Pentium Gas Station Limited v Commissioner of Investigation and Enforcement (Tax Appeal E399 of 2024) [2025] KETAT 167 (KLR) (14 March 2025) (Judgment)
Neutral citation:
[2025] KETAT 167 (KLR)
Republic of Kenya
Tax Appeal E399 of 2024
CA Muga, Chair, BK Terer, EN Njeru, E Ng'ang'a & SS Ololchike, Members
March 14, 2025
Between
Pentium Gas Station Limited
Appellant
and
Commissioner of Investigation and Enforcement
Respondent
Judgment
Background
1.The Appellant is a private limited company incorporated in Kenya and whose primary business activity is that of retail of petroleum products such as diesel, petrol and kerosene in Kenya.
2.The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws (hereinafter “the Act”). Under Section 5 (1) of the Act, the Kenya Revenue Authority is an agency of the Government for the collection and receipt of all tax revenue. Further, under Section 5(2) of the Act with respect to the performance of its functions under subsection (1), the Authority is mandated to administer and enforce all provisions of the written laws as set out in Part 1 and 2 of the First Schedule to the Act for the purposes of assessing, collecting and accounting for all revenues in accordance with those laws.
3.The Respondent issued assessments dated 3rd October, 2023 amounting to Kshs 7,267,887.00 comprising income tax -company and VAT of Kshs 4,472,011.00 for 2017 to 2020 and Kshs 2,795,876.00 for 2018 to 2020 respectively.
4.The Appellant made a late objection dated 18th January 2023, seeking for extension of time to lodge a late objection on the grounds that the managing director had been unwell. Upon review of the medical reports provided, the objection was allowed and the objection was validated vide a letter dated 14th February 2024.
5.The Respondent issued the objection decision dated 15th March 2024 partially accepting the Appellant's objection and confirming the tax due as Kshs 5,658,393.00. Dissatisfied with the Respondent’s decision, the Appellant filed the instant Appeal vide the notice of appeal dated 5th April 2024 and filed on 11th April 2024.
The Appeal
6.The Appellant lodged memorandum of appeal dated 5th April 2024 and filed on 11th April 2024 raising the following grounds of appeal:a.That the Respondent failed to exercise its duty of reasonableness by disregarding consideration, inspection and examination of the Appellant's records and books of accounts before carrying out its exorbitant and excessive assessments. The Appellant had made available its reconciliations for the bank deposits in demonstration of its stance that not all bank deposits translated into sales as otherwise presumed by the Respondent. The Appellant averred that its records and books proofs otherwise and that the Respondent's assumption were not anything to go by. The same should be set aside by this Tribunal.b.That the Respondent's estimated profit margin established did not hold and was misleading as there existed no prior agreement with suppliers and customers on the purported margin. The so-called average industry margin used by the Respondent in determining the taxable value did not hold in the real market with various variables and changing business trends. The Appellant averred that it dealt with its clients and suppliers at an arms-length and willing-buyer-wiling-seller basis and that such margin as proposed by the Respondent is nothing to go by and the same should be set aside.c.That the Respondent's decision to disregard the information, records and explanations rendered by the Appellant to it in defence of its objection amounted to bridge of law and lack of good-will in according the Appellant reasonable angle of justice it deserved. The Appellant averred that it was not properly treated by the Respondent in as far as inconsideration of its sufficient records and information availed to the Respondent is concerned. The Appellant stated that the Respondent simply made overreliance on its estimated profit margins and disregarded examination and consideration of the Appellant's records in issuing its decision. The manner in which the decision was issued by the Respondent amounted to violation of the law and disregard to the Constitution of Kenya 2010 (hereinafter “the Constitution”). Such decision should be set aside by this Tribunal and allow the Appellant express and defend itself in the spirit of justice and fairness.d.That the Respondent's decision to net off VAT on the purported gross banked sales for the year 2017 2018 (prior to 1st September 2018) amounted to ambiguity and erroneous computation as petroleum products dealt in by the Appellant for the said period were exempted from VAT and there was no reason for the Respondent to adjust for VAT on bank deposits that didn't constitute VAT element. Such kind of motive is what the Appellant termed as prejudice and excessive appetite for taxes even where there exists none. The Respondent, in so doing, hiked the purported profit margin with the interest of escalating the next estimated tax that it sought to compel the taxpayer to remit to it. It's on these grounds that the Appellant prayed to this Tribunal to consider allowing this appeal to grant it an opportunity to access justice and fairness in as far as the Respondent's assessments are concerned. The Respondent's decision should be annulled by this Tribunal as it fails the test of fair administration as provided for by the Constitution.
Appellant’s Case
7.In support of the Appeal, the Appellant filed its Statement of Facts dated 5th April 2024 on 11th April 2024. The Appellant’s case was as stated in its statement of facts having failed to file written submissions contrary to the directions of the Tribunal.
8.The Appellant averred that the purported tax demanded was as a result of the Respondent's findings carried out on the bank deposits out of which the Appellant had not declared in the VAT returns and requisite taxes paid.
9.The Appellant stated that the Respondent simply relied upon banking analysis as the only tools of deriving its assessment and failed to conduct a review of the Appellant's books of accounts and financial records since the Appellant had made partial declaration of its transactions and that the documents available could have led to a different tax decision, should the Respondent have carefully examined the said records.
10.It asserted that upon establishing the value of banking on annual basis, the Respondent went ahead to charge VAT at the applicable rates on petroleum products dealt in by the Appellant during the years under review and as a result derived its tax demand.
11.The Appellant stated that on 6th November 2023, the Respondent issued its additional assessment orders via i-Tax portal on both income tax-company and VAT. It asserted that at the time when the Respondent issued its assessment orders via i-Tax, the Appellant's Managing Director had developed severe illness and had resorted to seek for medical attention, hence could not initiate timely objection as he could not report to duty due to the adversity of his sickness but it sought leave from the Respondent to file objection out of time which the Respondent granted.
12.The Appellant stated that in accordance with the requirements of section 51 of the Tax Procedures Act, CAP 469B of the Laws of Kenya, the Appellant attached necessary supporting documents in support of its grounds of objection. The documents submitted were: letter of objection stating precisely grounds of objection, amendments required and reasons for the amendments required; medical records and reports stating precisely when the Managing Director was first admitted to hospital and the dates when he reported for check-up and monitoring.
13.It asserted that in its objection letter, it stated that the assessments were extremely inconsiderate as not all bank deposits constituted sales revenue generated by the Appellant for the years under assessment. The Appellant asserted that it would be good for this Tribunal to note that such assumptions obviously lead to an incompetent and ambiguous tax decision as the original books of entry and transaction books were neglected by the Respondent in establishing the correctness and validity of its assessment.
14.The Appellant stated that on 26th February 2024, the Respondent sent an electronic mail to the Appellant stating that it needed the bank reconciliation and any non-sale transactions by the Wednesday 28th February 2024 in support of the grounds of objection.
15.The Appellant stated that it submitted its books of accounts and records in support of its objection on various dates and also engaged the Respondent through its Tax Representative and that several engagements vide telephone were made in the spirit of settling the matter in an amicable manner. The Appellant further alleged that among the documents that were shared with the Respondent on various dates were the audited financial statements for the years under review, sales ledgers, purchase ledgers, bank reconciliations and other direct expenses ledgers among others but the Respondent ignored them.
16.The Appellant maintained that the Respondent ignored the documents that it availed and on 15th March 2024, the Respondent issued its objection decision having made slight adjustment to its initial assessment and confirmed the balance adding up to Kshs 3,309,412.00 on income tax-company and Kshs 2,348,981.00 as VAT.
17.According to the Appellant, the Respondent's objection decision, was ambiguous and erroneous in that the Respondent, knowing very well that the Appellant dealt in petroleum products for the years under assessment, went ahead to net off VAT on the adjusted bank credits before determining the estimated profit margin for the years 2017 and 2018 and yet petroleum products were exempted in nature as per the VAT Act, CAP 476 of the Laws of Kenya (hereinafter “VAT Act”). The Appellant submitted that it was an erroneous act as by so doing, the Respondent hiked the purported gross profit margin that was used in deriving the taxable value upon which the tax was demand from. Therefore, it asserted that the same should be quashed by this Tribunal and the entire decision be set aside.
18.The Appellant argued that the Respondent simply generated an unsupported margin and yet the Appellant had made available its books of accounts and records for consideration in determining the prices charged while carrying out business for the years under assessment. The Appellant averred that it had made partial declaration of sales and purchases from its transactions and that some information had not been made available to the Respondent at the time when the return period(s) fell due. The Appellant submitted that the Respondent was expected to consider the information from the Appellant's books of accounts but instead went ahead to derive the so-called profit margin from wherever sources, contrary to the actual transactions engaged in by the Appellant. The Appellant maintained that in so doing, the Respondent denied the Appellant the right to fair administration and justice.
19.Further, the Appellant stated that it has an arguable case and that it was willing to provide all the supporting documents in defence of its case and that this Tribunal should consider allowing this appeal and grant the Appellant an opportunity to defend itself against the excessive, inconsiderate and burdensome tax assessments carried out by the Respondent.
20.Consequently, the Appellant prayed for the following reliefs:a.That this Tribunal be pleased to allow the appeal and set aside the Respondent’s objection decision dated 15th March 2024;b.That this Tribunal be pleased to Order the Respondent to pay the costs of this Appeal;c.That this Tribunal be pleased to issue any other Order favourable to the Appellant as it may find just and expedient to issue; andd.The Appellant desired and requested under section 55 of the TPA to have the matter referred to the Alternative Dispute Resolution panel- (ADR) to enable resolving the additional assessment issues.
Respondent’s Case
21.In response to the appeal, the Respondent filed its statement of facts dated 14th May 2024 on 24th May 2024. The Respondent also filed written submissions dated 11th November 2024 on even date.
22.According to the Respondent, the assessments were based on an analysis of banking’s of the Diamond Trust Bank (DTB) Account held by the Appellant. The Respondent then compared declared income tax and VAT turnover to expected income from bank deposits, customs data, assets owned by the Appellant and its directors which established variances and that there was under-declaration of Income by the Appellant.
23.In response to Appellant’s assertion that the Respondent was not justified in issuing its assessment, the Respondent stated that a review of the tax affairs of the Appellant established that the Appellant had under-declared sales for the period 2017 and had been filing NIL returns for the period 2018 to 2021 for income tax.
24.The Respondent averred that the Appellant filed VAT returns for the period 2017 to 2019 but had under-declared sales for the period in dispute, and the same was brought to charge in accordance with Section 3 of the Income Tax Act, CAP 470 of the Laws of Kenya (hereinafter “ITA”) and Section 5 of the VAT Act.
25.It stated that sections 4 of the TPA as read together with Section 5 (2) of the Act, lays out the Respondent's mandate in performing functions including the collection of taxes and any other functions in accordance with Kenyan tax laws.
26.The Respondent contended that in conducting its investigation on the tax affairs of the Appellant and issuing its assessment, it acted within its set legal parameters in consideration of the information available to it and its best judgement. The Respondent contended it is clothed with the requisite powers to investigate, assess and issue assessments where it has established that a taxpayer has not made complete and accurate declarations of its income and taxes due.
27.The Respondent contended that the Appellant was given sufficient time to respond to the findings and provide supporting documents but failed to do so within the timelines provided neither did they provide documents to show that the findings were erroneous, or taxes had been paid on the undeclared income and/or the income received was not taxable. In absence of any documents and/or information from the Appellant, the Respondent contented that it used the available information and its best judgment and proceeded to issue an assessment.
28.The Respondent relied on Section 31 of TPA to assert that it give the Respondent powers to issue assessments based on available information and to the best judgement of the Respondent. The Respondent contended that the Appellant having failed to provide supporting documents including reconciliations for review and a schedule of entries the Appellant deemed were transfers or non-sale transactions during the objection review process, the Respondent used the available information and its best judgment and proceeded to issue an objection decision.
29.The Respondent alleged that the Appellant failed to respond to the findings within the stipulated timelines and/or failed to provide documents to show that the assessment was erroneous. It also alleged that the Appellant's grounds of appeal are vague and that the objection was rejected for being unsupported.
30.In addition, the Respondent averred that it issued the objection decision in compliance with section 51(8) of the TPA.
31.On whether the Respondent erred in employing an average industry margin in determining taxable value of the Appellant's income, the Respondent contended that when computing Income Tax, the review team adopted the average retail prices of petrol per year as stipulated in the Economic Survey 2022 by Kenya National Bureau of Statistics (KNBS) in order to arrive at the volume of fuel sold by the Appellant per year.
32.Whereas the Appellant argued that as a small gas station company, its profits range between Kshs 1 and Kshs 2 per litre and that the Kshs 3 per litre is only realized by the big companies in the industry, the Respondent argued that the Appellant did not provide any documentation to support the argument or to support costs incurred, therefore, the review team adopted the maximum allowed retail profit of Kshs 3 per litre by Energy (Petroleum Pricing) Regulations, 2010 under Third Schedule.
33.On whether the Respondent erred in netting-off VAT on the purported gross banked sales for the years 2017 and 2018 (prior to 1st September 2018) despite petroleum products being VAT exempt, the Respondent contended that it reviewed and issued its revised decision as per considerations made which introduced VAT on petrol to be computed at a rate of 8% from 21st September, 2023.
34.The Respondent asserted that the review team adopted the average retail profit of Kshs 3 per litre by the Energy (Petroleum Pricing) Regulations, 2010 under the Third Schedule. It contended that such an introduction mandated the players in the petroleum industry, including the Appellant, to charge and account for VAT in accordance with the provisions of the VAT and the TPA.
35.According to the Respondent, the VAT Act provides and list exempt supplies in its First Schedule; Section B: Exempt Supplies on Exemption which provides as follows:‘‘(1)the following goods shall be exempt of supplies for a period of three years from the commencement of this Act unless the exempt status of the supplies is earlier revoked-2709.00.00 Petroleum oils and oils obtained from bituminous minerals, crude.
29.other medium petroleum oils and preparations.’’
36.The Respondent contended that the VAT Act commenced on 1st September, 2013 and therefore, ten years later, the exemption was fully extinguished. It also maintained that the Appellant failed on its part in availing sufficient documents and explanations to evidence its claims and therefore the Respondent could neither review nor confirm its claims. Therefore, the Respondent averred that the Appellant failed to discharge its burden of proof contrary to Section 56(1) of the TPA.
37.The Respondent also relied on its written submissions wherein it submitted the Appellant failed to provide supporting documents therefore, it did not discharge its burden of proof as per the provisions of Section 56 (1) of the TPA and Section 30 of the Tax Appeals Tribunal Act , CAP 469A of the Laws of Kenya (hereinafter “TATA”).
38.It relied on the case of George v Federal Commissioner of Taxation; Mulheim v Commissioner of Taxation [2013] FCAFC; Joycott General Contractors Ltd v Kenya Revenue Authority TAT 028 of 2018 eKLR; Sony Holdings Limited v Commissioner of Domestic Taxes [2015] eKLR; and Mbuthia Macharia Vs Annah Mutua Ndwiga & Another [2017] eKLR where it was held that the burden lies upon the taxpayer of establishing that the Respondent’s decision is incorrect.
39.The Respondent cited the case of Bachman v The Queen [2015] TCC51 and submitted that the banking analysis test (banking deposit analysis) is an acceptable method of arriving at an assessment.
40.It submitted that in the absence of relevant documents to prove its case and in the circumstances the Respondent assessed the Appellant as per the available records as allowed by the law under Section 24 (2) of the TPA.
41.The Respondent also submitted that it did not err in using the Industry Average Margin because the Appellant failed to provide any documentation to support the claim of a lower margin of Kshs. 1 to 2 per litre and therefore the Respondent adopted the maximum allowed retail profit of Kshs. 3 per litre per the Third Schedule of the Energy Regulations, 2010.
42.Consequently, the Appellant urged the Tribunal to dismiss this appeal with costs to the Respondent and uphold the Respondent's additional assessments demand as contained in its objection decision dated 15th March, 2024 plus all the accrued interest and penalties.
Issues For Determination
43.The Tribunal having considered the parties’ pleadings puts forth the following three issues for its determination:a.Whether the assessments are time barred.b.Whether the Respondent assessed VAT on petroleum products before 1st September 2018.c.Whether the Appellant discharged its burden of proof.
Analysis And Findings
a. Whether the assessments are time barred.
44.The Respondent issued the assessments dated 3rd October 2023 seeking to recover taxes for the period between 2017 and 2021. Section 23 of the TPA provides for timelines for keeping records. The following provisions of Section 23(1) (c) requires documents to be kept for five years or lesser period:‘‘1)A person shall—(a)Maintain any document required under a tax law, in either of the official languages;(b)Maintain any document required under a tax law so as to enable the person's tax liability to be readily ascertained; and(c)Subject to subsection (3), retain the document for a period of five years from the end of the reporting period to which it relates or such shorter period as may be specified in a tax law.’’ (Emphasis is ours).
45.The view of the Tribunal as regards Section 23 of the TPA is that the Respondent can only expect a taxpayer to adduce documents that are not more than five years old. This is so because documents disappear, some get destroyed, while some simply become ineligible with the lapse of time.
46.With regards to additional assessments, Section 31(4) (b) of the TPA requires assessments to be issued within five years. It provides as follows:
47.Apart from accounting periods under Section 27 of the ITA, time starts running in relation to income tax from 1st July of the year upon submitting a return on or before 30th day of June of the year. In this regard, Section 52B (1) (b) of the ITA provides as follows:‘‘52B.Final return with self-assessment(1)Notwithstanding any other provision of this Act—(b)every person, other than an individual chargeable to tax under the Act, shall for any accounting period commencing on or after 1st January, 1992, furnish to the Commissioner a return of income, including a self-assessment of his tax on such income, not later than the last day of the sixth month following the end of the year of income...’’
48.Pursuant to Section 52B (1) (b) of the ITA and in absence of any other date when the Appellant may have filed its returns, in law, the Appellant must have filed its returns not later than 30th June 2017 and 2018 for the 2017 and 2018 returns. It then follows that the Respondent ought to have issued assessments within five years from 30th June 2017. However, the Respondent herein issued assessment on 3rd October 2023 translating to over 6 years and 3 months delay.
49.In view fo the foregoing the Tribunal’s finding is that the income tax assessments for the 2017 - 2018 years of income are time barred and ought to be expunged unless the Respondent demonstrates gross or wilful neglect, evasion or fraud by a taxpayer as required under Section 31(4)(a) of the TPA. On the other hand, VAT is due on or before the 20th day of the following month. This includes both the return and payment. In this regard, section 19 of the VAT Act provides as follows:‘‘19.When tax is due(1)Tax shall be due and payable at the time of supply.(2)Notwithstanding the provision of subsection (1), a person may defer payment of tax due to a date not later than the twentieth day of the month succeeding that in which the tax became due.’’
50.The view of the Tribunal on the basis of the cited provisions of Section 19 fo the VAT Act is that VAT assessments in respect of the period 2017 to 20th September 2018 are time barred and ought to be expunged unless the Respondent demonstrates gross or wilful neglect, evasion or fraud by a taxpayer as required under section 31(4)(a) of the TPA.
51.The High Court in the case of Commissioner of Domestic Taxes v Airtel Networks Kenya Limited (Income Tax Appeal E062 of 2022) [2023] KEHC 25059 (KLR stated as follows regarding the issue on timeframe:
52.The Tribunal finds that the Respondent herein failed to demonstrate why it issued assessments more than six years after the Appellant filed income tax and VAT returns. The Tribunal finds that the Respondent failed to demonstrates gross or wilful neglect, evasion or fraud by a taxpayer as required under section 31(4)(a) of the TPA to justify review of the returns that were beyond the five years statutory time limit.
53.Accordingly that the income tax assessments from 2017 to, and VAT assessments from 2017 up to September 2018 as assessed on 3rd October 2023 January ought to be expunged.
b. Whether the Respondent assessed VAT on petroleum products before 1st September 2018
54.The Appellant argued that Respondent’s decision to net off VAT on the purported gross banked sales for the year 2017 2018 (prior to 1st September 2018) was erroneous in relation to petroleum products because the said products were exempt from VAT for the stated period. The Respondent refuted this assertion based on the provision of Section B of the first schedule to the VAT Act which in part provides as follows:‘‘(1)The following goods shall be exempt supplies for a period of three years from the commencement of this Act unless the exempt status of the supplies is earlier revoked—2709.00.00—Petroleum oils and oils obtained from bituminous minerals, crude.2710.19.29—Other medium petroleum oils and preparations.’’
55.Paragraph 2 of the said schedule provides as follows:‘‘(2)Notwithstanding paragraph (1), the exemption shall be extended by a further two years from 1st September, 2016.’’
56.The Tribunal finds that in view of the fact that the date of commencement of the VAT Act was 1st September 2013 and pursuant to paragraph 2 of the SECTION B of the First Schedule to the VAT Act, petroleum products were exempt products under VAT Act up to 1st September 2018.
57.Consequently, the Tribunal finds and holds that the Respondent erred in assessing VAT on petroleum products before 1st September 2018.
c. Whether the Appellant discharged its burden of proof in relation to the assessments.
58.The Tribunal notes that the Appellant in grounds one, two and three of its Memorandum of Appeal averred that it provided documents but the Respondent ignored them. It also stated that the Respondent's estimated profit margin does not hold and is misleading as there existed no prior agreement with suppliers and customers on the purported margin. It also alleged that the Appellant dealt with its clients and suppliers at an arms-length and willing-buyer-wiling-seller basis and that such margin as proposed by the Respondent is nothing to go by. On the other hand, the Respondent vehemently refuted these allegations and stated that the Appellant failed to supply supporting documents.
59.The Appellant ought to discharge its burden of proof by adducing documentary evidence to succeed on this issue. The law expressly places the burden of proof upon the taxpayer. Section 56(1) of the TPA provides that, ‘in any proceedings under this Part, the burden shall be on the taxpayer to prove that a tax decision is incorrect.’ In addition, Section 30 of TATA provides as follows:
60.Courts have weighed in on the issue of burden of proof. In Singapore Motors Limited v Commissioner of Domestic Taxes (Income Tax Appeal E039 of 2021) [2024] KEHC 2443 (KLR), the High Court held as follows:
61.Further, in the case of PZ Cussons East Africa Limited v Kenya Revenue Authority (2013) eKLR the court stated as follows at paragraph 9 and 10 with regards to burden of proof:‘‘9- in the case of Pearson v Belcher (supra) it was stated as follows; ‘...there is an assessment made by the Additional Commissioners upon the Appellant; it is perfectly clearly settled by cases such as Norman v Golder, 26 T.C. 293, that the onus is upon the Appellant to show that the assessment made upon him is excessive and incorrect; and of course he has completely failed to do so. That is sufficient to dispose of the appeal, which I accordingly dismiss with costs.”’‘’10- I agree with the KRA that the burden would be upon the Company to show that the amounts taxed was excessive. But to that extent only.’’
62.In order for a taxpayer to to discharge its burden of proof, it must provide documentary evidence to demonstrate that the Respondent’s decision is incorrect. It is upon a taxpayer to adduce documents as provided for under Section 51(3) of the TPA. In the case of Katebes Enterprises Limited v Commissioner of Domestic Taxes (Tax Appeal E332 of 2023) [2024] KETAT 1293 (KLR), this Tribunal held that the taxpayer must produce documentary evidence to support its notice of objection and therefore to discharge its burden of proof.
63.In addition to the above, Section 13(2) of the TATA contains provisions in regarding the requirement of adducing evidence, documentary or oral file n support of the appeal. The said section provides as follows:
64.Rule 5 of the Tax Appeals Tribunal (Procedure) Rules, 2015 provides as follows in relation to documentary evidence:‘‘(1)Statement of fact signed by the appellant shall set out precisely all the facts on which the appeal is based and shall refer specifically to documentary evidence or other evidence which it is proposed to adduce at the hearing of the appeal.(2)The documentary evidence referred to in paragraph (1) shall be annexed to the statement of fact.’’ (Emphasis is ours).
65.Section 13(2)(d) of TATA expressly provides that the Appellant is supposed to file ‘‘Such other documents as may be necessary to enable the Tribunal to make a decision on the appeal’’ while Rule 5 of the Tax Appeals Tribunal (Procedure) Rules, 2015 requires a taxpayer to refer specifically to documentary evidence and documentary evidence must be annexed to the Appeal.
66.Therefore, Section 13(2)(d) of TATA and Rule 5 of the Tax Appeals Tribunal (Procedure) Rules guides taxpayers adducing evidence to support material facts and thereby discharge the burden of proof pursuant to Section 56(1) of the TPA and Section 30 of the TATA. Consequently, a taxpayer who does not adhere to the said provisions of laws cannot discharge the burden of proof unless the taxpayer is raising a demurrer or pure point of law. The question then is whether the Appellant adduced documentary evidence to support this Appeal.
67.The Tribunal examined the Appellant’s pleadings and noted that apart from filing medical records which were unnecessary in the prosecution of this Appeal, the Appellant did not file any other documentary evidence to support its Appeal.
68.Consequently, the Tribunal finds and holds that the Appellant failed to prove that the Respondent’s assessments were incorrect and more particularly the assessments in respect of the period October 2018 to 2021.
Final Decision
69.The upshot to the foregoing is that the Tribunal finds and holds that the Appeal partially succeeds and proceeds to make the following Orders:a.The Appeal be and is hereby partially allowed.b.The Respondent’s objection decision dated 15th March 2024 be and is hereby varied in the following terms:i.Corporation income tax assessments from 2017 to 2018 be and are hereby set aside;ii.VAT assessments from 2017 up to September 2018 be and are hereby set aside;iii.The Respondent’s VAT assessments on petroleum products before 1st September 2018 be and are hereby set aside; andiv.The Respondent’s corporation Income tax and VAT assessments from the period October 2018 to 2021 be and are hereby upheld.c.The Respondent is hereby directed to recompute corporation income tax and VAT assessment based on the Tribunal’s findings under order b (i) -(iv) above within Thirty (30) days from the date of delivery of this judgment.d.Each party to bear its own cost.
70.It is so Ordered.
DATED AND DELIVERED AT NAIROBI ON THIS 14TH DAY OF MARCH, 2025.CHRISTINE A. MUGA - CHAIRPERSONBONIFACE K. TERER - MEMBERBONIFACE K. TERER - MEMBEREUNICE N. NG’ANG’A - MEMBEROLOLCHIKE S. SPENCER - MEMBER