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CAR DEALER FIGHTS CUSTOMS ACT SECTION

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MBABANE - The validity and constitutionality of certain sections of the Customs and Excise Act are being challenged in court.


A car dealership company whose cars were seized by the Eswatini Revenue Authority (SRA) wants the court to declare Section 114 of the Act, particularly Section 1 and 2 to be inconsistent with the Constitution particularly, Section 19.
Section 19 (2) of the Constitution provides that: “A person shall not be compulsory deprived of property or any interest in or right over property of any description except where the following conditions are satisfied; the taking of possession or acquisition is necessary for public interest or in the interest of defence, public safety, public order, public morality or public health.”


Waryam Investments approached the court after SRA detained 11 of its cars imported from Japan.  SRA is reported to have detained the car in terms of Section 114 of the Customs and Excise Act.  Section 114 gives the SRA powers to detain goods and subject them to lien until a company which is owing has paid.


It further stipulates that any amounts owing or due constitute a debt to the government which might be recovered through a lien on goods found in one’s possession.
The car dealership also wants the court to set aside the detention notice.


Giving a background of the matter, Muhammad Zubair, who is the director of the Matsapha-based company, narrated that on November 28, 2019 the applicant (company) bought the motor vehicles from Japan. He told the court that the intention of bringing the cars into the Kingdom of Eswatini was for resale as his company was involved in the acquisition of imported vehicles for resale in the kingdom.


“The purchase of the motor vehicle in Japan was successful and same was accordingly shipped into the kingdom and delivered to Mponza Investment as the company (Waryam Investment) had use it as a clearing agent  and delivery was effected on February 11,2020,” submitted Zubair.


These are allegations contained in an affidavit whose veracity is still to be tested in court and the respondent is opposing the application.
Cost
According to Zubair, the total cost of bringing the impounded motor vehicles was the sum of E335 439.20.  He said he then proceeded to inspect the motor vehicles and upon being satisfied that everything was in accordance with what his company ordered in Japan, he then instructed the clearing agent (Mponza Investment) to facilitate the requisite documentation to comply with the Customs and Importation laws of the Kingdom of Eswatini so as to have the cars registered and sellable.
Zubair informed the court that his company then directly paid in full all amounts which were due to SRA in accordance with the Customs and Excise Act 21 of 1971.  He averred that, having paid the Custom dues he proceeded to collect the motor vehicles from the clearing agent’s possession but was, however, informed that they could not be released as the agent owed certain monies to SRA, which dated way back.


Meanwhile, in a letter written to the clearing agent, SRA Commissioner of Custom and Excise Gugu Mahlinza, stated that the motor vehicles had been placed under lien in lieu of a debt. She then informed the company that: “ Our records show that on or about the period between April 18, 2019 and May 2019 you cleared goods utilising funds which you have failed to provide proof that there were amounts deposited into SRA accounts for payment of duties and axes dues.”
Mahlinza further brought the company’s attention to Section 39 of the Act which states that no entry should be valid until all duties and taxes due were paid.


She then informed the company to pay in full the amount of E1 million plus interest at two per cent per month.  Mahlinza stated that the total amount due was therefore E1 439 290.16 and it was expected to have been paid by March 2, 2020.

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