Flynote

Right to appeal a TAT decision, exhaustiveness principle,” expressio unius est exclusio alterius” (the expression of one thing excludes others). Interpretation of statutes. Statutory Interpretation of Tax Laws, Contempt Powers for Administrative Tribunals.

Case Summary

Brief facts

Nile Breweries filed a tax return based on its own self-assessment. Following an audit, the Uganda Revenue Authority (URA) issued an additional assessment, demanding a higher tax amount. While Nile Breweries paid its self-assessed portion, it disputed the additional sum levied by the taxman.

To prevent URA from collecting the disputed tax during the legal process, Nile Breweries secured a conditional temporary injunction from the Tax Appeals Tribunal. The order required the company to pay 30% of “the tax assessed or that part not in dispute, whichever is greater.“ A conflict ensued over this clause: URA insisted it meant 30% of the disputed additional assessment, while Nile Breweries contended it had already complied by paying the larger, undisputed self-assessed amount.

When Nile Breweries refused to pay more, URA issued agency notices to the company’s banks to freeze and remit the funds. The banks also refused to comply. Consequently, URA applied to the Tribunal to have Nile Breweries and the banks held in contempt of court for disobeying the conditional order

Summary of the Ruling

The Court affirmed the Tribunal’s interpretation of the law. It held that the 30% deposit requirement applies only to the tax amount under formal dispute (URA’s additional assessment), not the taxpayer’s earlier self-assessment. Nile Breweries’ prior payment was therefore irrelevant to the injunction condition.

On the right to appeal, the Court rejected URA’s argument that the appeal was incompetent. It ruled that the right to appeal from the Tribunal extends to final orders on ancillary matters (like contempt) related to the main tax review application, avoiding an absurd result where significant sanctions would have no appeal mechanism.

The High Court set aside the Tax Appeals Tribunal’s finding of contempt against Nile Breweries and the fines imposed. It ruled that the Tribunal acted without jurisdiction, as its statutory powers are limited to criminal contempt and it improperly punished for civil contempt. The Court concluded the Tribunal abused its power, the correct remedy for failing to meet the 30% deposit condition was for the temporary injunction to lapse automatically, not a finding of contempt.