Platinum Distillers sues KRA for closing down its alcohol manufacturing plant

Platinum Distillers sues KRA for closing down its alcohol manufacturing plant
Crates of alcohol at Platinum Distillers Limited. PHOTO| COURTESY

A local manufacturer of alcoholic drinks has filed a case in court seeking to have the Kenya Revenue Authority compelled to open its manufacturing plant and allow it resume operations.

Platinum Distillers, whose plant was closed on February 24 by KRA for allegedly concealing imported goods in a suspected plot to evade tax, claims it requires to be in constant production to meet its regular business obligations.

“A day lost without production has a profound effect on business and if the petitioner is not allowed to resume operations promptly it will be rendered impecunious,” reads the petition.

The company claims that KRA “acting on mistaken belief” seized its manufacturing premises by chasing out all its workers, seizing and carting away documents from their premises and placing custom seals on the outer doors and go-down.

“The petitioner has been locked out and has not had access to the premise since,” reads court documents.

According to KRA’s head of tax investigations Edward Karanja, they raided Platinum Distillers following  a tip off that the firm had imported a consignment of raw material that was not properly declared in order to pay lower taxes.

According to Dr. Karanja, the imported material is believed to have been ethanol and should have seen the company pay at least Ksh.14 million in taxes. However, the consignment was declared as raw material for making packages and not alcohol, hence, the company paid Ksh.382,000 as tax.

In its defense, the Ruiru-based firm alleges that KRA tracked the delivery of the product belonging to Multiplan Limited believing it was unaccustomed ethanol belonging to it (Platinum Distillers) and proceeded to call media houses to the scene and announce the seizure.

Through its Director John Waweru Ndegwa, the company says it pays taxes regularly and it is fully licensed to manufacture and distribute dutiable and excisable alcoholic beverage.

Ndegwa says that the company shares the same compound with two other companies, Multiplan Packaging Limited and Propar Limited who have leased different go-downs at the MP Industrial Park.

In the court papers, Ndegwa says that on February 23, 2018 one of the neighbouring companies — Multiplan Limited — received a delivery of about 4000 liters containing a chemical product known as Glycol Propylene packed in two trucks.

He further claims that immediately after arrival of the product, officers of KRA entered the compound of the premises accompanied by a contingent of police officers and seized the said product.

KRA then proceeded to seize the manufacturing premises by chasing out all its workers, says Platinum Distillers in the court documents.

Platinum Distillers now wants KRA to compensate them for damages and loss during the period of closure of its production premises and for aggravated damages.

It also wants the court to issue temporary orders restraining KRA from continuing to seal the outer doors or in any way deny or limit access to their manufacturing premises.

Further, the company wants KRA ordered to return all the documents taken from its offices and manufacturing premises.

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