Estama Investments, the company at the centre of the Sh800 million mobile clinics scandal, is demanding an additional Sh200 million from the Ministry of Health as payment for the last consignment of portable health clinics it supplied under a deal that was questioned in a 2016 audit report.
Estama says, in a suit that was last week withdrawn for out-of-court settlement, that the Ministry of Health only paid half of the Sh400 million in respect of the last consignment of portable clinics.
It reckons that only Sh200 million was paid after ministry officials inspected the last batch of 40 portable clinics in June last year.
Estama made the revelation in response to a suit that the Kenya Revenue Authority (KRA) filed to have its accounts frozen as part of the effort to recover taxes due from the supply deal.
The suit had initially been withdrawn in April this year, but Estama returned to court barely three weeks later seeking to have the taxman compelled to withdraw agency notices issued to its bankers.
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Both parties agreed to withdraw the entire suit again last week after striking a deal that entails taking the dispute to the Tax Appeals Tribunal for determination.
KRA and Estama, however, told Justice Grace Nzioka that they had opened negotiations to also withdraw the proceedings before the tax tribunal.
Estama had, in its defence at the High Court, indicated that it was to receive Sh1 billion for the 100 portable clinics.
“The last 40 containers were delivered in June 2016 and on June 30, 2016 and Estama Investments received a sum of Sh200 million in respect of 20 portable medical clinics that had been delivered and duly inspected. The balance of Sh200 million is yet to be paid,” Estama said.
KRA has since demanded Sh322 million in unpaid taxes from the deal, which is the subject of proceedings before the Tax Appeals Tribunal.
“The sum of Sh800 million so far received by Estama Investments was received in the usual, normal and ordinary course of business and on account of contractual obligations with the Ministry of Health on the said contract without any element of corruption as alleged by the KRA or at all,” said Philip Nyachoti, who is representing Estama in the suit.
It is not clear from the court papers whether the Ministry of Health has agreed to release the Sh200 million that Estama insists is due from the portable clinics deal.
Mr Nyachoti and KRA’s lawyer, Okello Ogello, last week told the court that they had agreed to reach an amicable settlement of the matter.
Justice Nzioka admitted their consent in the case file and marked the suit as withdrawn.
Estama Investments had denied owing the taxman any money, and had instead argued that all its books have over the years been audited and all due levies paid in full.
KRA had in April opposed the company’s objection to the Sh322 million tax demand, forcing it to file an appeal at the tax tribunal.
Estama had said in its filings that it first delivered 20 portable clinics to the Ministry of Health on January 8, 2016 and was paid Sh200 million. The second lot of 40 clinics was delivered on June 24, last year and Sh400 million disbursed shortly after.
KRA has accused Estama of wiring the funds offshore, after tracking some transfers totalling Sh330 million to an unknown entity outside the country.
KRA has also accused Estama of overstating its costs while supplying the mobile clinics, a move that significantly reduced its value added tax (VAT) liability.
Information contained in KRA’s digital platform — Simba — indicates that Estama paid Sh1.4 million for each container clinic that it then sold to the Ministry of Health at Sh10 million apiece.
Estama has since claimed that the Sh330 million had been wired to its suppliers.
The firm did not, however, disclose how much money it owes the suppliers — Guangzhou Moneybox Steel Structure Engineering Limited in China.