Pharmaceutical files case over Sh44m tax
A pharmaceutical firm has moved to court to stop the Kenya Revenue Authority from demanding more than Sh44 million slapped on it for failure to remit tax between 2008 and 2011.
Lords HealthCare Limited in its suit filed under a certificate of urgency at the High Court said the demand by the taxman was not only illegal, but in contravention of the law.
Through the law firm of Kimondo, Gachoka and Company, the firm said the KRA procedurally wrote letters to its banks demanding they remit Sh44,897,218 without following the law.
“KRA has issued an agency notice to its banks at NIC, Commercial Bank and Prime Bank requiring the said agents to remit to it the monies,” the firm said.
The firm says the issuance of the notices to the bank are unprocedural and marred with bad faith. It said sometimes in 2016, KRA said that it had carried out investigations and uncovered unpaid corporation tax amounting to Sh44,897, 218.
The investigations further noted that the company had withheld tax totalling Sh256,053 for 2009, 2010, 2011, and 2012.
But the Lords HealthCare says the allegations are not true, and that it has been filing its returns and paying taxes as required.
“They have issued tax claim without taking into considerations the payment of Sh2,000,000 made by the applicant on May 27, 2016, and previous overpayments for a sum of Sh 4,300,000 made between 1997 to 2007, which is unreasonable,” says Lords Healthcare.
The firm further accused the taxman of failing to give it time to respond to the accusations, and instead rushing to its banks. It says it will stand to suffer grave harm and prejudice.