A senior Kenya Revenue Authority (KRA) official attached to the investigations and enforcement department, Mr Isaac Gachoka, has been accused of being used by some companies to falsely accuse their competitors of manufacturing goods with fake duty stamps so as to drive them out of business.
According to inside sources, Gachoka has an interest in two companies namely FRM (E.A) Packers Ltd and Manchester Distillers.
It is reported that the officer has since shut down 14 alcohol manufacturers in exchange for hefty commissions from both companies agreed at a Nairobi hotel a few weeks ago.
“These commissions are financing two ongoing construction projects, one in Mweiga, Nyeri and another one in Karen, Nairobi,” reveals our source.
The largest competitor for FRM and Manchester is Patiala Distillers Limited which has refused to play ball, hence the arraignment in court of its owners Francis Kiambi and his wife Mary Waigwe Muthoni.
This resulted to the closure of their factory along Airport North Road, Nairobi.
In the tussle that ensued, Patiala filed a case in court and obtained court orders for their factory to be reopened. In the case it was found that Gachoka’s actions were malicious and that he had stated many outright lies to try and get the court to decline the orders but the court sided with Patiala and ordered KRA to reopen the factory immediately.
“On 5th August 2021, this Court delivered a ruling and issued Orders interalia restraining the Respondent from ‘continuing to place customs seals, locks, or any seals or in way deny or limit the access to the Petitioner’s production equipment or manufacturing premises. The Court Order has been defied by the Respondent and the alleged contemnors despite acknowledged service and knowledge of its existence. Defiance of the Court Order is intentional, willful and in bad faith,” the court documents in our possession read in part.
“The Court Order has been specifically served upon each of the alleged contemnors who are officers of the Respondent but has been ignored. Service and knowledge of the Court Order has been duly acknowledged by each of the alleged contemnors by signature and stamp on the face of the Court Order, yet it has been ignored.”
Gachoka is accused of keeping the factories locked despite a court order, and instead kept prosecuting the owners in their individual capacity.
“This has led Patiala to seek to the Senior officials including the Commissioner Domestic Taxes jailed for contempt of court. KRA is planning to continue to defy court orders until Mr Gachoka and his group achieve their ultimate objective of destroying competition,” adds our source.
All of the companies manufacturing these products have huge loans with banks and will be ruined in a short while. This will leave only EABL (majority foreign-owned) and KWAL (government-owned) plus a few chosen companies in operation so as to take the entire market share and destroy all competition.
The sad part is that thousands of employees, their families, small businesses that supply to these companies and the Kenyan economy are the ones that stand to suffer the most especially in this tough economic times. The brave local investors who put up these factories and who have grown these businesses are also likely to be ruined financially by KRA and its actions.
“It makes one wonder who is working for who? Is KRA working in the interest of Kenyans or the interest of a chosen few. Why is that in Kenya, foreign based businesses are treated as Kings and Queens, while the local investor is faced with hurdle after hurdle until they give up? Why kill local manufacturing in favour EABL which serves a different segment?” adds our source.
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