All litigants are equal before the law - SARS included?
All litigants are equal before the law - SARS included?
By Mary Mola, Junior Consultant
In Commissioner for the South African Revenue Service v Taxpayer 3C (VAT 12167) [2026] ZATC 2 (12 March 2026), the Tax Court considered the South African Revenue Service’s (“SARS”) application for condonation for the late filing of its Rule 31 statement of grounds of assessment under the Tax Court Rules, promulgated in terms of section 103 of the Tax Administration Act (“the TAA”). The Court reiterated that all litigants are equal before the law—SARS included—and that both SARS and taxpayers are required to comply with procedural requirements and prescribed time limits.
The judgment underscores the importance of efficient and lawful tax administration and highlights the potential consequences of non-compliance with procedural deadlines.
Factual background
SARS issued Taxpayer 3C (Pty) Ltd (“Taxpayer 3C”) with an additional assessment for the 08/2015 to 03/2018 tax periods. Taxpayer 3C objected to the assessment. SARS partially disallowed the objection, and the dispute was subsequently referred for Alternative Dispute Resolution (“ADR”).
After the ADR concluded, on 3 December 2020 the SARS ADR facilitator emailed Taxpayer 3C’s attorney of record confirming that ADR had been terminated by agreement between the parties. On 4 December 2020, Taxpayer 3C’s attorney responded, confirmed that the appeal would proceed, and requested that SARS file its statement of grounds of assessment within the period prescribed by the Tax Court Rules. On 10 December 2020, a Mr JR of SARS wrote to Taxpayer 3C’s public officer advising that the appeal had been referred to the Tax Court. SARS contended that the 4 December 2020 email did not constitute notice delivered in terms of Rule 25(3)(b). Rule 25(3)(b) requires that notice be given to SARS within 20 days of the termination of the ADR if the appellant wishes to proceed with the appeal in the tax court.
In December 2024, SARS delivered its Rule 31 statement of grounds of assessment. Rule 31 requires SARS to deliver the statement within 45 days after delivery of the taxpayer’s notice of appeal. SARS attributed the delay to the responsible official’s illness; responsibility was thereafter assumed by his manager, and the relevant step was, on SARS’s version, not identified and attended to timeously due to workload constraints. In light of the four-year delay, on 15 January 2025 Taxpayer 3C delivered a Rule 56(1) notice of intention to apply for default judgment, calling on SARS to remedy its default within 15 days.
During the proceedings, Taxpayer 3C launched a Rule 30 application under the Uniform Rules of Court to set aside what it alleged was an irregular step taken by SARS. Although not fully clarified in the case as reported, the alleged irregular step appears to have been the four-year delay by SARS in filing its statement of grounds of assessment. In response, SARS brought a counter-application under Rule 30. Both parties later withdrew their respective Rule 30 applications.
The issue before the court
The central issue was whether SARS was required to apply for condonation, despite its eventual compliance, and—if so—whether condonation ought to be granted.
A further issue before the court was whether the email sent by the taxpayer, in which it stated that it persisted with the appeal, constituted a notice of appeal.
It is not clear why the Rule 56 issue was not also before the Court.
The court’s decision
The Court held that the email sent by Taxpayer 3C’s attorney of record on December 2020 constituted the notice of appeal. It rejected SARS’s contention that the notice did not convey a clear intention to appeal, finding that the contention was without legal foundation. The Court further found that, although the email was not sent to the required email address, there had been substantive compliance.
The Court also rejected SARS’s submission that it was not required to apply for condonation because it had subsequently complied. Emphasising that all litigants are equal before the law, the Court confirmed that SARS is not exempt from procedural time limits and is required to seek condonation where it fails to comply.
The Court accepted that SARS’s delay in delivering the statement caused prejudice to Taxpayer 3C. However, it considered the explanation for the delay to be satisfactory in the circumstances. The Court held that it was in the interests of justice for the appeal to be determined on its merits and, accordingly, granted SARS’s application for condonation.
SARS was ordered to pay the costs of the condonation application. SARS and Taxpayer 3C were each ordered to pay the costs of their respective Rule 30 applications.
Conclusion
This judgment reinforces the importance of complying with procedural time limits and confirms that no litigant is above the Tax Court Rules in principle, however, in practice, SARS was granted condonation after four years of non-compliance. One can only wonder whether the taxpayer would be afforded the same degree of leniency in similar circumstances. This judgment also illustrates the Court’s emphasis on the interests of justice when determining whether to grant condonation.
In Commissioner for the South African Revenue Service v Taxpayer 3C (VAT 12167) [2026] ZATC 2 (12 March 2026), the Tax Court considered the South African Revenue Service’s (“SARS”) application for condonation for the late filing of its Rule 31 statement of grounds of assessment under the Tax Court Rules, promulgated in terms of section 103 of the Tax Administration Act (“the TAA”). The Court reiterated that all litigants are equal before the law—SARS included—and that both SARS and taxpayers are required to comply with procedural requirements and prescribed time limits.
The judgment underscores the importance of efficient and lawful tax administration and highlights the potential consequences of non-compliance with procedural deadlines.
Factual background
SARS issued Taxpayer 3C (Pty) Ltd (“Taxpayer 3C”) with an additional assessment for the 08/2015 to 03/2018 tax periods. Taxpayer 3C objected to the assessment. SARS partially disallowed the objection, and the dispute was subsequently referred for Alternative Dispute Resolution (“ADR”).
After the ADR concluded, on 3 December 2020 the SARS ADR facilitator emailed Taxpayer 3C’s attorney of record confirming that ADR had been terminated by agreement between the parties. On 4 December 2020, Taxpayer 3C’s attorney responded, confirmed that the appeal would proceed, and requested that SARS file its statement of grounds of assessment within the period prescribed by the Tax Court Rules. On 10 December 2020, a Mr JR of SARS wrote to Taxpayer 3C’s public officer advising that the appeal had been referred to the Tax Court. SARS contended that the 4 December 2020 email did not constitute notice delivered in terms of Rule 25(3)(b). Rule 25(3)(b) requires that notice be given to SARS within 20 days of the termination of the ADR if the appellant wishes to proceed with the appeal in the tax court.
In December 2024, SARS delivered its Rule 31 statement of grounds of assessment. Rule 31 requires SARS to deliver the statement within 45 days after delivery of the taxpayer’s notice of appeal. SARS attributed the delay to the responsible official’s illness; responsibility was thereafter assumed by his manager, and the relevant step was, on SARS’s version, not identified and attended to timeously due to workload constraints. In light of the four-year delay, on 15 January 2025 Taxpayer 3C delivered a Rule 56(1) notice of intention to apply for default judgment, calling on SARS to remedy its default within 15 days.
During the proceedings, Taxpayer 3C launched a Rule 30 application under the Uniform Rules of Court to set aside what it alleged was an irregular step taken by SARS. Although not fully clarified in the case as reported, the alleged irregular step appears to have been the four-year delay by SARS in filing its statement of grounds of assessment. In response, SARS brought a counter-application under Rule 30. Both parties later withdrew their respective Rule 30 applications.
The issue before the court
The central issue was whether SARS was required to apply for condonation, despite its eventual compliance, and—if so—whether condonation ought to be granted.
A further issue before the court was whether the email sent by the taxpayer, in which it stated that it persisted with the appeal, constituted a notice of appeal.
It is not clear why the Rule 56 issue was not also before the Court.
The court’s decision
The Court held that the email sent by Taxpayer 3C’s attorney of record on December 2020 constituted the notice of appeal. It rejected SARS’s contention that the notice did not convey a clear intention to appeal, finding that the contention was without legal foundation. The Court further found that, although the email was not sent to the required email address, there had been substantive compliance.
The Court also rejected SARS’s submission that it was not required to apply for condonation because it had subsequently complied. Emphasising that all litigants are equal before the law, the Court confirmed that SARS is not exempt from procedural time limits and is required to seek condonation where it fails to comply.
The Court accepted that SARS’s delay in delivering the statement caused prejudice to Taxpayer 3C. However, it considered the explanation for the delay to be satisfactory in the circumstances. The Court held that it was in the interests of justice for the appeal to be determined on its merits and, accordingly, granted SARS’s application for condonation.
SARS was ordered to pay the costs of the condonation application. SARS and Taxpayer 3C were each ordered to pay the costs of their respective Rule 30 applications.
Conclusion
This judgment reinforces the importance of complying with procedural time limits and confirms that no litigant is above the Tax Court Rules in principle, however, in practice, SARS was granted condonation after four years of non-compliance. One can only wonder whether the taxpayer would be afforded the same degree of leniency in similar circumstances. This judgment also illustrates the Court’s emphasis on the interests of justice when determining whether to grant condonation.