Civil Reference No. 7 of 2004
African Barrick Gold PLC (ABG), a UK-incorporated company operating mining/exploration business in Tanzania, held a 51% interest in the Nyanzaga Gold Project through its subsidiary Barrick Exploration African Limited, with the remaining 49% held by Tusker Gold Limited (Australia) through its Tanzanian subsidiary. In 2010, ABG's UK subsidiary, BUK Holdco Limited, acquired Tusker's 49% interest via a compulsory acquisition on the Australian Stock Exchange, making ABG the sole owner of the Nyanzaga Project through BUK Holdco. The Commissioner General of Tanzania Revenue Authority (CGTRA) considered this share transaction to constitute a tax avoidance arrangement attracting Tanzanian tax on investment income, and issued a letter dated 20 June 2011 invoking section 35 of the Income Tax Act, notifying ABG of tax liability of USD 21,336,931 and demanding immediate settlement. ABG disputed liability, contending the transaction was between foreign companies outside Tanzania, and appealed to the Tax Revenue Appeals Board. The Board dismissed a preliminary objection that the appeal was premature (no formal assessment having been issued), holding the letter constituted an appealable decision/assessment, and on the merits held the transaction was not taxable in Tanzania. The Tribunal upheld the Board's decision on appeal by the CGTRA, prompting the present appeal to the Court of Appeal.
The central issue addressed by the Court was whether the Tax Revenue Appeals Board had jurisdiction to entertain and determine an appeal filed against the Commissioner General's notice on the existence of tax liability, as opposed to a formal objection decision or assessment. This turned on the proper interpretation of section 6 of the Tanzania Revenue Authority Act and sections 14 and 16 of the Tax Revenue Appeals Act (TRAA) as they stood in 2010–2011, specifically whether such a notice was appealable under section 14(1)/16, or only subject to a 'reference' under section 14(2). (Two further grounds concerning admissibility of documentary evidence and the taxability of the transaction were raised but not determined, as the jurisdictional issue was dispositive.)
The appellant (CGTRA), through Mr Maswanyia, argued that even assuming the notice constituted a determination of tax liability, the respondent was not entitled to appeal to the Board; instead, the proper procedure under section 14(2) of the TRAA was to lodge an objection with the Commissioner General or forward the objection to the Board by way of a 'reference,' not an appeal. He relied on the Court's earlier decision in Commissioner General TRA v JSC Atomredmetzolo (ARMZ), which he argued was factually similar and established that objections to existence-of-liability notices must proceed by reference, not appeal. He urged the Court to nullify the proceedings and judgments of both the Board and Tribunal for want of jurisdiction. The respondent, through Mr Kileo, sought to distinguish ARMZ, characterising the CGTRA's letter as a mere demand for payment rather than a tax assessment, and argued the appeal to the Board was properly filed under section 6 of the TRA Act together with section 14(2) of the TRAA. He contended that section 14(2) contained a lacuna because it did not prescribe a procedure for lodging a 'reference,' making an appeal the only practicable and long-standing practice among taxpayers. He conceded, upon questioning by the Court, that the respondent had never lodged an objection to the tax liability either with the Commissioner General or the Board, but maintained that the appellant suffered no prejudice from the appeal route being used instead.
The Court of Appeal held that the Board lacked jurisdiction to entertain the respondent's appeal against the Commissioner General's notice on the existence of tax liability. Reading section 6 of the TRA Act together with sections 13, 14 and 16 of the TRAA (as they stood before amendment), and Rule 7 of the Tax Revenue Appeals Board Rules, 2001, the Court found that an appeal to the Board under section 16 lies only against an objection decision of the Commissioner General following the statutory objection process, and that a notice on existence of tax liability is expressly excluded from the list of appealable decisions. Instead, section 14(2) of the TRAA vests the Board with jurisdiction to entertain a 'reference' — not an appeal — against such a notice. The absence of a prescribed procedure for lodging a reference did not render that remedy inoperative or convert it into a right of appeal. The Court reaffirmed its earlier decision in Commissioner General TRA v JSC Atomredmetzolo (ARMZ) as good law on this point. Since jurisdiction is foundational and its absence renders proceedings a nullity, the Court held that the Board's proceedings, and consequently the Tribunal's appellate proceedings which stemmed from them, were nullities. Accordingly, the Court allowed the appeal on the second ground, nullified the proceedings of the Board and the Tribunal, and quashed and set aside their respective judgments and orders, with costs to the appellant. The Court did not determine the remaining grounds of appeal (concerning admissibility of evidence and taxability of the transaction) since the jurisdictional finding was dispositive, but noted the respondent could pursue an available remedy in compliance with the law.
The judgment reaffirms and applies the principle established in Commissioner General TRA v JSC Atomredmetzolo (ARMZ) that, under the pre-amendment TRAA regime, a taxpayer aggrieved by a Commissioner General's notice on the mere existence of tax liability must proceed by way of a 'reference' to the Board under section 14(2) of the TRAA, not by way of an appeal under section 16, since an appeal only lies from a final objection decision following the statutory objection process. It underscores that jurisdiction of tax tribunals and boards is strictly a creature of statute, must be verified at the threshold, and that proceedings and any resulting judgment conducted without jurisdiction are nullities, regardless of how far the matter has progressed through subsequent appellate tiers. The decision also illustrates the interpretive principle that where statutory language is plain, courts must give effect to it without importing procedures or remedies not provided by the legislature, even where a perceived procedural lacuna (such as the absence of a prescribed reference procedure) exists. Practically, the case has significant implications for tax dispute practice in Tanzania, clarifying the correct procedural pathway taxpayers must follow when disputing a Commissioner General's notice of tax liability, and cautions litigants and tribunals against conflating the appeal and reference mechanisms under the TRAA.
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