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Relief food distributors charged with Sh273m tax evasion

Friday October 18 2019

 KRA headquarters

The KRA headquarters in Nairobi: The agency has accused two relief food distributors of failing to remit over Sh273 million in tax. FILE PHOTO | NATION MEDIA GROUP 

RICHARD MUNGUTI
By RICHARD MUNGUTI
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Two food distributors have been charged with failing to remit over Sh273 million in tax.

Mr Ali Hassan Apei and Mr Bashir Hassan Abbey Mamo whose company Microbit Systems had been contracted by the government to distribute food to affected families in north eastern region denied 10 counts of tax evasion.

Kenya Revenue Authority (KRA) through lawyer Irene Muthee did not oppose their release on bond but urged Chief Magistrate Martha Mutuku to free them on terms commensurate to the amounts reflected in the 10 charges.

TAX CLAIM

“I urge this court to pronounce bond terms commensurate with the alleged defaulted amounts given that there is a tendency of late by businessmen to evade remitting tax,” Ms Muthee stated.

But defence lawyer Philip Murgor for both suspects pleaded for reasonable bond terms since their company “is not a fly by night.”

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Ms Mutuku heard, Mr Mamo had resigned from the company in 2012 and should not “have been charged at all.”

“I had informed the KRA officers that Mr Mamo had resigned in 2012. The charges complained of are for the years 2013-2019,” said Mr Murgor.

The court heard Microbit has been dealing with Education, Devolution, Interior and National Treasury ministries in distributing food in Mandera, Marsabit, Garissa and other drought-prone areas in the northern frontier.

“The government has not paid Microbit over Sh200million for services rendered which is almost the amount alleged to have been defaulted in tax,” Mr Murgor told Ms Mutuku.

The lawyer added that Microbit had presented proposals to KRA on how it intends to settle the tax claim in vain.

“We presented proposals of settling the tax claim to KRA but officers declined and insisted on charging the directors,” Mr Murgor said.

Ms Mutuku granted a cash bail of Sh1 million to each of accused. The case will be mentioned on November 5.