Investigator tells court businessmen claimed tax from fictitious firms


An investigating officer in a case in which directors of Mahesh and Tirth Construction company limited are charged with fraud related charges of close to Sh 30 million has testified that the company claimed tax from two fictitious companies.

Chief inspector George Otieno from Kenya Revenue Authority said that the fictitious companies were Daruan wholesalers and Fahari wholesalers.

He added that the two companies that were flagged as fictitious were registered on paper as genuine traders by the registrar of companies but in actual party they were not trading nor did they have physical address for trading.

It is alleged that it was a scheme to assist genuine traders by issuing fictitious invoices to help genuine them (traders) to reduce taxes payable to KRA

Maheshkumar Batukraijani and Valani Keshra Karsani and their company, Mahesh and Tirth construction company limited are charged with fraud in relation to tax by unlawfully making incorrect statement in the value added tax return for a period of the said period thereby reducing his liability to VAT by Sh17,483,602.

The accused persons are alleged to have committed the offence on diverse dates between 20 February 2016 and 20th September 2017 jointly as directors.

The two are also charged with jointly making unlawful incorrect statement in the VAT return for the period 6th March 2016 to 1st January 2017 thereby reducing his liability to VAT by Sh 7,055,595 and another and another Sh 1.7 million payable to the commissioner of Domestic tax.

The three are also charged with failing to remit corporation tax amounting to Sh 3,259,544 payable to the commissioner of domestic taxes for the year 2015.