The High Court has determined that Rwandese businessman Desire Muhinyuza is the beneficial owner of Stay Online Limited Kenya.
In his judgement, Justice Alfred Mabeya found that Kenyan businessman Kirimi Koome had committed a fraud by not filling the form for beneficial ownership properly at the time of the incorporation of the company.
“Accordingly, I find and hold that the 1st plaintiff is the beneficial owner of the company. The 1st defendant committed a fraud by not filling the form for beneficial ownership properly at the time of the incorporation of the company,” Justice Mabeya ruled.
In the suit, Muhinyuza had sued Kirimi over the beneficial ownership of Stay Online Kenya.
Kirimi had claimed that he is the sole owner, 100% shareholder and beneficial owner of the said company in which merchants had injected Sh 400 million to run its operations.
However, through lawyer Danstan Omari, Muhinyuza told the court how he owns several other businesses with similar names in four other countries. The mother company being in Rwanda.
The judge found that the Rwandese had proved that he was more interested in the wellbeing of the company and why.
” Any loss to the company would affect him, unlike the 1st defendant,” the judge said.
Justice Mabeya also ruled that Kirimi admitted to have assisted the Rwandese with his Estonian counter-parts to establish a business in Kenya. “What business if not the Company?”
The court found and held that Muhinyuza is the one who initiated and caused the registration of the company and was the one who financed its establishment and operations.
“He wired from Rwanda the first capital injection of US$29,000 for the company to start its operations. He controlled its operations and the 1st defendant (Kirimi) was only his front awaiting for the 1st plaintiff’s (Muhinyuza) immigration status to be regularized,” the judge noted.
In addition, the judge disagreed with Kirimi’s evidence that the US$ 20,000 deposited to his personal account was his salary.
He further disagreed that the US$ 100,000 also deposited in his personal account was for tax provision.
“Firstly, there is no evidence to show that he was being paid any monthly salary or director’s allowances. The payment of US$ 20,000 must have been for an undisclosed consideration,” the court ruled.
“Secondly, it is unheard of that directors would withdraw monies from their companies and deposit the same in their accounts for future tax liabilities.”
According to the judge, the demand and pocketing of US$100,000 was without basis since no tax was paid out of that money. “The same is recoverable from the 1st defendant.”
During his testimony, Muhinyuza told the court that his Rwanda Company has passed a resolution to expand to Kenya, Uganda and Zambia.
His close friend and Equity Bank Rwanda e-commerce manager Patrick Kakuba was the one who recommended Kirimi to him to be Kenya’s representative.
Kirimi was to register and be the director of the company as the Rwandese awaited to regularize his immigration status.
However, after the same was done and money injected into the company, Kirimi allegedly started to abandoned his responsibilities thereby stalling the business.
