URA Takes On MTN In Tax Swindle Case
By Jacko D. Waluluka 12th, February 2013
Uganda Revenue Authority Commissioner Allen Kagina has set up a team of experts to calculate the actual tax amount allegedly evaded by MTN-Uganda, The Investigator comfortably reports.
MTN-Uganda, the country’s giant communications company was recently dragged to court over strong allegations that they swindled the country of worth over Shs100bn in a space of just three years.
Upon filing the case vide a private prosecution by Naphtali Were, the Company’s former staff, the Buganda Road Court Chief Magistrate Sylvia Nabaggala issued criminal summons to 13 Directors and top officials of MTN, commanding them to appear before her chambers, a directive they successfully reversed through an appeal.
“Whereas your attendance is necessary in court to answer charges of false declaration contrary to Section 203 (a) and (b) of the East African Community Customs Management Act 2004, Tax Evasion contrary to Section 203 (e) of East African Community Customs Management Act 2004, Conspiracy to make false declarations, [and] conspiracy to evade tax contrary to Section 193 of East African Community Customs Management Act 2004, you are hereby commanded to appear before this honourable court on 24th day of October 2012,” ordered Court late last year.
Registered vide criminal case number 276/12 of Buganda road, the summons were and still are directed to the Board Chairman Charles Mbiire, CEO Mazen Mroue, other directors/share holders Khumo Sheunyane, Mosipho Molope, Sifiso Dabengwa, Christian De Faria, Ignasius Sehoole and Mozipho January Bardir. Others include the Company Secretary Anthony Mutyaba Katamba, Head of Procurement Francois Terffoute, former head of procurement Meryvin Immelman, the Chirf Finance Officer (CFO) Mike Blackburn and, former CFO Nigel Williams.
In a 300 page charge-shit, each of the suspects is facing 196 counts of the alleged felony. The case filed through WEB Advocates, alleges that the suspects connived to swindle government of taxes worth over Shs200bn. However, legal sources indicate they have so far computed over Shs69bn and hence the filing of the case. But after the challenging the filing of the scandalous case, Court granted permission to the Director of Public Prosecution (DPP) to take over the matter. And since, appeals and counter appeals have been filed by both MTN and Web Advocates
Nevertheless, we have impeccably learnt that the no-nonsense Kagina recently contacted the complainant/whistle blower and convinced him to cooperate with her team, with a view of helping the tax body to recover the alleged loot.
Led by Irene Bashabe from investigations department, team of five are scrutinizing through specific entries, and they are reported to be computing the Bills Of Quantities (BOQs), over 100 entries, packing lists and commercial invoices from suppliers of network equipment who include Ericson, Huawey Technologies, Nokia Simens and Nec Corporation-Japan
With powers to prosecute, URA in normal cases take over such cases from the DPP who normally forwards the same. But in this particular one, the DPP preferred to handle, leaving Kagina with no option but to struggle and secure a recovery. URA sources intimated that in this case, the tax body’s interest is to recover the alleged swindled dime.
“Upon successful completion of the computation of figures, we issue a demand note showing shortfalls in collection, along with penalties and then interest in case it is over a year. Penalty is USD10, 000 per entry. And we expect about 100 plus. After recovery, the Authority can also choose to prosecute but this is mostly in case the offending party is uncooperative,” our knowledgeable source lectured last night.
In the initial Court case, the whistle blower alleges that MTN officials, in connivance with some individuals at the Ministry of Finance and URA, evaded taxes vide false declaration and under-declaration of telecommunication equipment between 2009 and 2012. “They declared some items like the coin and card pay phones tax free which is not the case. Other items were reportedly, falsely exempted of tax and these are details that will be adduced in court,” said one of the lawyers.
But Mr. Mbiire then rubbished the development, saying whoever filed the case wanted to divert them (MTN) from recovering their stolen money so far under investigations. “How can we rob ourselves? We know the people who filed that case and they are the very people whom we have on record to have confessed to steal our money. Now they are acting out of panic and they think they can divert us, never,” Mbiire said... Watch the space for developing stories.