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10-day delay costs oil marketer Sh578m in tax appeal
KRA audit issued an additional tax assessment of Sh578.56 million in June 2024, citing undeclared sales, overstated purchases, and unaccounted director benefits.
An oil marketer has lost its attempt to overturn a Sh578.56 million tax demand from the Kenya Revenue Authority (KRA) for filing the appeal 10 days out of time.
Evon Energy International Limited had sought the intervention of the Tax Appeals Tribunal to overturn the claim, but all its arguments were thrown out for filing crucial documents past the legally permitted time.
The oil marketer was told that its memorandum of appeal and statement of facts were submitted 10 days past the statutory deadline without seeking leave for extension.
The tribunal said it could not make even “one more step” in the case once it established that the appeal was filed out of time –echoing precedents set in similar cases involving late filings. It added that Evon either “ignored” or was “oblivious” of Section 13 of the Tax Appeals Tribunal Act on the filing of appeals.
“The tribunal finds that the memorandum of appeal and statement of facts of the appellant (Evon) were filed outside the statutorily mandated timelines without its leave having first been sought,” said the tribunal.
“Accordingly, the instant appeal is improperly before it and further having found as such, the tribunal finds that it is devoid of the jurisdiction to determine the instant appeal on its merits and must therefore down its tools”
The tribunal found that Evon failed to comply with the mandatory timelines set under the law, effectively stripping the tribunal of the jurisdiction to hear the case on its merits.
The tribunal said Evon, upon filling its memorandum of appeal and statement of facts out of the timeline specified in law, ought to have sought approval of the tribunal to file the said appeal documents out of time.
This is in line with Section 13 of the tax appeals law, which requires an entity filing an appeal to do so within 14 days from the date of filing the notice of appeal and submit relevant documents.
The law allows for an extension in submission of the documents on grounds such as sickness or absence from Kenya, but the appellant must first seek the extension from the tribunal.
The tribunal found that while Evon filed the notice of appeal on time, on December 23, 2024, the oil marketer filed its memorandum of appeal and statement of facts on January 17, 2025, being about 10 days past the statutory deadline. The panel said the documents ought to have been submitted by January 6 at the latest.
Quoting a previous case, the tribunal emphasized that “jurisdiction is everything,” and once a tribunal determines it lacks jurisdiction, it must “down its tools.”
The dispute stemmed from a KRA audit into Evon Energy’s tax affairs between 2020 and 2022, focusing on a contract with Kenya Electricity Generating Company to supply dual-purpose kerosene to the Muhoroni Power Station.
The KRA audit issued an additional tax assessment of Sh578.56 million in June 2024, citing undeclared sales, overstated purchases, and unaccounted director benefits.
Evon objected, arguing that KRA had ignored key business facts such as stock losses, calibration adjustments, non-tradable fuel quantities, and export fuel handled for other oil companies.
KRA, however, maintained that Evon had failed to substantiate its claims with documentation during both the audit and objection review stages, insisting that the tax assessment was proper and supported by evidence.
