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Appeal Bodies
1. Local committee
2. Income tax tribunal
3. High court
1) Income tax local committee
The local committee is an appeal body and is not part of the Domestic tax department. It is established by the minister of finance.
The duties of the local committee are to hear and determine appeals lounged by the taxpayer on matters pertaining to tax disputes.
Only the tax payers can appeal to the local committee against the commissioner's decisions. The local committee consists of nine members who are appointed by the minister of finance i.e. a chairperson and not more than eight other members.
They hold office for a period of 2 years unless
a) A member tenders a resignation.
b) The minister revokes members appointment for reasons of failure to attend three consecutive meetings and
c) A member is unfit perform duties of office due to reasons of mental or physical disability.
Local committee deals with matters of facts only since the committee members are laymen as far as tax law is concerned.
The procedures governing the conduct of local committees are given by the minister of finance. This includes:-
? The manner in which an appeal may be made to the local committee.
? The procedure of hearing an appeal to the records to be kept by the local committee.
? The manner in which to converse meetings the venue and the time to hold meetings.
? The scale of costs that may be awarded by a local committee appeal
The taxpayer must submit the following documents to the clerk of local committee
1. A memorandum of appeal-This states the ground of appeal and should be submitted in copies.
2. A statement of facts - This gives the sequence of events which took place regarding amending assessment was issued and similarly it shall be submitted in 9 copies.
3. A copy of the letter i.e. the notice of the intention to appeal to the local committee which was sent to the commissioners. Notification to the commissioner for intention to appeal to the local committee must be made within 30days after receiving the notice from the commissioner or after receiving the commissioner decision.
4. A copy of the commissioner's decision against which the appeal is being lounged e.g. a copy of the non-agreed amended assessment or a copy of the confirming notice.
When all the appeal documents have been filed in time to the clerk of local committee the clerk will register the appeal for hearing. He will notify both the taxpayer and he commissioner of the hearing dates.
2) The income tax tribunal
The tribunal is an appeal body established by minister of finance by notice in the gazette. It consists of a chairman, not less than 2 and not more than 4 members i.e. minimum of 3 and maximum of 5.
- The quorum for a tribunal is the chairman and two other members
- The tribunal is governed by the income tax rules. It will hear appeals on assessment that are based on the commissioner of domestic taxes directives under set 23 and 24 of the income tax Act.
- Section 24 is on avoidance of tax liability by non-distribution of dividends and section 23 is on transactions designed to avoid liability to tax.
- Under section 23 is on transactions designed to avoid liability to tax
- Under section 23 the commissioner is empowered to reject any transactions where he is of the opinion that the main purpose for which a transaction is effected was for the avoidance or reduction of tax liability or that the main benefit which might have been expected to accrue from the transaction in three years immediately following the conclusion was avoidance of reduction of tax then he may determine where just a reasonable for adjustment to be effected on that transaction. Under section 24 the commissioner is empowered to direct that a company makes a further distribution of dividend i.e. when the commissioner of domestic taxes is satisfied that there has been a shortfall.
- Where the commissioner is of the opinion that the company has not distributed to us the date ofaccounti.ng year, that part of income which could be so distributed he may direct that income to be distributed as dividends to the shareholders in accordance with the income tax Act.
Matters relating to an appeal to a tribunal are normally handled in the Head office where the taxpayer is not satisfied with decision of tribunal he can move an appeal to high court by giving a notice of 15 days after being* served with the decision.
3) Courts of law
Where a taxpayer disputes H decision by a tribunal or in very rare instances from local committee or where the commissioner disputes a decision by tribunal such can further appeal to the High court.
- Appeals to the High court will only be on the questions of law or mixed laws and facts.
- For the appeals to the High court, the appellant must serve the respondent with notice of intention to appeal to the court within 30 days of being served with decision from other appellate bodies.
- The appellant must file in court the following:-
- Memorandum of appeal
- Statement of appeal
- A copy of the decision of notice being appealed against.
Wilfykil answered the question on February 25, 2019 at 10:32
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