Court orders calculation of Kakuzi land rates in row with county
Business
By
Kamau Muthoni
| Feb 08, 2024
The High Court has ordered Murang'a County to release Kakuzi Limited's license in a dispute on how much the firm should pay in land rates for 43,942 acres.
Kakuzi had insisted on paying Sh200 per acre while the county had initially demanded Sh177 million, arguing that the multinational company had not come clean on the acres of land it owns.
After a stalemate, Kakuzi sued the county arguing that it was not only unfair to withhold the licenses but it was jeopardizing the large-scale avocados, macadamia nuts and blueberries business.
Justice Lucy Gacheru agreed with the firm on the license but she declined to order for a refund of more than Sh24 million that had been jointly held by Murang'a and Kakuzi lawyers.
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She directed that Kakuzi ought to provide the correct acreage of land, which will then be billed by the county at Sh200 per acre.
Justice Gacheru was of the view that in the event the acres will be less, then the overdue will be released to the company.
"The petitioner (Kakuzi) did not deny that it holds the acreage of land as tabulated by the respondent. It is clear that Sh200 is the rate charged per acre. The petitioner should accordingly provide the correct acreage to the respondent and the land rates be calculated according to the acres held by the petitioner," the judge.
The court also declined to block Murang'a from varying the rates for 2019 to 2022.
Kakuzi is a large-scale landholder within Murang'a County. It is a major supplier of avocados in the United Kingdom, the United States of America among others.
In its case, Kakuzi argued that it had always paid Sh627,700 per year as land rates up to 2018.
However, in 2019, Murang'a county government demanded Sh177 million. The court heard that the county however reviewed the rates downwards to Sh 8.7 million, then Sh 6.5 million.
For 2020 and 2021, Murang'a invoiced the firm for Sh8.7 million, while in 2022, it raised the amount by Sh100,000.
The firm lamented that Governor Irungu Kang'ata led county had illegally hiked the rates.
Initially, the court directed the firm to deposit at least Sh24 million in a joint interest-earning account to cover the four years it was contesting the rates.
It claimed that the county was holding the trade license as a ransom for payment of land rates.
On the other hand, Murang'a argued that the case was based on a fallacy that it had varied rates in its 6th schedule of the County Finance Act 2018.
It submitted that the Kakuzi had admitted to owning 32,872 acres of land which it ought to pay Sh6.4 million in land rates.
Further, the county averred that any variation of the land rates from the amounts given might be an indication of Kakuzi's concealment of the true acreage of land it occupied.
Murang'a asserted that holding onto the license was justified as it was a means of ensuring compliance.
The county also argued that other amounts added were in reference to other trading activities included a slaughterhouse, a petrol station, a butchery, pole and filters.
In a rejoinder, Kakuzi said that it had indicated in its records that it owns 43,942 acres of land.
It argued that Murang'a had not shown that it had been charging a rate Sh200 per acre all along, but had based the total amount on an erroneous acreage.