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Case facing former ministers postponed

12th February 2013
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Former Minister for Finance,Basil Mramba

Former Minister for Finance Basil Mramba yesterday failed to continue with his defense testimony when his case came for cross examination because the chairman of the panel of magistrates John Utamwa had other official duties.

The prosecution led by State Attorney Oswald Tibabyekomya assisted by Shadrack Kimaro informed the court that, the prosecution side was to start their cross examination to Mramba who is the first accused in the case after finishing testifying.

The panel of Magistrate led by Saul Kinemela told the court that they wouldn’t continue with the case because the panel of three magistrates was not complete as the chairman of the panel had other official duties.

The other two accused besides Mramba are Daniel Yona, Gray Mgonja the former Minister for Energy and Minerals and the former Treasury Permanent secretary respectively, who served during President Benjamin Mkapa’s administration are accused of occasioning a loss of 11,752,350,148/- through tax exemptions.

The accused are charged with failing to take reasonable care in the discharge of their respective duties by unjustifiably signing government notices that led to the loss of the said amount of money.

On his last testimony, Mkapa defended his controversial approval of tax exemptions for contractor Alex Stewart Assayers (ASA), saying he was allowed by the law to grant them exemptions.

He claimed that the Bank of Tanzania (BoT) has provisions that give authority to the Governor to enter and sign agreements between the Central Bank and different entities deemed eligible for tax exemptions.

He confirmed that section 4.3.1 of the Assayer’s contract stated that any payment to the company would not be taxed.

“On May 26, 2003, the treasury asked the Tanzania Revenue Authority (TRA) to advise the government on whether ASA should be given tax exemptions,” he said, adding that the inquiry was turned down but the letter explaining the fact was received ten days from the day of inquiry.

Mramba claimed that TRA’s response to the treasury Permanent Secretary was, in his words, ‘redundant’ because the agreement had already been signed.

When asked by his counsel on the prosecution’s claims that granting tax exemptions through Government Notice (GN) was an abuse of office, Mramba refuted saying all the legal processes were followed as the contract passed through the finance ministry, legal department and Attorney General‘s Office.

The case was instituted following three years of investigations by the Prevention and Combating of Corruption Bureau (PCCB) and the police into the suspicious hiring of Alex Stewart (Assayers) Government Business Corporation (ASA) to audit gold production in Tanzania.

Alex Stewart (Assayers) was in 2003 controversially assigned a contract which saw it receive a whopping 65bn/- (USD 50 million) in gold audit fees paid an average of 1.3bn/- (USD1 million) every month from June 2003 to August, 2007. The company completed the assignment and left the country in August, 2007.

The case has been adjourned to February 25 and 26 for the cross examination.

SOURCE: THE GUARDIAN