KRA will refund Westgate Sh3 million after the High Court found that it had a conflicting account of why it declined to honour its end of the bargain.
At the heart of the case is Sh33 million tax refund. The firm had requested KRA to use 30 million to offset the tax liability of its sister company Atlantic Group (K) Limited and refund the rest.
KRA first accused the firm of making an illegal claim then turned around and said it had used all the money to offset Atlantic’s tax debt.
Justice David Majanja dismissed KRA’s argument that Westgate had made a double claim in contravention of the law.
“In conclusion and for the reasons I have set out above, I find the commissioner’s position in this appeal wholly inconsistent with the position it had taken in the objection decision that it appropriated the refund to clear certain liabilities of the respondent and it’s holding company leaving Sh 3 million to be paid to the respondent,” ruled Justice Majanja.
It is the second time that KRA has lost a tax battle against Westage.
In a separate case, the same judge held that KRA was not entitled to demand tax on Sh600 million paid to Westgate’s parent company, Sony Holding, by Kenindia Insurance after Westgate was damaged in a terrorism attack. The judge found that the firm had provided proof of how much it received and spent.