Kenya Revenue Authority has slapped a Ksh400 million tax penalty to a company associated with controversial city tycoon Rajendra Sanghani.
KRA’s investigations and enforcement department stated that the tax collector was owed Ksh406.2 million in corporation tax, Value Added Tax (VAT), director VAT, Withholding Tax among others charges by Granada Trading Company Ltd.
This company which is associated with Saghani was given 30 days to appeal KRA’s decision at the Tax Appeals Tribunal.
The tax demand was in relation to a car import and sale business and promotional material.
“Please note that assessments have been amended in the system and if you are dissatisfied with decision, the commissioner draws your attention to the provisions of section 52 (1) (Tax Procedures Act, 2015) which allows you to appeal the decision to the Tax Appeals Tribunal,” the KRA letter, dated May 14, read.
Seghani who had written to the KRA on March 13 objected the tax demands by stating that the money being taxed was from a loan he had been given by the Jack and Jill supermarket owner Schon Noorani.
In a response, KRA demanded that Seghani produces the documents showing a breakdown of the loan advances from Noorani indicating the dates when the money was received, the amounts received and the bank account into which the amounts were paid.
The tax authority also wanted documents related to the breakdown of the loan repayments supported by cheque counterfoils and bank statements showing the outflows for the loan repayment to Schon Noorani.
Nation Reported that tabulations according to KRA, indicated that Granada had undeclared income on banking income of Ksh44.8 million in 2014 and Ksh187.7 million in 2015 totaling to Ksh232.6 million.
However, the tycoon, while confirming that he had received the tax penalty, stated that it was just a demand and he had been given 30 days to appeal.
In a separate case, Sanghani and Noorani are in court over the payment of a multi-million shilling loan.
In 2002, the businessman and his brother Tony Sanghani were charged with robbery with violence. The brothers were locked up at Kamiti Maximum Security prison after being accused of inciting their guards into beating two men.
