JSC Atomredmetzolo (ARMZ) is a Company incorporated in the Russian Federation dealing in uranium mining industry. Late 2010, the Company purchased from the Australia Stock Exchange all shares in Mantra Resources Limited (Mantra Resources) a company incorporated in Australia and owner of Mkuju River Uranium project located Tanzania. Following the acquisition of all the issued shares in Mantra Australia, JSC Atomredmetzolo became a sole registered and beneficiary owner of shares in Mantra Australia making Mantra Australia a wholly owned subsidiary of JSC Atomredmetzolo. Hence Mantra Tanzania and Mkuju River Uranium Project were placed under the control of JSC Atomredmetzolo who had a majority 51.4% shareholding in a Canadian Uranium exploration and mining company named Uranium One Inc. Thus, JSC Atomredmetzolo opted to invest in the Mkuju River Uranium project through Uranium One based in Canada. Subsequently, JSC Atomredmetzolo entered into a put/call option agreement with Uranium One, pursuant to which JSC Atomredmetzolo sold and transferred the shares it had acquired in Mantra Australia to Uranium One for a consideration equal to JSC Atomredmetzolo acquisition costs of the scheme shares. This was viewed by the tax authorities as acquisition of shares by JSC Atomredmetzolo in Mantra Australia which resulted into acquisition of interest in Mantra’s Core asset, that is, Mkuju River Uranium project located in Tanzania, because the subsequent sale and transfer of the said shares to Uranium One was a realization of interest in the Mkuju River Uranium project by JSC Atomredmetzolo. In that regard, the tax authorities concluded that, the said transaction was subject to taxation in Tanzania. As such, the tax authorities in November 2011 notified JSC Atomredmetzolo on existence of tax liability of USD 196,000,000/= assessed on investment income because the income earned has a source in Tanzania since the transaction involved a domestic asset. In addition, on account of conveyance of the domestic asset in question, the tax authorities also required JSC Atomredmetzolo to pay Stamp Duty which was assessed at USD 9,800,000. This made JSC Atomredmetzolo lodge two appeals to the Tax Revenue Appeals Board contesting the liability to pay the taxes. In a judgment handed down on 15th May 2013, the Board determined in favour of JSC Atomredmetzolo. This decision was later upheld by the Tax Revenue Appeals Tribunal in its ruling of december 2013. The tax authorities then brought to the Court of appeal. Judgement of the Court of Appeal. The Court nullified the decisions from the previous instances, due to lack of legal jurisdiction. Excerpt “In the case at hand, since the appellant’s letter in question constituted notice on existence of liability to pay income tax to the respondent, it was illegal to seek remedy of an appeal before the Board which is statutorily barred to entertain appeals relating to tax assessment under the provisions of section 7A of the TRAA. Therefore, the Board had no jurisdiction and it embarked on a nullity to entertain the respondent’s appeals. Similarly, it was illegal for the Board to entertain the respondent’s appeal on stamp duty because the respective tax dispute resolving mechanism initially requires the dispute to be adjudicated by the Stamp Duty Officer and the appeal therefrom lies to the Commissioner and finally a reference may be made to the Board. Thus, as it was the case on the income tax dispute, the Board illegally entertained the respondent’s appeal on stamp duty and what ensued thereafter is indeed a nullity. We are fortified in that account because jurisdiction is a creature of statute and as such, it cannot be assumed or exercised on the basis of the likes and dislikes of the parties.” “On the way forward, we invoke our revisional jurisdiction under the provisions of section 4 (3) of the AJA to nullify the proceedings and judgments of the Board and the Tribunal because the first appeal stemmed from null proceedings.” Click here for translation consolidated-civil-appeals-nos-78-79-2018-commissioner-general-tanzania-revenue-authorityappellant ...