes (Civil Appeal No. E581 of 2024) [2026] KECA 1531 (KLR), that a decision invalidating a notice of objection under Section 51(4) of the Tax Procedures Act is an appealable decision.
Having found jurisdiction, the Tribunal confined itself to the validity question and found that the Appellant had not discharged its burden under Section 56(1) of the TPA to show that its notice of objection satisfied the cumulative conditions of Section 51(3) of the TPA, particularly the requirement that all relevant documents relating to the objection be submitted. The appeal was dismissed.
Background
The Appellant is a private limited liability company incorporated in Kenya and carrying on business in Mombasa (para 1). The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, Cap 469, mandated under Section 5 of that Act to assess, collect and account for revenue (para 2).
The Respondent issued the Appellant with VAT additional assessments for the tax period of November 2019 on 23rd December 2020 (para 3). The Appellant lodged a late objection on 5th February 2021, citing the sickness of its director, and received objection acknowledgement number KRA202101626491 (para 4).
The Respondent issued a decision dated 3rd March 2021 rejecting the objection in full on the ground that relevant documents relating to the objection, which had been requested for, had not been availed (para 5). The Appellant, dissatisfied, filed its Notice of Appeal dated 14th October 2025, having been granted leave by the Tribunal to file out of time (para 6).
Core dispute
The Appellant argued that the Respondent erred in declaring its objection invalid, in confirming the assessments without considering whether the supplies were vatable, and in disregarding supporting information and documents it had provided (para 7). It contended that it had reasonable grounds under Section 51(7) of the Tax Procedures Act for its late objection due to its director's sickness, and that the Respondent's actions violated Article 47 of the Constitution of Kenya on fair administrative action (para 7, 11-14).
The Respondent maintained that the objection was correctly invalidated under Section 51(3) of the TPA for want of relevant supporting documentation which had been requested but not supplied, and relied on Section 56(1) of the TPA, which places the burden on the taxpayer to prove a tax decision incorrect (paras 19-22).
The single issue for determination was whether the Respondent was justified in invalidating the Appellant's objection (para 24).
Court findings
The Tribunal held that jurisdiction is a threshold question to be resolved in limine, citing Owners of the Motor Vessel "Lillian S" v Caltex Oil (Kenya) Ltd [1989] KLR 1 (para 26). It found that, despite being styled an "Objection Decision", the letter of 3rd March 2021 was in substance a declaration that the objection had not been validly lodged under Section 51(3) of the TPA (para 27).
Relying on Geo Chem Middle East v Commissioner for Domestic Taxes (Civil Appeal No. E581 of 2024) [2026] KECA 1531 (KLR), delivered 31st July 2026, the Tribunal held that a decision invalidating a notice of objection is appealable, and that it is a validity decision distinct from a merit decision under Section 51(11) of the TPA (paras 28-29). It therefore found it had jurisdiction and departed from its earlier decisions holding such invalidation decisions non-appealable (para 30).
The scope of the appeal was confined to the validity question; the Tribunal made no finding on whether the supplies were vatable or on the correctness of the sums assessed (para 31).
The Tribunal set out that the conditions in Section 51(3) of the TPA, including that all relevant documents relating to the objection be submitted, are cumulative (paras 32-33). Under the version of Section 51(4) in force on 3rd March 2021, the Respondent's obligation was simply to notify the taxpayer in writing that the objection was invalid, which it did (paras 34-36).
The Tribunal noted an error where the Respondent's letter cited Section 51(3)(a) but the stated reason fell under Section 51(3)(c), finding this mis-citation regrettable but not prejudicial, as the operative reason was stated plainly (para 37). It found the Appellant had been given written reasons satisfying Article 47 of the Constitution and Section 4 of the Fair Administrative Action Act, and had failed to cure the defect (paras 38-38).
Applying Section 56(1) of the TPA and the Tribunal's earlier decision in Boleyn International Limited v Commissioner of Investigations and Enforcement (TAT Appeal No. 55 of 2018), the Tribunal held the Appellant bore the burden of proving that all relevant documents had been submitted with its objection (paras 39-40). The Appellant annexed only the acknowledgement receipt and the impugned decision, not the notice of objection itself, and the Tribunal found it could not establish compliance with Section 51(3) on assertion alone (paras 41-44).
The Tribunal also observed that the Respondent's own evidential presentation was sparing, but held this did not shift the statutory burden from the taxpayer (paras 45-46). It found the acknowledgement receipt of 5th February 2021 had directed the Appellant to produce documents per email instructions, and the Appellant never denied documents were called for (para 47).
The Tribunal found the Appellant's reliance on Section 51(7) of the TPA misconceived, as the late objection had already been admitted and the extension allowed (para 48). It further noted a discrepancy: the appeal papers referred to two assessments (Kshs. 363,104.00 and Kshs. 842,400.00), but the objection and impugned decision related only to the Kshs. 842,400.00 assessment, confining the appeal to that decision (paras 49-50).
Outcome
The Tribunal found that the Appellant had not discharged the burden under Section 56(1) of the TPA to show that its notice of objection satisfied Section 51(3), particularly Section 51(3)(c), of the TPA (para 51). It held that the Respondent was justified in invalidating the objection and that the decision dated 3rd March 2021 was properly made and adequately communicated (para 52).
The Tribunal made no pronouncement on whether the supplies were vatable or on the quantum of the assessment, these being merit questions not yet determined under Section 51(11) of the TPA (para 53).
The Tribunal dismissed the Appeal, upheld the Respondent's decision dated 3rd March 2021, and ordered each party to bear its own costs (para 54).
Major issues / areas of contention
- Whether the Respondent's decision invalidating a notice of objection under Section 51(4) of the Tax Procedures Act is an appealable decision.
- Whether the Respondent was justified in declaring the Appellant's notice of objection invalid under Section 51(3) of the Tax Procedures Act.
- Whether the Appellant discharged the burden under Section 56(1) of the Tax Procedures Act to prove that all relevant documents relating to the objection had been submitted.
- Whether the Appellant's reliance on Section 51(7) of the Tax Procedures Act, concerning extension of time for late objections, was relevant given the extension had already been allowed.
- Whether the Respondent's actions violated Article 47 of the Constitution of Kenya on fair administrative action.
- Whether the appeal properly extended to an assessment of Kshs. 363,104.00 for which no objection or decision appeared on the record.