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Kuku Foods Uganda Limited v Uganda Revenue Authority [2025] UGTAT 5

Tribunal · 2025 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for temporary injunction arising from TAT Application 287 of 2024 contesting adjustment of tax losses
Decision
Application for temporary injunction dismissed; main application (TAT 287/2024) to proceed without 30% deposit requirement

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Tribunal denied the application for a temporary injunction restraining URA from adjusting the applicant's tax losses. The Tribunal held that the applicant failed to establish irreparable injury, as URA's adjustment of the loss position in the ledger does not prevent the applicant from filing returns based on self-assessment pending resolution of the dispute. The balance of convenience favoured the respondent, as granting the injunction would interfere with URA's mandate to collect revenue. The Tribunal further held that the 30% deposit requirement under s.15(1) of the Tax Appeals Tribunal Act does not apply where the taxpayer is not in a tax-paying position.

Outcome

Application for temporary injunction dismissed; main application (TAT 287/2024) to proceed without 30% deposit requirement

Facts

Kuku Foods Uganda Limited, a KFC franchisee, filed an application for a temporary injunction to restrain URA from adjusting its tax losses. URA had conducted an audit for the period March 2018 to February 2022 and reduced the applicant's tax losses from Shs. 16,800,266,960 to Shs. 8,287,456,708. The applicant objected on 13 June 2024, and URA issued objection decisions on 13 September 2024 partially allowing one objection and disallowing three. The applicant filed TAT Application 287 of 2024 contesting the adjustment. In September 2024, URA conducted a returns examination that wiped out the applicant's entire loss and placed it in a tax payable position of Shs. 4,235,796,669. The applicant objected to the September assessments, and URA disallowed the objections in February 2025. The applicant sought a temporary injunction to maintain its tax loss position pending final determination of the main application.

Issues

  1. Whether the application for a temporary injunction should be granted?

Orders

  • The application for a temporary injunction is hereby denied.
  • The 30% deposit is not payable in respect of TAT Application 287 / 2024.
  • Costs shall abide in the main application.

Rules and key headnotes

Temporary Injunctions — Status Quo — Meaning and Application
The status quo to be preserved by a temporary injunction is the last actual, peaceable, uncontested status which preceded the pending controversy, not the status at the time the court hears the matter or gives a ruling, but at the time of filing the application for the temporary injunction.
Temporary Injunctions — Conditions for Grant — Prima Facie Case, Irreparable Injury, Balance of Convenience
For a temporary injunction to be granted, the applicant must establish: (i) a prima facie case with a probability of success; (ii) that the applicant will suffer irreparable injury which cannot adequately be compensated by damages; and (iii) if the court is in doubt, that the balance of convenience favours the applicant.
Tax Administration — Self-Assessment Regime — Effect of URA Adjustments on Taxpayer's Right to File Returns
Under Uganda's self-assessment regime, an adjustment by the Uganda Revenue Authority of a taxpayer's loss position in the taxpayer's ledger does not prevent the taxpayer from continuing to file returns based on their self-assessment, pending resolution of the dispute by the Tax Appeals Tribunal.
Tax Appeals — 30% Deposit Requirement — Application Where No Tax Liability Exists
The requirement under Section 15(1) of the Tax Appeals Tribunal Act to pay 30% of the tax assessed does not arise where the taxpayer is not in a tax-paying position and there is no tax liability upon which to compute the 30% deposit.
Temporary Injunctions — Irreparable Injury — Adjustment of Tax Losses in URA Ledger
An adjustment by the Uganda Revenue Authority of a taxpayer's loss position in the taxpayer's ledger does not constitute irreparable injury where the taxpayer can continue to file returns based on self-assessment and where the Tribunal can order reversal or maintenance of the adjustment upon final determination of the dispute.
Temporary Injunctions — Balance of Convenience — Interference with Statutory Mandate
The balance of convenience favours the Uganda Revenue Authority where granting an injunction would interfere with the execution of its statutory mandate to collect tax revenue and to track changes and movements in taxpayers' tax compliance positions through periodic review and updating of taxpayer ledgers.

Legislation cited (7)

Cases cited (10)

  • Kiyimba Kaggwa v Hajji Katende (Civil Suit No. 2109 of 1984)
  • American Cyanamide v Ethicon [1975] AC 396
  • Victor Construction Works Ltd v Uganda National Roads Authority (HCMA No. 601 of 2010)
  • J K Sentongo v Shell (U) Ltd [1995] 111 KLR 1
  • Kiyimba Kaggwa v Hajji Katende (Civil Suit No. 2109 of 1984)
  • Humphrey Nzeyi v Bank of Uganda and Attorney General (Constitutional Application No. 01 of 2013)
  • Nived Enterprises Limited v Uganda Revenue Authority (HCMA No. 301 of 2023)
  • Geilla v Cassman Brown & Co Ltd (1973) EA 358
  • Cotton International African Farmers Trade Association BV v Lango Cooperative Union [1996] HCB 57
  • Ndimwibo & Anor v Uganda Revenue Authority (Civil Suit No. 424 of 2012)

Full judgment

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

Kuku Foods Uganda Limited v Uganda Revenue Authority 2025 UGTAT 5 (31 March 2025)
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.