Rice dealer ordered to pay taxman Kshs. 1.4B in tax arrears – KBC

Rice importer Jhulay LAL Commodities Ltd will have to pay Kenya Revenue Authority (KRA) a sum of Kshs. 1.4 billion in tax arrears, the Tax Appeals Tribunal has ruled.

This follows the dismissal of an appeal filed before the tribunal by the firm, on grounds that KRA’s assessment into its financial records was excessive.

Jhulay LAL Commodities main trade is wholesale and retail sale of rice imported from Pakistan.

Jhulay LAL Commodities appealed the decision of KRA contesting that the entire tax of Kshs. 1,456,433,604 demanded.

The main grounds of the appeal was that the Commissioner determined the taxable income on the basis of its gross banking against the basic accounting principles and tax law.

KRA successfully argued that it made the assessment after an investigation revealed several irregularities including unexplained bank deposits and that the sales of the rice exceeded the amounts imported.

The Tribunal reviewed the evidence as presented by both parties and held that KRA exercised its powers judiciously to make the decision based on the material before it.

The Tribunal held that the Jhulay LAL Commodities Ltd failed to prove that the assessment was excessive and dismissed the appeal.