Xolani Mbanjwa
2 minute read
30 May 2012

Mpisane wins tax clearance fight against SARS

Xolani Mbanjwa

DURBAN socialite Shauwn ­Mpisane received a lifeline from the high court in Pretoria yesterday when she secured an urgent interdict against the taxman.

DURBAN socialite Shauwn ­Mpisane received a lifeline from the high court in Pretoria yesterday when she secured an urgent interdict against the taxman.

A delighted Mpisane told The Witness last night the judgment was an important one not only for her company, but also for South African taxpayers.

“It shows that the SA Revenue Service [SARS] must take decisions that are fair, lawful and constitutional, and I am quite delighted with the decision.”

The court ruled that it was unlawful for SARS to invalidate tax clearance certificates without giving taxpayers an opportunity to defend themselves.

The multi-millionaire businesswoman — who is under investigation for alleged tax fraud — was granted an urgent interdict to prevent SARS from withdrawing a tax clearance certificate for one of her companies, Zikhulise Cleaning, Maintenance and Transport CC.

Mpisane, a close friend of suspended national police commissioner Bheki Cele and the daughter of late eThekwini councillor Florence Mkhize, argued that she had not been given an opportunity to defend her company before SARS informed her that her clearance certificate had been withdrawn because of alleged non-compliance.

Judge Gregory Wright ruled that SARS had acted “unlawfully” when it invalidated Mpisane’s tax clearance certificate for the period January 17 2012 to January 16, 2013.

Mpisane’s lawyer, Rafik Bhana SC, said the interim judgment could have wide-ranging ramifications for the taxman — it could mean that all non-compliant taxpayers should be given an opportunity to defend themselves.

“This will mean that SARS may not just withdraw a tax clearance certificate and then inform the taxpayer later. This is a precedent-setting judgment because SARS can’t just arbitrarily take away the certificate.

“SARS acted unlawfully in invalidating the certificate as it should have given Mpisane the right to be heard before taking a decision to withdraw the certificate.”

According to court papers, SARS withdrew the certificate on March 16 this year.

It was issued on January 17 and would allow Mpisane’s company to bid for government tenders, conduct business and retain its compulsory registration with the Construction Industry Development Board and the National Homebuilders Registration Council.

Mpisane argued that without the certificate her company would not be able to do any business, let alone be paid for work already done.

The court agreed with Mpisane that SARS had failed to act in a procedurally fair manner by failing to give Mpisane’s company adequate notice of the withdrawal.

Mpisane would not say last night how business was affected.

“At this point I am not willing to comment on that; maybe I will comment at a later stage.”

Mpisane’s victory comes just days before she heads back to the Durban Regional Court where she is facing charges of tax fraud involving R2,4 million for allegedly submitting false invoices to reclaim value added tax.

A spokesperson for SARS said the organisation would respond to the outcome of today’s case at a later stage.