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Chinese firm CEO sues over travel ban

tax

MrJohn Njiraini, KRA commissioner-general. PHOTO | DIANA NGILA | NMG

Motor dealer Foton East Africa managing Director Da Li has been barred from travelling outside Kenya over a Sh223 million tax dispute with the Kenya Revenue Authority.

Mr Li says in a suit he has filed against the taxman that the travel prohibition order has affected his work, becoming a big risk to the business.

He is now asking the High Court to lift the orders arguing that he is a Kenyan and not a flight risk, making the travel ban a violation of his rights.

“Issuance of the departure prohibition order against the second applicant was unprocedural, arbitrary, unreasonable, unlawful and made in bad faith to frustrate the applicants. The foregoing decision violated the rights of the applicant to fair administrative action,” Mr Li in says court documents, adding that the decision is meant to harass, frustrate the company with a view of forcing it to close its business and exit Kenya to the benefit of its competitors.

Mr Li, who was born in China, says he has since become a Kenyan citizen and is married to a Kenyan.

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He wants the court to lift the ban, noting that he is scheduled to accompany Cabinet Secretary Ministry of Transport, Infrastructure, Housing and Urban Development on a tour of  China to attend an infrastructure and investment conference on June 7 and 8.

Mr Li further says he had no knowledge of the travel ban and only learned of it on January 4, 2018 from immigration officials upon arriving at JKIA to travel to Dubai.

He has now instructed his lawyers to follow up the matter with KRA, culminating to a January 5 meeting, where the taxman asked for Sh4 million security to let him travel.

Foton proposed that KRA accepts an undertaking from the County Government of Nairobi to provide the debt it owes the firm as a security.

But KRA is said to have reneged on its decision to accept Nairobi County undertaking as a security, opening the legal challenge.

Mr Li is the second business executive in as many months to be barred from travelling abroad coming after OiLibya CEO who is also in court over tax arrears owed by oil firm.

Libya Oil Kenya general manager Duncan Murashiki, a Zimbabwean, was prohibited from leaving the country in an ongoing investigation involving Sh15 billion tax claim.

The ban has since been lifted by consent of both parties ,pending determination of the suit he has filed in court.

The taxman wrote to the Director of Immigration Services seeking to have him prohibited from leaving the country unless the KRA commissioner revokes the request in writing, prompting Mr Murashiki to contest the decision in court.

However, the taxman says he has since engaged KRA and promised to co-operate and his confiscated passport returned, which hints at behind the scene talks that led to the lifting of the ban.

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