Case Reference:Pernod Ricard Kenya Limited v Commissioner of Domestic Taxes (Tax Appeal E192 of 2024) [2026] KEHC 7591 (KLR) (Commercial and Tax) (3 June 2026) (Judgment)
Commissioner of Domestic Taxes v Pernod Ricard Kenya Ltd (Tax Appeal E179 of 2024) [2026] KEHC 7599 (KLR) (Commercial and Tax) (3 June 2026) (Judgment)
Background
Pernod Ricard Kenya Limited is the local subsidiary of the world’s second-largest spirits and wine company. From the Jameson whiskey in Nairobi’s top bars to the Chivas Regal in duty-free at JKIA, their products are everywhere. They are a major taxpayer. And like any large company, they sometimes overpay and need to claim refunds from KRA.
The disputes turned on key provisions of the Tax Procedures Act. Under the current law, when a taxpayer applies for a refund, KRA has a statutory timeline to make a decision. If the application is subjected to an audit, KRA has 120 days under Section 47(4A). If no audit is conducted, the timeline is 90 days under Section 47(2). The hammer remains Section 47(3) and Section 47(4A): if KRA fails to decide within the prescribed timeline, the refund is automatically “deemed ascertained and approved” by operation of law. The taxpayer wins without proving anything else. The clock is KRA’s enemy, and silence means victory for the taxpayer.
In Pernod Ricard’s cases, the applications were made in December 2022, before the Finance Act 2023 amendments took effect. Therefore, the governing timeline was the old 90-day rule. But the principle remains identical under the current 120-day regime.
Then there is Section 56(2). This provision limits appeals to the High Court from the Tax Appeals Tribunal to questions of law only. You cannot appeal on questions of fact. A question of law asks whether the Tribunal correctly interpreted a statute. A question of fact asks what actually happened – whether a letter was sent, whether an email was received, whether a decision was made on a particular date. This distinction becomes the difference between winning and losing.
With that in mind, let us examine the two battles.
Battle One: Tax Appeal E192 of 2024
In 2016, Pernod Ricard filed a refund claim for Kshs 57,986,843 from the 2014/2015 income year. Five years later, in February 2021, KRA rejected the claim. Pernod Ricard claimed they never received the rejection. No email. No iTax notification. No stamp on a letter.
Instead of filing a timely objection or appeal, they waited until December 2022 and buried the same rejected claim inside a fresh refund application, hoping no one would notice.
The Tax Appeals Tribunal saw through the strategy. They called it “mischief” and expunged the claim entirely. The Tribunal noted that the law provides clear mechanisms for challenging a rejection. A taxpayer cannot simply ignore a rejection, wait two years, and then repackage the same claim inside a new application.
Pernod Ricard appealed to the High Court with thirteen grounds. They argued that their fair trial rights under Article 50 of the Constitution had been violated. They insisted that the 2021 rejection was void because they were never notified.
Justice Njoroge’s ruling was brutal but legally correct. He held that the issue of non-notification was a question of fact, not a question of law. Under Section 56(2), the High Court cannot entertain factual disputes on appeal. More devastating for Pernod Ricard was the judge’s finding that this issue of notification had never been raised before the Tribunal at all. It was an entirely new argument being introduced for the first time on appeal. The High Court is not a trial court. You cannot show up with new evidence or new factual claims after losing at the Tribunal.
The appeal was dismissed. KRA won. Pernod Ricard lost Kshs 57.9 million. The lesson is clear: you cannot resurrect a dead claim by hiding it in fresh paperwork. If KRA rejects your claim, you must follow the proper process – object, then appeal to the Tribunal within 30 days. Do not ignore the rejection and try again years later.
Battle Two: Tax Appeal E179 of 2024
The same December 2022 refund application also contained fresh claims for Kshs 25.9 million covering July 2019 to June 2020 and Kshs 3.4 million covering July 2020 to June 2021. These claims had never been rejected before. They were clean.
Pernod Ricard filed on 6th December 2022. Under the old law that applied at the time, KRA had 90 days to make a decision. The 90th day fell in early March 2023. But the days came and went. On day 91, silence. On day 100, still silence. KRA had forgotten about the application entirely.
Finally, on 6th April 2023, KRA issued a rejection decision. That was 147 days after the application had been filed, or 57 days late. They then formally communicated this rejection to Pernod Ricard on 23rd May 2023, which was 169 days after the application, or 79 days late.
Pernod Ricard appealed to the Tribunal, but they did not argue the merits of the refund. Instead, they played the only card that mattered: Section 47(3). KRA failed to decide within the statutory timeline, so the refund was deemed approved by operation of law. They did not need to prove they actually overpaid. The law itself had already ruled in their favor.
KRA scrambled desperately to salvage the situation. They claimed that they had actually made a decision much earlier, on 1st March 2023, which was well within the 90-day window. They insisted that a KRA officer had sent an email to Pernod Ricard’s tax agents at PwC rejecting the refund claims. If this were true, KRA would have complied with the deadline, and Section 47(3) would not apply.
There was only one problem. When the Tribunal demanded to see proof of this mysterious 1st March 2023 email, KRA came completely empty-handed. No screenshot. No copy of the message. No delivery receipt. No read receipt. No response from PwC acknowledging receipt. Nothing but their own word that the email had been sent. The Tribunal found this highly suspicious. If such a critical communication had genuinely been sent, surely KRA would have kept a record.
The Tribunal ruled against KRA. They calculated the timeline with cold arithmetic. One hundred and forty-seven days and one hundred and sixty-nine days both far exceeded the statutory ninety days. As for KRA’s claim about a 1st March 2023 decision, the Tribunal noted that KRA had merely “averred” the communication but had failed to adduce any evidence of it. The refund application for the 2019 to 2021 periods was therefore deemed approved by operation of law. Pernod Ricard had won without ever having to prove that they actually overpaid their taxes.
KRA appealed to the High Court. Justice Njoroge was unimpressed. He calculated the same dates and reached the same conclusion. He noted with thinly veiled skepticism that while KRA had claimed a timely decision existed, they had failed to produce any communication or correspondence in their pleadings before the Tribunal. The judge quoted the Tribunal’s finding that KRA had “averred” but not “adduced.” In a courtroom, an assertion is not evidence. Saying something happened does not make it true. You must prove it with documents, emails, or other tangible proof.
The appeal was dismissed. Pernod Ricard won Kshs 29.4 million. The lesson is equally clear: if KRA fails to respond to your refund application within the statutory timeline – whether 90 days under the old law or 120 days under the current law – you win automatically. You do not need to prove the merits of your claim. You just need to prove when you filed. Keep records. Save screenshots. Get receipts.
The Bottom Line for Kenyan Taxpayers
These two judgments, delivered back-to-back by the same judge, offer a clear roadmap for anyone dealing with tax refund disputes in Kenya.
If you repackage a rejected claim in a fresh application, the Tribunal will expunge it and publicly call it “mischief.” If you ignore a rejection and fail to appeal on time, you lose the claim forever. The law provides clear mechanisms for challenging a rejection. You cannot skip them.
On the other hand, if you keep proof of when you filed your refund application, you can trigger the deeming provisions if KRA misses the statutory deadline. Under the current law, that deadline is 120 days if KRA conducts an audit, or 90 days if no audit is conducted. Under the Finance Act 2025, these timelines have been further adjusted to 120 working days and 180 working days respectively, but the core principle remains unchanged.
And if you fail to raise factual issues before the Tribunal, you cannot raise them for the first time in the High Court. The High Court’s jurisdiction is limited to questions of law only.
For businesses, the message is to respect the procedural rules. Do not try to outsmart the system with creative refilings. The courts have seen every trick before.
For KRA, the message is that statutory deadlines are not suggestions. They are guillotines. Miss them, and the taxpayer wins automatically – whether the refund is valid or not. Also, keep proper records. An unproven assertion about a timely decision will not save you in court.
For taxpayers, the message is encouraging. If KRA takes more than the statutory timeline to respond to your refund application – be it 90 days, 120 days, or the new working day timelines under Finance Act 2025 – do not wait. File an appeal at the Tribunal immediately, citing the relevant deeming provision. The law is on your side. But you must prove the filing date. Keep your evidence.
