Case Brief: Republic v. Ghana Revenue Authority, Ex parte Export Finance Company Ltd
Citation: Suit No. CM/MISC/1186/2019
Date: 8th July 2020
Court: High Court of Justice (Commercial Division), Accra
Judge: George K. Koomson J.
Flynote
Administrative Law — Judicial Review — Supervisory Jurisdiction of High Court — Tax Administration — Objection to Tax Decision — Condition Precedent (30% Payment) — Time Limits — Effect of Commissioner-General’s failure to decide objection within statutory 60 days — Garnishment — Whether delay invalidates subsequent tax decision — Revenue Administration Act, 2016 (Act 915).
Facts
The Applicant, Export Finance Company Ltd, sought an order of certiorari to quash a tax decision by the Ghana Revenue Authority (GRA/Respondent) dated 26th February 2019 and a subsequent garnishment notice served on its bankers, Universal Merchant Bank (Interested Party).
- Assessment: On 10th December 2018, the GRA assessed the Applicant’s tax liability for 2013 and 2018 at approximately GH¢2.5 million.
- Objection: The Applicant objected to this assessment via a letter dated 17th December 2018. The GRA acknowledged receipt on 21st December 2018.
- The Dispute: Under Section 42(2) of the Revenue Administration Act (Act 915), the GRA is required to make a decision on an objection within 60 days. The GRA did not issue a decision until 26th February 2019 (outside the 60-day window), disallowing the objection.
- Garnishment: The GRA subsequently garnished the Applicant’s accounts on 26th July 2019.
- Applicant’s Argument: The Applicant argued that the GRA’s failure to respond within 60 days rendered any subsequent decision void, and the delay should be interpreted as the objection being “allowed”. This was a misprint in the earlier version of the law. This error was subsequently corrected.
- Respondent’s Argument: The GRA argued the Applicant failed to pay the mandatory 30% of the disputed tax required to entertain an objection. Further, the law states that silence after 60 days implies the objection is disallowed, not allowed.
Issues
- Jurisdiction: Whether the High Court has the supervisory jurisdiction to entertain the application.
- Condition Precedent: Whether the Applicant satisfied the statutory requirement of paying 30% of the disputed tax to validate their objection.
- Effect of Delay: Whether the Commissioner-General’s failure to make a decision within the statutory 60-day period renders a subsequent decision void or implies acceptance of the objection.
- Remedy: Whether the appropriate remedy was judicial review or a tax appeal.
Held (Judgment)
The High Court dismissed the application, finding no error of law on the face of the record.
- Supervisory Jurisdiction: The Court confirmed it has jurisdiction under Article 141 of the Constitution and Section 16 of the Courts Act, 1993 (Act 459) to supervise lower adjudicating authorities.
- 30% Payment Rule: The Court found the Applicant failed to pay the 30% of the disputed tax required by Section 42(5)(b) of Act 915. While this normally invalidates an objection, the Court held that the GRA waived this requirement by proceeding to make a decision on the merit of the objection, as permitted by Section 42(6).
- Interpretation of 60-Day Rule: The Court rejected the Applicant’s argument that failure to decide within 60 days means the objection is “allowed.”
- Section 43(3) explicitly states that if the Commissioner-General fails to decide within 60 days, the taxpayer may elect to treat the objection as disallowed.
- The provision is designed to allow taxpayers to proceed to appeal, not to prevent the GRA from making a late decision.
- The Court likened this to a judge delivering a judgment after the statutory deadline; it does not invalidate the judgment.
- Proper Remedy: Since the GRA’s decision was not void, the Applicant’s proper recourse was to file a tax appeal under Section 44 of Act 915, not an application for judicial review.
Relevant Legal Provisions Considered
- 1992 Constitution, Article 141: Grants the High Court supervisory jurisdiction over lower adjudicating authorities.
- Revenue Administration Act, 2016 (Act 915):
- Section 42(2): Commissioner-General must decide on objections within 60 days.
- Section 42(5)(b): Requires payment of all outstanding taxes and 30% of the disputed tax before an objection is entertained.
- Section 42(6): Allows the Commissioner-General to waive or vary the 30% payment requirement.
- Section 43(3): If no decision is made in 60 days, the objector may treat the objection as disallowed.
- Section 44: Provides for appeals to the Court within 30 days of a tax decision.
- Sections 60 & 61: Provisions regarding Garnishment (though Applicant failed to demonstrate breach of these).
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