A Blantyre businessman and his partners are challenging a K16.7 billion (US$39 952 153) tax bill the Malawi Revenue Authority (MRA) slapped on them after allegedly not paying tax.
The businessman, Abdul Batatawala and his business partners, Pamodzi Settlement Trust and Reliance Trading Limited, have since applied for a judicial review in the High Court in Zomba.
According to court documents, MRA obtained a search warrant from Blantyre Resident Magistrate’s Court in July to search the business premises of Batatawala at Makata Industrial Area after which it seized documents and computers which helped it come up with the tax bill that has accrued from principal, interest and penalties.
But the businesspersons on January 27 this year obtained a court order also from Blantyre Resident Magistrate’s Court, ordering MRA to immediately release all business records, books of accounts and any other documents that were taken by MRA.
“The respondents (the businesspersons) shall at all times during working hours allow the applicant (MRA) reasonable access to the said documents should the applicant need the said documents in furtherance of the tax investigations herein,” reads the order in part.
But in a twist, lawyer representing Batatawala, Frank Mbeta , on Novermber 30, 2013 wrote the Attorney General (AG) Antony Kamanga stating that his client was contracted to supply assorted items to the Malawi Defence Force, Malawi Police Service, Malawi Prison Service and Immigration Department but they have not taken delivery of the goods.
“The goods were specially made for the departments’ use and they were manufactured to suit the specifications and needs of the particular respective departments.
“The goods were duly cleared duty free by the respective departments. However, the Malawi Defence Force, Malawi Police Service and the Immigration Department have not taken delivery of the goods despite several reminders,” the lawyer wrote.
Mbeta stated that the value of the undelivered goods are in excess of K3 billion (US$7 177 033).
“Our client would also like to assign the sums due for the undelivered goods to MRA upon delivery of the goods to the respective departments.
“We thus seek your indulgence for all the said departments to take delivery of the goods…kindly be advised that should those departments fail or neglect to take delivery of the goods, we shall seek an order for specific performance and other ancillary reliefs against the Malawi Government as an effective remedy in the circumstances,” the letter reads.