Post loses judicial review

Sat, 22 Oct 2016 10:42:55 +0000

Counsel argued that the Respondent’s irrational and ulterior motives as well as its determination to close down the Appellant were confirmed by a recording which was in the Appellant’s possession and in which the then Minister of Finance, Honourable A.B. Chikwanda, was informing a third party that he had asked the ZRA Commissioner-General to fix the Appellant by using its outstanding tax obligations to the Respondent.

The Appellant’s counsel went on to refer to Diplock J’s definition of ‘irrationality’ in the case of Council for Civil Services Unions and Others vs. Minister for the Civil Service² and concluded their arguments around ground One by contending that the Respondent’s decision of refusing to allow the Appellant to liquidate its tax liability in instalments as had been proposed to it was not only plainly irrational and Wednesbury unreasonable, but was also procedurally flawed and clearly in breach of the general principles of fairness. In relation to Ground two, counsel argued that the Judge below fell in error when he totally ignored the Appellant’s uncontested evidence which points to bias on the part of the Respondent arising from interference by the Minister of Finance.

According to Counsel, the evidence suggesting bias and interference in relation to the Respondent and which had been deployed before the lower Court was overwhelming and ought to have been considered to tilt the scales of justice in favour of the Appellant. Counsel cited the case of Nkhata and Others vs. The Attorney General³ in support of his argument that there was clear bias in the Commissioner-General’s decision to take over the negotiations between the Appellant and the Commissioner-Domestic Taxes  as borne out by the shift from the initial decision of allowing the Appellant to make proposals for the discharge of its tax liability in instalments to the rejection of the said proposals coupled with threats to levy distress against the appellant and closing the company down altogether.

Counsel contended that the learned trial Judge should have considered the evidence referred to able and that the Court’s failure to do so constituted a grave misdirection which warranted interference by this superior Court. In relation to Ground Three, the learned Counsel for the Appellant argued that the failure by the Judge in the Court below to hear the Appellant’s application to file a Further Affidavit which established that Zambia Daily Mail Limited and Times Printpak Limited owed the Respondent more taxes than the Appellant but were not being subjected to the same harsh treatment as the Appellant was an indication that the respondent’s intention was not to collect tax but to sue the same as a mere cloak to treat the Appellant unfairly.

Counsel cited the case of Chief Constable of North Wales Police vs. Evans where4, at page 143, Lord Hailsham stated as follows: ”It is important to remember in every case that the purpose of the remedy of judicial review is to ensure that the individual is given fair treatment by the authority to which he has been subjected and that it is not part of that purpose to substitute the opinion of the judiciary or of individual judges for that of the authority constituted by law to decide the matters in question”.

Counsel further argued that the Appellant was not treated fairly by the Respondent, particularly its rejection of the Appellant’s proposal to pay its tax liabilities in instalments and its insistence on crippling the Appellant’s business. The Appellant’s Counsel concluded their written arguments by reiterating the principles in the case of Nkhata and Others vs. The Attorney General³ cited above and submitted that this was a proper case for this Court to overrun the lower court’s decision. We were accordingly urged to allow the Appellant’s appeal.

In opposing this Appeal, the learned Counsel for the Respondent also filed Heads of Arguments on behalf of the Respondent. Counsel begun by giving a brief background to the matter which we shall not repeat here, suffice it to say that we have read and taken due note of the same.

In response to Ground One, counsel for the Respondent when submitted that the Appellant’s first Ground of appeal was misconceived as the Court below neither erred in law nor in fact when it held that the Commissioner-General had authority to take over the communication between the Appellant and the Commissioner-Domestic Taxes and against allowing the Respondent to settle its tax liabilities in instalments. As regards the Appellant’s allegation imputing procedural impropriety to the Respondent, Counsel for the Respondent begun by agreeing with the Court below and pointing out that this allegation, and the case law relied upon to advance the same (namely, The Attorney-General vs. Kang’ombe¹) was totally misconceived and misapprehended and could not be related to the facts and circumstances which led to the institution of Court proceedings by the Appellant.

Counsel accordingly invited us to uphold the lower Court’s finding that the Commissioner-General had authority to take over the communication which the Appellant had directed to the Commissioner-Domestic taxes and to deal with the same in the manner that the Commissioner-General did. Learned counsel then went on to recount the purpose of judicial review by referring to the following passage which was drawn from the case of Fredrick Jacob Titus Chiluba Vs, the Attorney General5:- “The remedy of Judicial Review is concerned with reviewing, not the merits of the decision in respect of which the application for Judicial Review is made but the decision-making process itself. The purpose of Judicial Review is to ensure that an individual is given fair treatment by the authority to which he has been subjected and that it is not part of that purpose to substitute the opinion of the judiciary or of individual judges for that of the authority constituted by law to decide the matters in question.

The court will not on Judicial Review application act as a ‘court of appeal,” from the body concerned, nor will the court interfere in any way with the exercise of any power or discretion which has been conferred on that body, unless it has been exercised in a way which is not within that body’s jurisdiction or the decision is Wednesbury unreasonable. When the High Court is reviewing the decision of a public body it will not admit evidence which is relevant to whether the decision is a reasonable one; but it will permit evidence which is relevant to whether the decision is one which the body had power to make or whether it was made in circumstances in which a reasonable body could have made it.”

Counsel for the Respondent then proceeded to repeat the arguments which were canvassed on behalf of the Respondnet in the Court below with regard to the position of the ZRA Commissioner-General under the Authority’s enabling statute as well as the Tax statutes which imbues him with immense powers not only to enforce these statutes but, in the specific case of the Income tax Act to appoint staff or officers in the Domestic Tax Division of the Authority and to delegate any of his functions to such appointees.

It was counsel’s further arguments that, in terms of section 7 (1) of the Income Tax Act, “….any decision made or any notice or communication issued or signed by any such officer may be amended or withdrawn by the Commissioner-General, or by the officer concerned, and shall, for the purposes of this Act, until it has been so withdrawn, be treated as having been made, issued or signed by the Commissioner-General”. It was counsel for the Respondent’s further contention that, on the basis of the law as cited above, there was nothing procedurally improper in having the Commissioner-General respond to the letter which the Appellant had addressed to the Commissioner-Domestic Taxes because the law specifically and unambiguously empowers the Commissioner-General not only to implement the provisions of the Income Tax act, Chapter 323 of the Laws of Zambia and the Value Added Tax Act, Chapter 331 of the Laws of Zambia but also to delegate any of his functions to any of the officers of the Respondent. Counsel also contended that a person who delegates his/her functions remained accountable and that nothing would prevent a person who delegates a function or functions from doing that which he would have delegated. Counsel also argued that the import of section 7 (1) of Income Tax Act, as quoted above, was that it empowered the Commissioner-General to amend or to withdraw any decision made or any notice or communication issued, as the case may be, by any officer in the Domestic Taxes Division and that such intervention by the Commissioner-General may arise at any time as there is no prescribed time frame within which the Commissioner-General can exercise the power which the law gives him.

counsel further argued that the suggestion by the Appellant that the decision of the Commissioner-Domestic Taxes could only be reviewed on appeal was a gross misapprehension of Section 7 (1) of the Income tax Act  adding that the power conferred on the Commissioner-General under section 7 (1) can be exercised at any time and that therefore, by acting the way he did, the Commissioner-General merely exercised his powers under the Income Tax Act by amending or indeed withdrawing the decision of the Commissioner-Domestic Taxes. The Respondent’s Counsel further submitted that section 7 (1) of the Income Tax Act does not set any preconditions which have to be met before the Commissioner-General can either amend any decision or withdraw any communication issued or signed by any officer in the Domestic Taxes Division, nor does it require him to hear the concerned party before amending or withdrawing any decision or communication. Relying on the observations which we made in Chiluba vs. Attorney-General5

 and Nyampala Safaris (Z( Limited & Others vs. ZAWA & OTHERS6 (to the effect that it is not all cases that the rules of natural justice apply) Counsel argued that, as the right to be heard was unavailable in the circumstances in question, the question of breach of the rules of natural justice by the Respondent did not arise and that, in any event, and as the court below correctly noted, the Appellant was heard in that there was full engagement between the parties both in writing as well as verbally over the Appellant’s tax indebtedness and the settlement of the same. Counsel insisted that the fact that the engagement between the Appellant and the Respondent did not yield the outcome which the former was seeking or had hoped for did not discount or negative the fact of such engagement having taken place. The Respondent’s Counsel fervently contended that there was nothing unfair, illegal or irregular about the manner in which the Appellant was treated by the Respondent adding that the Appellant had failed in its civic responsibility to pay taxes on their due dates inspite of the Respondent having given it time within which to pay is tax arrears and impressing upon it to remain current with its tax obligations.

Counsel also argued that the issue of procedural impropriety did not arise given that the Commissioner-General acted within the provisions of the law. With regard to the Appellant’s allegation suggesting irrationality and Wednesbury unreasonableness, Counsel for the Respondent contended that the Appellant’s arguments around these allegations constituted an assault upon the merits of the Respondent’s decision which it was not competent for this Court of the court below to inquire into.

In this regard, Counsel insisted that the apparent invitation by the Appellant to have the Court review the merits of the Respondent’s decision was misconceived and clearly offended the purpose of judicial review which, consistent with the decisions of this Court in Fredrick Jacob Titus Chiluba vs. the Attorney General5 and Nyampala Safaris (Z) Limited & Others vs Zambia Wildlife Authority & Others6 cited above, is concerned, not with the merits of the decision, but with the decision making process itself. Counsel also insisted that it was not even open to a Court of law to substitute the decision of the decision maker in question, such as the Respondent in the instant case, with the Court’s own decision. Continues on Monday