Case Note: Audax Kijana Kameja Vs Commissioner General Tanzania Revenue Authority (2025 Tzca 49)

Court: Court of Appeal of Tanzania
Coram: Kerefu, J.A., Fikirini, J.A., Masoud, J.A.
Date of Judgment: 21st February 2025
Appellant: Audax Kijana Kameja
Respondent: Commissioner General, Tanzania Revenue Authority
Appeal Number: Civil Appeal No. 144 of 2022

Introduction

The Court of Appeal of Tanzania (CAT) has consistently held that the refusal to grant a waiver of the one-third tax deposit is not appealable before the Tax Revenue Appeals Board. This decision in Audax Kijana Kameja vs Commissioner General TRA aligns with previous rulings, including Pan African Energy Tanzania Ltd v. Commissioner General TRA (2019) and Pan African Energy Tanzania Ltd v. Commissioner General TRA (2021), reinforcing the established jurisprudence on the jurisdictional limits of the Board. By affirming that waiver refusals are administrative decisions outside the Board’s jurisdiction, the CAT maintains a clear stance on the statutory framework governing tax appeals. 

Background

This appeal arose from a tax dispute between the appellant, Audax Kijana Kameja, and the Commissioner General of the Tanzania Revenue Authority (TRA). The appellant was served with an adjusted tax assessment notice for the 2010 year of income, requiring payment of TZS 402,192,237.10. In response, he sought an extension of time to file a notice of objection. While this application was pending, a second demand notice for TZS 379,912,382.10 was issued. The appellant, dissatisfied with the assessment, filed a notice of objection and simultaneously sought a waiver of the one-third tax deposit required under the Tax Administration Act, 2015 (TAA). The TRA rejected the waiver application on the ground that it was time-barred.

The appellant challenged the rejection before the Tax Revenue Appeals Board (the Board), which held that it lacked jurisdiction, as the appeal did not arise from an objection decision but rather from the TRA’s refusal to grant a waiver. The appellant then appealed to the Tax Revenue Appeals Tribunal (the Tribunal), which upheld the Board’s decision, relying on the Court of Appeal’s precedents in Pan African Energy Tanzania Ltd v. Commissioner General TRA (2019) and Pan African Energy Tanzania Ltd v. Commissioner General TRA (2021). The appellant subsequently appealed to the Court of Appeal.

Key Legal Issues

1. Whether the Tax Revenue Appeals Board had jurisdiction to hear an appeal against the TRA’s refusal to grant a waiver of the one-third tax deposit.
2. Whether the Tribunal correctly applied the precedents set in the Pan African Energy cases in determining the jurisdictional issue.
3. Whether the appellant’s claim was based on an ‘omission’ by the TRA under Section 53(1) of the TAA, thus falling within the Board’s jurisdiction.

Appellant’s Arguments

The appellant contended that the Tribunal erred in dismissing his appeal by incorrectly applying the Pan African Energy precedents. He distinguished his case by arguing that the TRA’s failure to determine his application for waiver within the prescribed time constituted an ‘omission’ under Section 53(1) of the TAA, which should have been within the jurisdiction of the Board. He further asserted that the legislative intent of Section 53(1) was to allow appeals against tax authorities’ failures to act, separate from the requirement of an ‘objection decision’ under Section 16(1) of the Tax Revenue Appeals Act (TRAA).

Respondent’s Arguments

The respondent argued that the only appeals allowed before the Board are those stemming from ‘objection decisions’ under Section 16(1) of the TRAA. The respondent maintained that its refusal to grant a waiver was not an ‘objection decision’ but rather an administrative determination, which could not be challenged before the Board. The respondent further emphasized that the Pan African Energy cases had already established that the Board lacked jurisdiction over waiver denials.

Court’s Analysis and Decision

The Court of Appeal reaffirmed that the Board’s jurisdiction is strictly confined to appeals against ‘objection decisions,’ as prescribed under Section 16(1) of the TRAA. The Court ruled that a taxpayer can only appeal against an objection decision arising from an assessment dispute and not against administrative refusals, such as a waiver denial. The Court reiterated its previous stance in Pan African Energy I and II that the phrase ‘other decisions or omissions’ in Section 53(1) of the TAA does not extend the Board’s jurisdiction to matters outside ‘objection decisions.’

Regarding the appellant’s claim that the respondent’s delay in determining the waiver request constituted an ‘omission,’ the Court found that the respondent had ultimately issued a refusal decision, albeit belatedly. Since the appellant’s appeal was based on that decision rather than a complete failure to act, it did not fall within the definition of an ‘omission’ under Section 53(1) of the TAA. Instead, it was deemed a refusal decision outside the Board’s jurisdiction. The Court further held that adherence to the doctrine of stare decisis required it to follow its prior rulings in Pan African Energy cases, which were on all fours with the present matter.

Conclusion and Holding

The Court dismissed the appeal in its entirety with costs, upholding the Tribunal’s decision that the Board lacked jurisdiction to hear the appellant’s claim. The ruling reinforced the position that taxpayers cannot challenge the Commissioner’s waiver refusals before the Board and must seek alternative legal avenues if aggrieved by such decisions.

Our Analysis and Recommendations 

While this decision ensures legal consistency, it also highlights a significant gap in the tax dispute resolution framework for the following reasons:

1. Section 53(8) of the TAA grants the Commissioner General broad discretionary powers to determine waiver applications. These broad discretionary powers are not subjected to any defined statutory boundaries. Without such limitations, the power risks being used arbitrarily, potentially undermining fairness and allowing for abuse. In law, discretionary powers must be exercised with due diligence and fairness, thus any misuse or arbitrary decision should be subject to judicial review.
2. Secondly, all tax disputes are initiated through an objection process that requires taxpayers to deposit one-third of the assessed tax. This prerequisite effectively integrates the waiver application into the appeal process. Thus, classifying it as an administrative matter rather than an objection decision is misplaced. The rigid one-third deposit requirement creates an unfair barrier, particularly for taxpayers who cannot afford it despite having valid objections. As a result, taxpayers who have legitimate grounds for objection but cannot meet the financial requirement are left without an effective remedy, as their right to challenge the assessment is effectively extinguished. 
3. Furthermore, the same Commissioner General who assesses and collects taxes also decides on waiver applications. This dual role creates an inherent conflict of interest. An independent review mechanism is necessary by empowering an independent body, such as the Tax Revenue Appeals Board (TRAB), with revisionary authority to ensure that waiver decisions are made impartially.
4. Last but not least, the Court’s decision highlights a legislative gap that leaves aggrieved taxpayers without a clear avenue for recourse when a waiver is denied. In this decision, while Court held that one must seek alternative legal avenues if aggrieved by such decisions, they failed to provide what exactly are the alternative legal avenues to be explored. This raises a critical question: Should a taxpayer’s right to adjudication be forfeited due solely to financial incapacity? The current framework provides no clear answer, underscoring an urgent need for reform, and unfortunately the Court has consistently overlooked opportunities to reform the law.

In light of the above, we recommend the following recourse: 

1. The Parliament should reform the law to introduce an administrative process for reviewing waiver decisions. This could involve vesting the Commissioner General with express review powers or granting the TRAB revisionary jurisdiction over waiver determinations. Such measures would provide a formal avenue for redress and help ensure that waiver decisions are fair and transparent. 
2. The Presidential Commission for Tax Assessment and Advisory should prioritize this issue by exploring structured solutions to address the conflict of interest and procedural barriers inherent in the current system. By doing so, they can help create a more balanced tax dispute resolution framework that protects taxpayer rights and prevents unjust tax enforcement.

Moving forward, there is a need for legislative reform to provide a structured solution, ensuring that legitimate tax disputes are not dismissed solely due to an inability to meet the one-third deposit requirement. Without such measures, the existing system risks perpetuating an imbalance that favours administrative discretion over equitable taxpayer recourse.