Akagera Business Group Ltd (ABG), Rwanda’s exclusive distributor of Toyota vehicles, is battling a Rwf1 billion tax case with Rwanda Revenue Authority (RRA) in the Supreme Court.

The case, which started in 2011 in the Commercial High Court, concerns tax that ought to have been paid in 2006 and 2007, but the two parties have failed to agree on the amount.

RRA settled on Rwf1 billion following an audit conducted by its agents in the car dealing company, but the latter refutes the amount saying it was miscalculated.

“Instead of taxing income, RRA taxed the turnover and we raised this in the Commercial High Court but it was not reviewed,” said Abel Nsengiyumva, ABG’s legal counsel.

The Commercial High Court had ruled in favour of RRA, but ABG appealed to the Supreme Court alleging that the lower court disregarded evidence availed by the claimant proving the contrary.

“We provided evidence showing that the tax was overvalued because of accounting errors, but in the ruling the judge said they cannot be considered,” Mr Nsengiyumva told the Supreme Court.

RRA, which has asked the Commercial High Court to take no notice of the said evidence, still insists they should not be considered in this case, citing an article of the tax procedure law that bars all evidence not provided during the audit.

“A taxpayer shall not be allowed to provide at any stage of appeal any additional evidence that had not been produced during the audit,” the article states.

“When RRA auditors were in Akagera, their accountants did not present this evidence, and they also failed to produce the same evidence in the extra month given to them after the audit,” said Bajeni Byiringiro, the RRA lawyer.

ABG told the court that it presented all requested documents to auditors from RRA, and on time.

The claimant’s lawyer requested the court to appoint an independent accounts expert to verify the allegations, but RRA contested the proposal.

The dispute over admissibility of “overdue” evidence that ABG insists hold the truth of the matter dominated the debates, and the Supreme Court decided to first resolve this before considering the merits of the case.

“The court will have to first assess if the contested evidence was produced on time and as provided by the law, and this will determine if we will go ahead and review the specifics of the case,” said the presiding judge.

The hearing was set for January 13, 2017.

The Supreme Court has this month heard a number of cases concerning tax disputes, with the biggest being the Rwf227 million case between RRA and Sonarwa, an insurance company.