Directors in court over 160 Million tax evasion

Two directors of a construction and supplies company have been charged with denying the government Sh160 million in taxes.

Hassan Barhe Nur and Umar Idle Yakub, who are directors of Kalme General Contractors and Suppliers Limited, are accused of omitting from the value added tax (VAT) returns, money worth millions of shillings.

The suspects are charged with ten counts of omitting from the returns an amount which should have been included, contrary to the Tax Procedure Act.

They are accused of knowingly omitting from the VAT returns for the months of January to December 2014, sales amounting to Sh40.8million, which they ought to have declared to the commissioner as required by the VAT Act.

In other counts, the suspects are charged with omitting from the VAT returns for 2015, sales amounting to Sh19.8million, deliberately defaulting to remit Sh6.6 million to the Commissioner of Domestic Taxes and omitting from the income return filed in the same year money amounting to Sh45.8 million.

They are further charged with deliberately defaulting in the obligation to remit income tax by the due date, according to the Tax Procedure Act, where they are accused of failing to remit Sh5.5 million in 2015.

The suspects are further accused of omitting from income returns filed for 2016, income amounting to Sh17.6 million and failure to pay Sh2.1 million in taxes in the same year.

Mr Nur was additionally charged with failure to submit tax returns for 2015.

The suspects denied all the charges when they appeared before Mombasa Senior Principal Magistrate Henry Nyakweba.

State Counsel Erick Masila asked the court to deny them bond, claiming they were a flight risk and might jump bail considering the gravity of the charges they are facing.

But Mr Masila said should the court consider granting them bond, it should apply stringent terms considering the colossal amounts of money in taxes the suspects denied the government.

“The amount of money involved is huge and this is equal to economic sabotage. The court should issue harsh bond terms, cash bail should not be given,” he said.

But he suspects, through their lawyer, pleaded with the court for lenient bond terms, arguing that they are still suspects and that they have not been convicted of the charges.

The suspects also asked the court to consider the fact that they had honoured the summons and appeared in court as had been directed, thus they cannot be said to be a flight risk.

The magistrate concurred with the suspects that they have not been convicted of the offence and that bond should not be used as punishment but to ensure that the suspects attend court.

“Indeed the amount the suspects owe the exchequer is enormous but that will be considered upon conviction. The purpose of the bond is to ensure the suspects attend court,” he said.

Mr Nyakweba released the suspects on a Sh1 million bond each with one surety or Sh500,000 cash bail each.

The case will be mentioned on November 5.


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