Platinum Distillers was closed last month due to an alleged plot to evade payment of up to Sh14 million in taxes.
A Ruiru-based alcoholic drinks manufacturer has moved to court seeking to have its premises reopened.
The authorities closed down the Platinum Distillers Limited factory during a sting operation under Inspector-General of Police Joseph Boinnet and Director of Criminal Investigations Geoffrey Kinoti last month.
The closure was due to an alleged plot to evade payment of up to Sh14 million in taxes.
Through lawyer Chris Kabugu, Platinum said its directors and workers had been denied access to their premises after the Kenya Revenue Authority (KRA) officers placed customs seals on the outer doors, putting the factory under 24-hour watch.
Mr Kabugu told Justice Weldon Korir that the closure has harmful consequences on his client’s business.
Platinum said the KRA officials raided the premises on February 23 without any lawful cause, seized documents, locked the factory and placed custom seals at the premises, “thereby denying employees entry”.
Platinum said it is a licensed importer of ethanol and pays its tax promptly.
“KRA officers had no power to raid, seize documents and taxpayers possessions without a court warrant,” said Mr Kabugu.
The judge heard that the KRA actions were “manifestly unlawful and premised on an error in law”.
The directors said their rights to do business and own property had been violated.
Ethanol
Mr Kabugu said the KRA officers acted on misinformation that the ethanol transported by two lorries belonged to Platinum but its owner is another company they share premises with.
“The livelihoods of hundreds of workers have been affected as the KRA officials even closed premises adjacent to Platinum,” he told the judge. But the taxman defended its actions, saying the petitioners were guilty of tax evasion.
The KRA said Multiplan Packaging Limited, which imported the impounded ethanol even though it is not a licensed importer, and Platinum co-own the closed premises.
The taxman sought 30 days to complete investigations into the importation of the ethanol.
The KRA said Platinum violated Section 157 (1) (A) of the East African Community Customs Management Act, 2004.
Under the Act, the taxman may lock any premises it suspects to store uncustomed goods.
“The KRA officers acted within their mandate to lock the premises where ethanol used to manufacture alcohol beverages is stored,” the taxman’s lawyer told the court.
The judge also heard that the investigations would establish whether or not the alcohol manufactured using the uncustomed ethanol is hazardous to health.
Justice Korir will rule on the re-opening of the premises on Thursday.
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