Nairobi — The supreme Court has concluded the hearing of a government appeal against a Court of Appeal-endorsed High Court decision that declared the Finance Act 2023 unconstitutional.
A full bench led by Chief Justice Martha Koome said the court will deliver its judgement on notice.
Among the issues raised during the hearing was the question of whether there had been sufficient citizen engagements and whether there was necessity for concurrence between the National Assembly and the Senate on amendments made by either House without involvement of the other prior to the enactment of the law.
Parties opposed to the reinstatement of the Act led by Busia Senator Okiya Omutata argued that their case as sought clarifications on key Issues relating to the appeal.
Govt appeal
Lead Counsel for the National Assembly and Speaker of the National Assembly Issa Mansour reiterated the position that there had been adequate public participation and that there were avenues open to the public to keep track of the progress of the legislative process including uptake of their representations received during the public participation stage.
"The Bunge TV Channel is open to the Public and all House proceedings are open to the Public. The National Assembly has social media channels where all it's activities are posted, namely the Parliament of Kenya Facebook Page and National Assembly X account. The Chamber also has a public gallery open to any citizen to physically follow proceedings of the House," said Mansour.
Professor Githu Muigai who led coulsel for Attorney General and the Cabinet Secretary for Treasury and National Planning cautioned against upholding the Court of Appeal Judgment indicating that it would be akin to crippling the operations of the State.
"The judicature should avoid radical rulings that imperial the stability of the state which is exactly what the High Court did. When you defund the state that is not a step that should be taken lightly," Prof. Muigai urged the court.
The Supreme Court had suspended the Court of Appeal's judgment declaring Finance Act 2023 unconstitutional pending the outcome of the final appeal.
Supreme Court stay
In its decision on August 20, the Supreme Court highlighted the uncertainty surrounding the revenue measures and the difficulties that could arise in government operations if the Act remained unconstitutional.
The Supreme Court emphasized that public interest tilted in favor of maintaining the Finance Act in force pending the appeal, as reversing its effects later might not be feasible if the appeal succeeded.
The Court also acknowledged that, unlike the Court of Appeal, which had refused to stay the execution of the High Court's judgment on the matter, it was within its discretion to issue interlocutory orders on a case-by-case basis.
Court of Appeal had in July 31, declared the Finance Act 2023 unconstitutional due to flaws in its enactment process.
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A three-judge bench comprising Justices Kathurima M'inoti, Agnes Murgor, and John Mativo found that the amendments made to various tax laws -- including the Income Tax Act, Value Added Tax Act, Excise Duty Act, Retirement Benefits Act, and Export Processing Zones Act -- post-public participation were unconstitutional.
The judges cited failure to subject the amendments to fresh public participation, a move they said violated constitutional provisions.
"Accordingly, we hereby issue a declaration that the enactment of the Finance Act, 2023 violated Articles 220 (1) (a) and 221 of the Constitution as read with sections 37, 39A, and 40 of the PFMA which prescribes the budget-making process, thereby rendering the ensuing Finance Act, 2023 fundamentally flawed and therefore void and consequently unconstitutional," the bench stated.
