KAMPALA, Uganda — The High Court has dismissed a judicial review application brought by Kasule Mahmood and Kasirye Henry Masanganzira seeking to stop their prosecution by the Uganda Revenue Authority, ruling that URA acted within its statutory powers when it sanctioned criminal charges over alleged fictitious VAT claims.
In a decision delivered by Justice Isaac Bonny Teko, the court rejected claims that the tax body acted illegally, irrationally or with procedural impropriety in prosecuting the applicants in HCT-00-AC-CO-0070 of 2024, Uganda Revenue Authority v Kasule Mahmood & 7 Others. The applicants, officers of KK Electrical Company (U) Limited, had argued that URA ignored the company’s separate legal personality and prosecuted them personally instead of proceeding against the company, even though the disputed transactions were allegedly supported by EFRIS invoices and other records. They also said criminal proceedings began before investigations were complete and before tax administrative remedies were exhausted.
URA, however, told court that its investigations established fictitious purchases had been declared from Chocho Electrical Appliances Limited and Power Link Engineering Limited, resulting in unlawful VAT claims, and that the applicants were the persons responsible for making false statements to a tax officer under section 58 of the Tax Procedures Code Act. The respondent argued that one applicant had appeared before the Anti-Corruption Court, pleaded not guilty and been granted bail, while the other failed to honour criminal summons and a warrant of arrest was issued.
Justice Teko said the applicants’ constitutional challenge to section 82(1)(a) of the Tax Procedures Code Act could not be determined in judicial review proceedings, noting that such a question falls within the jurisdiction of the Constitutional Court. “The Applicants’ constitutional objection fails because the question of the validity of section 82 of the Tax Procedures Code Act falls within the jurisdiction of the Constitutional Court and cannot be determined in proceedings commenced by way of judicial review,” he said.
The judge further stated: “The Respondent therefore possessed the statutory authority both to investigate the affairs of KK Electrical Company (U) Limited and, where appropriate, to institute criminal proceedings.” He added that “the mere fact that the Applicants were prosecuted in their capacities as company officers cannot, without more, amount to illegality. Parliament has expressly authorised such prosecutions.” He then concluded: “I therefore find that the Applicants have failed to establish illegality as a ground for judicial review,” and “Accordingly, the Applicants have failed to establish irrationality.”
In the end, the court denied the request for certiorari, dismissed the declaration of unlawful and malicious prosecution, and ordered that costs be paid by the applicants. “In conclusion I find that the Applicants have largely failed to prove the grounds for judicial review,” Justice Teko ruled.
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