Ravasam Development company to pay Ksh.760 million to KRA after tribunal dismisses appeal

Ravasam Development Limited will pay Ksh.761,828,987.44 to the Kenya Revenue Authority (KRA).

This is after the Tax Appeals Tribunal dismissed the case filed by the company, seeking to set aside the tax demand for Corporation tax and VAT.

In the case, the Tribunal noted that the taxpayer did not raise any objections to the assessments raised by KRA within the 30-day timeline provided by law.

The company wrote to the Commissioner on November 6, 2019 requesting to file a late objection.

“During the hearing of the case, KRA informed the Tribunal that there exists no appealable decision from which the taxpayer can prefer an appeal to the Tribunal since its alleged appeal was premised on a letter which did not constitute an appealable decision,” KRA said.

KRA contended that the Tribunal did not have jurisdiction to hear the Appeal before it because there was no appealable decision considering that the taxpayer failed to exhaust all available remedies before approaching it.

The Tribunal held that the taxpayer was required to bring its notice of objection in conformity with the Tax Procedures Act 2015, and failure to do so offended the doctrine of exhaustion of administrative remedies.

KRA granted it an opportunity to do so on December 19, 2019 on condition that the taxpayer avails all documentary evidence.

It however failed to do so despite being requested severally. Following this, the Tribunal held that the case filed by the taxpayer was deficient both on merit and in substance, thus allowing KRA to collect taxes amounting to Ksh.761.8 million.

Meanwhile, the Tax Appeals Tribunal has upheld KRA’s tariff classification relating to importation of a grain storage silo and the demand of 6.8 million shillings from Mombasa Maize Millers (Nakuru) Limited.

The Tribunal, in a judgment delivered on 13th May 2021 , observed that the Taxpayer had imported a complete flour milling plant which included grain storage silos.

“The Taxpayer therefore contended that the correct commodity tariff code for the imported item is 8437.80.00 which it declared on its customs entry. KRA’s position however was that the goods imported by the Taxpayer were prefabricated structures made of galvanized steel that are assembled on site and which in its considered view are properly classifiable under tariff Code 9406.00.90,” reads part of the statement.

KRA noted that the goods imported by the Taxpayer were prefabricated structures made of galvanized steel that are assembled on
site.