Tata Chemicals Magadi Limited v County Government of Kajiado (Civil Appeal 530 of 2019) [2025] KECA 1721 (KLR)

The Rating Act and Valuation for Rating Act required a formal process for valuing properties, including creation and maintenance of a valuation roll, public participation and a right to object to valuations. There was no evidence that the rates demanded resulted from any such determination. The respondent therefore imposed rates outside the statutory framework, denying the appellant an open and objective framework to challenge the rates, breaching Article 201 of the Constitution.

Under both the repealed Mining Act and the Mining Act, 2016, mining activities are regulated by the National Government and royalties are payable to the National Government with rates prescribed by the Cabinet Secretary. Minerals are public land vested in the National Government under Article 62(1) and (3). The county's own Finance Act purporting to charge royalties on soda ash, and the inclusion of royalties in the demand, were therefore unconstitutional.

Article 209(5) prohibits exercise of county taxation and revenue-raising powers in a way that prejudices national economic policies, economic activities across county boundaries or national mobility of goods, services and capital. By sending security and police officers to shut down the appellant's operations to force payment, the respondent paralysed those activities and thereby contravened Article 209(5) and infringed the property rights protected by Article 40.

The court adopted the reasoning in County Government of Kwale v Kenya Airports Authority, where this Court held that a county government imposing rates on exempted properties acts ultra vires and contravenes Article 209(5). It applied that principle to the present case, where the leased premises were held under leases with the National Government, rates and royalties were reserved to the National Government, and minerals were vested in the National Government.