The High Court has upheld a judgment of the Tax Appeals Tribunal that was delivered on December 8, 2016 that taxes amounting to Sh1.65 billion are due and payable by Ushindi Ltd.
Following reports from Parliament that the taxpayer was dealing in smuggled gold, the Commissioner carried out investigations into its affairs for the years 2010- 2011.
It established that Ushindi Limited, formerly Ushindi Exporters Limited, had made exports of gold worth Sh2,.5 billion in 2010 and Sh2.9 billion in 2011.
KRA requested the taxpayer for documents to support its transactions, but it said that it carried out its transactions predominantly in cash.
Ushindi Ltd had also alleged that most of the gold was purchased from artisan miners who normally did not give their personal details nor tax invoices.
It was also the taxpayer’s contention that it maintained records in accordance with the Trading in Unwrought Precious Metals Act (Cap 309 of the Laws of Kenya).
The Act only required details limited to the date of transaction, nature and weight of precious metal and price if any.
In its view, there was no requirement to give names or identities of the sellers based on an alleged correspondence from the then Ministry of Environment and Mineral Resources
It was the commissioner’s view that the taxpayer had failed to provide documents sufficient for computation of tax.
