Civil Reference No. 7 of 2004
In 2014, the appellant, a Dar es Salaam businesswoman, was found in possession of uncustomed goods, which were seized and deposited in a customs warehouse. In 2015 she admitted to an offence under section 200(d)(iii) of the East African Community Customs Management Act, 2004 (EACCMA), and the second respondent (Commissioner for Customs and Excise) compounded the offence under section 219(1) of the EACCMA, ordering payment of duties and penalties of TZS 48,326,824.71 before release of the goods. The appellant paid this sum on 25th January 2016, but upon presenting proof of payment and a release order, discovered the goods had already been sold by the second respondent on 20th January 2016 (the respondents claiming the goods were sold as overstayed imports due to the appellant's delay in payment). She sued in the High Court on 13th June 2017 for TZS 264,400,000 as the value of the goods plus interest, including interest on a loan she took to pay the duties. The respondents raised a preliminary objection that, under section 7 of the Tax Revenue Appeals Act (the Act), the Tax Revenue Appeals Board (the Board), not the High Court, had sole original jurisdiction over the civil dispute. The High Court upheld the objection and dismissed the suit for want of jurisdiction, prompting this appeal.
Whether the High Court of Tanzania has jurisdiction to adjudicate the appellant's claim for compensation for the sale of uncustomed goods seized from her, or whether such jurisdiction lies exclusively with the Tax Revenue Appeals Board under section 7 of the Tax Revenue Appeals Act.
The appellant, through Mr. Mikidadi, argued that the dispute arose from the second respondent's exercise of punitive powers to compound an offence under section 219(1) of the EACCMA, and that since section 219(3)(e) of the EACCMA makes compounding orders final and non-appealable (enforceable as a High Court decree), the Board lacked jurisdiction over any civil matter arising from such an order. He relied on Commissioner General (TRA) v. Mohamed Ali-Salim & Anor and Board decisions in Rungwe Freight (T) Limited and John C. Mwemezi to support the proposition that the Board cannot inquire into compounding orders. He further contended that the appellant, having accepted the compounding order rather than seeking judicial review, properly sued the Commissioner in tort under section 221(1) of the EACCMA, which permits the Commissioner to be sued in his own name, including in tort, and thus the claim fell outside section 7 of the Act.
The respondents, through Ms. Andrew and Mr. Maswanyia, countered that section 7 of the Act vests the Board with sole original jurisdiction over all civil disputes arising from revenue laws administered by the TRA, and section 6 of the TRA Act requires aggrieved persons to appeal to the Board. Relying on section 7(1) of the Civil Procedure Code and the precedent in Tanzania Revenue Authority v. New Musoma Textile Limited, they argued courts should not entertain matters for which a special forum exists unless no appropriate remedy is available there, and that TRA-administered revenue law disputes are for the Board. They argued the appellant's claim, challenging the sale of goods seized under the EACCMA (a scheduled law), was a civil action within the Board's jurisdiction and had no direct nexus to a challenge against the compounding order itself, which was never pleaded as unlawful. They distinguished the appellant's cited authorities as concerning challenges to the finality of compounding orders, not compensation claims for asset disposal. They also argued section 221(1) of the EACCMA was merely a provision on the Commissioner's capacity to sue or be sued, not a jurisdictional grant to the High Court.
The Court of Appeal dismissed the appeal, holding that the High Court correctly declined jurisdiction. The Court reaffirmed that section 7 of the Tax Revenue Appeals Act confers sole original jurisdiction on the Board over all civil proceedings arising from revenue laws administered by the TRA, and that courts should not entertain matters for which a special forum exists unless no appropriate remedy is available there (following New Musoma Textile Limited, Attorney General v. Lohay Akoonay, and TRA v. Kotra Company Limited). The Court found that the appellant's claim, though connected to a compounding order she had accepted (and never sought to judicially review), was in substance a civil action for compensation arising from the administration of the EACCMA, a scheduled revenue law, and thus fell within the Board's exclusive jurisdiction under section 7 of the Act. The Court rejected the appellant's argument that the Board lacks jurisdiction over any civil matter connected to a compounding order, clarifying that whether a civil action arose from or is connected with a compounding order is inconsequential so long as it arose from TRA's administration of a scheduled tax law; this does not change the nature of the proceeding as a civil action within the Board's purview. The Court distinguished the authorities cited by the appellant (Mohamed Ali-Salim, Rungwe Freight, John C. Mwemezi) as concerning challenges to the finality of compounding orders, not compensation claims for unlawfully sold goods. The Court also rejected reliance on section 221(1) of the EACCMA as a jurisdictional basis, finding it merely governs the Commissioner's capacity to sue or be sued, not court jurisdiction. However, the Court found the High Court erred procedurally by 'dismissing' rather than 'striking out' the suit, since dismissal implies adjudication on the merits while the matter was terminated at a pre-trial stage on a point of law; it vacated the dismissal order and substituted an order striking out the suit, though this variation did not affect the outcome. The appeal was dismissed with costs.
The judgment reaffirms and clarifies the scope of section 7 of the Tax Revenue Appeals Act, establishing that the Tax Revenue Appeals Board has exclusive original jurisdiction over all civil disputes arising from the administration of revenue laws by the TRA, regardless of whether such disputes are connected to or arise from a compounding order under the EACCMA. It draws a clear distinction between (i) challenges to the finality/legality of a compounding order itself (which fall outside the Board's jurisdiction and must be pursued via judicial review in the High Court, per Mohamed Ali-Salim) and (ii) civil claims for compensation or other relief arising from the TRA's administration of revenue laws following such an order (which fall within the Board's exclusive jurisdiction). The decision also reinforces the general principle that courts should decline jurisdiction where a specialized statutory forum exists, absent proof that no adequate remedy is available there. Additionally, it provides procedural clarification on the correct disposition of suits terminated for want of jurisdiction: such suits should be 'struck out' rather than 'dismissed,' since dismissal implies a determination on the merits, reinforcing established Court of Appeal precedent on this procedural distinction.
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