Wakilii

Wallace Brothers and Company (Holdings) Ltd v Commissioners for Stamp Duties (Miscellaneous Civil Suit No. 85 of 1955)

East African Court of Appeal · [1956] EACA 39 · 1956 Appeal Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal by way of case stated from Commissioners for Stamp Duties under section 60 of the Stamp Ordinance
Decision
Transfer held liable to stamp duty; Commissioners' determination affirmed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that a transfer of shares between two companies incorporated in the United Kingdom is liable to stamp duty under section 4 of the Stamp Ordinance and item 62(ii) of the First Schedule. The words 'company with limited liability' in section 30B must be construed restrictively to mean a company incorporated in Kenya. Express and unambiguous language is required for exemption from stamp duty, and section 30B does not provide such exemption for transfers between foreign-incorporated companies.

Outcome

Transfer held liable to stamp duty; Commissioners' determination affirmed

Facts

On 4 January 1955, Wallace Brothers and Company Ltd, a company incorporated in the United Kingdom, transferred 6,800 ordinary shares of Sh. 20 each in Wallace and Adam Ltd (a company incorporated in Kenya) to the appellant, Wallace Brothers (Holdings) Ltd, also incorporated in the United Kingdom. The transfer was presented to the Senior Collector of Stamp Duties on 22 January 1955. The Commissioners for Stamp Duties were satisfied that the transfer effected a transfer of beneficial interest and that the appellant owned not less than 90 per cent of the issued share capital of the transferor. The Commissioners held that the exemption provisions of section 30B of the Stamp Ordinance applied only where both transferor and transferee companies were incorporated in Kenya, and that the transfer was therefore liable to stamp duty at the rate of Sh. 10 per centum under section 4 and item 62(b)(ii) of the First Schedule.

Issues

  1. Whether a transfer of shares between two companies incorporated in the United Kingdom, involving shares in a company incorporated in Kenya, is liable to stamp duty under section 4 of the Stamp Ordinance Cap. 259.
  2. Whether the transfer is exempted from stamp duty by section 30B of the Stamp Ordinance.
  3. Whether the words 'company with limited liability' in section 30B should be construed in a restricted sense to mean a company incorporated in Kenya or in a wider sense to include companies incorporated elsewhere.

Orders

  • Appeal upheld.
  • Transfer held liable to stamp duty under section 4 of the Stamp Ordinance and item 62(ii) of the First Schedule.

Rules and key headnotes

Stamp Duty — Liability — Transfer Between Foreign Companies
A transfer of shares between two companies, neither of which is incorporated in Kenya, is amenable to stamp duty under section 4 of the Stamp Ordinance Cap. 259 and item 62(ii) of the First Schedule, notwithstanding that the shares transferred are in a company incorporated in Kenya.
Revenue Statutes — Restrictive Construction of Exemptions
The words 'company with limited liability' in section 30B of the Stamp Ordinance must be construed in a restricted sense to mean a company with limited liability incorporated within the law of Kenya, not any company with limited liability incorporated elsewhere.
Stamp Duty — Exemptions — Express Language Required
Express and unambiguous language is indispensable in an ordinance enacted to impose a stamp duty or to exempt from a duty imposed. Where the exemption from the imposed duty does not appear expressly and unambiguously in the statute, the exemption cannot be granted.
Revenue Statutes — Analogous English Legislation
In construing a colonial revenue ordinance, decisions of British courts on similar sections in similar British Acts may be utilized by colonial courts in determining the meaning or underlying intention of the colonial ordinance.

Legislation cited (11)

  • Stamp Ordinance Cap. 259 s.4
  • Stamp Ordinance Cap. 259 s.30B
  • Stamp Ordinance Cap. 259 s.60
  • Stamp Ordinance Cap. 259 First Schedule item 62(b)(ii)
  • Companies Ordinance Cap. 288
  • East African Income Tax (Management) Act 1952
  • Finance Act 1927 s.55
  • Finance Act 1930 s.42
  • Stamp Act 1891 s.112
  • Stamp Act 1891 s.113
  • Interpretation and General Clauses Ordinance s.34

Cases cited (3)

  • In re Tennant, Stanley v Stanley (1906) 1 Ch 131
  • Nestle Co Ltd v Inland Revenue Commissioners (1952) 1 All ER 1388
  • Nestle Co Ltd v Inland Revenue Commissioners (1953) 1 Ch 355

Full judgment

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

Wallace Brothers and Company (Holdings) Ltd v Commissioners for Stamp Duties (Miscellaneous Civil Suit No. 85 of 1955) [1956] EACA 39 (1 January 1956)
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.