The death of Kenyan tycoon Mohan Galot was supposed to mark the end of a long and bruising chapter for one of Kenya’s most controversial industrial empires. Instead, less than a year after the billionaire’s death in London, the courts have reopened a tax war that now threatens the survival of the family’s flagship business, London Distillers Kenya.
In a major victory for the Kenya Revenue Authority, the High Court has reinstated a tax demand exceeding Sh3 billion against the liquor manufacturer, overturning an earlier decision by the Tax Appeals Tribunal that had offered the company temporary relief.
The ruling places the Galot empire under intense financial pressure at a time when its founder is no longer around to personally manage the legal and political battles that once kept the business afloat.
Justice Francis Gikonyo ruled that the Tribunal had improperly ventured into arguments that London Distillers itself had not raised during its objection proceedings. The judge found that KRA had sufficiently demonstrated massive discrepancies between production records, excise stamp activations, bottle purchases and declared sales, shifting the burden to the company to explain the gaps.
According to court records, the company failed to do so convincingly.
The dispute traces back to a KRA investigation covering the years between 2015 and 2019. Investigators accused the company of systematically underreporting production volumes and sales in order to evade excise duty and VAT obligations.
KRA investigators relied on multiple data trails that painted a troubling picture of the company’s operations.
One analysis showed that between 2016 and 2018, London Distillers activated more than 1.6 million excise stamps corresponding to over 527,000 litres of alcoholic products, yet taxes were declared on only about 359,000 litres. The difference represented thousands of litres of alcohol allegedly sold without proper tax remittance.
Another audit focused on bottle procurement records obtained from suppliers. KRA concluded that the number of bottles purchased by the company far exceeded the production volumes declared in tax returns. The discrepancies reportedly pointed to nearly 10 million litres of undeclared alcohol production.
The authority also scrutinised banking records and found billions of shillings flowing through company accounts beyond what had been reported in official returns.
Initially, KRA assessed tax liabilities of about Sh2.68 billion before revising the figure downward after limited reconciliations with the company. With accumulated penalties and interest, the amount now exceeds Sh3 billion.
For years, the Galot family fought back aggressively through the courts and political channels.
In 2021, Mohan Galot was personally charged with 18 counts of tax evasion at the Milimani Law Courts. Prosecutors accused him of orchestrating a deliberate scheme to suppress production figures and avoid paying taxes amounting to billions of shillings.
The charges included allegations that the company omitted millions of litres of spirit production from excise duty declarations and failed to remit VAT tied to huge sales volumes.
Galot denied wrongdoing and mounted an aggressive legal defence. His lawyers argued that the tax assessments were disputed and therefore criminal proceedings should not continue.
Even as the criminal case unfolded, the company managed to secure a controversial tax waiver during the final months of former President Uhuru Kenyatta’s administration.
Former Treasury Cabinet Secretary Ukur Yatani approved the abandonment of hundreds of millions of shillings in tax obligations owed by London Distillers despite objections from KRA officials.
The move later triggered political backlash after Parliament launched investigations into tax waivers granted during the Kenyatta administration. The current administration eventually revoked the waiver and ordered the company to settle the outstanding balance.
By then, Mohan Galot’s legal troubles were deepening.
In April 2025, a court issued a warrant of arrest after he failed to appear for proceedings. His son, Avin Galot, informed the court that the businessman was undergoing medical treatment in London. Two months later, the billionaire died, effectively ending the criminal prosecution against him personally.
But his death did not erase the company’s tax liabilities.
The High Court ruling now places enormous pressure on Avin Galot, who took over as managing director of London Distillers in recent years and is now tasked with steering the troubled business through what could become its biggest crisis yet.
Industry analysts say the ruling could severely affect the company’s ability to access financing, maintain supplier confidence and continue expanding in an already difficult alcoholic beverages market.
The troubles facing London Distillers also mirror wider battles between KRA and some of Kenya’s largest alcohol manufacturers.
Over the past decade, authorities have pursued aggressive enforcement actions against several major liquor companies over allegations involving counterfeit excise stamps, undeclared production and unpaid taxes.
Among the most prominent cases was the crackdown on Africa Spirits Limited linked to billionaire businessman Humphrey Kariuki, where authorities alleged tax evasion running into tens of billions of shillings.
Keroche Breweries also became embroiled in prolonged disputes with KRA over disputed tax claims worth billions, leading to repeated shutdowns and court battles.
For London Distillers, however, the crisis carries an added emotional and symbolic dimension because it now defines the legacy of its founder.
Mohan Galot spent decades building one of Kenya’s most recognisable liquor empires. His brands became household names while his lavish lifestyle, including luxury vehicles and multimillion-shilling properties, made him a familiar figure within Nairobi’s wealthy business circles.
Yet the empire he leaves behind is increasingly weighed down by litigation, tax disputes and allegations of financial misconduct that continue to haunt the family after his death.
The company still operates its sprawling Athi River distillery and its products remain stocked in bars and supermarkets across Kenya. But the reinstated Sh3 billion tax demand now threatens to destabilise a business already facing declining consumption, tighter excise policies and mounting scrutiny from regulators.
For Avin Galot, the challenge is no longer simply preserving his father’s empire.
It is whether the empire can survive at all.
There's no story that cannot be told. We cover the stories that others don't want to be told, we bring you all the news you need. If you have tips, exposes or any story you need to be told bluntly and all queries write to us [email protected] also find us on Telegram
