The Directors of two firms being investigated by KRA for fraudulently inflating the cost of purchasing supplies by Sh162 million to reduce their tax liability were arraigned before Mombasa Chief Magistrate Ms Edna Nyaloti Wednesday, charged with fraud in relation to tax.
The Directors, Hussein Sheikh of Omar Lensk Trading Company Ltd and Suleyman Mwalimu of Chengo Qwali Group Ltd separately faced four, and two counts, of reducing their tax liability by a total of Sh7,968,917.
The two businessmen pleaded not guilty to the charge. The court released Hussein on a bond of Sh5 million and a surety of the same amount with an alternative cash bail of Sh 2 million, while Suleyman was set free on a surety bond of Sh2 million and an alternative of Sh1 million cash bail.
Hussein and his firm Lensk Trading Company were charged that with another not before court for unlawfully claiming VAT refunds/reliefs through their VAT returns in the months of June, July, August and September, 2019, thereby reducing their tax liability by a total of Sh5,743,873.
On the other hand, Suleyman Mwalimu Chengo and his company Qwali group limited were charged with reducing their tax liability by Sh2, 225, 044 by unlawfully claiming VAT refunds/reliefs through their VAT returns in the months of September and October, 2019.
Kenya Revenue Authority (KRA) arrested the directors of two companies, Hussein Sheikh Omari of Lensk Trading Company Ltd and Suleyman Mwalim Chengo of Qwali Group Ltd.
Lensk Trading Company Ltd and Qwali Group Ltd fraudulently edited the amounts in the original cash sales receipts from the alleged suppliers to reflect high purchase amounts totaling Sh162 million for purposes of reducing tax liability.
The alleged suppliers denied ever transacting with them indicating that the transactions were fictitious and designed to evade payment of taxes. Professional enablers providing tax advice and financial services are being pursued as part of the wider investigations to bring all parties in the tax crime to book.
The Chief magistrate fixed hearing of the two cases on 10th December.
By Joseph Kamolo