Case ID:162360

Rongai Tiles & Sanitary Ware Limited v Commissioner of Domestic Taxes [2020] eKLR

Case Metadata

Case Number:

Tax Appeal E011 of 2020

Parties:

Rongai Tiles & Sanitary Ware Limited v Commissioner of Domestic Taxes

Date Delivered:

06 Aug 2020

Case Class:

Civil

Court:

High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Case Action:

Ruling

Judge(s):

David Amilcar Shikomera Majanja

Citation:

Rongai Tiles & Sanitary Ware Limited v Commissioner of Domestic Taxes [2020] eKLR

Advocates:

Mr Mola instructed by Mola, Kimosop and Njeru Advocates for the Appellant.

Mr Chabala, Advocate instructed by Kenya Revenue Authority for the Commissioner of Domestic Taxes.

Court Division:

Commercial Tax & Admiralty

County:

Nairobi

Advocates:

Mr Mola instructed by Mola, Kimosop and Njeru Advocates for the Appellant.

Mr Chabala, Advocate instructed by Kenya Revenue Authority for the Commissioner of Domestic Taxes.

History Advocates:

Both Parties Represented

Case Outcome:

Application partly allowed.

Disclaimer:

The information contained in the above segment is not part of the judicial opinion delivered by the Court. The metadata has been prepared by Kenya Law as a guide in understanding the subject of the judicial opinion. Kenya Law makes no warranties as to the comprehensiveness or accuracy of the information

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

MILIMANI LAW COURTS

COMMERCIAL AND TAX DIVISION

CORAM: D.S. MAJANJA J.

TAX APPEAL NO. E011 OF 2020

BETWEEN

RONGAI TILES & SANITARY WARE LIMITED.........................APPELLANT

AND

COMMISSIONER OF DOMESTIC TAXES.................................RESPONDENT

RULING

1. The application for consideration is the appellant’s Notice of Motion dated 9

th

March 2020. It is an application for stay pending appeal following the judgment of the Tax Appeal Tribunal sitting in Nairobi in

Tax Appeal No. 163 of 2017

dated 26

th

February 2020. The application is supported by the affidavits of Sumar Mohammed sworn on 9

th

March 2020 and 26

th

May 2020 respectively. The application is opposed by the replying affidavit of Eugene Wanende, an officer of Kenya Revenue Authority in the Investigation and Enforcement Department, sworn on 28

th

April 2020.

2. The issue for determination is whether I should grant a stay of enforcement of collection of taxes pending the hearing and determination of the appellant’s appeal from the Tribunal which dismissed his appeal. Following dismissal of the appeal, the respondent has demanded Kshs. 410,093,385.00. It is not in doubt that this is a colossal sum by any means and its payment would likely lead to closure of the appellant which is a going concern.

3. As regards security, the respondent has demanded that the appellant provide security for 60% of the taxes amounting to Kshs. 200,000,000.00 while the respondent proposes to provide a bank guarantee for Kshs. 500,000.00. The appellant has shown the nature of its business, which like any other Kenyan business, is undergoing challenges during the COVID-19 pandemic. In order to balance the rights of both parties and to ensure that the business remains a going concern and to secure taxes which may be paid in the future, I now make the following order:

(a) A stay of execution and further enforcement of taxes be and is hereby granted pending the hearing and determination of this appeal on condition that the appellant provide a bank guarantee to the respondent from a suitable bank for Kshs. 800,000.00 within 45 days from the date hereof.

(b) I invite the parties to take direction for the hearing and determination of the appeal.

DATED and DELIVERED at NAIROBI this 6

th

day of AUGUST 2020.

D. S. MAJANJA

JUDGE

Mr Mola instructed by Mola, Kimosop and Njeru Advocates for the appellant.

Mr Chabala, Advocate instructed by Kenya Revenue Authority for the Commissioner of Domestic Taxes.