KRA threatens to auction CMC Di Ravenna over Arror-Kimwarer dams scandal
Kenya Revenue Authority(KRA) has threatened to auction an Italian firm at the centre of the row over the Sh63 billion Arror-Kimwarer dams scandal.
The authority threatened to auction its equipment and machinery held at the Mombasa port.
In a statement released on Friday, the authority gave CMC Di Ravenna and other companies whose goods are lying in Mombasa Port up to next month to clear the equipment, or risk auction.
“Pursuant to the provisions of section 42 of the East African Community Customs Management Act 2004, notice is given that unless the under-mentioned goods are entered and removed from the Customs Woodlouse, ICDE within 30 days from the date of this notice, they will be sold by public auction on May 18,” said KRA.
In 2018, the equipment were shipped in by CMC Di Ravenna for its dam construction projects however, bankruptcy has made the firm fail to clear the equipment.
The auction of the equipment comes a week after the Italian company lost the first round of attempts to block Absa Kenya’s bid to sell 98 cars over a Sh585 million loan.
On May 22,2019, KRA won a case against CMC di Ravenna, seeking a Sh166million Value Added Tax refund.
In a judgement delivered by High Court Judges Lady Justice Pauline Nyamweya and John Mativo, CMC Di Ravenna Kenya, a Company contracted by Rift Valley Water Services Board to construct Itare dam for the sum of Sh28.9 billion lost the case where it was suing KRA for VAT refund of Sh166, 247, 378.
In their ruling, Lady Justice Nyamweya and Justice Mativo struck out the suit noting that the firm had failed to follow the laid down procedures in seeking relief for tax matters.
In 2020, the court allowed KRA to seize more than 100 vehicles belonging to CMC Di Ravenna over tax evasion claims.
Justice John Mativo dismissed the petition by the firm, saying the Italian firm had not established any of the grounds for judicial review.
“The applicant before court is not the owner of the vehicles hence there is no basis, which the orders being sought can be granted to it,” he said.
Further, the judge said courts respects the constitutional and statutory mandate of the State agencies and cannot, therefore intervene where there was a clear abuse of powers.
He said the court would not grant orders, which impede the KRA and DCI from lawfully performing their legal mandate.
Both Kimwarer and Arror are budgeted to cost Sh65 billion.
An advance payment of Sh7.8billion was paid out; Sh4.3billion for Arror and Sh3.5billion to Kimwarer respectively.
Documents in investigator’s possession further shows an additional commitment fee of Sh900million; Sh418million for Kimwarer and Sh490millon for Arror Dam was paid out to CMC Di Ravena.
Another Sh10billion was advanced to Service Assicurativi Del Comercio Estero (Sace) in two tranches of Sh6billion and Sh4billion for both Arror and Kimwarer Dams respectively.
A counter fund kitty of Sh900million meant for compensation and relocation of landowners cannot be accounted for.
Detectives have traced the money as part of the payment made in Italy then re-routed back to Barclays bank, Westlands Branch.
Sh300million and another transaction of Sh150million was made from Nairobi to Dubai and South Africa respectively.
Barclays has regional offices in South Africa.
If actualised, construction of the two dams would have seen addition of 60 MW of electricity to the national grid.
According to KVDA records, Arror and Kimwarer dams were to occupy 8000 acres of land.
KVDA gave misleading information that they had acquired 400 hectares of forestland from the Kenya Forest Service (KFS) in exchange for 570 hectares of private land an assertion KFS board dismissed in a formal board resolution.
At the same time, the same company CMC Di Ravenna constructing the stalled Itare Dam had diverted Double Cabin Pick Ups meant for Arror and Kimwarer to the Itare Multipurpose Dam site.
Among those who were grilled in in connection to the probe include National Treasury cabinet Secretary Henry Rotich, Agriculture CS Mwangi Kiunjuri, Devolution CS Eugene Wamalwa and Industrialisation CS Peter Munya.
Others are Treasury PS Kamau Thugge, former Devolution and Planning PS Irungu Nyakera, ex- East African Community PS Susan Koech, KVDA Managing Director David Kimosop and KVDA Procurement Manager Paul Kiprotich among others.
The multi-million equipment includes dump stations that are used for the safe disposal of raw sewage and muck cars used for tunnelling.
