Keroche directors deny tax evasion charges

A television grab image of Mr Joseph Karanja and his wife Tabitha. The Keroche Breweries directors are charged with evading taxes to the tune of Sh14b. [Wambua Sammy/Standard]
The directors of Keroche brewery have denied tax evasion-related charges amounting to Sh14 billion and released on bail.

Chief Magistrate Francis Andayi released the duo on Sh5 million bond or Sh2 million cash bail for Joseph Karanja while the wife, Tabitha Karanja was released on Sh15 million bond or Sh10 million cash bail. The court slapped the company with Sh15 million cash bail.

Appearing in court on Friday,  the couple listened carefully as court a prosecutor read the charges.

Joseph Karanja, probably owing to his health condition remained seated as the court official read the charges while a composed Tabitha remained standing responding with “not true” answer to the each of the accusations.

The Keroche directors are represented by Lawyer James Orengo whose team also includes Kioko Kilukumi who, early this week, represented billionaire Humphrey Kariuki in another tax evasion case worth Sh41 billion.

Immediately after directors denied the charges, the prosecution side asked the court to consider the amount of tax evaded in determining the cash bail and the fact if the accused are found guilty, they could be imprisoned for up to ten years.

“Your honour in coming up with the bail terms, in this case, it is our prayer that you consider the amount of tax evaded.  The cash bail should be commensurate to the figure,” said Catherine Mwaniki, Senior assistant DPP. She also wanted the suspects to deposit their passports and not to leave court jurisdiction without permission.

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Mr Orengo noted that the amount of money in question (Sh14 billion) is under dispute and asked the court to take that into consideration.

He also noted that the accused are presumed innocent until proven guilty.

“Therefore, the court should not be carried away by the amount of money said to be in tax arrears; the Sh14 billion figure is still in dispute,” he submitted.

He also prayed that the court takes into consideration the health condition of Mr Karanja who recently underwent lifesaving surgery.

In seeking the release of the directors, Mr Orengo left the court in stitches when he reminded the court not to go against the Bible by separating the two accused who are husband and wife. 

 “My lord yesterday we saw Mr Karanja released at night and the wife Tabitha left to spend the night in custody. We pray that this doesn’t happen again,” he entreated the court.

“In the Bible, we are told that what God has put together let no man put asunder.”

On Wednesday, the Director of Public Prosecutions issued orders for the couple's arrest for failing to pay taxes amounting to Sh14 billion from 2015. 

The DPP noted that investigations had revealed that the company evaded paying Sh12.34 billion Value Added Tax, Sh329.4 million for stamps and Sh135.4 million for Crescent Vodka among other products. 

In terms of excise duty, the DPP claimed Keroche owes the taxman Sh41 million in stamps, Sh55 million on Crescent Vodka, Sh233 million on Vienna Ice with quantity variance and Sh1.5 billion with rate variance.

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Keroche BreweryTabitha KaranjaTax EvasionKRA