Universal Corporation Limited & 2 others v Kenya Revenue Authority & another [2021] KEHC 12879 (KLR)

Facts

Universal Corporation Limited, Elys Chemical Industries Limited, and Dawa Limited are registered companies that manufacture and supply pharmaceutical products. They seek VAT refunds and other relief due to the retroactive application of Section 1(a) of the Finance Act, 2015.

Issues

1. Whether Section 1(a) of the Finance Act, 2015 is unconstitutional due to criminal retroactivity.
2. Whether the petitioners' right to property has been infringed.
3. Whether Section 1(a) of the Finance Act, 2015 violates Articles 10 and 24 of the Constitution.
4. Whether Section 1(a) of the Finance Act, 2015 frustrated existing contractual rights and/or impaired accrued substantive rights.
5. Whether the petitioners are entitled to the orders sought in their petition.

Reasoning

The court found that Section 1(a) of the Finance Act, 2015 does not impose retroactive criminal liability as it does not criminalize acts or omissions that were not offenses at the time they were committed. The court also noted that the amendments to the VAT Act and Tax Procedures Act do not create new tax obligations that would lead to criminal liability.

Outcome

The petitioners' claims for declaration and relief are dismissed.

Authorities cited