The Kenya Revenue Authority (KRA) and a gemstones mining firm associated with former Machakos senator Johnstone Muthama are entangled in a legal dispute related to payment of import duty amounting to Sh600,000.
In the dispute that started March 2019, the KRA Commissioner-General accuses the company Rockland Kenya Limited of mis-declaration of imported goods so as to pay less import duty.
The dispute started when the company imported a consignment of materials related to mining activities and presented its documents for verification by the Customs Department.
Court papers indicate that the importer in its declaration form had declared only one item which was described as part of industrial laboratory electric furnaces and ovens. In its self-assessment on import duty the amount owed to the taxman had been calculated at Sh439,092, which it paid.
But a further verification and re-assessment of the imported goods by the KRA officers revealed that at least five items had been declared as one, reads the court documents.
A KRA officer, Mr Joackim Mwawasi, said the five undeclared items included ceramic bricks, disks, ceramic tubes, adhesives and heating elements among others.
After withholding of the goods by KRA, the company moved to court seeking orders for the release of its property.
Through its general manager, Wilson Mwaniki Ngumbi, the importer said the withheld materials are crucial to its mining business. Mr Ngumbi complained that despite paying all the requisite duties and taxes, KRA together with the Kenya Bureau of Standards have refused to release the goods.
However, Justice Wilfrida Okwany found that the said goods cannot be released without all the substantive issues raised by all parties are addressed.
“... This then raises the question of how the case will be eventually heard in the event the goods are released,” ruled justice Okwany.
KRA argued that if the mining firm was dissatisfied with the verification, it was required to lodge a review request with the head verification officer before moving to court.