Kuwait Court of Cassation principle number 269

Summary: - Establishment that the Tax Assessment Department assessed the national labour support tax payable by the appellant company and notified it of the tax assessment on its profits for the assessment years. The appellant objected, its objection was rejected, and it was notified of the rejection. The appellant’s failure to appeal before the Tax Appeals Committee within thirty days of the date of its notification. Its effect. The assessment becomes final and unchallengeable before any body, even by way of a defence in an ordinary action brought against it to collect the tax. The appellant’s complaint that the action is not to be heard owing to lapse of time for some assessment years. Ineffectual because the tax has become payable. The Court of Cassation may correct the statements vitiating the judgment in this respect without quashing it. Rule: Since it is established from the papers that the appellant company is a Kuwaiti company listed on the Kuwait Stock Exchange on 29/9/1984, and that the Tax Assessment Department assessed the national labour support tax payable by it for the financial years ending on 31/12/2001, 31/12/2002, 31/12/2003, 31/12/2004 and notified it of the tax assessment on its profits for those years, and the appellant objected to this assessment, but the Tax Department issued its decision rejecting this objection and notified the appellant thereof on 28/1/2006, and the latter did not appeal that decision before the Tax Appeals Committee within the time limit specified in Ministerial Decision No. 16 of 1997, referred to above, namely thirty days from notification of rejection of the objection—and the appellant does not dispute this—the assessment has thus become final and unchallengeable before any body, even by way of a defence in an ordinary action brought against it to collect this tax. Since the first-instance judgment, upheld on its grounds by the challenged judgment, adopted this view and accordingly ordered the appellant to pay the amount awarded, it correctly applied the law and is free of any violation thereof. This is not undermined by what the appellant raised concerning its dispute as to non-receipt of the tax assessment notice or its complaint against the expert in the action for failing to deduct certain amounts stated in its two bundles of documents submitted to him from the amount payable by it, since the tax payable by it has become final and payable, as explained above. Granting its request to appoint another expert to examine its objections would therefore avail it nothing. Nor is the soundness of the challenged judgment affected by the erroneous assessments tainting its grounds in stating that the letter sent by the appellant dated 27/12/2005 constitutes an acknowledgment of the debt and interrupts prescription—as it put it—since the tax has become final and payable. The appellant’s complaint that the action is not to be heard owing to lapse of time for the years 2001, 2002, 2003, whatever view may be taken of it, is ineffectual. The Court of Cassation may correct the assessments vitiating the judgment in this respect without quashing it, and the criticism of it in the grounds of the cassation appeal is without foundation.