On 29 August 2025, the South African Revenue Service (SARS) announced a Supreme Court of Appeal (SCA) judgement in the case Assmang (Pty) Ltd versus the Commissioner of SARS (CSARS).
The SCA released the following media summary of the judgement:
The following summary is for the benefit of the media in the reporting of this case. It does not form part of the judgements of the SCA’s Assmang (Pty) Ltd (Assmang) versus CSARS and Others.
Today, the SCA dismissed with costs an appeal by Assmang against a decision of the Gauteng division of the High Court, Pretoria, which had rejected its claim for diesel refunds under the Customs and Excise Act, 1964 (the Act).
Assmang, a mining company operating in the Northern Cape, had contracted with service providers for mining activities at its Khumani mine. It contended that the diesel supplied to those contractors qualified for rebates under Rebate Item 670.04 in Part 3 of Schedule No. 6 to the Act, 1964. SARS determined that the claims did not qualify and demanded repayment of refunds previously made. The High Court confirmed SARS’ determinations and dismissed a constitutional challenge brought by Assmang.
The SCA held that the contracts in question were in substance concluded on a ‘wet rate’ basis, not a ‘dry rate’ basis as required to qualify for a refund. The court endorsed the reasoning in Canyon Resources (Pty) Ltd versus SARS, finding that Assmang’s accounting method, whereby diesel costs were deducted from the contractor’s invoices, amounted to the contractors bearing the cost of fuel. The contractual arrangements, therefore, did not entitle Assmang to diesel refunds. The court further found that Assmang’s record keeping failed to comply with the detailed requirements of Note 6(q) to Part 3 of Schedule No.6 to the Act, 1964. The system used by Assmang tracked only the dispensing of fuel to contractors, but not its ultimate use in qualifying for mining activities. This was insufficient to establish eligibility for refunds.
On the constitutional challenge, Assmang argued that the Act, 1964 was unconstitutional insofar as it required taxpayers to pay interest on amounts owing but did not oblige SARS to pay interest on refunds. The SCA held that the challenge was introduced late, without a proper factual foundation, and amounted to an abstract challenge. The court emphasised that constitutional issues must be properly pleaded and supported by evidence. As the refund claims themselves failed, the issue of interest was not a live controversy and did not warrant determination. Finally, the court noted that SARS had not imposed any penalty, and the High Court confirmed none.
The appeal was accordingly dismissed with costs, including the costs of two counsel.