Owners of Westgate shopping mall will have to part with Sh380 million in tax arrears and compensation owed to the Kenya Revenue Authority, a Nairobi court has ruled.
The owners of the building had been paid Sh4.4 billion by their insurer but objected tax claims by the taxman, arguing that the push was in bad faith.
According to them, the amount paid by the insurance company only covered for capital incurred in businesses that lost and not income.
However, Justice John Mativo said KRA's application was justified, directing the owners of the building to pay KRA 30 per cent of Sh600 million paid as arrears by the insurance company.
“The applicant has not demonstrated that the taxes are not due. On the contrary, the material shows that the taxes were due, hence the request for exemption,” Justice Mativo said in a judgment published on Tuesday.
“In view of my findings and conclusions as here above discussed, the conclusion becomes irresistible that the applicant’s application must fail”.
Kenindia Assurance Company had paid Sony Holdings Sh3.1 billion as compensation for damage to the mall and a further Sh1.2 billion as compensation for loss of rent during the period the shopping complex in Nairobi’s Westlands area remained closed.
The Kenya Revenue Authority was seeking a share of the Sh1.2 billion after deduction of operation expenses.
“I find and hold that the applicant has failed to present grounds to demonstrate that the impugned conduct of decision is legally frail,” said Justice Mativo.
Al-Shabaab militants attacked Westgate mall in 2013 killing 67 people in one of Kenya's worst internal assault by the terrorists.
Last year, the mall opened again after undergoing maintenance.