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Uganda Projects Implementation & Management Centre v Uganda Revenue Authority (Constitutional Petition No. 18 of 2007)

Constitutional Court · [2009] UGCC 2 · 2009 Reference Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Constitutional reference from the Tax Appeals Tribunal under Article 137(5) of the Constitution
Decision
Constitutional reference dismissed; section 34C(3) of the Value Added Tax Act upheld as constitutional

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Cited — treatment unverified cited in 4 (treatment unverified) Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

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Holding

On a reference from the Tax Appeals Tribunal, the Constitutional Court held that section 34C(3) of the Value Added Tax Act, requiring a taxpayer to pay 30% of the disputed tax before lodging an application with the Tribunal, does not contravene Articles 21 and 126(2)(a) of the Constitution. The provision applies uniformly to all taxpayers and is therefore not discriminatory under Article 21; the petitioner led no evidence of differential treatment. While the section restricts access to court, the restriction is not arbitrary, unreasonable or unjustifiable in a free and democratic society, and is justified under Article 43 by the public interest in prompt tax collection. Ndyanabo was distinguished. The reference failed with costs to the respondent.

Facts

The petitioner, a Non-Governmental Organisation, carried out community activities mobilising the population during the 2002 National Housing and Population Census and voter education during the 2005 National Referendum. The respondent audited the petitioner's accounts for the income years 2000-2005 and assessed VAT liability of Shs 394,700,051, which it demanded. The petitioner objected, arguing there were no taxable supplies and that any tax was collectable from the Electoral Commission. The respondent disallowed the objection and issued third party agency notices on the petitioner's bank accounts. The petitioner applied to the Tax Appeals Tribunal for review. The respondent raised a preliminary objection that the application was incompetent because the petitioner had not paid 30% of the assessed tax as required by section 34C(3) of the Value Added Tax Act. The petitioner contended that this requirement contravened the Constitution, and the Tribunal referred the constitutional question to the Constitutional Court for determination.

Issues

  1. Whether section 34C(3) of the Value Added Tax Act (as amended by the Finance Act 2001), which requires a taxpayer to pay 30% of the tax in dispute before lodging an application with the Tax Appeals Tribunal, contravenes Articles 21 and 126(2)(a) of the Constitution by denying the right of access to justice.
  2. Whether the requirement imposed by the impugned section constitutes discrimination within the meaning of Article 21 of the Constitution.
  3. Whether any limitation imposed by the impugned section on the right of access to court is justified under Article 43 of the Constitution.

Orders

  • The reference fails with costs to the respondent.

Key headnotes

Constitutional Law — Interpretation — Purpose and Effect Test
In determining the constitutionality of legislation, both its purpose and its effect must be taken into account; legislation is unconstitutional where either its purpose or the effect of its implementation is inconsistent with a provision of the Constitution.
Constitutional Law — Presumption of Constitutionality — Burden of Proof
There is a rebuttable presumption that legislation is constitutional, and the onus of rebutting that presumption rests on the party who challenges the legislation; to succeed, that party must show the impugned provision is arbitrary, unreasonable and unjustified.
Human Rights — Access to Justice — Justifiable Limitation
The right of access to court is a fundamental right but is not absolute; a statutory restriction on that right is constitutional where it is not arbitrary, unreasonable or demonstrably unjustifiable in a free and democratic society, and is therefore saved by Article 43 of the Constitution.
Constitutional Law — Equality and Non-Discrimination — Article 21
A statutory provision that applies uniformly to all persons in the relevant class, regardless of sex, race, tribe, religion or social or economic standing, is not discriminatory within the meaning of Article 21; a petitioner alleging discrimination must adduce evidence of differential treatment.
Tax Law — Value Added Tax — Pre-condition to Appeal — 30% Deposit
The requirement under section 34C(3) of the Value Added Tax Act that a taxpayer pay 30% of the tax in dispute before lodging an application with the Tax Appeals Tribunal is a constitutionally valid limitation justified by the public interest in prompt collection of taxes, and is analogous to requiring an appellant to furnish security or deposit the decretal amount before pursuing an appeal.

Legislation cited (13)

  • Value Added Tax Act Cap 349 s.34C(3)
  • Finance Act 2001
  • Value Added Tax Act s.31(1)
  • Value Added Tax Act s.32(1)
  • Value Added Tax Act s.33
  • Value Added Tax Act s.34(3)
  • Value Added Tax Act s.35
  • Constitution of Uganda 1995 art.137(5)
  • Constitution of Uganda 1995 art.21
  • Constitution of Uganda 1995 art.126(2)(a)
  • Constitution of Uganda 1995 art.43
  • Constitution of Uganda 1995 art.17
  • Constitution of Uganda 1995 art.28

Cases cited (9)

  • Ndyanabo v Attorney General [2001] EA 495
  • Lezama &others v Attorney General of Trinidad &Tobago HCA Cv 2098/2002
  • Olum & another v Attorney General [2002] 2 EA 508
  • Olum & another v Attorney General [2001] 1 EA 258
  • Attorney General v Silvatori Abuki (Constitutional Appeal No. 1 of 1998)
  • The Queen v Big Drug mark Ltd (Others Intervening) 1996 LRC (Const).332
  • Lall v Jeypee Investment [1972] EA 512
  • Attorney General v Prince Ernest of Hanover [1957] AC 436
  • Metcash Trading Ltd v Commissioner for South African Revenue Services & another (2000) ZACC 21
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.