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Indian nationals in URA fake invoices saga fined Shs60m
Directors of Wellex Hardware Ltd were convicted by the Anti-Corruption Court in Kololo for generating and selling fictitious invoices last week. PHOTO/ COURTESY OF URA
What you need to know:
- When the Commissioner of Tax Investigations at URA, Mr Denis Kugonza, was contacted in a telephone interview, he stated that they have so far recovered over Shs4 billion from the syndicate scam of the trio and their beneficiaries plus Shs1 billion from China Railway No.3 Engineering Company Limited.
Three Indian nationals who pleaded guilty to making fictitious invoices to Uganda Revenue Authority (URA) have been released after paying a fine of Shs60 million.
The two directors of Wellex Hardware Limited, Mr Jigar Chandarana, 44, Mr Jitendra Sorathiya, 41, and their accountant Mr Ronak Moradiya Ghanshyambhai, 25, pleaded guilty to making false statements to a tax officer contrary to section 58 of the Tax Procedures Code Act, 2014. They also paid Shs102 million in taxes.
The trio appeared before the Kololo-based Anti-Corruption Court where they pleaded guilty to the five charges. They entered a plea bargain agreement with the State.
Chief Magistrate Joan Aciro, the presiding officer, thereafter ordered the trio to each pay a fine of Shs20 million or face five years imprisonment on default.
“The court having reviewed this form and any addenda and having questioned the accused concerning the accused’s constitutional rights, finds that the accused has expressly, knowingly, understandingly, and intelligently waived and given up his constitutional and statutory rights,” Ms Aciro ruled last Friday.
She added: “The court finds that the accused’s pleas and admissions are freely and voluntarily made with an understanding of the nature and consequences thereof that any allegations as indicated in this form are true and that there is a factual basis for the pleas. The court accepts [their] pleas.”
Lawyer Diana Prida, representing URA, said she had explained to the accused and discussed the facts of the case, the nature and elements of each charge, any possible defences to the charges, and the consequences of a full trial.
Prosecution stated that the three and others still at large being directors and an accountant of Wellex Hardware Limited in March 2021 in Kampala knowingly filed Value Added Tax (VAT) returns to a Tax officer at URA purporting to have made supplies to China Railway No.3 Engineering Company Limited amounting to Shs361 million, which they knew was false.
It was the prosecution case that the three in August, September, and October 2021 filed false VAT returns of about Shs8 million, Shs140m and Shs212 million purporting to have made supplies to the Chinese firm.
The trio in May 2022 also filed a false VAT return to URA purporting to have made supplies to China Railway amounting to about Shs378 million.
According to section 62H(c) of the Tax Procedures Code (Amendment) Act, 2022, a taxpayer commits an offence if he or she makes a false or misleading statement in the information return.
Upon conviction, the offence attracts a fine not exceeding Shs50 million for each day of default or imprisonment for a term not exceeding 10 years or both.
When the Commissioner of Tax Investigations at URA, Mr Denis Kugonza, was contacted in a telephone interview, he stated that they have so far recovered over Shs4 billion from the syndicate scam of the trio and their beneficiaries plus Shs1 billion from China Railway No.3 Engineering Company Limited.
“The convicts also paid their taxes of Shs102million and we shall monitor their businesses and their return and compliance levels to make sure they do not go back to those habits and taxes were recovered from the companies which bought the invoices [from the trio] ,” he said.
Media reports show that the trio would generate and sell fake invoices for a commission.
