Q&A – 29 July 2019
Corporates committing a crime
A corporation is an artificial entity that does not have mind, so how can it commit a crime? What offence can a corporation commit and how does a corporation get charged with a criminal offence and how does it plead to the offence? Does the company need bail? What sanctions can a Court impose on the corporation when it is found guilty and who is held liable for the criminal conduct of the corporation if it is charged and convicted?
GJ, Dar
Although corporations are artificial persons who do not have a mind, they can be held criminally liable. In criminal law, the mind of the corporation’s employee, is generally considered to be that of the corporation.
A corporation’s criminal liability covers many offences that an individual can commit like bribery, money laundering, manslaughter and all regulatory offences. But it does not extend to offences that are punishable only by imprisonment or whose commission cannot be attributed to the offender’s intent to benefit the corporation. Such offences are treason, murder, rape and trafficking in narcotic drugs.
There are two ways of taking a corporate body to Court. One, by filing a charge in Court and ask the Court to issue summons to be served on the director, manager or any principal officer of the corporation who is concerned with the management of the affairs of the corporation requiring her/him to appear in Court on the date and time appointed in the summons. The summons must state in brief the offence with which the corporation is accused. This method is commonly used for regulatory or compliance offences for example failure to remit pension contributions of employees to a pension fund. The second method to take a corporation to Court is by arresting the director, manager or principal officer of the corporation who is concerned with the management of the corporate affairs. This method is used where the corporation has dishonoured the summons to show cause or where it is accused of a serious crime.
A corporation can appear in Court by an advocate, director, corporation secretary, manager or any principal officer of the corporation by whatever designation or title he is called where the corporation’s plea is taken through its representative. You must note that charges against a corporation do not abate because the corporation representative in the case is dead as proceedings may be continued against the person for the time being holding the position. Generally speaking, since a corporation is an artificial person that cannot be incarcerated and cannot abscond, it does not need to be admitted to bail.
The most common form of sanction against corporation is a fine. Even where the law does not provide the fine, the Court has to impose it as you cannot imprison a corporation. Section 71(3) of the Interpretation of Laws Act guides the Courts on how to convert the custodial sentence into a fine for the purpose of punishing a corporate offender. Other forms of penalties against corporations are confiscation, restitution and compensation. Most regulatory statutes of Tanzania impose criminal liability on both the corporation and the directors, managers or other officers managing the corporation at the time of the commission of the offence. This means both the corporation and the director could be charged and in case both are convicted, both should be condemned to pay a fine. The fine imposed by the Court is paid by the accounting officer of the corporation and not the representative. When a director or MD pleads guilty for a corporation, he does so for the corporation and not for himself, and that does not normally establish a criminal record for the director, CEO or employee.
TRA sent demand notice to wrong address
Tanzania Revenue Authority sent an assessment of taxes to our old post box address. We only recently found out now that they want to execute against us. What is the protocol for service?
OY, Mtwara
Unfortunately, you have not told us what type of tax it is but usually the TRA serve you in person as there is a tax officer who visits you. It seems that either your company does not have a physical address and is dormant or the company has had no engagements with TRA over your tax affairs, which by the way is your statutory responsibility. In the absence of a physical address, the TRA would normally use your last known address.
The key here is whether you had informed TRA of your new address and whether or not your BRELA file is updated with the new address. If you have done neither, under section 82 of the Interpretation of Laws Act, what TRA have done is correct. Section 82 states that (1) where a written law authorises or requires a document to be served by post, whether the word “serve” or any of the words “give”, “deliver”, or “send” or any other similar word or expression is used, service shall be deemed to be effected by properly addressing and posting (by prepaid post) the document as a letter to the last-known address and unless the contrary is proved, to have been effected at the time when the letter would have been delivered in the ordinary course of post. (2) Where a written law authorises or requires a document to be served by registered post, whether the word “serve” or any of the words “give”, “deliver”, or “send” or any other similar word or expression is used, then, if similar word or expression is used, then, if the document is eligible and acceptable for transmission as certified mail, the service of the document may be effected either by registered post or by certified mail.
In order for you to challenge the assessment, you will need to apply for extension of time to file an objection. If you have reasonable grounds, the TRA may consider this application.