Twiga Chemical Industries Limited v Commissioner of Customs and Border Control (Tax Appeal E256 of 2025) [2025] KETAT 318 (KLR) (3 December 2025) (Judgment)
Neutral citation:
[2025] KETAT 318 (KLR)
Republic of Kenya
Tax Appeal E256 of 2025
RM Mutuma, Chair, M Makau & T Vikiru, Members
December 3, 2025
Between
Twiga Chemical Industries Limited
Appellant
and
Commissioner Of Customs And Border Control
Respondent
Judgment
Background
1.The Appellant is a company incorporated under the Kenyan Companies Act and is registered for tax in the Republic of Kenya. It is engaged in the business of producing and distributing agrochemicals, consumer products, crop protection products and animal health productions.
2.The Respondent is a principal officer appointed pursuant to Section 13 of the Kenya Revenue Authority Act (KRA), Act No. 2 of 1995, and KRA is empowered to enforce and administer provisions of written laws set out in Section 5 as read together with the First Schedule of the KRA Act.
3.The Appellant placed an order for three fertilizer products on 28th September 2024, the consignment/product whereof was lodged on 9th October 2024, the Respondent disputed the HS Code declared and reclassified the products to HA Code 3824.9XXXX, however the products were cleared on 30th October 2024 and the Respondent’s decision was issued on 5th December 2024.
4.The Appellant lodged a review application vide the letter dated on 19th December 2024, to which the Respondent issued its Review Decision dated 16th January 2025.
5.The Appellant being dissatisfied it requested the Respondent to review it decision vide the correspondence dated 28th January 2025 and the Respondent upon consideration rejected the request and upheld its earlier position as to the reclassification of the products vide the letter dated 31st January 2025.
6.The Appellant, dissatisfied with the Respondent’s decision lodged this Appeal at the Tribunal on 28th February 2025.
The Appeal
7.The Appeal is premised on the following grounds as stated in the Appellant’s Memorandum of Appeal dated 14th March 2025:a.That the Respondent erred in law and fact in classifying the product described as Introsol Even (N:P:K 21:21:21+TE), Import Entry No. 24EMKIM401XXXX (“the product”) under Harmonized System Code/Tariff No. 3824.9XXXX as opposed to Hamonized System Code/Tariff No. 3105.XXXX contrary to the clear provision of the Protocol on the establishment of East African Community Customs Union (“the Protocol”) as read together with annex 1 thereto – the East African Customs Union Common External Tariff (“EAC CET”) and the rules thereunder, to wit: the General Rules for the Interpretation of the Harmonized System (“GIR”);b.That the Respondent erred in law in its reading and understanding of the general note to Chapter 31 of the EAC CET and specifically, the General Note which excludes, from Chapter 31, “micronutrient preparations containing small amounts of fertilizing elements but not as the essential constituents”;c.That the Respondent erred in fact in failing to appreciate that the product is not a micronutrient preparation but rather a constituent of 3 essential and predominant elements being Nitrogen, Phosphorus and Potassium in the proportion 21:21:21, respectively;d.That the Respondent erred in law and in fact in failing to categorise the product as a nutrient based fertilizer intended for plant growth and instead categorizing it as a chemical product;e.That the Respondent erred in law and fact in failing to appreciate and or ignoring the fact that the classification of products under EAC CET is based on their major primary component/s, and which product/s define their essential character, and not their micronutrient content;f.The Respondent erred in law in its interpretation and or understanding of the GIR and especially GIR 1 and 3 which if properly interpreted and or understood would have ;ed to the conclusion, by the Respondent, that the Product is not a micronutrient preparation but rather a constituent of 3 essential and predominant elements being Nitrogen, Phosphorus and Potassium in the proportion 21:21:21, respectively;g.That the Respondent erred in law by ignoring and or blatantly failing to follow clear and express decisions, rulings and judgements by this Honourable Tribunal and High Court of Kenya in its classification of products similar to this product;h.That the Respondent erred in law by failing to appreciate the tenor and content of KEBS Standards KS 2427 2020 (specifically scope 4.3) which recognizes that products such as the Product may contain micro elements which nevertheless do not change the classification and or essential character of said products;i.That in its erroneous classification of the Product, the Respondent went against the trite and universal principles of taxation including that of certainty and simplicity; and,j.That the Respondent erred in law in failing to appreciate the law and evaluate the evidence before it and consequently arrived at wrong conclusions in respect of the issues appealed against.
The Appellant’s Case
8.The Appellant’s case is premised on its;a.Statement of Facts dated and filed on 14th March 2025, together with the documents attached thereto;b.Witness statement of Peter Thuku dated, signed and filed on 11th June2025, adopted as evidence in chief on 23rd June 2025; and,c.Written Submissions dated 9th July 2025 and filed on 18th July 2025.
9.The Appellant averred that the on or about the 28th September 2024, it placed an order for three (3) fertilizer products (to be delivered) by sea, from the company referred to as Sinaria Holland BV, which products were Introsol P – Starter, N:P:K 10:50:10 + TE, Introsol K – Flower & Fruit – N:P:K 12:12:36 + TE and Introsol Even – Balanced – N:P:K 21:21:21 + TE (the products).
10.The Appellant stated that Sineria Holland BV shared material safety data sheet and certificates of analysis setting out the detailed composition of the products.
11.The Appellant contented that the Appellant through one Peter Thuku lodged a duly filled Import Declaration Form on 20th June 2024 under IDF No. 24EMKIM0005XXXX and declared the products under the classification of HS Code/Tariff No. 3105.XXXX.
12.The Appellant averred that the products were lodged under import entry number 24EMKIM401XXXX, however the Respondent disputed the HS Code and reclassified the same under HS Code No. 3824.9XXXX, which position was disputed by the Appellant.
13.The Appellant avowed that the products were cleared from the port on 30th October 2024 after the Appellant provided a bank guarantee to the Respondent.
14.The Appellant stated that on the same date, the Respondent sent one of its officers to take samples of the products. On conclusion of laboratory testing the Appellant received 3 letters dated 5th December 2024 from the Respondent, formally communicating its decision to classify the products under HS Code No. 3824.9XXXX and therein enclosed were the laboratory testing of the samples that were taken on 30th October 2024.
15.The Appellant stated that upon receipt of the Respondent’s decision, it lodged a review with the Respondent vide three (3) letters dated 19th December 2024 and raised eight (8) grounds, which were outlined in its Statement of Facts.
16.The Appellant maintained that the Respondent responded to its letters of 19th December 2024 through the letters of 16th January 2025 and affirmed its decision of classifying the products under HS Code 3824.9XXXX.
17.The Appellant stated that being aggrieved by the Respondent’s reclassification vide the letters dated 16th January 2025, it appealed to the Respondent to review its decision vide the correspondences dated 28th January 2025, the grounds whereof were majorly founded on the grounds as set out in the first requests for review in the letters dated 19th December 2024.
18.The Appellant averred that, the Respondent upon consideration of the further request from the Appellant, responded vide its letters dated 31st January 2025 and upheld the position that the Appellant’s products were classifiable under HS Code 3824.9XXXX.
19.The Respondent considered the further request for review, and vide its letter of 31st January 2025, upheld its earlier decision that the products imported by the Appellant are classifiable under the H.S Code 3824.9XXXX, the Appellant further averred.
20.The Appellant stated that in view of the unwavering position of the Respondent, it duly lodged its Notices of Appeal on 28th February 2025 pursuant to the EACCMA, as read together with the Tax Appeals Act, Cap 469 A of the Laws of Kenya and commenced the Appeal herein.
21.During the hearing on 23rd June 2025, the Appellant presented a witness one Peter Thuku, the Appellant’s clearing and forwarding officer, whose witness statement signed on 11th June 2025 and filed on the same date, was adopted in evidence-in-chief. The witness was cross -examined and re-examined.
22.The witness testified that the Appellant imported three fertilizer products from a company known as Sineria Holland BV. Which products were:-Introsol P Startet , N.PK 10.50.10 + TE.-Introsol K- Flower & Fruit – N.P.K 12.12.36+TE.- Introsol Even -Balanced-N.P.K 21.21.21 + TE.
23.The witness further testified that, on 20th June 2024, he lodged a duly completed Import Declaration Form (IDF) under IDF No. 24EMKIM005XXXX, aided by his knowledge of the composition of the declared products, under the Tariff classification H.S Code 3105.XXXX. The products consignment was on 9th October 2024 lodged under import entry number 24EMKIM401XXXX, he further stated.
24.The witness further testified that upon docking of the vessel carrying the products at the port of Mombasa, the Respondent disputed the Harmonized System code used claiming that the products should be classified as micronutrients under H.S Code 3824.9XXXX. The Appellant contested the Respondent’s contention.
25.The witness went on to state that the dispute went on back and forth, but eventually the products were eventually cleared from the port on 30th October 2024 in protest, after the Appellant secured the alleged duty liability with a bank guarantee in the sum of Kshs. 1,199,438.00 from Absa Bank Kenya on 29th October 2024 PLC. He stated that the costs and charges of securing the Bank Guarantee amounted to Kshs. 43,379.77.and continues to escalate as the Bank Guarantee remains in force.
26.The witness also testified that the Appellant objected to the Respondent’s reclassification of its product from Tariff H.S Code 3105.XXXX to H.S Tariff Code 3824.9XXXX and its basis and reasons for the objection, and application for review were;i.The Respondent erred in classifying the products under the Tariff H.S Code 3824.9XXXX as opposed to Tariff H.S Code 3105.XXXX contrary to the provisions of the EAC/CET and the GIRs;ii.The Respondent erred in its reading and understanding of the General Note to Chapter 31 of the EAC/CET, and specifically the General Note which excludes, from Chapter 31;iii.The Respondent failed to appreciate that the product is not a micronutrient preparation but rather a constituent of 3 essential predominant elements being Nitrogen, Phosphorous and Potassium, in the following proportion;a.10.50.10 in respect of Introsol P - Startet.b.12,12.36 in respect of Introsol K - Flower & Fruit.c.21.21.21 in respect of Introsol – Balanced.iv.The Respondent failed to categorize the product as a nutrient based fertilizer intended for plant growth and instead categorized it as a chemical product.v.The Respondent failed to appreciate and or ignored the fact that the classification of products under the EAC/CET is based on their primary components/and which products define their essential character, and not their micronutrient content.vi.The Respondent erred in its interpretation and understanding of the GIR and essentially GIR 1 and 3 which if properly interpreted and or understood would have led to the conclusion, by the Respondent, that the product is not a micronutrient preparation but rather a constituent of 3 essential and predominant elements being, Nitrogen, Phosphorous and Potassium in the proportions outlined earlier.vii.The Respondent erred in law by ignoring and or blatantly failing to follow clear and express decisions, rulings and or judgements by the Honourable Tribunal and the High Court of Kenya in its classifications of products similar to the product subject of the Appeal.viii.The Respondent failed to appreciate the tenor and content of KEBS Standard KS 2427:2020 (specifically scope 4.3) which recognizes that products such as the subject product may contain microelements which nevertheless do not change the classification and or essential character of the said products.
27.In its submissions, the Appellant state that two key issues emerge for determination, to wit;
28.In addressing the issue of jurisdiction raised by the Respondent, the Appellant submitted that the Court of Appeal in the case of Kenya Ports Authority vs. Modern Holdings (EA) Ltd (2017) eKLR, stated;
29.The Appellant submitted that the Respondent has contended that the Honourable Tribunal does not have the jurisdiction to adjudicate over the instant matter for the reason that the operative appealable decision is not that issued vide the Respondent’s letter dated 31/01/2025, but rather that issued vide the Respondent’s letter dated 16/01/2025.
30.It was stated that, in the circumstances, the Respondent has asserted that;i.That by virtue of the fact that the Appellant lodged an appeal against the Respondent’s decision of 31/01/2025, and not the decision of 16/01/2025, the Appeal is incompetent.ii.The Appellant’s Appeal is time barred for being lodged outside the statutory timelines.
31.The Appellant submitted that it lodged its Appeal against the decision of the Respondent rendered vide its letter dated 31st January 2025. However, the Respondent contends that the operative decision that the Appellant ought to have appealed against is the one issued vide the letter dated 16th January 2025.
32.It was submitted that the Respondent’s decision of 31st January 2025 which was communicated to the Appellant post the first Review Decision of 16th January 2025 was a separate and distinct decision from that issued on 16th January 2025.
33.The Appellant further submitted that the decision issued vide the letter date 31st January 2025 was arrived at and issued by the Respondent after due consideration of corresponding letters, from the Appellant, and specifically the Appellant’s letter of 28th January 2025, seeking a further review of the Respondent’s decisions.
34.The Appellant cited the case of Commissioner of Customs & Border Control vs. Auto Industries Ltd (2022) KEHC 15974 (KLR), and Submitted that the operable and appealable decision is that rendered by the Respondent vide its letter of 31st January 2025.
35.The Appellant submitted that having established that the operative appealable decision is the one rendered by the Respondent on 31st January 2025, the question as to when the Appeal ought to have been filed arises.
36.It was submitted that the Appellant lodged its Notices of Appeal in relation to the decision of the Respondent issued on 31st January 2025 on 28th January 2025, which was within the statutory timeline. It was also submitted that it is noteworthy that even if the operative appealable decision by the Respondent was that rendered vide its letter of 16th January 2025, the Appellant would have been still within the statutory timeline having filed its Appeal on 28th February 2025.
37.In view of the foregoing, the Appellant submitted that the Preliminary objection by the Respondent has no merit and ought to be dismissed.
38.In regard to the proper classification of the product, the Appellant submitted that the Tribunal has had occasion, on multiple instances, to adjudicate over similar disputes as this instant one between the Commissioner of Customs & Border Control and diverse taxpayers, which decisions have not been overturned by the High Court.
39.The Appellant submitted further that it was unfortunate and contemptuous of this Tribunal and the High Court for the Respondent to be having disputes with taxpayers over matters that have been severally adjudicated upon.
40.The Appellant submitted that its product is a fertilizer containing the essential fertilizing elements – Nitrogen, Phosphorous and Potassium.
41.In this matter it is not disputed by the Respondent that the product was a fertilizer. It is also not disputed that the product contains the three fertilizing agents Nitrogen, Phosphorous and Potassium, which position was confirmed by the Respondent after its sampling and lab analysis, the Appellant further submitted.
42.The Appellant submitted that the product contains Nitrogen, Phosphorous, and Potassium ad its essential constituents, which unequivocally define its nature and primary use as a fertilizer. These micronutrients are vital to plant growth and establish the product’s classification under H.S Code 3105.XXXX.
43.It was submitted that the micronutrient composition are merely fortifying agents that enhance the efficacy of the fertilizer, and neither transforms the product into a chemical, nor alters its essential purpose.
44.The Appellant also submitted that the Respondent’s contention that Chapter 31 of the EAC/CET is not applicable by reason that the general note thereto excludes micronutrient preparations containing small amounts of fertilizing elements but not as the essential constituents. This is misplaced because the product is not a micronutrient preparation. Its NPK elements, making up over 60 % of its composition, are the essential constituents and the defining feature of the product.
45.It was further submitted that the Respondent’s classification under Heading 38.24, a residual heading covering miscellaneous chemical products like binders and solvents, is inappropriate. Heading 38.24 applies to industrial products with no specific agricultural purpose, while the product in the instant case is a nutrient-based fertilizer explicitly designed for plant growth. The essential character of the product as a fertilizer cannot exist without NPK, and removing NPK composition would strip the product of its primary function as a nutrient provider.
46.The Appellant cited the case of Coffee Management Services Limited vs. Commissioner of Customs & Border Control (2022) eKLR, where it was stated;
47.It was therefore submitted that the Respondent’s attempt to classify the product under Chapter 38, specifically Heading 38.24.99.90, as fundamentally flawed, as Chapter 38 is intended for general industrial chemicals and miscellaneous products without a defined purpose in agriculture.
48.It was further submitted that as the product is a nutrient based fertilizer containing over 50% NPK, meets every requirement under Chapter 31 and specifically Heading 31.05. To classify the product otherwise, would be to misapply the Tariff Code, ignore its agriculture purpose, and create an unjustifiable precedent. In the circumstances, the only logical and legally sound conclusion is that the product is to be classified under Chapter 31, Heading 31.05 of the EAC/CET, as a chemical fertilizer containing the essential nutrients, Nitrogen, Phosphorous and Potassium.
49.The Appellant also cited the cases of Commissioner of Customs & Border Control vs. Lachlan Kenya Ltd ITA E054 of 2021) eKLR, and, Commissioner of Customs & Border Control vs. Exome Lifesciences Kenya Ltd (ITA E020 of 2023), where it was stated that;
50.It was also submitted that GIR 3 states that prima facie, the most specific description must be accorded to the product and in ascertaining its classification, its most material components must define its essential character.
51.It was also submitted that the Respondent’s attempt to reclassify the product under HS Code 3824.9XXXX is not only legally untenable but also irrational. It is founded on the reliance of emphasis of a minor element, which is less than 1 % (micronutrients) while disregarding the overwhelming majority of the product’s composition and its fundamental purpose as a nutrient-based fertilizer. Such conduct is arbitrary, inconsistent with classification principles, and undermines the integrity of the Harmonized System.On the other hand, HS Code 3105.XXXX accurately reflects the product’s agricultural purpose and essential character.
52.In view of the foregoing submissions, it is clear that the Respondent erred by re-classifying the Appellant’s product from H.S Code 3105.XXXX to H.S Code 3824.9XXXX.
The Appellant’s Prayers
53.By reason of the foregoing, the Appellant prays for orders;a.That the Appeal be allowed;b.That the Respondent’s decision dated 31st January 2025, and all prior decisions thereto relating to the product, be set aside;c.That a declaratory order do issue to the effect that the product is one that ought and is indeed classifiable under the Harmonized System Code/Tariff No. 3105.20.20 of the EAC/CET;d.That the Respondent be condemned to pay the costs of this Appeal; and,e.That this Honourable Tribunal do grant any other or further reliefs as it may deem fair and just.
The Respondent’s Case
54.The Respondent’s case is premised on the following, it’s;a.Statement of Facts dated 13th June 2025 and filed on 25th June 2025 together with all the documents attached thereto;b.Witness Statement signed by Thaddeus N. Ogoti on 16th June 2025 and filed on 18th June 2025, which was adopted in evidence-in-chief during the hearing on 23rd June 2023; and,c.Written submissions dated 16th June 2025 and filed on 18th June 2025.
55.The Respondent stated that the allegations laid out by the Appellant in its Memorandum of Appeal and Statement of Facts are unfounded in law and not supported by evidence.
56.The Respondent also stated that Chapter 31 covers classification of chemical fertilizers as specified in the limitive lists in heading 31.02, 31.03, 31.04, and 31.05.a.Heading 31.02 – Nitrogenous;b.Heading 31.03 - Phosphatic;c.Heading 31.04 – Potassic;d.Heading 31.05 – Other.
57.It was stated that the Heading 31.05 covers the classification of “other fertilizers” as specified in Explanatory Note 6 to Chapter 31. For the purposes of Heading 31.05, the term “other fertilizers” applies only to products of a kind used as fertilizers and containing as an essential constituent at least one of the fertilizing elements, nitrogen, phosphorous, or potassium in tablets or similar forms or in packages of a gross weight not exceeding 10 kg.
58.The Respondent also stated that the General Notes to Chapter 31 excludes micronutrient preparations which are applied to seeds, foliage, or to soil to assist in seed germination and plant growth. They may contain small amounts of the fertilizing elements, nitrogen, phosphorous and potassium, but not as essential constituents.
59.It was stated that Heading 38.24 covers the classification of prepared binders for foundry moulds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products) not elsewhere specified or included.
60.It was further stated that Heading 38.24 provides for, in pertinent part, the classification of chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products).
61.He Respondent stated that the products imported by the Appellant contained both macronutrients and micronutrients, which are beneficial to the plant. For Introsol Even 21. 21.21 + TE, it was specified to contain: -a.Nitrogen;b.Phosphorous;c.Potassium;d.Sulphur;e.Calcium;f.Iron M;g.Magnesium;h.Manganese;i.Copper;j.Boron; and,k.Molybdenum.
62.The Respondent further stated that the micronutrients Nitrogen, Phosphorous and Potassium are essential for plant growth and overall state of the plant.
63.It also stated the product has micronutrients which help plants by providing minerals and vitamins crucial to disease prevention and healthy development and well-being of plants (i.e. Magnesium, Zinc, Molybdenum, Iron, copper and boron).
64.It was stated that both macronutrients and micronutrients are important for plants’ overall growth, and none can claim an advantage over the other.
65.The Respondent contended that as was presented, Introsol – Even (Balanced) 21.20.21.+ TE, Introsol -P Startet-10.50.10 + TE, and Introsol – K-Flower and Fruit 12.12.36 + TE, are classified under the Tariff 2022 EAC/CET H.S Code 3824.9XXXX.
66.It stated that the review issued by the Commissioner after the Appeal, upheld the classification of the product in 2022 EAC/CET H.S Code 3824.9XXXX, which is at variance with the 2022 EAC/CET H.S Code 3105.XXXX that was declared by the Appellant.
67.The product Introsol Even (balanced) - 21. 21.21 + TE is a water-soluble crystallite that contains elements i.e. Sulphur 1%, Calcium 10%, Magnesium 0.6%, Manganese 0.5%, Copper 0.05% and Molybdanim 0.0005%. the product is intended to be used as an agricultural farm input to provide plants with a balanced macro and micro-nutrients for vegetative growth, flowering of fruits as well as seed development.
68.The Respondent further stated that it was therefore misleading to ignore micronutrients when citing the identity of the product. It stated that the additions to the product though in small quantities are sufficient quantities required for plant growth and development. The fact that they are available in minute quantities does not make the micronutrients elements less important in the plant growth and development.
69.The Respondent also stated that this is a balanced fertilizer with equal amounts of nitrogen, phosphorous, and potassium. It is suitable for all stages of plant growth, especially in promoting vegetative growth (due to nitrogen), root development (due to Phosphorous), and overall plant health and fruiting (due to potassium). It was stated that the added trace elements (TE) help address any micronutrient deficiencies that plants might experience, making it an all-purpose option for general plant health.
70.The Respondent further stated that all the elements in the fertilizer including the Trace Elements are what constitutes the fertilizer, arguing that it is manufactured in such a manner as to offer all round benefits to other plants and the micronutrients play an important role in making the fertilizer what it is. Therefore, in much as the fertilizer contains those micronutrients it cannot be ignored that it also contains micro nutrients, it was stated.
71.The Respondent also contended that to classify fertilizer, it is important to note the elements that make up the product. First, the fertilizer is comprised of macronutrients i.e. Nitrogen, Phosphorous and Potassium, in equal amounts, and micronutrients, i.e. the Trace Elements (TE). It noted that the macronutrients in the fertilizer are incomplete without micronutrients as it is manufactured as an all-round fertilizer for the crops. It was stated that it is wrong to ignore the micronutrients when citing the identity of the product.
72.It was stated that the application of the rules and the classification was based on the facts as determined and the submissions made by the Appellant.
73.The Respondent also stated that Section 236 (a) of EACCMA provides;
74.It was stated that upon verification, the Respondent classified the goods in the Nomenclature (Harmonized Commodity Description and Coding System) applying the six General Interpretative Rules mutatis mutandis.
75.It was stated that classification is done in accordance with the legal provisions under the Harmonized System (HS) Code and General Interpretative Rules.
76.By the application of the rules of classification, the products presented are classified under Chapter 31 (macronutrients) and Chapter 38 (micronutrients). By the application of GIR 3 (C) the heading that comes last in numerical order is preferred where a product is potentially classifiable in two headings, it was stated.
77.The products as presented contain both macronutrients (N.P.K) as well as micronutrients (Iron, Copper, Boron, Molybdenum, Manganese). The micronutrients are classified under Chapter 38, the Respondent added.
78.It also averred that the micronutrients are essential to plant growth and development, and by their very description they are required in minute quantities. It further stated that to refer to the quantities as contained in the product to indicate whether they are essential or significant in determining the classification is misleading to the Honourable Tribunal. It added that there is nowhere whatsoever in the HS legal notes has quantities been mentioned in reference to classification.
79.The Respondent stated that it has properly and legally classified the products under 2022 EAC/CET HS Code 3824.9XXXX by application of GIR 1, 3(C) and 6.
80.The Respondent also stated that upon considering Heading 3105.XXXX of Chapter 31, and Heading 3824.9XXXX of Chapter 38 where the macronutrients and micronutrients are classifiable, Heading 3824.9XXXX takes precedence as guided by the GIR, which provides;
81.The Respondent further stated that whereas it is not in dispute as regards the terms of Heading 31.05, the Appellant has deliberately ignored the fact that the product as presented has also micronutrients in addition to the macronutrients of NPK, and the General Explanatory note to Chapter 31 that excludes micronutrients preparations to Heading 38.24 apply;
82.The Respondent also stated that the classification of goods is done as presented to the Respondent during importation. The goods under this Appeal has never been a subject of dispute before the Tribunal on this matter where the Respondent is dealing with a specific product will be misleading. The Canadian case of Deputy Minister of National Revenue for Customs and Excise vs. Ferguson Industries Ltd was cited by the Respondent.
83.The Respondent presented a witness during the hearing on 23rd June 2025, one Thaddeus Ogoti, whose statement signed on 16th June 2025 and filed on 18th June 2025 was adopted in evidence-in-chief. The witness was cross examined and re-examined.
84.The witness testified that during the classification review of the Appellant’s products which he undertook, he considered all the information submitted by the Appellant and made findings which formed the basis for the Tariff classification as follows ;a.The composition of the product – composed of macronutrients and micronutrients intended for foliar application.b.The macronutrients included Nitrogen, Phosphorous and Potassium.c.The micronutrients included chelated micro-elements/Trace Elements (TE) including Sulphur, Calcium, Iron, Magnesium, Manganese, Copper, Boron, and Molybdenum.d.The composition of the product indicated that when administered through foliar application, the crop would benefit from both the macronutrients and micronutrients.e.The product as presented contain two essential constituents, which merited consideration for customs classification under the Harmonized System nomenclature i.e., mineral or chemical fertilizers of Heading 31.05 and micronutrient preparations of Heading 38.24.f.The packaging of the product was in 25kg bags as per the packing list.g.The product’s usage is intended to be used as an agricultural farm input to enhance quick and strong roots development for better water and nutrient uptake.
85.The witness further stated that based on the technical information provided by the Appellant and the provisions of the GIRs, he concluded that the product was an agricultural nutritional formulation containing both macro and micro elements classifiable under HS Code 3824.9XXXX of the EAC/CET based on GIR 1, 3 (C) and 6.
86.He further stated that HS Code 3824.9XXXX provides for other products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products) not elsewhere specified or included.
87.The witness further stated that HS Code 3824.9XXXX also includes the classification of micronutrients as per General Notes to Chapter 31, as follows;
88.The witness also testified that upon conclusion of the review and classification, he prepared a Tariff Ruling, which was reviewed and approved by his supervisor, and issued to the Appellant through a letter dated 5th December 2024.
89.He testified that the Appellant appealed for review of the Tariff decision vide its letter of 19th December 2024, and upon review the Tariff ruling was upheld vide the Respondent’s letter dated 16th January 2025.
90.In its submissions, the Respondent stated that there were four issues raised by the Appeal to wit;
91.On whether the Appellant’s Appeal is competently before the Tribunal, the Respondent submitted that it issued a Tariff Ruling on 5th December 2024, to which the Appellant sought a review on 20th December 2024 pursuant to the provisions of Section 229 of EACCMA.
92.The Respondent submitted that it reviewed the Appellant’s application for review and issued Review Decision on 16th January 2025 pursuant to Section 229 (4) of EACCMA, and this decision concluded the Application for Review process to the Commissioner. It was therefore submitted that the Respondent became Functus officio on 16th January 2025 when it communicated the Review Decision.
93.It was thus submitted that the Application for Review Process crystallized when the Respondent issued the Review Decision on 16th January 2025, and accordingly, the Respondent’s Decision of 16th January 2025 was no longer available for further review under Section 229 of EACCMA.
94.It was therefore submitted that the Appellant’s Appeal is incompetent to the extent that it does not comply with the provisions of Section 230 of EACCMA. The section provides that a person aggrieved by the Respondent’s Review Decision ought to appeal to the Tax Appeals Tribunal and not the Commissioner. The Appellant having not appealed against the Review Decision of 16th January 2025 renders the Appeal herein incompetent and cannot stand.
95.The Respondent submitted that consequently, the Respondent’s Review Decision of 16th January 2025 still stands and thus is binding on both the Appellant and the Respondent.
96.On whether the Tribunal has jurisdiction to entertain the Appeal, the Respondent submitted that it is trite law that a Notice of Appeal is a foundation of the Appeal and thus a jurisdictional prerequisite which invokes the Tribunal’s mandate. In the case of Ken Iron and Steel Limited vs. Commissioner of Investigations & Enforcement [2023] KEHC2770 (KLR), the High Court observed;
97.It was submitted that the Appellant filed a Notice of Appeal dated 28th February 2025 seeking to appeal against the Respondent’s letter dated 31st January 2025. In the said letter the Respondent informed the Appellant pursuant to Section 229 of EACCMA, it had already issued a Review Decision dated 16th January 2025.
98.The Respondent submitted that its letter dated 31st January 2025 is neither a Review Decision or Tax Decision for the purposes of Sections 3 & 12 of the Tax Appeals Tribunal Act, Cap 469 A. Therefore, considering that the Appeal is founded on the Respondent’s letter dated 31st January 2025 and not the Review Decision dated 16th January 2025, it follows that the Appeal herein is incompetent and thus the Tribunal lacks the jurisdiction to consider the same.
99.On whether the product imported by the Appellant is correctly classified under HS Code 3824.9XXXX of the 2022 EAC/CET, the Respondent submitted that Chapter 31 excludes micronutrient preparations which are applied to seeds, to foliage or to soil to assist in seed germination and plant growth. It submitted that Chapter 31 covers the classification of chemical fertilizers as specified in the limitive lists, in heading 31.02, 31.03, 31.04, and 31.05.
100.The Respondent submitted that the Appellant erroneously relied on Section 3105.XXXX , which provides;
101.It was further submitted that the rule of strict interpretation in Cape Brandy Syndicate case, mandates that H.S Code 3105.XXXX be interpreted plainly, which leads itself to the construction;
102.It was further submitted that the Appellant erroneously interpreted Section 3105.XXXX to mean compositions of nitrogen, phosphorous and potassium and any other additional mineral. The section however expressly provides for the mandatory constituent elements.
103.The Respondent submitted that the Appellant’s product contained both macronutrients and micronutrients, which are all beneficial to the plant, and essential for plant growth and overall state of the plant, and none can claim an advantage over the other. The products have constituent elements that are not limited to nitrogen, phosphorous, and potassium, in accordance with strict interpretation of Section 31.02.
104.The Respondent also submitted that a fertilizer with nitrogen, phosphorous and potassium together and or alone will thus fall under Chapter 31 of the 2022 EAC/CET. Chapter 31 of the 2022 EAC/CET does not apply in this case because there is the presence of other trace nutrients which are essential to plant development and growth. The General Rule under Chapter 31 already excludes micronutrient mixtures.
105.It was submitted that in accordance with Rule 3 (c) of the GIR, the most important chapter is 38, “Miscellaneous Chemical Products”, the items in question are chemical products and therefore the heading is appropriate. Both macronutrients and micronutrients are important for plants overall growth and none has any advantage over the other, it was stated.
106.The Respondent therefore submitted that the terms of Heading 3824 are appropriate, itemizing several items that fall under the heading, including;
107.It submitted that the product in issue is a chemical mixture whose composition of constituent elements eliminates them from classification under any other chapter heading. Since the nature of this composition is not anywhere else provided, it rightly falls under Heading 3824, specifically HS Code 3824.9XXXX.
108.It was also submitted that the items in question do not satisfy the parameters (limitive lists) under Headings 3102, 3103, 3104 and 3105 of the 2022 EAC/CET, and the same cannot therefore be classifiable under Chapter 31.
109.The Respondent further submitted that the Appellant has not discharged its burden of proof as per Section 30 and 38 (b) of the Tax Appeals Tribunal Act cap 469A, and Section 107 of the Evidence Act.
110.It was therefore submitted that the Respondent’s Review Decision is valid in law, as the Appellant failed to prove that the same is incorrect. The Respondent thus reiterates that the Tariff classification Ruling of 5th December 2024 as confirmed in the Review Decision of 16th January 2025 are valid and correct as they are grounded in law.
The Respondent’s Prayers
111.By reason of the foregoing, the Respondent prayed that the Honourable Tribunal grants the orders;a.That the Respondent’s Review Decision classifying the product Introsol Even 21.21.21 + TE, under HS Code EAC/CET 3824.9XXXX on 16th January 2025 be upheld;b.That this Appeal be dismissed with costs to the Respondent as the same lacks merit.
Issues for Determination
112.The Tribunal having carefully considered the pleadings filed, the evidence adduced and the submissions made by the parties is of the considered view that the Appeal herein distils into two issues that commend for determination as follows:
Analysis and Determination
113.The Tribunal having identified the issues proceeds to analyze the same as hereunder :
114.The issue subject of the dispute in the Appeal herein is the proper classification of the Appellant’s imported fertilizer product, Introsol Even 21.21.21. + TE.
115.The summary of the background is that the Appellant imported three fertilizer products from a company known as Sineria Holland B.V, among them, the subject product.
116.The Appellant lodged its Customs clearance entry with the Respondent’s ICMS system and declared the imported products under the tariff EAC/CET HS Code 3105.XXXX, which the Respondent disputed and contended that the products ought to be declared under the Tariff EAC/CET HS Code 3824.9XXXX and accordingly issued a tariff classification ruling on 5th December 2024.
117.The Appellant objected to the reclassification of its product by lodging its application for Review on 19th December 2024 with the Respondent. The Respondent considered the application for Review and rendered its Review Decision on 16th January 2025 upholding its Tariff classification decision.
118.Dissatisfied with the said Review Decision as communicated by the Respondent’s letter of 16th January 2025, the Appellant once again appealed to the Respondent for review of the said decision on 28th January 2025. The further request for review was founded on the same grounds as set out in the application for review dated 19th December 2024. The Respondent again considered this further request for review from the Appellant and vide its letter of 31st January 2025 upheld its earlier tariff decision that the Appellant’s product is classifiable under HS Code 3824.9XXXX. It is thus this communication from the Respondent to the Appellant that triggered the instant Appeal.
119.The Respondent has contended that the Appeal herein is not competent on the basis that the Review Decision issued on 16th January 2025 is the appealable decision the Appellant ought to have appealed against, and not the one dated 31st January 2025.
120.The Respondent has submitted that it issued a tariff classification ruling on 5th December 2024 which the Appellant sought to be reviewed on 19th December 2024. It reviewed the Appellant’s application and issued a Review Decision on 16th January 2025.
121.It was submitted that it is the Respondent’s decision of 16th January 2025 that concluded the Application for Review process to the Commissioner. It was further submitted that the Respondent became functus officio on 16th January 2025 when it communicated its Review Decision. The Respondent again submitted that the Appellant’s Appeal is rendered incompetent as it does not comply with Section 230 of EACCMA, and the Respondent’s decision issued on 16th January 2025 is no longer available for further review under Section 229 of EACCMA. It was therefore the Respondent’s contention that by virtue of the Appellant lodging an Appeal against the Respondent’s decision of 31st January 2025, and not its decision of 16th January 2025, the Appeal is consequently incompetent .
122.The Appellant stated that on 5th December 2024 the Respondent formally issued its tariff classification ruling communicating its intention to classify the imported product under HS Code 3824.9XXXX, instead of the Appellant’s declared HS Code 3105.XXXX. The Appellant lodged a review application thereto to the Respondent on 19th December 2024. On 16th January 2025, the Respondent communicated its Review Decision in which it emphasized its position in classifying the subject products under HS Code 3824.9XXXX.
123.The Appellant has averred that being aggrieved by the Respondent’s decision dated 16th January 2025, it again through its letter dated 28th January 2025 appealed to the Respondent to review its decision dated 16th January 2025. The Respondent again considered this further Appeal and rendered a further decision on 31st January 2025, again upholding the position that the subject products are classifiable under tariff HS Code 3824.9XXXX, the Appellant averred.
124.The Appellant posits that the Respondent’s decision dated 31st December 2025, communicated to the Appellant post the first Review Decision of 16th January 2025 was a separate and distinct decision from the one issued on 16th January 2025, as it was issued after due consideration of the Appeal correspondence from the Appellant, specifically the letter dated 28th January 2025, requesting a further review.
125.The Appellant also averred that it was noteworthy that in its letter of 16th January 2025, it expressly advised the Appellant to reach out in case of any queries relating to the contents of the said letter, thereby expressly inviting the Appellant to challenge the decision issued vide the said letter dated 16th January 2025. It is on that basis that it sought a second review, and the Respondent not only entertained the second review request letter dated 28th January 2025, but responded to the same with a decision dated 31st January 2025, and concluded;
126.The Appellant submitted that the effect of the foregoing was that the Respondent was stating in its letter of 31st January 2025 that it had made its final decision in the matter pursuant to Section 229 of EACCMA.
127.The Appellant therefore contended that the final Review Decision on the tariff classification of the subject product is that communicated vide the Respondent’s letter of 31st January 2025 which constitutes the appealable decision, and not that communicated vide the letter of 16th January 2025.
128.In view of the foregoing, it was submitted that the Appellant’s Appeal is competent before the Tribunal, and the Tribunal has the jurisdiction to hear and determine the same.
129.The Tribunal notes that though the Respondent argues that the Appellant ought to have appealed to the Tribunal following its Review Decision dated 16th January 2025, the Respondent continued engaging with the Appellant, receiving further correspondence, information, and documentation culminating to the Tariff Review Decision letter dated 31st January 2025 which upheld its earlier position, and in which it declares a“…conclusion of all tariff deliberations of the product as provided under Section 229 of EACCMA …” , and is thereby estopped from maintaining its letter of 16th January 2025 as the conclusion of the classification tariff review process.
130.In essence ,the letter of 16th March 2025 was overtaken by events, leading to the issuance and sustenance of the letter dated 31st January 2025 as the tariff Review Decision, and this letter is what constitutes the appealable decision, thus the Appeal is rightly before the Tribunal.
131.Consequently, the Tribunal finds and holds that the Appellant’s Appeal is competently filed before the Tribunal, and the Tribunal therefore is rightly conferred with the jurisdiction to hear and determine the same.
ii. Whether the Respondent erred in re-classifying the Appellant’s imported fertilizer product, Introsol Even 21.21.21 + TE, under tariff HS Code 3824.9XXXX instead of the tariff HS Code 3105.XXXX.
132.The facts and averments of the Appellant’s and Respondent’s cases are as extensively set out hereinabove which the Tribunal does not intend to rehash in detail in this analysis again.
133.The Appellant has contended that the classification of its goods under the Harmonized Classification System is determined by the essential characteristics, components, and composition of the product. The Appellant averred that its fertilizer product was composed of the macronutrient Nitrogen, Phosphorous and Potassium as the man essential constituents, with trace elements of micronutrients such as Boron, Copper, Zinc, Magnesium, Molybdenum, Iron, Manganese, appearing in minute quantities.
134.The Appellant submitted that its product contains Nitrogen, Phosphorous and Potassium as its essential constituents, and which unequivocally defined its nature and primary use as a mineral fertilizer. It contended that the micronutrients are vital to plant growth and establish the product’s classification under the Tariff HS Code 3105.XXXX. The Appellant submitted that the micronutrient composition are merely fortifying agents that enhance the efficacy of the fertilizer, and neither transform the product into a chemical nor alter its essential purpose as a fertilizer.
135.The Respondent contended that in classifying the fertilizer product, the intended application and the provisions of the GIRs and Explanatory Notes, the product was considered to be a chemical fertilizer classifiable under the tariff 2022 EAC/CET HS Code 3824.9XXXX. The Respondent contended that Chapter 31 as applied by the Appellant excludes micronutrient preparations that applied to seeds, foliage or soil to assist in seed germination and plant growth.
136.In objecting to the Respondent’s classification, the Appellant contended that the fertilizer product, Introsol Even 21.21.21 + TE, cannot fall under the categorized classification as the product is composed of 63% Nitrogen, Phosphorous and Potassium which form its main elements and are minerals, and the micronutrient are too minute to qualify the product as of chemical composition.
137.The Appellant further contended that the HS Code 3824.9XXXX applied by the Respondent is applicable to chemicals used in binding materials such as foundry and cement and ought not to apply to its fertilizer product, which contain the three fertilizing elements of Nitrogen, Phosphorous, and Potassium and are used for agricultural purposes to promote plant growth, and prevent the occurrence of macronutrient and micronutrient deficiencies in plants.
138.The Tribunal takes note that fertilizers are classifiable under Chapter 31 of the EAC/CET;
139.From the foregoing analysis, the Tribunal is persuaded that the Appellant correctly applied the classification of its fertilizer product using GIR 1. GIR 1 States ;
140.The Appellant justified applied relevant chapter 31 heading in classifying its fertilizer product as per the Tariff EAC/CET HS Code 3105.XXXX as opposed to the heading in Chapter 38. Chapter 31 states;
141.Since Chapter 38 applies to chemical products, the Tribunal is persuaded that the more specific classification of the product would be under Chapter 31 as a mineral fertilizer, as opposed to a classification under Chapter 38 of EAC/CET.
142.The net effect of the foregoing is that the Tribunal finds and holds that the Respondent was not justified in reclassifying the Appellant’s fertilizer product under the HS Code 3824.9XXXX as opposed to the Appellant’s classification under HS Code 3105.XXXX.
143.The upshot of the foregoing is that the Appellant’s Appeal is merited and hereby succeeds.
Final Determination
144.The Appellant’s Appeal having succeeded the Tribunal proceeds to make the following orders;a.The Appellant’s Appeal be and is hereby allowed;b.The Respondent’s Review Decision dated 31st January 2025 and consequential decisions thereto be and are hereby set aside; and,c.Each party to bear their own costs.
145.It is so ordered.
DATED AND DELIVERED IN NAIROBI THIS 3RD DAY OF OCTOBER 2025ROBERT M. MUTUMA - CHAIRPERSONMUTISO MAKAU - MEMBERDR. TIMOTHY B. VIKIRU - MEMBER