Rehana Shah and Mohammed Naseeb were each sentenced to three year’s imprisonment for tax evasion, complicit in deliberately understating taxes due of some $800,000 over a six year period ending 2016. Their claim to have no knowledge of tax requirements, having left this work to their tax agent, was dismissed.
They unsuccessfully appealed their conviction and sentence to the High Court, stating there were no grounds for criminal liability; it was simply a case of muddled accounting in their poorly run and chaotic business, they said.
Tax convictions followed failures to properly account for GST, PAYE deductions and income for their company: Supreme Constructions Civil & Drainage Works Co Ltd. Their company stopped trading in 2015 and was wound up, insolvent. They also understated taxable income in their personal tax returns.
Conviction for tax evasion requires proof of intent; the taxpayer knew tax was due, but deliberately evaded payment.
Ms Shah and Mr Naseeb said they left all tax filings to their tax agent. Any errors were not their responsibility, they said. In addition, Ms Shah said she was no more than a ‘simple housewife who helped with some of the paperwork.’
Justice Jagose said there was clear evidence of the two concealing information from their tax agent in what amounted to deliberate efforts to evade tax. Their tax agent was given limited information. Relevant bank accounts were kept hidden.
Ms Shah’s claim to limited involvement in company business did not tally with evidence of her having an employment contract with Supreme Constructions and being involved in coding bank account statements delivered to their tax agent.
The two provided no assistance to Inland Revenue’s investigation. Their sustained attempt to deceive and mislead Inland Revenue by delaying and obfuscating inquiries was further evidence of intent to evade tax, Justice Jagose ruled.
Shah v. Inland Revenue & Naseeb v. Inland Revenue – High Court (20.11.24)
25.036