by Nancy Gitonga

The High court has set aside orders freezing accounts of Kenya Ports Authority (KPA) over Sh 1.9 billion tax arrears.

In a brief ruling issued by Justice John Mativo lifted orders granted to Kenya Revenue Authority blocking KPA from accessing billions of shillings in its seven bankers.

“This court hereby vary its order issued on the May 17, 2022 and in its place substitute with a temporary Order suspending the agency notice (s) May 6,2022 and May 16,2022 issued by the KR to the KPA’s bankers; Standard Chartered Bank (K) Ltd ,NCBA Bank, Kenya Commercial Bank, Equity Bank (Kenya) Ltd,Diamond Trust Bank, Co-operative Bank of Kenya Limited and CitiBank N.A in respect of funds due and payable to the KPA pending the hearing and determination of the application,” justice Mativo ruled.

The Judge also suspended orders allowing KRA to continue issuing notices to KPA bankers stopping the government institution from dealing any funds held in its accounts.

The turn of events came after KPA , through lawyer Cecil Miller, lodged an urgent application at the High Court seeking to lift agency notices issued to seven of its bankers on May 6 and 12, 2022 that blocked it from accessing its funds.

Miller told the court that the operations at the authority have been paralysed since it cannot access its fund held in the seven banks which had been frozen.

“That if the court does not intervene as a matter of urgency, the agency notices by the KRA also have extreme dire consequences as to KPA’s operations and will lead to ultimate shut down of the authority’s business both locally and regionally and paralyzing business globally,” Miller said.

The court also heard that the the agency notices relates to payment made to Toyota Tsusho Corporation and Med marine Kilavuzkul for a sum of Sh 1,993,582,700 for associated infrastructure expansion programs and equipment in acquisition of Ship to Shore Gantry Cranes, Rubber tyred cranes and Tug boats.

“That KPA issued what they term as additional assessment on the outstanding issues vide a formal assessment dated April 22,2022 on payment made a Toyota Tsusho Corporation and Med Marine Kilavuzkul for a Sh 1,993,582,700 on associated infrastructure expansion programs and equipment under the same MPDP in relation to the following contracts: a Ship to shore Gantry Cranes and Rubber Tyred Gantry Cranes (Tender no. KPA /021/2016-17/ID and Salvage Tug Boats (Tender No.KPA /077/2018-2019/ME,”the Lawyer said.

Miller told the court that KRA moved to freeze its accounts before responding to KPA’s objection to the tax assessment as required by the law.