Overview:
High Court dismisses Real Task Agencies' UGX1.1B tax challenge against URA and Stanbic Bank, reaffirming tax dispute procedures.
KAMPALA, Uganda — The High Court has dismissed a judicial review application by Real Task Agencies Limited, a machinery and equipment company, in a tax dispute exceeding 1.1 billion Ugandan shillings (about \$290,000 USD) with the Uganda Revenue Authority (URA) and Stanbic Bank Uganda.
Justice Simon Peter M. Kinobe ruled the application, which sought various orders including declarations, injunctions and damages, was “not amenable for Judicial Review” and fell outside the court’s jurisdiction.
The case stemmed from a Nov. 28, 2020, URA audit that led to additional Income Tax and VAT assessments for Real Task Agencies. The company objected to the assessments, claiming errors that warranted rectification under the Tax Procedure Code Act. After the objection process, the company sought Alternative Dispute Resolution, but the application was nullified by the URA.
Real Task Agencies alleged the audit and subsequent URA actions were procedurally unfair and illegal. However, the URA and Stanbic Bank argued otherwise. The tax authority maintained the applicant failed to exhaust all available remedies, did not provide sufficient evidence, and that the matter was improperly before the court.
Stanbic Bank, which had acted on a third-party agency notice from URA to remit the 1.1 billion shillings, contended it had no obligation to notify Real Task Agencies, calling the case “misconceived” and “an abuse of court process.”
Justice Kinobe noted that judicial review focuses on the process of decision-making rather than the merits of the decision itself. He stated the applicant’s suit appeared to challenge the correctness of URA’s tax decision rather than its legality, rationality or procedural fairness.
“The purpose of judicial review is to ensure that the individual is given fair treatment by the authority to which he or she has been subjected,” Justice Kinobe emphasized, citing precedent. “This application is intended to determine an individual right and is a form of ‘appeal’… as opposed to challenging the process.”
Citing the Tax Appeals Tribunal Act, the judge reaffirmed that tax disputes fall under the exclusive original jurisdiction of the Tax Appeals Tribunal, not the High Court.
“If one is not agreeable with the decision of the 1st and 2nd respondents… the aggrieved party should follow the set procedures of appeal as established by law,” he added.
The court dismissed the application with costs awarded to the respondents, finding no justification to invoke its inherent jurisdiction.
“This judgment reaffirms the importance of procedural propriety in seeking redress against government decisions,” commented Kwerit Sam, counsel for URA. The ruling underscores that tax-related grievances must first go through established tribunal channels before escalating to higher courts.