Kenya Revenue Authority (KRA) might be bracing for yet another bruising court battle for allegedly serving Bluebird Aviation Ltd with nonexistent tax arrears notice.
Bluebird Aviation has moved to court to protest the notices served by KRA to the airline’s bank early this year, where the taxman demanded KSh.1.08 billion in tax arrears.
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According to Bluebirtd’s lawyer Roger Sagana, the claims are unsubstantiated since the airline has been paying its dues diligently and boasts of Ksh.539 million in rebate.
Mr. Sagana further stated that KRA acted in contravention of logic, as it did not seek an alternative dispute resolution mechanism to address the issue before jumping into the notice filing decision that has adversely affected the airline’s operations.
“The said agency notices infringe on the ex-parte applicant’s constitutional right to property and statutory right to exhaustion of dispute resolution remedies provided under section 51 to 54 of the tax procedures Act, thus the respondent’s action is unconstitutional, ultra vires, illogical and illegal,” said Mr. Sagana.
“The respondent acted in abuse of its authority when it failed to accord the ex-parte applicant an opportunity to be heard in blatant violation of its constitutional and statutory rights to be treated equally before the law. It [KRA’s action] was arbitrary, an abuse of power, misuse of authority, and grossly unfair and it is contrary to the rules of natural justice.”
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Bluebird’s Chief Executive Officer (CEO) has spelled out the likelihood of a witchhunt from the taxman since there are tax compliance documents dated December 2021, meaning that the company had complied fully by then.
Hussein said that despite KRA requesting them to lodge a complaint, it has never been resolved to date.
He said the notice has had far-reaching consequences on the airline since it was filed, which includes the emptying of its accounts and cancellation of credit facilities.
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