advertisement

News

I&M Bank loses Sh238m court battle with KRA

Times Tower, the headquarters of the KRA, in Nairobi. FILE PHOTO | NMG
Times Tower, the headquarters of the KRA, in Nairobi. FILE PHOTO | NMG 

I&M Bank #ticker:I&M has lost its court battle to stop the Kenya Revenue Authority (KRA) from demanding Sh238 million in VAT, corporate and withholding tax.

High Court judge George Odunga has instead ordered I&M to take its case against the KRA to the Tax Appeals Tribunal for determination.

The KRA initially demanded Sh434 million from I&M following a 2015 assessment of the lender’s books. I&M later filed an appeal against the demand at the Tax Appeals Tribunal.

The bank, in the suit, held that the KRA failed to respond to its objection to the 2015 tax assessment for more than 60 days, which, under the Kenyan law, means that the demand for unpaid levies had been waived.

The KRA, however, argued that the letter it received from I&M was open-ended and could, therefore, not be construed to be an objection to the tax demand. The KRA said I&M only made some inquiries regarding its demand for unpaid taxes.

Justice Odunga has now ordered I&M to amend its appeal at the Tax Appeals Tribunal to include its claim on the objection letter.

“The substance of my findings hereinabove is that the issues raised herein would have been better dealt with by the Tax Appeals Tribunal in the exercise of its appellate jurisdiction under section 12 of the Tax Appeals Tribunal Act as read with section 51(9) of the Tax Procedures Act,” he said.

advertisement