Fishrot-linked Saga Seafood loses N$18.4m tax battle against Namra

An Icelandic-owned company involved in the Fishrot fraud, corruption and racketeering case has been dealt a setback in a High Court case in which it is suing the Namibia Revenue Agency (Namra) for N$18.4 million. The company, Saga Seafood, which is part of the Icelandic fishing company group Samherji, is suing Namra in an attempt to have N$18.4 million that the tax agency took from the company’s bank account in February 2020 returned to it. In a judgement delivered in the Windhoek High Court on Thursday, judge Boas Usiku dismissed an application by Saga Seafood for a summary judgement for the payment of N$18.4 million to be granted against Namra. Usiku also ordered Saga Seafood to pay Namra’s legal costs in respect of the application for a summary judgement. Usiku made the order after finding that Namra has a genuine defence against Saga Seafood’s claim filed in the High Court in February this year. Saga Seafood is one of the Samherji subsidiaries mentioned in charges faced by the 10 people charged in the pending Fishrot case. The state is alleging that the Samherji subsidiaries paid tens of millions of Namibia dollars to some of the accused in the case after the companies got access to fraudulently granted Namibian fishing quotas through the accused. Usiku recounted in his judgement that Namra made a tax assessment in respect of Saga Seafood in February 2020 and calculated that the company owed N$18.4 million in tax from the 2018 tax year. A week after Namra informed Saga Seafood that it owed the amount, Namra appointed First National Bank of Namibia as its agent in terms of the Income Tax Act of 1981 and asked the bank to pay N$18.4 million from a bank account of the company to the tax agency. Saga Seafood lodged an objection against Namra’s assessment about a week later, but a decision about the objection has not been made yet, Usiku noted. In the claim that Saga Seafood filed against Namra in the Windhoek High Court in February this year, it is alleging the tax assessment is defective because calculations in the assessment are not supported by the company’s financial statements for the year ending 31 December 2018. The company also alleges it was not given an opportunity to object to the assessment and that the tax assessment was made solely with the intention of using the section of the Income Tax Act that allows Namra to have money taken from a tax debtor’s bank account. Saga Seafood “therefore alleges that the assessment was not an assessment as envisaged in the act and the withdrawal of the amount from the plaintiff’s bank account constituted an unlawful withdrawal,” Usiku said in his judgement. In its opposition to the company’s application for a summary judgement, Namra argued that Saga Seafood should first have its objection determined by the tax agency, and if it is not satisfied with that decision it should appeal to the special tax court created in terms of the Income Tax Act. Namra is also alleging that Saga Seafood unreasonably delayed the institution of its claim in the High Court, which was filed five years after the money it now wants to be paid back to it was taken from its bank account. Namra is further claiming that the company should have asked for an order compelling Namra to make a decision about the tax assessment objection it lodged in February 2020. Usiku stated: “Summary judgement is aimed at expediting claims where a defendant does not have a bona fide defence. It allows a court to grant judgement without a trial. The crucial issue for determination is whether in the present case the defendants have disclosed a bona fide defence that warrants the matter to proceed to trial.” The defences raised by Namra are genuine, and Namra has disclosed material facts that are sufficient to establish a reasonable possibility of success in a trial, Usiku said, before concluding that Saga Seafood has failed to make out a case for a summary judgement to be granted. The case has been postponed to 19 November for a case planning conference to take place. Senior counsel Raymond Heathcote represented Saga Seafood in court. Namra was represented by Tinashe Chibwana.