REPUBLIC OF SOUTH AFRICA
IN THE TAX C OURT OF SOUTH AFRICA
(HELD AT BLOEMFONTEIN )
Case No.: IT 46151
In the matter betwee n:
APPELLANT PKM Appellant/ Applicant
and
THE COMMISSSIONER FOR THE SOUTH AFRICAN Respondent
SOUTH AFRICAN REVENUE SERVICE
J U D G M E N T
(1) REPORTABLE: YES / NO
(2) OF INTEREST TO OTHER JUDGES: YES/NO
(3) REVISED.
14/04/2025 ……………………
DATE SIGNATURE
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Van Zyl , J
[1] This is an interlocutory application wherein Appellant PKM (Pty) Ltd (the appellant) is
seeking amendments to its statement of grounds of appeal filed in terms of Tax Court Rule
(TCR) 32, together with condonation in respect thereof. In terms of the applicant`s Notice of
Motion it is seeking relief in the following terms:
“1. That the condonation for the late submission of amendments to Rule 32
Statement be granted in terms of section [ sic] 50(4) of the Tax Court Rules .
2. That amendments to Rule 32 Statement of Appeal, be admitted and included
in the dossier of discovered documents for the hearing of 10 – 11 March 2025,
together with the original Rule 32 filed on 4 April 2023.
3. That the respondents (sic) pay costs in the event of opposition. ”
Background
[2] The main matter between the parties concerns the 2015 year of assessment in respect
of which SARS issued an additional assessment on 20 September 2018. The appellant lodged
an objection against the additional assessment, which was disallowed by the respondent. The
appellant then proceeded to lodge a Notice of appeal and grounds of appeal on 14 September
2021.
[3] The matter was referred to Alternative Dispute Resolution where various concessions
were made by the respondent. The remaining issue(s) was then referred to be heard as a tax
appeal in accordance with the Tax Court Rules.
[4] The respondent filed its TCR 31 Statement of grounds of assessment and opposing
appeal on 23 September 2022. The appellant subsequently filed its TCR 32 Statement of
grounds of appeal (‘TCR 32 Statement ’) on 5 April 2023 and the respondent ’s TCR 33 reply
to statement of grounds of opposing appeal was filed on 4 May 2023.
[5] On 31 December 2024 e -mail correspondence was received by the respondent in
which a request was made on behalf of the appellant in terms of TCR 35(1) that the parties
agree that the TCR 32 Statement may be amended by the appellant. On 6 January 2025 the
respondent responded, inter alia, that it does not agree to any amendment of the TCR 32
Statement . The said response is attached to the interlocutory application as annexure ‘LMD1 ’.
The appellant consequently filed the present interlocutory application in terms of TCR 35(2),
read with TCR 52(7), and further read with TCR 57.
[6] The respondent duly and timeously delivered its Notice to oppose a s provided for in
TCR 60(a) read with the Notice of Motion, on 23 January 2025. Thereafter the respondent
filed a Notice of intention to raise questions of law only, in terms of Uniform Rule (of the High
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Court) 6( d)(iii). I will return to this aspect.
[7] In response thereto, the appellant filed a document titled “Replying Affidavit in terms
of Tax Court Rules” on 25 February 2025.
[8] A pre -trial meeting, as required for purposes of the tax appeal, was held on
18 February 2025, during which the parties agreed, inter alia, to a separation of the present
interlocutory application and the tax appeal, with the matters to proceed on 10 – 11 March
2025 and 22 – 23 April respectively.
Respondent`s Notice to file a notice of intention to raise questions of law:
[9] Further to delivery of a Notice of intention to oppose an application, TCR 60(c) provides
that a respondent must within 15 days of notifying the applicant of the intention to oppose the
application, deliver an answering affidavit, if any, together with the relevant annexures, to the
applicant and the registrar . (My emphasis) TCR 60(c) does therefore not compel a respondent
to deliver an answering affidavit albeit that the application is opposed.
[10] TCR 42 provides as follows :
“If these Rules do not provide for a procedure in the tax court, the most appropriate rule under
the Rules for the High Court made in accordance with the Rules Board for Courts of Law Act
and to the extent consistent with the Act and these Rules, may be uti lised by a party or the tax
court. ”
[11] Uniform Rule 6 deals with applications in the High Court and Uniform Rule 6(d)
determines as follows:
“(d) Any person opposing the granting of an order sought in a notice of motion shall:
(i) … ;
(ii) within fifteen days of notifying the applicant of his intention to oppose the
application, deliver his answering affidavit, if any, together with any relevant
documents; and
(iii) if he intends to raise any questions of law only he shall deliver notice of his
intention to do so, within the time stated in the preceding sub -paragraph,
setting forth such decision. ”
[12] In the present matter the respondent elected not to file an answering affidavit but
instead filed a Notice of intention to raise questions of law within the stipulated time.
[13] The procedure so followed by the respondent was consequently due and proper.
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The app ellant’s replying affidavit in terms of Rule 61:
[14] Uniform Rule 6(5)( e) provides as follows:
“(e) Within 10 days of the service upon the respondent of the affidavit and
documents referred to in sub -paragraph (ii) of paragraph (d) of subrule (5) the
applicant may deliver a replying affidavit. The court may in its discretion permit
the filing of further affidavits. ”
(My emphasis )
[15] In casu, the respondent did not file an affidavit and documents referred to in Uniform
Rule 6(5)( d)(ii) – it only filed the Notice of intention to raise questions of law referred to in
Uniform Rule 6(5)( d)(iii). The appellant was consequently not entitled to have filed the replying
affidavit in terms of TCR 62.
[16] The said replying affidavit filed by the appellant in the interlocutory application, is thus
struck from the record and is considered to be pro non scripto.
The appellant`s TCR 34 Reply to respondent `s statement opposing appeal:
[17] On 23 January 2025 the appellant filed a document titled ‘ Rule 34 Reply to
Respondent Statement Opposing Appeal’.
[18] It is not clear to me what this document entails, since TCR 34 does not make provision
for the filing of such a document. Be that as it may, the said document was filed within the time
period provided for the respondent to have filed its Notice of intention to oppose, which was
indeed delivered on even date.
[19] Therefore, not only was it filed prematurely, but the Tax Court Rules do also not make
provision for the filing of such a document. In the circumstances it is inadmissible and is struck
from the record and is considered to be pro non scripto.
Application for condonation for th e late filing of the interlocutory application:
[20] In terms of TCR 57(2) an application must be brought within the period prescribed in
TCR 50(4). TCR 50(4) provides , inter alia, as follows:
“(4) An application under this Part, unless the context otherwise indicates, must be
brought within 20 days after the date of the cause of the application unless the parties agree to
a longer period under rule 4(1) or the tax court otherwise di rects under rule 52(1) …”
(My emphasis)
[21] TCR 52(1)( a) reads, inter alia, as follows:
“52(1) A party who failed to obtain an extension of a period by agreement with the other
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party, the clerk o r the registrar, as the case may be, under rule 4 may apply to the tax court
under this Part for an order, on good cause shown —
(a) condoning the non -compliance with the period; and … ”
(My emphasis)
[22] The founding affidavit filed in support of the interlocutory application was deposed to
by Mr LMD White , a tax consultant who also represented the appellant during the hearing of
the interlocutory application. Mr White states, inter alia, in the founding affidavit dated
9 January 2025, as follows:
“4. Nature of Application
4.1 This is a Notice of Motion and application to the Tax Court in terms of
Rule 52(7) of the Tax Court Rules, to admit Rule 35 Amendments to section 32
Statement of Appeal in the above matter. The amendments are not new
evidence but clarification, corrections and deductions of what is already on
record, as detailed herein, permitted in rule 32(2).
4.2 . . . I had been on record since 20 October 2019, marked LMD2 and as long
as I am dealing with SARS I was a valid representative of the Appellant. I have
since renewed The SARS Power of Attorney and obtained a further Power of
Attorney for the Tax Court, marked LMD3(a and b).
5. Application for Condonation for the Late Filing of Amendments to Rule 32 Statement
of Appeal, in terms of rule 50(4) of Tax Court, if applicable.
5.1 Application is hereby submitted for condonation for delay in bringing these
Rule 35 Amendments of the Rule 32 Statement of Appeal filed of record
around 4 April 2023.
5.2 The reasons for the late filing of the amendments are that;
5.2.1 The business and its bank account closed on 24 June 2019, and there
was no one to attend to administrative matters after the closure. The
business is not operating having suffered irreparable harm from 2019
onward owing to these disputed assessments.
5.2.2 The attorney who had been appointed resigned in 2023 due to
unavailability of funds. There was no income to hire another attorney. I
am appearing pro bono.
5.2.3 The assets of the business of the Appellant were auctioned by first
mortgage lender, First National Bank, and the Appellant was paralyzed
in that sense.
5.2.4 I have only been requested on 8 January 2025 to take this matter to
bring closure to the case.
6. . . .”
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[23] Further in the affidavit the deponent deals with the amendment of the TCR 32
statement.
[24] From the aforesaid it is evident that no explanation is given as to what the cause of the
application was or what lead to the need for the application . According to the deponent he has
been involved with the appellant since October 2019. There is no explanation why he could
not have earlier filed the amendments to the TCR 32 statement, especially considering that
the TCR 32 statement had already been filed on 5 April 2023 and the TCR 33 rep ly on 4 May
2023. If he has been requested on 8 January 2025 to ‘take this matter’, there is no explanation
why he could not have been requested to do so at an earlier stage.
[25] As already mentioned earlier, TCR 52(1)( a) determines that condonation can be
granted ‘ on good cause shown’. The requirements for ‘good cause ’ are trite. In Grant v
Plumbers (Pty) Ltd 1949 (2) SA 470 (O) at 476 - 477 they are set out as follows:
“(a) He (the applicant) must give a reasonable explanation of his default. If it
appears that his default was wilful or that it was due to gross negligence the
court should not come to his assistance.
(b) His application must be bona fide and not made with the intention of merely
delaying plaintiff’s claim.
(c) He must show that he has a bona fide defence to plaintiff’s claim. It is sufficient
if he makes out a prima facie defence in the sense of setting out averments
which, if established at the trial, would entitle him to the relief asked for. He
need not deal fully with the merits of the case and produce evidence that the
probabilities are actually in his favour.”
See also Silber v Ozen Wholesalers (Pty) LTD 1954 (2) SA 345 (A) at 352G & 353A.
[26] In an application for condonation an applicant should explain, comprehensively, the
reasons for his delay and/or his failure to adhere to and comply with the prescribed time limits
with which he was obliged to comply. Th is obligation also entails a n obligation to explain each
period of delay. In High Tech Transformers (Pty) Ltd v Lombard (2012) 33 ILJ 919 (LC) the
importance of a reasonable and acceptable explanation for a delay was accentuated at para
25 of the judgment:
“[25] . . . Condonation is not merely for the asking as was duly pointed out by the court
in NUMSA & another v Hillside Aluminium [2005] 6 BLLR 601 (LC):
‘[12] Additionally, there should be an acceptable explanation tendered in respect of
each period of delay. Condonation is not there simply for the asking. Applications for
condonation are not a mere formality. The onus rests on the applicant to satisfy the court
of the existence of good cause and this requires a full, acceptable and ultimately reasonable
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explanation. … Nevertheless, to do justice to the aims of the legislation, parties seeking
condonation for non -compliance are obliged to set out full explanations for each and every
delay throughout the process. … ’ ”
[27] An applicant should also show that he has reasonable prospects of success in the
process for which he seeks condonation to proceed with.
[28] In PAF v SCF 2022(6) SA 162 (SCA) para 21 the Supreme Court of Appeal held as
follows:
“[21] A court considering a condonation application exercises a discretion in the true sense,
upon consideration of all the circumstances of each case. In Aurecon South Africa (Pty) Ltd v
Cape Town City 2016 (2) SA 199 (SCA) ([2016] 1 All SA 313; [2015] ZASCA 209) para 17 it
was held that the relevant factors in that enquiry generally include the nature of the relief sought;
the extent and cause of the delay; its effect on the administration of justice and other litigants;
the reasonableness of the explanation for the delay, which mus t cover the whole period of
delay; the importance of the issue to be raised; and the prospects of success. The onus is on
the applicant to satisfy the court that condonation should be granted. ”
[29] I shall also accept that good prospects of success on the merits can serve to scrutinize
the explanation tendered for the delay somewhat less strictly. In Melane v Santam Insurance
1962 (4) SA 531 (A) at 532 E -F this principle is stated as follows:
“What is needed is an objective conspectus of all the facts. Thus, a slight delay and a good
explanation may help to compensate for prospects of success which are not strong. Or the
importance of the issue and strong prospects of success may tend to compensate for a long
delay. And the respondent's interest in finality m ust not be overlooked. ”
[30] The majority of the reasons provided by the appellant are bald statements without any
corroboration or support thereof and without explanations . The appellant failed to explain each
period of delay and only made general, vague allegations. More importantly, the statements
show no relevance as to why those circumstances prevented the appellant from having filed
the interlocutory application earlier. There is no explanation as to what brought about the
change which all of a sudden enabled the appellant to hav e filed its interlocutory application.
If the appellant was able to request Mr White on 8 January 2025 for assistance in the matter,
it is to be accepted, in the absence of an explanation to the contrary, that the appellant could
also have done so a t an earlier stage .
[31] As evident from the authority referred to earlier, the second ‘leg’ of ‘good cause’ is
reasonable prospects of success with the appellant`s proposed amendment of the TCR 32
Statement . The appellant completely failed to address and provide any detail regarding the
merits of the appellant`s case.
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[32] For the aforesaid reasons, the appellant, in my view, failed to make out a case for
condonation and the application for condonation therefore stands to be dismissed.
Prayer 2 of th e No tice of Motion and the contents of the foundi ng affidavit
[33] For the sake of completeness, should it be found that I erred in my aforesaid finding, I
also deal with prayer 2 of t he Notice of Motion and the contents of the founding affidavit.
[34] TCR 57(1) determines as follows in respect of a Notice of Motion and founding
affidavit:
“(1) Every application must be brought on notice of motion which must set out in full the
order sought , be signed by the applicant o r the applicant`s representative and must be
supported by a founding affidavit that contains the facts upon which the applicant relies for
relief .”
(My emphasis)
[35] As set out earlier in the judgment, th e second prayer sought in the Notice of Motion
reads as follows:
“that amendments to Rule 32 Statement of Appeal, be admitted and included in the dossier of
discovered documents for the hearing of 10 – 11 March 2015, together with the original Rule 32
filed on 4 April 2023. ”
[36] This prayer is the main prayer of the relief sought by the appellant in the interlocutory
application . However, it is trite that the Notice of Motion, in an instance such as this, should
set out which parts of the rule 32 statement the appellant seeks to amend and in what ways,
which parts thereof it seeks to supplement and which parts thereof it seeks to substitute , since
that will constitute the order. It should provide the particulars of the amendments to the rule 32
statement that are being sought. Not only is this not set out in the relevant prayer, but same
is also not even evident from a reading of the founding a ffidavit as such. It is not for the tax
court to unravel what the actual order is which the appellant is seeking. It is therefore
impossible to grant an order in terms of the prayer as it stands, even read together with the
contents of the founding a ffidavit.
[37] It is furthermore not clear in what way the required ‘amendments’ can be requested to
be included in the ‘dossier of discovered’ documents, since TCR 40 which provides for the
contents of the dossier, does not make provision for ‘discovered’ documents.
[38] In addition, the founding affidavit is replete with factual averments that are alleged to
have occurred prior to the deponent having had any contact with the appellant and/or which
cannot be accepted to fall within the personal knowledge of the deponent. The application is
not supp orted by a confirmatory affidavit of the public officer of the appellant. In the
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circumstances great parts of the founding affidavit constitute inadmissible hearsay evidence.
[39] The appellant consequently also failed to make out a proper case for the granting of
prayer 2 of the Notice of Motion.
The nature/contents of the grounds of appeal the appellant is attempt ing to introduce:
[40] For the sake of completeness, I also deal with the last -mentioned aspect, although I
have already found that the appellant`s interlocutory application cannot succeed f or more than
one reason.
[41] TCR 32(2) and (3) determine as follows in respect of the statement of grounds of
appeal:
“(2) The statement must set out a clear and concise sta tement of—
(a) the grounds upon which he appellant appeals;
(b) which of the legal facts or the legal grounds in the statement under rule 31 are
admitted and which of those facts or legal grounds are opposed; and
(c) the material facts and the legal grounds upon which the appellant relies for the
appeal and opposing the facts or legal grounds in the statement under rule 31.
(3) The appellant may include in the statement a new ground of appeal unless it
constitutes a ground of objection against a part or amount of the disputed assessment not
objected to under rule 7.’
(My emphasis)
[42] The proposed amendments do not comply with TCR 32(2). In fact, to allow the
amendments will render the TCR 32 Statement excipiable. It is settled in our law that an
amendment which would render a pleading excipiable ought not to be allowed. See Tengwa
v Metrorail 2002 (1) SA t39 at 746 F - G.
[43] In addition, with some of the proposed amendments the appellant is seeking to
withdraw admissions made in the original TCR 32 Statement. This is impermissible in the
absence of any explanation for the withdrawal thereof to indicate the bona fides of the
appellant ad the absence of prejudice for the respondent. Example s of such withdrawal of
admission s appear in paragraph s 8, 18 and 19 of the founding affidavit. In Bellairs v Hodnett
1978 (1) SA 1109 (A) the following is stated at 1150 G -H:
“But, as it has frequently been stated, an amendment cannot be had merely for the asking. This
is equally, if not especially, true of a proposed amendment which involves the withdrawal of an
admission. In such cases the Court will generally require to have before it a satisfactory
explanation of the circumstances in which the admission was made and the reasons for now
seeking to withdraw it. ”
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[44] Furthermore , the entire paragraph 7 of the founding affidavit speaks to the 2007, 2008
and 2009 years of assessment, which years of assessment are not the subject matter of the
current tax appeal , which is the 2015 tax year. From a reading of the said paragraph 7, in
conjunction with the rest of the founding affidavit, it appears that part of the amendments
sought effectively constitutes appeals against the additional assessments issued for the 2007,
2008 and 2009 years of as sessment. Accordingly, the amendments the applicant is seeking
in this regard are in contravention of TCR 32(3).
[45] The aforesaid constitute further reasons why the appellant failed to make out a proper
case for the granting of prayer 2 of the Notice of Motion.
Conclusion
[46] On the basis of the aforesaid conclusions, individually, alternatively cumulatively, the
interlocutory application cannot be granted .
Costs
[47] There is no reason why the costs of the interlocutory application should not follow its
outcome and the appellant is therefore to pay the costs.
[48] In terms of the respondent`s Notice of intention to raise questions of law the
respondent sought costs on an attorney and own client scale. However, this request was not
repeated in its heads of argument nor in argument itself. In my view and in the exercise of my
discretion there is no justification for a special costs order.
Order:
[49] The following order is made:
1. The application for condonation is dismissed, with costs.
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C. VAN ZYL, J
Coram: Van Zyl, J
Heard : 10 March 2025
Delivered : 14 April 2025