Following conflicting judgments in different divisions of our High Court, the country’s apex court has recently sought to provide legal certainty as to whether review and/or appeal proceedings are competent when attacking determinations made by the Commissioner in terms of the Customs and Excise Act, 91 of 1964 (“CEA”)[1].

The judgment in question rendered by unanimous decision of the Constitutional Court followed an interlocutory application brought by the Richards Bay Coal Terminal (Pty) Ltd (“RBCT”), in which RBCT pursued an order to compel the South African Revenue Service (“SARS”) to produce a record of its decision under Uniform Rule 53 (alternatively with Uniform Rule 35(11)) in terms of which, inter alia, SARS had determined that RBCT was not entitled to claim refunds for the diesel fuel used by its locomotives within its internal rail network under a diesel fuel concession scheme introduced in 2001.

In challenging SARS’ determination to disallow the refunds, RBCT sought to attack the decision both under the appeal provisions of section 47(9)(e) of the CEA, and in the alternative through judicial review under the provisions of the Promotion of Administrative Justice Act, 2000 (“PAJA”) and a legality review.

To decide whether to order production of the Rule 53 record, the Court had to decide whether a taxpayer in these circumstances would in fact be limited to the so-called wide appeal under the CEA, and if not, whether a taxpayer could, in the alternative or separately, challenge the determination by a judicial review.

After grappling at some length with various aspects, such as the interaction between wide appeals and judicial reviews, the importance of the doctrine of separation of powers, the principle of subsidiarity and also the distinction between the concepts of the assumption and the exercise of a court’s jurisdiction, the Constitutional Court ultimately elucidated the following principles:

1. The wide appeal provision contained in section 47(9)(e) does not amount to an ouster of the review jurisdiction of the High Court.

2. That said, although a High Court seized with a matter therefore assumes review jurisdiction, it must as be entitled as part of its decision to decide whether or not to exercise its review jurisdiction.

3. In deciding whether or not to exercise its review jurisdiction, the court will have regard to various factors, which is not a closed list, including the availability of the tailor-made remedy contained in section 47(9)(e) of the CEA. 

What can a taxpayer take away from this judgment?  The writer suggests the following:

1. The Constitutional Court has now established that an aggrieved taxpayer does not enjoy carte blanche and therefore unrestricted access to challenge a decision by SARS by choosing either or both appeal and review remedies.

2. Due regard must be given in the first instance to the wide appeal provisions under section 47(9)(e) of the CEA, being the remedy provided by Parliament under the CEA.

3. It is only where the facts of a particular matter warrant it that a taxpayer may ask a court to use its discretion to exercise its review jurisdiction. The particular facts of the matter will determine whether this is appropriate or not, but at the very least, cogent reasons should exist to persuade a court to invoke its review jurisdiction. 

In conclusion, and in addition to what is now the settled position, it is also submitted that any taxpayer engaged in a dispute with SARS take immediate steps to gain a complete understanding of all the options available to it before embarking on any action or proceeding.  In this regard, one is reminded of the wise adage in the game of chess, which holds that in order to improve your game, you must study the endgame before everything else[2].