Kenya Revenue Authority(KRA) has been directed it to collect Ksh.761.8 million from Ravasam Development Limited.
The Tax Appeals Tribunal dismissed the case filed by the company, seeking to set aside the tax demand for Corporation tax and VAT.
In 2019, the company wrote to the Commissioner 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.
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.
KRA granted the company an opportunity to raise objection within 30 days on condition that the taxpayer avails all documentary evidence.
However, the company 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.
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.
This comes after the taxman streaked another case battle against a Pakistani rice company.
KRA won a Sh1.4 billion tax evasion claim suit after Tax Appeals Tribunal dismissed an appeal filed by Jhulay LAL Commodities Ltd that contested KRA’s demand for the money.
The company filed for an appeal after a Mombasa Magistrate High Court was in favour of KRA arguing that the authority’s assessment was excessive.
“KRA successfully argued that it made the assessment after an investigation revealed several irregularities including unexplained bank deposits and that the sales of the rice exceeded the amounts imported,” said the tribunal.
The company is said to have dodged taxes for four years.
In February last year, the authority prosecuted two Pakistan businessmen, Rahim Qasim and Rameez Gulzar Ali of having imported rice worth sh. 1.68 billion and sold it all but failed to declare and remit income tax from the business to KRA.
They also faced two other counts of defaulting to pay sh. 434,930/= to KRA arising from business undertakings amounting to sh 1.4million in 2017, and Kshs 522 million from business undertakings amounting to sh. 1.7 billion in 2018.
They denied all the three charges.