Court bars KRA from seizing goods, documents over unpaid taxes
The High Court has declared unconstitutional the law empowering the Kenya Revenue Authority to search goods and documents from taxpayers suspected to have evaded taxes.
Justice George Odunga Wednesday ruled that Section 44 (1) and (2), section 60 (1) and (3) of Tax Procedures Act, 2015 violates Article 31 (b) of Constitution, which guarantees “right not to have their possessions seized”.
The judge also declared unconstitutional section 59 (4) of the Act which had waived the rights of individuals or organisations who are bound by contractual duty of confidentiality.
The decision are contained in a ruling delivered in case filed against KRA by former Nairobi County Secretary Robert Ayisi who contested the decision by taxman to arrest him after he allegedly failed to produce documents relating to legal fees paid to lawyer Tom Ojienda.
“I declare that the sections 44 (1) and (2), 60(1) and (3) and 59(4) of Tax Procedures Act, 2015 are unconstitutional and are invalid and are accordingly null and void,” ordered Justice Odunga.
He directed deputy Registrar of the High Court to serve the Judgment on the office of the Attorney-General for further action.
Mr Ayisi, who had claimed that his rights was infringed when he was briefly detained by KRA officers, also got reprieve as the judge found that his right to be treated with dignity was infringed.
For their actions, KRA was ordered to pay him damages of Sh2 million for violations of his rights. The taxman will also shoulder the legal cost incurred by Mr Ayisi.
Mr Ayisi Amoved to court in 2016 seeking to bar KRA from arresting him or demanding that he produce the documents in relation to the legal fees paid by the city government to Prof Ojienda, whom the taxman said was under investigations for under declaring earnings.