Wakilii

Electric Power Services Limited v Uganda Revenue Authority (Application 4 of 2022)

Tribunal · [2023] UGTAT 19 · 2023 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Preliminary objection to tax appeal application on grounds of non-payment of statutory 30% deposit
Decision
Application dismissed for failure to pay the statutory 30% deposit required under Section 15 of the Tax Appeals Tribunal Act

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that withholding tax credits applied to reduce a tax assessment before the assessment was issued do not constitute payment of the statutory 30% deposit required under Section 15 of the Tax Appeals Tribunal Act. The requirement to pay 30% is mandatory and must be evidenced by actual payment after the assessment is issued. Pre-existing credits that reduce the assessment amount do not satisfy this requirement where their accuracy and applicability remain in dispute.

Outcome

Application dismissed for failure to pay the statutory 30% deposit required under Section 15 of the Tax Appeals Tribunal Act

Facts

On 23 August and 1 September 2021, Uganda Revenue Authority issued income tax and VAT assessments totalling UGX 129,547,849 to Electric Power Services Limited. The applicant objected to the assessments. URA disallowed the objections and the applicant filed an application with the Tax Appeals Tribunal on 3 January 2022. At scheduling on 26 June 2023, URA raised a preliminary objection that the applicant had not paid the mandatory 30% deposit (UGX 38,864,354) required under Section 15 of the Tax Appeals Tribunal Act. The applicant argued it had satisfied the requirement because URA had utilized its withholding tax credits of UGX 38,893,440 to reduce the income tax assessment from UGX 69,246,943 to UGX 30,353,502. The applicant tendered a tax ledger showing the credit had been applied. URA contended that no actual payment had been made and the applicant had not adduced sufficient evidence of payment.

Issues

  1. Whether the applicant has paid 30% of the tax in dispute as required by Section 15 of the Tax Appeals Tribunal Act.
  2. Whether withholding tax credits applied by the Commissioner to reduce an assessment constitute 'payment' for purposes of Section 15 of the Tax Appeals Tribunal Act.

Orders

  • Preliminary objection sustained.
  • Main application dismissed.
  • Costs awarded to the respondent.

Rules and key headnotes

Tax Appeals — Mandatory 30% Deposit — Section 15 Tax Appeals Tribunal Act
The requirement under Section 15 of the Tax Appeals Tribunal Act for a taxpayer to pay 30% of the tax assessed pending resolution of an objection is mandatory and constitutional, and does not infringe on the right to a fair hearing.
Tax Appeals — Payment Requirement — Withholding Tax Credits
Withholding tax credits applied by the Commissioner to reduce a tax assessment before the assessment was issued do not constitute 'payment' of the statutory 30% deposit required under Section 15 of the Tax Appeals Tribunal Act where the accuracy and applicability of those credits remain in dispute.
Tax Appeals — Evidence of Payment — Burden of Proof
A taxpayer seeking to rely on tax credits to satisfy the 30% payment requirement must adduce evidence that the Commissioner was satisfied the credits were due, and that actual payment occurred after the assessment was issued. A ledger alone, not admitted by the Commissioner as accurate, is insufficient evidence.

Legislation cited (6)

Cases cited (6)

  • Uganda Projects Implementation and Management Centre v Uganda Revenue Authority (Constitutional Appeal No. 2 of 1999)
  • Commissioner General Uganda Revenue Authority v Meera Investments Limited (SCCA No. 22 of 2000)
  • Elgon Electronics v Uganda Revenue Authority (HCCA No. 11 of 2007)
  • Samuel Mayanja v Uganda Revenue Authority (HCT-00-CC-MC-0017-2005)
  • Red Chilli v Uganda Revenue Authority (Application No. 38 of 2018)
  • A Better Place Limited v Uganda Revenue Authority (HCCA No. 37 of 2019)

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Electric Power Services Limited v Uganda Revenue Authority (Application 4 of 2022) 2023 UGTAT 19 (8 August 2023)
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.