19870612 TZHC Dar es Salaam 1

4---t C,rl IN THE HIGH COURT OF TANZAf'-TIA

AT DAR ES SALAAM EC0!'-1 0MIC CRIMES JURISDICTION (DAR ES SALAAM REGISTRY) ECONOMIC CRIMES CASE NO. 6 OF 1986

THE REPUBLIC vs BALTAZAR CHRISTOLOGE MWENDA ••e•••••ACCUSED

JUDGEMENT ~llat Mr• chambul.ilo, _ (Lay Memp_ers) ~ · In this case the accused stards cherged with and pleads ;ot l~il.ty to four cou,.,ts, to with beirg ir possessio'I" of property 10 tonably suspected to have beer corruptly or otherwise unlawfully -. . ~:I.red c/s 9 ( 1) of the preve,.,tio'r" of corruptio'I" Act 1971 as read il')f$\her with se_ctio'I" 59 and the First schedule to the Ecoriomic and ra~ised Crime Cortr.-,1 Act No~ 13/1984; two courts of obtairdr,g adva~tage without adequate corisiaeration els 6 of the prevertion of corruption Act 1971 a'l"d section 59 ar-d paragraph 2 of the First 'f1'~dule to the ECO'l"omic ard organised Crime Co'l"trol Act No.13/1984 ,nd' one count of occasior-irg los!' to a specified authority contrary •~ Paragraph 11(1) of the first schedule to, and Sectio'I" 59 of, the 20 ·o•?mic and orgarised Crime control Act No.13/84. The particulars in tat~ eount will be dealt with in due course wher it will be necessary ~~ do so. In a nutshell the f7llowing matters are rot disputed. At a;,., the material ti::>, the accused was, a_rd still is, the commissioner ti ;c,..come Tax .. He is therefore a public officer withi"' the meaning ol t.he Preventio!"1 of corru,ption Act. AS regards count ore the accused 1•• _admitted that he has built a house or Plot :t-.ro.1017 Msasani Penin- 1\Aa. That house was assessed by a Tarzaria Housi'l"g Bark valuer .. lie

-accused was served with notice t0 explain the source of income \f\thieh enabled him to build the said house. The accused had furnished 30 •tat in~ormatio!'1 i"' accordarce with the pr0visiot1s of section 8(1) of 1t19 prevention of corruptior Act. The prosecutio'I" have accepted that •te accused had lawfully spent the sum of shs.675,000/=. on the ~\her hand the prosecution and the deferce are at variarce about the ·'· -..alue of the house. The prosecutior maintair that the value of the ·\·0~se is shs~2,029,000/=• They therefore mairtain that the accused \ ,las eo~ruptly or otherwise unlawfully acquired the sum of shs. \aJ~4,000/=• The defence case is that the house was constructed at \eost of shs.831,000J=• • 0. ,./2 ii •i.:.:. j - - 2 Regarding the ucoconc:. 2.:-:c. t:..·.i:;:-c: coc.::::ts 9 t~-:e acc~:oed had bought from Caso7ent Lfrica Lt~. ~uilding materials worth over shs.100,000/-. Ee :._)niC:'. [or tho goods and obtained a discount :for the goods purchnoedo The p:::-oGGcution contends, and the defence vol-ioi:1e:ntly de:ny, t:~at the :J.iscoW1.t was an advantage without aC:oQ1.:·.~ -te co~-;.::;idere. tion·. In count four the v,ndi.sputcd facto arc these. There was · a foreign cor.ipany in the na1:10 of Tnnga Consortium, in this judgment it will be refer~ed to as Tnncon. It w~o contracted to build the Tanga and Ebeya Come:r:t plants. Tancon was liable 10 to pay tax on a

non-resident rate of 55% of its profits. Tancon submitted co:nsolidated accounts :for the yec1.rs 1977-1981 show:i.ng a loss~ The a:ccused r.mde a :provisional computation show:i_Jig a J.oss of shs.3,000,000/-. It h.Qs been contended by the prosecution that Tancon h2d made a profit and was liable to pay income to.x nnou:r~ting nl:s. 97 9 l:.7 L;., 468, th8 t the acc..,,s ed had been negligent in ~ot verifying tbe accounts o:f Tancon. The accused had maintained that there is a loss and that the aQcounts were verified. - How we come to the evider..ce in respect of each count. We 20 start with count ono. Chabani Haza (:i_,w10) io a Valuation· Manager employed by the Tan:::;ania :-:ouoing :S2.nk (hereinafter i t uill be referred to as THB). :-=e told the court that he is concerned with the valuation and costs of projects, that in this case he did not asGess the value of the house of the accused and that the hou0e of the acc,._,:sed ,r2s o.::;Geosed by his· ju..--iior Joram M:asun and he recognised 2xhibit P1 an being prepared by the said Joram Viasuni« He told the court that according to the valuation report the house was undervalued. I-~o said that Joram I•fosuni is out ,, of' the country on study. Ee onid that to _arrive at the value 30 of' the hou·se they checked the design or plan"o:f the house, the location the house has beea built and thG finishing touches of ; the house. He

inf'orr.1ed the court ti-lat the house ,,ms ve.lued at the Qurrent rates of cor..struction. He stntec'. that after the valuation the file uas fcrvrarded to the de9artr.1ent concerned for insurance and contract. He ad.mi tted when cross-exar.1inecl ti:.at the valuation was made the basis o:f insure.nee ar:.d mortgage. :fo also ac1ni tited that he is not n quali?ied quantity ourveyor. He agreed further ,i:t, that the house was under construction since 1977 and he admitted 40 that in 1977 the cost of con::;·~ruction wn::; cheaper than in 1984. He told the court t:::.a t in 1984 the house u2s 7o~{i conpleted. He further conceded that in 1984 THB did not i1c:ve nny cchedt.~led rates o:f construction and that Joram hac". used his opinion only. ~lhen re-examir..ed he rei ·tera tecl t::-:at in· 1s8/.j. 'I'EB c.ic:. !lot have any scheduled rates of cons-tr~ction &nd -that they r.1ake t~e ...aluation so that THB does r..ot ,;-ive r.10:..~e nw:.:ey t:.-1c1.n in necessary. .. ~~: - 3 -· rAe prosecution have rel•ied also or .Exhibits P1, P2, p4 ar,d P5. In his eviderce on oath the accused stated that he started •~ilding the house in March 1977 ard that the main structure of -\l,e house was completed iT"' 1979n He also stated that he finished bij1l.ding the house i,.., t,1ovember, 1984. He irformed the court fij•\her that he did T"'Ot employ aT"'y cortractor, to build the house, , ~~at his

relatives had built the house f~r him. He alleged in ai~ 9Vidence that his relatives were T"'Ot paid any salaries. AS io l\is means or source of 5.nc0me he adopted EXhibit P3, a 10 11~1ernent he made to the erti-corruptior squad, which showed the lfl~kdown. He added however, that due to the short time he was 1t1e~ to answer the questio,...aire he omd.tted the sum of shs.100,000/= ~liCh ~a~ tee amourt of cash (20,000) he received for the sale· of ·1• ~ar which should have read shs.220,000/= instead of shs.200,000/= It shown· in EXhibi t p3 ard also proceeeds from sale of building -, a\erials left over after c "Jmpletior of the c0rstruc:ti0r of the 11ai• house. He told the c-:i'urt that the house ha9 cost him shs .. 'e ~11•000/= to build. He also told the court that he bought most of building materials between 1977 ard 1980. of peeipts which were admitted as EXhibit D2. collectively. He produced a heap He 20 1~1 vigorously disputed EXhibit P1e He told the court that he lad applied to THB for additioral loan ard that he had mortgaged 11e house _as security. He said that his urderstardiT"'g was that the vo.~ation was done to ascertair the security for the loar and not 14e ~ost of constructior .- He stated that THB had used the standard e.f"?•omic rates of corstructior at the time of valuatinr, which, e,1~rding to him, is the rate which a building cortractor would aave eharged. He

i~sistec that his source of Ir,come had beer eJPiained in EXhibit P2a 30 Whe:n cross-examired the accused stated that he built the house wi_"h the help of his cr:iusiT"' Lukas Kisura who was assisted by labourers "'lo were also his relatives a""d that they were livir-,g at the site., Mt regards EXhibit_ p3 the accused stated that he was give,.., one day, s pe1iod to answer all questi0T"'s and that he did ~ot obtaiT"' his bank •1atements at the time" He iT"'sisted that wheT"' he rec0rc iled his . .~unts in pchibit P2 he fnurd that the sum of shsg100,ooo/= was .' .. sJ11itted. AS regards the loar of Shs.250,000/= from Italconsult he ,,tated that he used the money towards buildiT"'g the h_ouse. - 4 - ""' exhibit P1 the accused replied that the valua"tioT' was i"'tended to obtain security for a" additioral loa"~ He stated that cost value a~d ~arket valtie are two diff~r~~t ihiT'gs. Lukas Augustiro Kisura (pw4) gave evider-ce O"' behalf of the ae•used. He told the court that he is related to accused, that he is a mason and carpeT'ter.. He 1:0iormed the court that he had built '\~e house of the accused fr0m 1977 to 1979 whe~ co,..,struction work wa1 ~ornpleted. He said that betweeT' 1980 ard 1984 there remained fi,..is'hing work,., He said he was bei-ng helped by labourers who were al,,o relatives. He said that he ar,d the labourers were stay_ing 10 a• 'the site, that they were "'Ot

paid a"y salaries ard that they ,.,11,airied their stock of food from their home village, that accused ·,e.,..\ some of the labourers t--, a tech,..,ical school. When cross-examined DW4 told the court that he is married a"'d has fpur childreT' o"e of whom was, i" 1977 iT' Form I at Mzizima ~~fO'fldary school, that the other child had not been selected •0 join secondary school ard had seT't him back to the village. He said the school fees for the child at secor,dary school was Shs. _·t,00,s per annum. He de"ied that accused had paid them a"Y salaries ,,.,, hui~ding the hou_se. He stated that he was meetiT'g his expenses 20 1tf building houses for 0ther people whe-n buildiT'g material at the ,1~~ of the accused were 1"'0t available. He admitted-that he saw a 1a• from THB at the house of the accused but der~ed that that man •~\lied to him or asked ary questions abriut the house .. He said ,,e, he saw the mar, go rou"'d tt.e house ard then left. He denied that te was lying. The accused also called two quar,ti ty i'surveyoll!s Modest Mshana f'D\tl5) Managing Director cif Cost Co1"'sult. Ltd a1"'d Gabriel Kagize (DW6) a •eeturer at the Ardhi Ir,stitutee Both are registered quantity ..,veyors. The testimo'r-y of DW5 is to the effect that the accused 30 appr-".)ached and requested him to estimate the c0st of c "'"struction of h~s house he said that he agreed~ He t0ld the court that

he avami.ried the drawir9s of the house, visited the house ard t0ok .. "~asurements. He talked with Kisura who built the 'house ard he was i•f,1rmed that the house:/was built be twee.,.., 1977 aTid 1984. He sa~d ••at the accused gave him various receipts with which he bnught W.il.ding materials. He stated that the main h0use was built between, t~'l''7 and 1980., He· said with this ir-formatiori he worked out the -,tpetetive market rates -0f the build.ir9 materials prevaili,..,g at 40 •· .•1e particular time., He said he v·orked out the cost of materials, \a.J>,-,u~, overheads ard pr~fit c0rnparirg them with rates used by - 5 - fOritz;-uctors at that period. He told the court that___he got the cost of 1Jaterials from the receipts supplied to him •"by the accu:sed a"'d he also ade hj.s own enquiries from Bhesco, RTC ard private dealers. on labour 101ts he stated that he used gover"'me"'t rates prevailirg at the time. At 1egards overheads he iriformed the court that they were miriimum as the ~o~se was a self mariaged project ard that "'0 profit had accrued to accused. He ,ta~ed that he the"' prepared the bills of quantities a"'d priced then t, a,tording to the rates prevailir,g y~~ar to year si"'ce the house took a ,..,u~he~ of years to co"'struct a,..,d that prices varied from year tc year. He $a1d accordil"g to his valuatiol'"I, al"d with the irifor'matior, available, 16 qe

house had cost the ~ccused shs.887,220/10 to construct. He had ,.~d1ced his report as EXhibit 011. The witness also t0ld the court that he had see!" EXhibit Pio He said 1i,ai.EXhibit P1 has a "'umber of errorse The first error he pointed out •~Wf wa1 \he area of the first floor. He t,ld the court that EXhibit Pi has that the first floor has ar, area of 274.31m2~ He said that when he ~et~ed the house he f~urd 0ut that a"' opel'"I space measuring 93.68m2 was 1,,~\lded., Accordil"g to him this area should have beer1 excluded, and lf do~e, the first floor sh0uld have ar1 area of 178.63m2. He said that . . error had affected the value of the h,-.,use by shs.463,8i4/= and if 20 -e,.a, 1,1, over valuatior is adjusted from the figure given ir EXhibit P1 then value would be shs. 1,.565, 196/=• The sec·..,,,d error he pointed out was THB took iPto accoul"t the rates operatil"g i,, 1984 of shso4,200/= per y,.a;e met.re., He said that this was wror,g ar,d that the THB valuer should aa1e taken the cost of c0nstruction stage by stage from the year of con- i,ijeUot'l, _ He said.that had he dore so he would Y"Ot have come to the a,eij•t shown in EXhibi~ P1. when cross-examined ows told the court that he had worked as a -a~tity surveyor for 13 years before establishirg his owr company. He 30 aid he first krew the accused briefly in 1975 whel" they were neighbours a~d then from February this

year. He admitted that he knew that accused · a4 a case pendil"g in court wher, he was coritacted to value the house. we ,aid that he used other receipts besides EXhibit D2 and that he saw iofetpts from coastal steel IY'dustry. He said the work was done in 1984 -~ the receipts could be issued i"' 1985. He admitted that he was paid by i\e a•~used for the work done a"'d that he pays income tax. on re-exa- ti•a'tion he said that the items from coastal steel Il'"ldustry were shown t,,. !\is report urder headir,g nwork done in 198411., He said these receipts 40 ~w shs,123,000/c. OW6 told the court that he took a theoretical approach to the issue. He 1\ated that consideri,,g the lel"gth of time the project took he decided yo ••break 11 the buildil"g dow,-, il"to its compo"'el"t parts, that is, the t9~~datton, the slab, a,,d th~ walls etc~ He said i"' this way he was - 6 - able to get the material and labour needed to complete each part. He said a-rter doini:: that he used an objective approach by examining receipts supplied by accused, then he checked the prices with the .Prices Com1nission. He also considered the labour cnsts, ever head co~ts and profits. He s~id that the house was self IDG1.na.gea. and that he was told th6l.t labour was free. be said in his report he included labour cost and according to his valuation the cost of construction was &hs. 965,000/=• He said L!ut

fol.towing discu.s.:;ion with Kisura and the accused op. the question of labour costs te deducted 8hs. 100,000/=. He told l(' the court thc.t.t he is confident that if labour cost are deducted the house would cost i:ihs. 8;-0,000/= to construct.- His report has been ~dmitted ~s exhibit D.12. He stated undE::r cross ... exumination that he did not know the accused before J-;.pril 1 1937, that the accused approached the ..,. A;rdhi ·, Institute for expert Opinion and that it was the Ardhi Institute which assi 5ned- him to evc:.luate the house as he is the only registered quantity surveyor ~t the Institute~ He said that the Institute offer~~COrt$ultancy services to institutions and individual people and th<q pay for it. He adm'itted thut 20 the accused has to pay tc the institute for the services ;e~dered~ From the e~itlence above we h~ve fi~st to decide whether the ~ccused ~i~ not ~,y lubour costs for the house. In their evidence both the accused anc: iJvJ.4 stated that the1Se labour was not not paid for; that the house w~s built by relatives who stayed at the eite. We have con_sidered this evidence. We agree that the house WG1.S a self managed. project b·cit we are not ir,clir>ed to believe that ~ccused did not pay Kisura und the labourers at all. The house has taken a number of years to complete. DW.4 had a family to 30 support and indeed he was paying school fees for one of

his children who was ~t that tiwe attending secondary education. Both DW.4 and accused have indicated in their testimony that eome labourers were sent to a trade school. we believe that the accused must have paid for their tuition.. In short we do not believe the t_estimony of the accused and, DW .4 that there was no labour costs involved taking into account, as we have indicated, the long perio<l the house ·';ook to construct., Anr~her issue is whe~her the house wa~ conitructed at a value of .b~. 2-,029,'·-J0/:::. '.!.'_he:": burden :i.s on the prosecution to establish the v~lue befor~ the accused assumes the duty to prove on a balanr.:e of probability, the source of his income. As indi- •atati above -~ij-..: ;ycose~utiori have relied upop exhi_bi,~s P.l, P2, P3, P4 and P5 toget.twr wi ·Gh the tes_timony of PW.l;O/ W·e,··9an easily" - 7 - dispose of with P~.10. tle did not prepare Exh~ Pl. ~either did he visit the· scene.,. AcC_ording to his own testimony he does not agree with Lih,P.1 because the h0use was ~ndervalued. He did not tell the court the basis of his opinion that the house was undervalued. His evidence therefore cannot be relied upon to establish the value of the house anu we ace ord no··. we:ic;ht to it. '.L'he next pie•ce of evidence is ~xh. ·P.l •. We have read and r~-read Exh. ~.l. It contains three main documents o 'I'he first is a form entitled ·11

Mapendekezo ya Maombi ya Mkopo wa Nyumba kutokl:I. Benki_ ya Nyumba (THB). 11 In this form the accused applied for a loan of ..>·hs. 70,000/=., :i.·his form was dated 17/10/83 and bears the signature of the accused. '.i.'his form is 10 t~ped. It is noted that in paragraph 11 it is shown that estimated oost of the house is Bhs .430, 000/ There are other typed figures 0 ,.. or words. 'l'hese have been cancelled and instead of Shs .430,000/= -;here is a handwri"ct.E.n figur<) c: '.i:iso 2,119,000/=. We shall refer to ~llis in due coun,e .. 'l'he i:,,conC. .·or:r, i:..: headed "Valuation form" dated 011 12/3/84. Last:1.y tt.:::_-e is a 1:.:-.ip,:,r b-1.nclwritten and headed "Valuation ~omputation" which shov,s the: :fi~.·re of Bhs. 2,119,000/=. We are r:, q f ompelled to believe t:tv-.-t the al-. ·t ·:a·.: ions in the figure in the form aQ(PJSed had signed was c.one by t:1e a:Jtr1 0r of tho valuction computation tOr' it woulu not have been ace id- :·t":::o.l tha,. the figure in the computati~n 20 valuation shouid appE.' ~· in the bC( . ..::.sed':.; form. v-iha.t bearing this has we shall sho1,.r presen+-ly. '1 'he ace ·'.secl has strongly disputed that the coat of construction of his house was bhs. 2,029, 000/=, maintaining that the form he ha<l :filled w;;;.s to enable tim to get an additional .,oan from Tllli an~ that 'l'lh val.Lt;U ·che house for the purpose of ol)taining

security and not to dete::-mine the cost of construction. 11,. l.iakha has submitted that it iG not proved when the valuation by ~ was maue. ,1e fo·, .... _. n~ nerit -i.n that submission as it is clearly sl,lown that the valuation was made on 12/3/84. '.l'hen Mr. Lakha sub- ~ited that the valuation by ThB was wrong because it based its 30 •~putation on the entire area of the house, and secondly THB had ~e~ the construction rates prevailing in 1984 instead of taking \tLto account the costs prevailing at tje time the house was tQJl~tructeio Re submitted tha·~ the approach taken by DW5 and DW6 was sorrect ana has urged this. court to accept their testimony Mr. Shaidi ·•u'bmi tted that the val~ation c c.::nuucted by THB was proper and it should be relied upon by the courte He argued that THE had valued the house i i the course of their work and had no interest in their work as there w~ tlO penuin.g proceecl::_ngs D.gfair st the accuGec.. He said that accused 40 ~rl agreed wi ➔.r. valuation repor·( by signing it. As regards DW 5 ~~ l)W6 he submitted that they are inte;~ested parties, that they knew ~}.at the accused was facing cr::.minal charges when they prepared their v~tion; that they were paiu. jy accused, and that their evidence is - 8 - i""te..,ded to save their clie,-,t,· the accusedo He has urgued this court, f0r the reasons he advarced to reject their eviderce. AS regards

Mr• Lakha 1 s submissior we have corsidered _sxhibit P1 with the full kpowledge that the valuer did rot give eviderce. This ' has given us some difficulty. There are matters which reeded ex- pial"lation which PW10 would rot explair. The whole area of the first floor had been computed ir the valuatiol". ows has disputed this as wto~g. He said that it was ar oper spaGe. Agair ows had stated that the first floor is bigger ir area thar, the groul"ld floor. we·have checked ·the handwritteP paper el"ltitled val,atio.,., cornputatiors.. we agree. 10 !'he ground floor shows 248.3m2 .. ard--;the,,firstrfloorlshows. 272.312. A!ain there is f'\O explar,atiol"I on this.. owS stated that. the :area of 17i2•31rn 2 included al" ope" space of 93.68m2·. This was rot challenged. ~e said this was at" error ar,d the first floor has ar area of 178.63m2e A~ail"I this was f'\Ot challer,ged. We accept that this was al" error as we ~ave no reason to disbelieve his testimo"Y• This error has affected the i,al'4e of the house by shs.463,814. Mathematically speakir,g if it is 1.ilt~i,t·~9;: i; as we do, that the area of 93. 68m2 was ffas wrorgly included and 11,e sum.·of shs.463,814/= the child of that errorOis take"' out from the pigure of shs.2,029 1 000/= -~her, the value of the house, ac~ording to THB, 20 if they did not make that error, would have beer shso1,565,186/=• We wo~ld further go on with that

mathematical approach~ The prosecution •ave accepted that accused would accou~ted for the sum of shs.675,000/= fr,m E;Xhibit p2. A"'d if you deduct that sum which p_rosecutior, have ;1nceded from the sum of shs.~,565,186/= as showl"I above then the value ~! the house shoul9~ave beer shsw890,186/c ard r,ot shs~2,0~9,000/= as shown in the charge sheet. The accused should ther, be requ~red to ac~~unt for shse890,186/= beirg the differerce betweer, shs.1,565,186/= a.rd shs 1 575, 000/:,,. This could have bee" explai,-,ed by either PW10 who ~.. fo~tunately did rot do or by the valuer himself. There is aY1other 30 poi,.,·t to which we have di-rected our mird a"'d to which the Republic has · ,,rongly urged this c0urt to accept a"d this is that whether it is ,10~e~ and correct to value a house built ir, the 1970 1 s with the costs of fflaterials prevaili,l"lg ir 1984? we thir,k it is u~conscionable and ~~just to evaluate a house built ir, the 1970 1 s at the coPstruction •ate of prices ir 1984v It is comrnol"I k"'owledge that prices have the ·~e...,del'lcy to char,ge redically \,iithir, a short period.. secondly EXhibit P1 ,, ~~ow• eonclusively that he did "'ot take ir,to account the ~ost of material. Me o,..,ly considered the area of the house as the base of his cost., The a,r~sed stated that he cnmpleted the rnai"' structure in 1979. ows has 40 1tated that he fourd the house 65%

completed. .And accordi ,:,g to DW10 )~ 'said in cross-exami"'atior that in 1984 the house was 70~ complete. A"'d according to EXhibi t P 1 · the paper headed valuatior, repqrt paragraph tB 5hows clearly that the mair buildirg 'structive had bee"· completedfl tf tnat is so, as it is admitted by the valuer what is the basis of "I - 9 ---· d\arging the currert cor-struc,tion rate based or-· area which had been · to!J.pleted long ago. We fird t"IO ratior-al reasor-, .none has been suggested ·\c,;us 1 nor does it appear itself a,~ rec0rd~ we hold that the valuer erred in this., we have also directed our mirids to the submissiori of Mr• shaidi., He has urged this cou-rt to reject .the. testimor,y of owS a,..d ow6 as paid 1~terested persons~ It is true that both owS and DW6 have admitted that t~ey were paid for the job done and that they knew that accused has a Jaoe pending i~ court. But that alorie is no ·reaso~ for rejecting their ~yidence. It is a questiori of credibility .which is at stake. They must 10 ),e shown· that they are lyir,g. Both have given very detailed account of jt,W they collected the inf.')rmatior, ar,d werit about their assig-nment. Their ,~ports, and in a poirt of fact their evider,ce ir court was not ,~a1le~ged. ow5 ever- pointed out errors apparer-t ir- exhibit p1 which ;nQ Republ±c did rot disputes we agree they were paid and they were . ~-,~tled to be paid.

sut they were rot .lyir,g and we fird both DWS and .,~ e;,edible witnesses ard we accept thei_r evidence~ Mr. Shaidi•s rext point is that the accused has agreed with the va.ijation of THB by sigring the valuatior, form. we have earlier on p0~~ted out that exhibit P1 has three documer,ts which we had already 20 Ff~rred to aboveo After carefully examil'.'ir'g exhibit P1 we found that a,cus·ect sign1;d the form headed "Maperdekezo ya Maombi ya Mkopo wa l'-Jyumba ,,..ts~a Benki ya Nyumba(THB)"• we have also pointed out that this form wa1; -typed, that accused asked for a loar of shso7),0;0/=, ar,d that he 1llowed the cost as shs .. 430,00J/= which cost was deleted ar,d written in piai!'I ball-pen ·(Tlot typed) as shs .. 2,, 119, 000/=. This is the figure appeared 11 the valuation £orm. The accused form referred to above was dated ~•J1.0/1_983 and the valuatior- form was dated 12/3/1984.. we are not told -•aat the accused signed i::he .i.:0rm, he sigr,ed, or 12/3/1984 when the lllll'~tation by the valuer was madeQ on the evider-ce we hold that the 30 Sf•~eed signed his form or, 17/10/1983 ar,d wher, he sigr,ed the form the 1a·,1Jation of his house had "'ot beer. done ard he G1ou1d therefore not have ag1eed with the valuation d,rie by the valuer ir, 1984. That submission 1a~r,ot bJ supported by the evider-ce or- rec0rd a~d we disagreeo I:n exhibit P2 the accused has showr 7 _ir- a

schedule "A" the sum of 11••942,090/= .. The prosecutior- have cisputed shs.25-J,0J0/= from A1e.~«onsult that by the time :)f valuation the accused did not use that 0•ey forwards corstruction nf the house" we have eXamir-ed EXhibit pS. W$ agree with the Republicu. The valuation was car-ducted or 12/3/1984. ,,:.accused received the cheque for the loar Of'.' 26 July, 1984,. He 40 ~U4Q . ·~ hardly have used that amount· ir- March, . 1984. " . . That ir- itself does. viot establish the Republic Is case ar-y step further ir- proving that ~h~_eonstructio)"l value of the house is 2~029,000/= ■ ~t only proved that 1( - at the time of .valuation the accused had not used ~hs. 250,000/=. ~e have demonstrated in our jude;ement that the basis_upon which exbi.'bit Pl was made I especially the valuation computation is wrong./ it- ,noluded an area which should have been excludeq. It based 0011etruction rates current in 1984 ba&ed on the area of the house when the ma.in buil cih.; r;t"'•;.~+:ur1~ hc1d been completed long before 1984. it did. not consider the cost of mate~ial at the time of construction. We have accepted the evidence of the defence that the cost of cons- tJtUOtion wci.s .Shs" 930, 000/=_,, Tht1 c.ccused has explained his source of i.noome and we are satisfied that it is within his re£1ch. 10 But Mr. ~haidi has submitted that the investigation was conducted iu accordance with

section 14 of the Prevention of Corruption Act which · qeals with the market value of the property. According to him it is the ·market value of 'the house and not the· construction value. Section J,4(1) of the P.revention of Corruption JI.ct States:- 11 . . . . .; In pro·ceEidi.ngs fox- -an·: of:fence under this act, the fact that an acGused person. is _iri:,.,,poss.ession, for which he cannot satisfactorily accoun.t' to the court, of pecuniary res,eu.rces or of a property the market v~lue of which is disproporti- onate to his known sources of income, or that he had, at 20 or about the ti.me of the allege·d offence, obtained an acer.et ion to his pecuniary_ resources or property for which he cannot satisfar~ly account 'to the court, may be proved and may be ta.ken. into consideration by the court as corroboratir,g rrny other evidence in such proceedings that . suc_h accused person received or obtained any advantage or corruptly acquired any property·••.• "· . ' Ti'G section ..'.. ls 11•~+h wh1,t evidence the court consider. before tt in Pf QC et.dings under the Act 11 It should not be considered in isolation. T~ere must be proof of the market value. In this case no evidence was 30 ieC. as to the market v~lue. Indeed· according to ,l!;xhibi t Pl the accused h~Q-asked for an additional lo~n to construct the house. The valuation w~e done not to get the m~rket vulue but to secure a

mortgage. It would Qij a different matter, in our view, thut the accused had bought the llij\iee for bhs.2,-029,000/=, '.l.1 ~E:i.t would be taken into consideration as to .• . . h•s means __of income. In our considered view iri determining whether pJOP~;ty reusonably suspected to hav~·been corruptly acquired or other- wi,e unlawfully obtained, in the Cose of a house under construction it it the construction value or not the m~rket value. But where such ffOp~~ty has ~een purchased then the determining factor is the market 40 va'°ue. For the reasons we have given above we are satisfied that it is ,.-,,,t pfoved that the value of the house whether construction or market has not. been established. ,.... - 11 ·- In count two ard three the evidence against the accused has b€en givei, by Jackson Mlay PW9 who produced the stateme~t of chande p. TUlsian ~o worked for casemert i . ..-rica Ltd~ Mlay (J?W9) was the investigating officer in respect of these c,urts. He said that there was an allegation ,.at accused had obtained a discount after paying for grills from casement Af,i•a Ltd~ He i,-,formed the court he met 'i'ulisian who agreed that the e,,~sed had pt1rchased grills a!"d that he gave a discoU+--t t,, accused. He flid He recorded the statemeht of Tulsiah+ read it over to him and Tulsiah fO•tif:i.ed it as correct. He further told the c,:)Urt that Tulsian was an .a,trtate and his

work permi~ expired in 1984. The statement of TUlsian wa1 admitted as EXhibit 16. 10 He told the court under cross-examination that the discount had been i~dt~ated in a receipt as a •special case 1 • He also denied any know- \edge that casement Africa Ltd has ary policy on discount._ He denied \Aai he has any interest ir this caseo He admitted, wher pressed \~e~, that casemert Africa Ltd& grants discount to dealers and he ,~ed that he did rot write this ir TUlsiar statement. He insisted ovJQVeJ: qhat casemert Africa Ltd. does rot ·rormally give any discounts. je'-aaid that he asked Tulsiar why he grarted a discount to the accused a•d \)1at Tulsian told him that the order was on the high side and accused ad as~ed for a discount but he did rot ask Tulsiar what is meant by 20 t the high side"• Whe,.., it was suggested t0 him that uon the high side c,Y'{, 11 .~fef~d to the price PW9 deried this. He also stated that he asked ,._..d,an if casemert Africa Ltd. had ar,y policy· or, discount and that tt.•isia~ had denied the existence of such a policy. He agreed that he did;"ot record this i,,, Tulsia" statemert. He vehemer,tly der,ied that he 1a1 being deliberately urtruthful. He was showr, a document dated in 1979 ~ awd -rJas asked whether he saw it before.· He admitted to have seen it a '/ear before. He prnduL.:ed it. as EXhibi.t P17.. He admitted that ther,e W~f a policy on

discount, that r,or-dealers get discount at the discretion of t~e·manager. He stated that he would not be surprised if casement 30 J\fti•a Ltd. allowed disc0ur-ts to other customers. The accused stated ir his testimory that or, 20/7/1980 he bought to•d1 worth shsQ7,000/= from caseme-t Africa Ltd ard was issued with a Fllipt EXhibit D3 a,,,d that he di-:'. "'Ot get a discourt4 He informed the .,irt ·•that in 1984 he bnught grills whose value was over shso 100, 00Q/.,,. ~O •afd'.that he erquired if he c~uld rot get a discou~t. He said that •~e eaJ.esmal"l informed him that he qualified for a discour,t and that he wo-~d see the manager over. the issue, He stated that the salesman.went ,~ see)}iS manager ard wher- he came back the salesmar told him that the 40 t1a•a9~r had grar,ted 5% discour-t< He said that he paid the money and ... ·~.: l•\et he was told that t~e marager wanted to meet him" He said he \lla1111-t;e'cl an·a met the marager •. -- 12 - .. He d~nied ·that he got the discount as the-Commissioner of Income Tax. He also told the court that he has never dealt with any tax matters concerning Casement 1- i"rica Ltd~ and that .no tax file hds ever been br·o\lght to :i:1im. He said after the purchase he proceeded for one ·1ear study course abroad and th:..,t there was no likelihood of him ever dealing with tax matters o·" Casement Africa Ltd. When cross-examined he admitted

that he received a discount. He said that he has two identities, one personal as .Mwenda and the eeeond official as the Commissioner of Income tax. He said that when Ile conducts his private affairs he does so as Mr. Mwenda. He told lit:· the ~curt further that the sal~sman told him that there was a discount and that it was granted by the manager. He stated that he went to see the manager after paying the money. As regards taxation the accused-stated that many tax payers go to him and that he cannot anticipate them as it ~epends: on the cormplexity of each oase. He said a m:mbex- of -fa·-ctors must be considered before any file goes to him. He denieJ that the~e 0as any pending tax issue before ·•lim which c9ncerns Casement Afrisa Lfd~ He said he went to Casement Afriea Ltd. in his privhte and perro~al cqpacity and that he got the <il,GOQUnt in his pri vat~ C&.:?ac i t;r > Juma _.B.a··d.si Ali M.s&.-sa (Dw,,,2) :s :..i-ie salesman employed by Ca.,ement .H.frica Ltd. He said ·dwt he lrYiO'·JS the accused and that the e,.o~~ed · went to buy grills from Ci:.lsement .H.fri.ca Ltd. He said that o~ 4tk July, 1984 the accused o:: 'iered grill·:; worth Shs .107,525/= and ?2 1 050/= und that accused was ::,,,e,iieo discount in both c~. . ses. -ie 0 .J.entified 1:.;xhibit P.6. He said > Oil both occasions the acc:.1sed w£,.s given a 5% discount. He said that ~Of\Uied made enquiries if he

coulc\ not ge~·a discount for the amount p~d, DW2 told the court that he .informed the accused that he would l.ive to consult the manager first and he went and manager agreed. 30 He eaid that the manl:iger is Tulsian who authori,;.ed the discount by Yf:i.ting special case. He said th.:.,t Casement Africa Ltd~ had a policy of discount and that if the accused was a dealer he would be entitled to iO 10% discount. He said the accused was a non-dealer and that only tbe manager can grant it. He sai( Tulsian asked him who the customer WN.and he told him that he was the Commissioner of Income Tax. He sa~d- the accused puid the money and then he told the accused that the me.pager wanted to meet him. He recognised exhibits D3 and Exhibit D9 aJ tpe receipts Casement Africa J,-~c:~ issued to accused and that he ~¥g written then and further stb.ted thbt in those two exhibits the at1\,}Sed did not get a. discount as he cli .] not qualify as the amount 13_ - was small. Under cross-examination ~W-2 stated the accused had paid by 'bla1'k cheque and that the particulars in the cheque were writte.n by him (DW.2). He said that Casement Africa Ltdo has a policy of a~scount and that for non-dealer customers the discounts is granted by th2 manae,l::. Es . ~\mitted that he had made a statement -to the anti-corruption squad" He denied to have said that he took the accused to the manae;er before he paid

the· money.. He maintained that he introduced the.accused to Tulsian after the e.ccused had paid the money~ }\,rther he t~ld the court that there is · 11 ~o fixed rates of diocount for non-dealer cu~tomers and that the man~ger _decides according to h~.s wishes. He said that if 'r~lsian had stated in his statement that Casement Africa Ltd. has no policy on ' dtscpunt he was wrong and that ~ulsian 1 s statement does not agr~e with the company's policy. He denied that the discount was given to accused as a special case. We have already Atated tte undisputed facts regarding these ·two counts, that accused purc1a3ed building materials from Casement ~frica Ltd. 1 that Casement A:'ric_o. Ltd.n granted the accused a c;Ugeount and that accused haci 0Jtain.ed a discounL I_t ilae:\ been tQiitended h:r the l<epublic, a cr;r,tt.ntion to which we address our- ,e~ves, that Casement Africli Ltd. h&s no policy on discount. Our ,irst pr~occupation is wheth~r that j_s tr~9. PW.9 had maintained ~hz-oughout his evictence and Le was very adamant in his testimony .. -. ..uolic"J on disc aunt. We think t~ij.t PW. 9 has deliberately 1 ed on this. vi hen cross-examined he iamitted tb have seen ~xhih.it P. 17 a year before he gav~ ~,Q.ence and that +.he exhibit was lying in his office two weeks -eCore he gave evidenre. ~espite his knowledge that Casement Aftit;~ Ltd. has policy on discount he persistedly

denied this fact *i the court. Again PW.9 was the investigating officer and recorded t~e statement of Tulsian. Xat he purported to have asked Tulisian a~d not Tulsian told him that c~sement Africa Ltd. has no policy •• . i Of ~count. 'l'his was not reflected in 'I'ulsian atatement. He .54~d that 'l'ulsian was not a dishonest person. If PW. 9 is .correct i~.t .,he asked 'l'ulsian and he denied that -6~~ement Africa Ltd. has I policy on_.ci:£.6:e,t,ult . .. , · then '.l'ulsian must be a very dishonest. person ~~use .c,xhibi t :P. 1-7. clearly show such policy ff ·But we find no ~on why '.l.'ulsian '~houlu lie" Pw.9 had admitted that he did not V~fe down the ctenial by 1'ulsian. we _t~ink _this was a deliberate ·~ ' ' . omission on the part o:f F'.j9. ·r o are f·crtificd in this belief by the conduct of' ?~l9 ~11.:.0 despite the k..."J.owledge that Casement hfrica Ltd. hao a ?Olicy on discount he persistedly denied uro.til ho ·:ms brouc,:i:-... t do1-m to admission on being shovm Ex~1.ibit r:17. Lr:,c1 "1hat disturbs us most in these two counts is the cor.. duct of' Republic. They lr..new the eJd.stence of' Exhibit Pl7. We expected tho.t u.i.-ider the proce- dures of prelir.1inary hearing J:xhibit Pl7 should have been produced. Ue uould not be deali~1.g with the issue whether Casement Africa Ltd~ has a policy on discount but the legal 10 issue of' whether there was adequate

consideration. For this l,"'eason the statement of' Tu.lsian recorded by ?W9 r.mst be eonsidered with the greatest caution as i t appears to us that :i.. t ·was recorded by a person who appeared, in our opinion, to be ~terested in the case. It was tllarefore not surprising to us that the statement of Tulsian Gid not oention and dis- ooi..mt, Exhibit Pl7 was produced by ::?U9 during cross-examination. The accused made no secret about thio issue. u~12 was forthcoming and straight forward. 1fo acco:_::,t tho evidence of accused and m·r2 Their testimony is supr;-ortod by Exhibit Pl 7. He accorcl- 1 t~gly hold that Casement Africa ~td, hns a policy on discount. 20 Hr. Shaidi has placed a gr0at deal of emphasis on the WO::'dS lapeoial case" to show that Casm:1ent .Africa Ltd. does not grant disoounts. i·4r_. Lakha has subr.1itted that spGcial discount applies to non.. de.alers . ~ Unfortun:::-. taly ~:~-r9 did not. c:::iquire as to the . ' reaaons why t?,e receipt::, wore 1-rri tten II special case". Ue hcve e~amined Exhibit f17. · According to Exhibit ?17 the policy of discount is applicable to dealers who 1 upon f'ulfilling the condi- tions therein stipulated, are o::.;.-ci. tled as o:f right to get discount, But for non-dealer cu.ctomers pc:ragraph 5 of' Exhibit ,. P11 clearly states that "All the above aro applicable only for JO dealers, lfo· :non-dealer cuotor:ior ic allm·red

any discount with.out be;IJlg authorised by the rn2.i1.2..ger. T~1.e acct.:sed is a non-dealer customer. He is Y1ot entitled, r1c of.' right, to any discount. He must get i t by tee autn.ority of.' the r:ic:u::.r_,(ser, The discount whi.ch a non-dealer gets ~-s 9 ::..::.-.. o-:.:::i.~ cor~:::;ic~cr0d view, a special case, It do.es not □ ec..n anything ;-;-;o:;.~o tb.ar;__ t:'..-1at. Another point for docisior:. is uhcthor tl::i.ere was inadequate consideration. ::O::t ha.s been ::rt.:.br:1i·:;-cocl by the Republic purchase of goods is not considernt~o~ let alcnci c good consideration. Mrt Sha;l..di forcebly argued t:::.c:. -t n ::_,ui)lic officer commits an 40 offenoe if he purchased gooC:c ancl :.::·eccives n discount i f the giver of' discount is a per.son likoly to oo concerned in a matter before him as a public officer. 15 -· The court was referred to B• V. ~Tillia1:1 Hainir~g (1970) E.L. 620 and DPP, v. Jafari i{. Ea,,rawa .( c.::_) Cric'lina!_ App .Ifo, 21 /1980 ~ Er. Lakha contends tha·t that is not the law~ First we exa~ineCthe facts i~ the two cases referred to us by learned counsel :for th0 ;.~c:;_:,u0lic to s0e if th0y fit with the facts in tho present caGo., In i-Iail-~ing case (supra) the acoused was the Regional Engineer 1-·:iwanza; I-Ie received a Mercedes Benz from one f:.hned, a contractor who held a number of copt,:-acts with the governme_nt. I-Ie did not pay

anything for the motor vehicle which he rec0i v_~d. In the case of. Kawawa. 1O (;3uJ?.,raJ., he was the It~1r.tlgra tio;:1 O:ff'icer - in - charge of i'-~w;::nza Region, He received an interest free loan of shs.2O,OO0/- from .Al;,daU.ah Mbarak Baleth and pror.:iised to rcpo.y the loan. Th,e accu- sed had recommended the extecsion of Baleth~s stay in the country and also processed passports in respep~of the child~en of Baleth. In the present case the accused had purchaGed building materials from Casement Africa Ltd. Unlike Haining and Kawawa the accused has paid f'or the goods. Lgain in Haining c.nd Ka:ua,·ra there was evid.~nce that they had direct contacts with the ·accused. In the .--✓~ present case no such evidence 1--ras adclucec;:1. Clearly the facts in 20 · J the present case are dinstin::r..1ishablc from the coses of I-foining and K:-. \,10.wa. t·-Te no;w come to the rec.l icsue of whether a discount obtia.ihed upon purohas.e of goods by a public of'ficer is nn c.dvantage without adequate consider-:, tior:. 'i'he terms 11 considera tion 11 and "adequate consideration 11 huve boon considered and approved in thiJ cases of D P.P • v Ja.fc.ri l-:I.Kc.1·1~rwa and ~. William Hainin su ra • ·• In Km-mwa-·• s · o~s·e. the court o? L.pp0nl stat0d 11 The consic101.~2. tion in a con tro ct, convoya.r:ce or other legnl transaction is rm act or promise by JO vrhich some right,

intereot, profit, or benefit a accrues to one pnrty, or by ·which some forebe- arance, detrincnt, loss or resp~nsibility is given, suffered oi~ undertaken by the other, in r~_turn for which the party ,rho rccoi ved. the benefit or for whom the detriLlent ic cu?fered, promises or conveys something to tho otl-~er (Currie v,Hisc.1875) L.R.1O Exhibit 162)., 'i\;."J.S ir~ et contro.ct of sale, the money paid or ~creed ~o bo ?Bi~ by the purchaser is th~ coiisidorntion to tho vendor, and the property 40· sold ic thG consideration to the purchaser •••••• " (emphasis suppliod). 1 .... '- 16 lJl Haj.ning v Republ;Lc (supra) tho Court of Appeal for EnGt A;fr;i.ca, stated as regards "uclcquate consideration" as folloi:-vS". "It seems to us rending section 6 as a whole, that: when i t refers to accepting any valuable thing for a la.w:ful conside~ation which rGceipient knows to be inadequate, 11 i~odequate 11 must r.1ean l0ss than the value .of' the./hing accepted, and valu0 ,;-rill ordina-- rily mean t~1.e ;erice., wLich a willing purchaser would pay to a willing vendoro "adequate 11 considerntion uill not be merely the In the coD~ of a loan, the II 10 promise to repay but also the promi::,e to pay at least the lowest rate of' interest which the borrower could have borrowed elsewhere.·•••••• II ( a.gain emphasis is supplied). It is therefore clear Zro □ tho t~o cases above that aoney

paid is the consideration Hl1.ich Cc1ser.1ent J.,frica Ltd. granted the discount• Mr. 3haidi st!bL,itted wha.t the acct.1.sed did is exactly what the lQ.W has forbidden anC:~ t:tw t. ;.re should apply the law as it is• We think thcd; the law i::i not Q bli!c.d leader. If' we have to :follow the law th0n i t must lend us properly. Eow dc:.ngerous 20 to accede to l'llr. Ghaidi 1 s subr.1ission can be c1er:ionstra ted by the ;folJ_ow1ng·,, advertisement uhich has be'en appearinG in the Daily/ Sunday News in recent days. It is given by the I.Jc.tional Steal Corporation. "de r.mke _1-:c.o apolo::;ry for quoting i t from the Sw-iday News of J,st May, 1987. It re2Csg- 11 • • • • • • • ·,:-re ar? pleased to inform our esteemed customers -.( especially i-C2IDA .;1embers) and the general. _pv/:J.lic o.t large that the recently delivered steel consignoent from Denmark.is now offered :for snle at 10~~ discount. The JO price for oDe tonuc -::·rill now be shs.L:.5,000/= instead of' C.:l:is,50,000/= ••••••• 11 Can anyone argue ~-ri th nll o,:;riousness and sincerety that a pubJ.j.o officer' would cor:imi t 21.;:1. offence t.~dcr section 6 of the Prevention o:f Corruption A.ct i:,: he buys t~~e consignment at a discount of 10~~1 If' the anower is yes the law is ctn a.soistant the public of:fice-r who uculd i:1.oist at buying at Gho.!:)0 1 000/- is .. a hypoQ,:-ite. \Te think that ri 0;l'1t to

discount is a social righ.:t granted to ~11 □ enbers of the public to which the public o:f:ficers are a part. Tfi th unfettered roservo. tions hold th2.t u discount ·,,10 obta~ed upon purchase of gooc!s by a public officer amount::; to · 40 good copside~ation. Another point which wao rt.ised oy 1·1r~ Lakha in submission concerns the issue :from uhor;,. c::.ot:.ld -the co:nsidera tion come from. Mr 1 Lakha submitted that Casement Africa Ltd. had three reasons -t 17 for granting the considerc, tion. ~-!G eta ted tl:.a. t Casement Africa Ltd. by selling large q~anti ti Gs ~;.ao been able to save costs, that it has i~cre2c0d its t~rnover and gained bette~ profits and that by recoiving l~reG owns Cosement Af~ica Ltd. is capnble o~ □nnneing its capital properly. Mr 1 Shaidi has contended that the considerntion muot moye :from the public of'fic0r to the giver of the discount and not the reverse. We have considered the wording of 30ction 6 of the Act. ·- We are in no doubt that Hr. Sh2.idi is correct. It might be 10 true. that the giver benefits by giving an advantage to a pubi~o officer. But as .long as the public officer, the reci- p:lep.t of· the aqvantage, has no consideration in receiving the ad,.-a~tage· the mischief ia done and the public officer is guilty of' an offence 'under Section 6 of' the Act. In ~his case we have , I shown that• the consic'!ero.tion has □ oved fror:.1

accused to Casement Af'X'ic:.a Ltd. Again.Mr. Lakha has submitted that tbere is DO evidence, that accused was concerned as a public officer ·when he bought the materials frora Cas01-:-1ent Af':.~ica Ltd. and that ti-:ere was no 20 ev~denoe that accused had been or is or will likely be conc3rned in a matter of taxation with CaGeoent Africa Ltd. Mr. Shaidi argued that Casenent L:frica Ltd. is a compnny liable to pay tax; that since a'ccuaed had obtained_a discount i t w2.s likely that Casement Africa Ltd. ~ould gc to accused if' dissatisfied with the assessr:1ent done by the accuced juniors. We have con.23idered the s-,_-:__br_1iscions in the light .of' the eviden<:.e given by ?''.TS, and the statement of Tulsian (Exhibit P16). It is not enough to state that C2.sement Africa Ltd. pays tax. It must be shown thc:-,t t~,.ere -;,-ms sor.w r:mttGr pending before the JO accused involving Casenent Africa Ltd. IToither the stater:1ent of Tul.s1an (E:d1ibi t Pl6) nor the evidence bf' T?:-!9 a.s alleged· thiG. The accused has stated that the likelihood of taxation of Case- ment A:fx-ica Ltd. going to him is 0.000025%. This was not challenged, ~fo think that t~'1ere is no evidence b3fore this court that the accused had been or was likely to be co~-::ccrned in taxation matters uith Casement Africa Ltd. The sub□isGion that Casement Africa Ltd. pays tax and would g~ to accuced if

dissa- tisft~d is a best a speculation. Ten witnesses have tentified for the prosecution in court 40 Donati Kezilahabi (?~ll) n nenior tru: asces::.;or inforr:1Gc'. tho court that in March, 1981 ho uas in charge of Corporate tax department th.at he kno;-rn a company call Ed Tar.:.ga Consortim ( in this Part of' the ju~ge□ ent it could be r0ferred to as Tnncon). 18 He stated that ;i.n July, 1901 1-~o rej ccted the unaudited accou.."1.ts of Tancon but in LL.1 gt.,Gt, 1901 Tancon subr.ii tted audited accounts for the yc;:,rG 1$77 to 1901 for its proje- 1-us s.n Tanga, Mbeya a:ud Tanzania I-:nrbours h.u thori ty •.. _ He said he made prel.iminary submission to accused Exhibit :l?lJ and that accused directed him what to do in order to get more inoome. This is contained in Exhibit 14 •.. He told the cou,:'Q that in September 1981 he made a provisional assessoent of' a ohargeable income of' shs.103,,.528,48.5/= and submitted i t to the aooused E,~hibit Pl5. He said that later he was called 10 to the anti-corruption squad --;rhere the Deputy I1inister of' Finanoe asked him if he had deal-uith Tancon taxation and he agre~d• He said that he gave the Deputy Minister the informa- tion he needed. He said thcit he denied before the Minister that the assGssment ua:::; c1eterrnined. He said that he uas d;lreeted to put dovm the information in writing. He agreed under eross-examir4ation tj:rnt

the asses::iment was s t ~ open and that there were divergent legal opinion on the ;i..asu~,. He also ad.mi tted that there were r.10re than five computa- tioµs each dif'f'ering f'rom the other •. He ctated further that by 20 the time he left the matter ho did not kn.01,1 if there was any agreement,, He said that he aloo foruarded r·:a1agoda' s corapu·tation wh~ch Has also subject to clarification. :c·~-r, was nsked and he gave hi,s opinion of each area ·,Tl::ich ,-ms in contention. The second pl:"osecution :-Ji·~:;:1e::ic ic 8t0phen Eassawe (2·:-r2) •. He i~ the Regional Principal accessor fer il'Galaam Region. He in.formed the court that in 1981 ~-ie was a senior finance J.Vianagement of~ioe~ and that he has been a~ ascessor cincc 1969. He told the eour~ that in 1981 Kezilahabi ~repared an assessment in respect of Tancgn showing a chargeable i:-1cor:1e of shs .108, 528, 48 5/-.. He said that he agreed wi.th the assossr,10nt anc1 recor.mendGd that tax of JO sh.s 1 59 1000,900/- be paid by Tancon and that if Tan~on were dissa- tist~ed with the asse~ment i t should appe~l •. He stated that the accused was dissa ti::;f'iec1 with his roco.:1r.1endo tion and th.at accu.sed told h:i.m that there woulcl be a neeting uith Tancon representa- tiv~s on 16/12/1981 •. I-Ie ;:;aid or~ tbat day one Er Ott a::id Mr Piet met him in his office ar..d he told t::.er:'.! about the departr.ient'

s stand on the income of' shc,.J.08,000,000/- •. , I·Ie said that Mr Ott obje<.ted a.,-.,.d wanted to meGt ti.,.e acc-:..,socl.. :-:;:e said that on same ,day he met the accused u~:.o disa.greec:i. ·:ri tl:. him on wear and tear, 40 baJ.an~ charges, tender costs, ?:;'.'oli1:1inary expenses, labour costs••· interest,, and expatriate allmrances. He said thll he was ta}d.ng minutes of the meetings in the norning of 16/12~81 but aceused himse1.f took the r.1inutes in the c.:.:ternoon.,. / ·' I .J. 19 - rte further testified teat on 17/12/1981 t~e accused took the :file away :from hir.:1 and l:.o did not c:eal ~ri th i t again, He said later the accused reques~ecl hi □ to write dovm the notes I· I 'of interviews of 16/12/1981 2.1:.C: tha-:; he did n.ot write them be<.ause the accused had iil.l.ready written to Tancon that they .-had a· loss ox shs.J,000,000/-:. E0 identified Exhibit P8. He stated further that ~xi1.ibit :=8 l:.:td dealt with the 1;1atter in d:1.spute and needed clc.ri:fication. He said he disalloHed depreciation, ·wear ar1c:. tear, :i.n-.;;erest to Ambro bank, tender costs, preliminary expenses, au.c?.i t fees to co·opers and Lybrand; 10 and .freight and insurance. The ?".-J2 wont on to toll the court that M:r:-• ntagazwa, the Finance :0eputy Minister called a r:1oeting J '' which was attended by hir.iself', _i:':.i:.:ija, Kezilahabi, and the accused. I . !,.. Ee

said that after tl:.e. r.1eeting the Deputy I·1li_nister directed th.at the accounts of Tancon should be reviewed. 5e told the court that they then issued ag0ncy notices to ~he NBC, City ilrive Bran•n• and Saruji Corporation in r✓i:ay, 1983, He said at that t;i.me i:he assessoent had not been made. He oaid that in Exhibit P8 the accused had sho1-m a loss of' Ghs,.3,000,000/=. 1lhen cross..-examined ?112 a.c~r.1i tted th.at exhibit Pl5 was not 20 an assessment but only a provisional c·omputntion, On ViH2 computation he agreed uith it in principle, He said that 2xh.ibit PJ..5 had eleven io sues to be resolved·• He agreed that accl.:.sed had replJ.ed to exhibit 215 and he agreed further that accuGed reques- ted 11:1,m to review the cor.iputation. _He said that he did not do :i.t and he passed i t over to ?~'!l. ,·rho made the cor.1putation. He further· agreed tha ·i; t:t.e revim·r ~,ms riot done up to the time of the :i_nterview ·with To.neon officials. He also admitted th.at in tax matters two experts ,,rill not agree in tax computation. He den:i,.ed that acct.:sed i!1s·c::'u.cted hir.i to conduct interview ~-Ti th . 30 Ta.noon officials. I-7.e ncbi tted tI:-1[', t after interview he ~-ms in:.:;t.,. I ructed to make the notes of ii--;.tervie1-1, Ee said he refused as a matter of principle, that he has made Q decision on i t but den;Led that he wns bie.sed 2..ga.inc t Ta.neon. He

also admitted that there were two acceooments c:f chs;72,B79,228 in reapect He admitted I that accused was not i::.1.volved in the 1982 assessment as he was . abroad for the whole yeE!r. L-sai:;. :lG ·denied that Tancon had lodged an objection ar:c ·Jent on -to deny further that he saw a letter f'ror:i. Tancon dated 19/10/198.5 on -cl-;.e issued. Ee also /40 stated that he car.met rer.1e □ber i:f he rocomended a non-agreed: assessment on 21 /8/1985 1 nor ·,1c-;_:;_ld be :cmnec1ber that PU12 had' fixed a meeting with Tancon representatives. PUJ is Dona-ti :Sdward Einja tt.e_a.soistant commisaioner in charge of corpor;::te ·l;c..J.:c,tion, Eo told the court that he l~ad dealt with Tancon tc:?rntion, ·:;hat the accused had directed him to 20 to review the accounta to Getcr~ine if they should pay tax or not, ,He said thnt from the rot:ords he found that t!1.e accounts were dealt ,-rith by ICezilahr-.bi+. I~nlncoda~ I-Tasso.we nnd the acct.~sed himcelf, He snicl th.at ::ezilahabi I c ccL1:._:~tn tion shm·red. a ch.2.rce- able :i.ncome o-£ shs.1on,524,Li-85/= attracting- tax of shs.59,000,000/=. He stated that he did r..ot find -;;~:e computction prepared by the aooused, He went 011. to tell the court that in March, 1983 Mr. Ntagazwe. 1 the Finance :iJeputy lliini.ster convened a meeting Hhich was attended by the accused, J.V::assawe, lfolagoda, and himself-. He said that the

Minister directed that the accounts of Tancon be received 10 and that he was appointed to compute t:i.--~e account"s • He said that ho did so and found a chargeabie incone of shs,159,542t3~8/= and that Tancon was liable to tnx i::1 the sun1 of' shs.87 1 74Ct318/=• He said that To.neon h~d shown a loss of shs.10,000,000/= and oecause of the controversy surrounding the issue he decided to start a f,;-esht He said thut he considered all the points in issue and then h~ took the following decioioflce. He added up depreciation, wear and tear interest, He disallo1-red ':freight nnd insurance, prelir.1i- nary expenses, tender costs, sale of pnrt and r.mchinery, temporary but1d:1.:n.gs, :fees paid to Coopers 1::nd Lybrand •. He said that his 20 oomputation was subject to objection, He told the court that the ma;i.n difference between his computation and that of ICezilahabi/ Malagoda was on the profits of sheds sold, depreciation and audit fees• He said that he has added them back while Kezilahabi/ ~a~agoda did not do so. He said in ICezilahabi/Malaeoda 1 s computa- tion -there was an unexplained figure of shs.11,000,000/=. He said that after the cor.:putation :-:i.e issued inotruction to ICezilahabi to issue an assessr:iont. :-:0 s~::id th.at later he saw a copy of' the assessment issued to Ta.neon. :-Ie stated that thereafter he did not dea'- witb Tancon taxation again. JO l Minja

(PW3) denied 0:..1. cross-exaoinatior- that he was involved ;iJ:1. Tanoon taxation be.fore June, 1983. He said that he uas involved after the meeting with the Finance Deputy Minister in March, 1983. 'When pressed hard 11.iinja ac1. .--nittod tl::at he was involved since 1981 when he made the cor:ipu -tn ·;;iono =!::? also acli:1i tted the t he approved Kezilahe.bi 1 s computci.-tion but der..ied a sucgestion that he was involved in a plot of conspirancy to oust the accuse4, He admitted that he did not tell the accused that he had ?repared a brief on Tanoon taxation to the :)o~Juty lf;inistor, saying that he uas not bou.µ.d to do that. Ee also agroo<J. that he ac~epted Kezilahabi's 40 computation and inGtructod ti-:o.t T:::-..ncon should be issued with an assessment• He :further nc:ir,1ittcc', that in 1983 ho disagreed with l{ezl.l,ahabi I s oomputa tions a:"d r.10.d0 hio ovm,. Ho stated th.at he disallowed interest because it wao paid to third party. He said that he would not allow tho interest even if there was a letter show;.ng that it was used by Tecncono Ee also rever:.led that accused had ordered for further partict.:.lars 'iJut he did not know how who comp:J.ied with his directives. I::c -:;old the court ti1.at on 17/12/81 the accused·. made a coraputa-tio1')_ :--;x~-:ibi t :P8 ond. informed the court that he did not think that the nccuced was negligent in making 50 thG

~omputation.; He agreed t~~at on 21/8/198_r,: there was meeting and 'bhat Rwechungura :flecorcled tl~c Vii:autos of' that meeting. When cross examined on the varioun poi::~ts in contention PUJ • • .. 21 - tol-d the f'Ourt the issues ure arguable~ . he admitted that Tancon was entitled to wes-r: a~d tear, on mcJ.chinery not sold. :-le admitted that he d~d ~ot allow that. he said freight and insurance is subject to Jefititation, He said th~t there was a tasting error: He admitted \~~t ~reliminary expenses should be alldwed and th~t he disallowed then b~cause ihey were part of mobilizbtion, he admitted that all the 10111;n.itations were subject to chaz·.ge. He vehemently denied that on 21/8/85 he approved ah as. essment of ohs. 122,000 ,ooo/=, that he denied further tha·t he took an active and leading role in the comll'jittee of five on '-l'd/'or;, and also denied th~t he changed the computation according to 10 ~6 OWll whims. Un the committee of ten he admitte<l that it was an ~~eFenuan~ committee heuued by an IMF expert tax advisor and that they \ t: tO~<l a loss. I ♦,, Un re-examination Pw3 state~ that in all the cpmputations there was a t~.able income. Be told the court that to issue a tax assessment is ~Qt a harrasment to the tax payer. f ...,. ,A. ;. rleuben Mwami (PW4) ~1oyce ~hewere (~W5) begerine Marwa (PW6), ,.., Mohamed· 1-'ifaume (VW.7) und Leonard nwechune:,ura (PW.12)

are principal tax ~sessors. Pw.4 told the court that h8 is attached to the audit and ~vei;-t~gation anct that in 1977 he was posted at 'l'anga as a Senior tax 20 qijSijijSOr. He told the court that in 1978 Tancon had written to him fij~jesting for an extension of time within which to submit their accounts a fiqiest which he granted. He said that in 1979 Tancon submitted a PlOV~ional ace ount showing a loss. he said that thereafter he did not de~~ with the file bec2use the management committee of the department ,det~Ged that taxation of multinational companies should be dealt with at the headq~arters. He again told the court that while in Tanga the aeifed appointed him by letter (~xh.PW12) to be a member of a ten-man ~ !ij~m~ttee to review the computation of Tancon. He s&id thet there were thiee computations one showing a profit and two showed losses. He said he ,ould not remember who made the computations. lie told the court that3° the ~haiTman of the committee of ten was fony Devine and the coordinator w~s the late Kulaya. He stclted that they went through item by item and -U1e.i. decided if it is chargeable to tax. He said 'l'ony lJevine was reading ·tbe ~tem from the file. AS regarcts decision Pw4 told the court that they iwa~~e~ general consensus and where they differed the committee instructed i·, thij ehairman and the coordinator to verify with 'l'ancon. Hegarding

the v~,~Q~~ items Pw4 told the cour~ that the committee agreed to allow 1 w;ai and tear, that the committee instruct~d that more information be eoug~t on interest, thut the com~ittee disallowed tender costs in respect o~ ,~~yan contracts, that they allowed tender costs in respect of 40 ~~ 'l'a"ia;i,1,an contracts; that they added up depreciation, freight and ~iFance costs were· allowed., they sought more details on preliminary ~~penees, audit fee to'ec0.pers and Lybrand were allowed. At the end PW.4 st.a\ed that th.e eommitte.e ot ten found a loss of bhs. 4,000,000. Ii - 22 - He gaid he did not sign the fin~l report as he was away but could not ~h~ from the conclusions finally_ reached by the committee. He said th~t this figure of ~hs.4,QOQ,OOQ/= could change when certain documents are obtained. fie said in cross-examina~ion that it was possible to allow Tancon to file block accounts, He agreed th~t there wus general agreement in the oommittee of ten on all issues discussed. He said that he agreed wa.tll the final coniputatiohs. The evidence of PW5 is not basically uifferent from Pw.4. He ij~ated that he did not get the files of Tancon but that the committee 10 op,._ d.~liberated on the principles involved. he said th<:1t eat·h Qiember WrJ.§ •Jee to make his own opinion •. He said that as he did not see the -r;" e he signed the final report as "neutral" and he cannot say

if \he.e w~s profit or loss. -, Ue admitted uuring_cross-examinution that ~ancon was entitled to w~•i a~d tear, interest pai~ to Ambro bank, preliminary expenses, °'@iQ.EI:' costs· for •rc.1.nzanian project, auclit foes paid to Coopers and liJQ,l.lnU. and profit on sale ,of temporary buildings. ~egerine Marwa (~W6), like Aloyce Shewcre (PW.5), told the court th~'t he did not see the '11ancon file and accounts. He said that the 20 ; ·, cna~mari. was explai·ning to them the details from the file. He said that thej discussed item by item and concentrated on the principles of law. H~ ~a~d that they agreed on certain items but .liffered on others. He sa~d that he could not agree or disagree with the conclusion reached by the committee as he diu not see the accounts. When cross-examined PW.6 agreed that the approach taken by the eomm~tt~e wo.s correct and that he [;llso ugreed with the principles foi,li~ed. he said wh.:.. t wus in dispute was the figures. He admitted that, the chairman furnished the information and figurt:,s from the file. lie to•d the court that he has no reason to suopect that the ch~irman 30 W~ij g~ving false information. When ,.· re-examined . he stated that in principle he agreed with appe~Q~ A in exhibit ~12 and th~t hie only concern was that he did not see ~he account in Tancon files. Mohamed Kilimo (P~7) told the court that he attended three t~'1'.Ull~ttee

meetings on 9th, 10th and 11th August, 1983 but he could ·no~ Jttend other meetings as he was assigned oth~r duties upcountry. He ;ai~ that there were three computations in all and they examined all of them then decided to deal with appendix A. He said that the taxable iiiome was shown to be shs.87,74~,31~/=. He saicl that he did not go 40 tbfijU~h the file or the accounts.of Tancon but the chairman was reading 1A@ partwulars from the file and appendix A, lie said that he recognised e~g~t Pl2 and it containe.d r9s$rvations which the chairman ,;.,._-~~.. ~. 23 ·:.:.:.." a~, the coordinater were directed td'~erify with Ta~~on. that he_ agreed with the cor-cl~sio'"'S tb:a't Ta"'c~i-~tnade a lasso He said r I He told the court whe1" cross-exami,..ed that the meeti,.,gs were fat~ly~ co1"dueted a,..d that he had ro reaso"' to suspect that the·chairmar gave false i.-f0rmatiori~ He tol_d the court that he agreed i,.. p.r:i-ciple with the co~te,..ts ,f exhibitp12. r.,eor,.ard Rwechu.l"lgura (PW12) has t·,ld the c··urt he was inv ,lved in Tan•o• affairs in .:t'-our sta~es. He sa.id first the accused directed him te deal with the qhestion of wear and tear in the accourts of Tar~on to see if they were a~lQwable to Ta,..~on. He said that he found· a slight~1• errea ard he ccrtected ite seco-dly he told that he was i,..volved again in Tareor matters when he was appoi-ted 1,-, the.committee

of te,-,. . His eviderce in this res~ect is i,-, all fours with that of PW4, PWS, PW6 a~d PW7 as regards the ma .. rer the c0mmittee co,.,ducted its busi,..ess, how the deeisi6ns were reached ard the fi-al c~-clusions. Thirdly he stated tha• he was assi~- ed to deal with audit queries raised by the au~it r (PW11). He said that he.was assig .. ed to verify excess charge$; expa~.r-iate salaries, travel expe--ses a-d medical expe,. ses 1 labOUJ •r.sts; i1~come from Ta,;.za,.,ia Harb-:mrs Authority; freight ard i~suraree; a-d preliminary experses. His last ergagemert was ir the A6 committee of f-ive and this was ir August 1985. He said that the comm.tt~e r:if five. corisisted of :the acti·~g Commissiorer of Ircome Tax Mr Mallyd., Mr Mir,ja, Mr Massawe, Mr 111du,.,guru a..,d himself. He said that· he was merely a recorder. He said that or 16/5/1985 they decided that the audit query should be settled by a "'0"'-agreed assessme-to He told the court that he issued the r0r-agreed assessmert or 21/8/1985(EXhibit p23~. He said that he was ordered to telex Ta-co,., a-d he did so through exhibii P24. He said that the assessment was shs.132,5O7,688/= ar• that he iert anotherietter a~d telex to Tarcor EXhibit P25 to show how 'this wae arrived at. He' testified that he wrote to ore Rhemtulla a 30 . repreiertative, of_ Tancon to comment ,,r th~ -o"-agreed assessme"'t (EXhib~· P2f). He said

'.IRhemtulla replied (exhibit p3t) showirg a profit ·of s~s,1 1 514,117/:o He said this differed from the origiral accou~ts whi•h Ta'"enr has submitted as sh,1w- 1..- exhibit p19o Whe,.. asked by the . . .prose9uti0r .about the activities ir the c~mm&ttee of ten Rwechurgura stated .hat the committee ofter had followed tha accou,.,ts subrnittee by Tancon, and that the c~mmtttee of te,.. had made the correet c··mputationo He said that i,., their accourts Tarcon had sh'.)WT' the breakdOW'"o He said further 1..- 1982 Tarc0- had ear-ed ·shso4O,6O3,7O6/= : .arid was +iable to tax iri the sum nf shso24,565,240/=~ He produced the 4G assesem8""t f,r 1982 as exhibit p31. . ir er:·•ss-examination PW12 stressed that the c0mmittee of ten had made \he.~orreet.computaticr a..-d that while i..- the committee of five 24 ll@ was orde;red1 against his advise, by hallyi to issue an assessment of e~ • 1)2; 507; 608/=. He sid. a. tho.t he registered his objection but he was overruled by Mallyi and Minja. He further told the court that he Wi.t.~ in the process of obtaining furth(-;r information from Tancon whe~ Mally ordered him to cancelfue ~ppointment with Hhemtulla. li~ a.g:eed that the procedure for issuing a non-a breed a, sessment wa~ not fol~owed.. He also informed the court thb.t prior to that M~ss~we advised that more inform~tion should be obtained as all the ~ssue~ 4ad not been exhausted.

He said th&t there was no communication between the department and Tancon betw~en 14th August, 19~5 and 21st, 10 A~gu~t, 198~ when the non-agreed assessment was issued. He admitted t~a~ Mttss;;,.we was acting U!:!,t...inst his own r8commendation contained in ~Ai,b~t J;1, lie suid thG.t the cowi1ittee of five took the report of ~W.11 a~ a revised computaticn. 11.s to the vctrious areas ·in dispute ~W.12 d~~ not waver from the stand taken by the committee of ten. Aj regards 1982 ur:;se.'.:.,::;ment .l:-'W'.12 stated that iV1assawe told him that ♦ a.J.•CJI had lodged an objection with t.he iVlinister·o He said that Mallyi a.~d ti~nja have played D. leuding role in the cornrnittee of fiveo He said tna; the accused should not be held responsible for the 1981/82 asees~tnep.t. 20 ♦~ re-examination ~W.12 stated that the committee of ten have au nor~~ed. the chairman and the coordinl-tor to verify the information 1 w~~~ Xancon. As regards the Tancon accounts PW.12 informed the Court jhat the accounts were computerised and that they were correct~ tne testimony of Mohamed Abood (PW.8) the Controller and Auditor U~p.er~l w~s brief. He st&ted in effect that in December, 1983 the V~P~tI !Vlinister of Fincance 1 Mr. 1'1tagazwa in&truc ted him to sent his expert to verify the accounts of 'l 6lncon. 1 He said wheri the expert ret~rne~ from overse&s leave he instructed him, on 7th April, 1984,

to veri!Y the Tuncon ~ccounts. He said that on 25th May, 1984 the expert 30 ~UQtni.tted the report to him, then he wrote c1 l&tter and forwarded the rijvort to the LJeputy Minister. He said thut the tax to be collected wui shs.87,000,000/= a~d thG.t shs.13,000,000/= hc1d been collected. the expert whom .~w.8 instructed to verify tha ~ccounts of Tancon ~ij ~alled T.~. Vusuuevan(~w.11). He is a very knowledgeable person. li; ho•i.i.s a bachtdor's degree in Chemistry, another degree in accountancy, aj~.i~Ug and taxation. he also attenued a course on computerised ~a~agement. he has 24 yeurs experience as an auditor in his kit • .tte told the court that he had worked in Tanzania from B-eptember, 1978-0to December, 1982 and agai~ from februa~y, 1984 to April, 1986 and ' that he was attache<;l to ..-excheq~er and audit. departmenL . rt e stated that he has dealt with '.l.'an~on accounts and that on ?th April, 1984 th.e Q . ~ ~ requ.eeted him to audit the ·rancon accounts arld subsquentl:, f'v-r.8 .instructed. him to audit the 'l'ancon accounts and . submit a r:eport. to hini~ ~e said that ·he collected the Tancon files ,ind .other documents from the. income tax department. ·,. : t1ten he werit. tp Tang&. and Mbaya to check income tax .files . there~ in i>ar es ~a.ial,lll he visited NP!!'. office and checked .NP1f. payment returns. He said that he examined all these 10 doc~ments and

comp~red them with earlier computations. He said that he completed the audit check in May, 1984, prepared and then submitted a report to Pw.8. He called his report as a technical report which be pNdu.ced in court ~s exhibit P.18. lie told the court. that he checked the computation prepared by·Minja which showed a profit of bhs. 159,000,000/= and that prepared by the committee of ten assessors showing a loss of ~hs. 4,000,000/=• lie said that he also checked the accounts submitted by 'l'ancon. he said that afte.r analysing the coQiputations by i.'.'.i?lj[k and the committee of ten he came tp the conclusion that both 2C computations were wrong. tie told the court that the accounts submitted by Tancon were correct and that there were several areas which needed verification. he sa~d that he did not know if the ·accused had made any computation. He stated that the committee of ten had two main adjustments. One was l deductions of audit fees and the second was deductions on withholding tax on profits~ He said these deductions increased the loss altho~gh he agreed that the deduction on audit fees was valid. lie said that he did not agree with deductions of profits from withholding tax. He said that the accused 30 also rejected the advise of the tax ad~isor on the deductions of withholding tax. He said tha;y the accused was right.. As for the various items rw.11 said that salaries paid

to · n~ed exl)atriat~LL verification. He said that according to the docum~nts he got expatriates were paid Shs. 8,000,000/= while '.i.'ancon AC.C.ounts show that expatriates were paid shs. 44 1 000,000/,:; .... He. said the difference wo.s too large to be .accepted. As f.01". J.?.bour c<>ats he stated that from in:f_ormation he.eal.leoted the ma~imum number of labourers :·.-· . employed by 40 ,, 'l!ancon were 1040 and that although constructioh,.1t~~s completed in 1980 'l'ancon accounts showed that the said lab<.furers were employ~J for the whole contrbct period. He said th&t according to his computation the salaries pa.id to labourers was .'::>hs. 20 1 000,000/= while 'fancon act.aunts reflected Shs .. - 42,000,000/= thus leaving ~hs. 22,000,000/= unexplained. As to tender costs he su~d thQt Tancon received ~hs. 6,250,880/= but their ace aunts showed .::ihs. 256, 000/=. lie said that l~ter he verified with 1anzunia harbours Authority that Tancon was paid the amount stated. He said that there was need for 10 more information on temporclry buildings and capital expenditure on machinery 7 H1:,' said that }:is report wus intended to point out areas to be invastigutcd und that the accounts of Tancon were not properly varifi.ed a .. ,u tb,1t in the absence of in- formatio.n. one :;annot c0c-1e to uny clear conclusion on the issue., He told the cou.rt in cr.:.:cs--exl...mi·:ation

that he has been in toucb with accused frou; t~_rne to tir,;e. When he was asked how he regards -;he accused he tol'.l the court that the accused ltas the oom;petence and cou1·:.ge to disagree with the views 20 a foreign tax adtisor if :1e forms ·che opinion that the advise he is given is wrong~ He stnted further that the accused 11 is absolutely 11 a cc,mpeten~ tax administrator. He also went on to tell the court that in his examining -the Tancon files he did not find the accused negligent. he stated further that accused appointed a committee of ten le~ded by an IMF tax a...dvisor,. lie a.dndtted thut the accused acted in all reasonable manner to see that 'l'ancon w1;;.s properly to.xed. When cross- examined on ~xhibit Pl8, PWoll stated tha~ he was making an audit enqu;i.ry to examine various aspects of tax liabilitj. 30 He denied flatly that he w£.s making a tax ccmputation. He said th~t he would be shocked to hear th~t the prosecution intended to use his report as a p~se for convicting the accused. lie said that the figures in his report are subject to verification. Qn expatriate allowances he admitted that the sum of ~hso ?00,000/= wa£ too small fo:· 32 expatriates and that he was shocked that his :t'igure.s w:.:J'e accepted without verification. lie said ~.:.at he cannot say thut there were 58 expatriates • . lie admitted tha·c .Shs o 44~000 .. 000/= was a ;reasonable

expenditure it '..L'ancon &ould ~ive the detailsc He also stated that ' the 40 -:- 27 - amount expended on ~x~~triate tr~vel neeJ~i verification and that he took childreh in.~o account. lie tlien revet.led that Tbncon did ndt do any business after July, 1981 and that they -are no't liable to tax fti'ter that period. He said that freight and insµrance needed verification and th~t he did not dispute the principles applied to it. As for wear and tear PW.11 info}med ~he court that it was a mistake not to allow it and that the whole :item shoulJ. b.e allowed. .t<egarding small machinery artd tools vaiueJ at uhs. 64,000,000/= he told the 0ourt ha~.did not see the breakdown and that there was need 10 for verification. he said this applies to private u~e of I '.l'ancon cars~ He told the court that interest paid to Am~ro bank should. have been allowed. 11 e found. ~~-~~wrong for not allowing it. he said that the department took ste~s on his report and th"'"t l~duriguru was acting on it. Re also foi.1nd Mt11aa negligent in making an erroheous assessmeht. lie said a~ regat"ds 1xhibit l-'~10 that items 1 ... 4 'sh·o~ld have been allowe"dt ~ub:j·ect to verifi·c'ation, that he ko'uld ch~fge 10% oh item 6 1 that itt-1ms r1 81 9\ 16i 12~ 13,and i4 should have beeh i:lllowed ahd th~t item il was not ciear~ ri0 ~aid that th~ com~ittee 20 of ten did not consider items 6 - 10 irl Bxhibit P.1®.

He further reite:ated in re-examination that·~a was negligent in taxing ite~B C - !! ~~d that if the assessment was mad~ without verification it ~ould amount to negligence. He further SD.id thut 'l'ancon had given a lot of information but i i :, not ,,deq,u~t.e. 1te insisted that his reporttneeded verifi' u.·:ion. 1'he accused informed the court that the whole of 1982 he was overseas for study and.that he did not deal with the accounts of that year. ue further stated tha~ the c.ommit_tee 30 of five had raised the assessment in his absence. he told the court that on 23rd August, 1981 he ~W- a lette.r from Tancon•in reply to Kexilahabi's points he had rai~ed. He said:1that Kezilah.abi ·had then made submission to him and he in turn wrote a minute to Massawe pointing oµt that he disagreed that wear and tear and suggested ;o him to examine other o.dJ:J.ger areas. l-ie said as it might take time he instru,:.··ed Ma.ssawe also to talk with Tancon .. He stated that Massc:;we did not do the v~r1Hication. He said that later Tancon went to the department and again he instructed 40 Massawe to hold disoussions with them. He said that later - 28 - Tancon complained that 1th.ie· ,,wa;t ter was not moving and that they wanted the ibsue finalized. rie said he called Massawe and informed him of the c on,}J:'.:... int und he alleged that Nassawe admitted that he mistied the appointr:ient for one

hour and he requested him to grant 'l'ancon an interview.; iie tolcl the court that he agreed and Massa we + ook tJ:., :i r! ·s of +:he interview. He said that later he told Massa,,"~ thL,t ·. 'ancon wanted at least to get 0 a provisional computation C,.nd th,J.t he should ask for more information on matters which might have arisen~ He said that Massawe did not do that. He said Tancon offic.ials had on three previous occasions travelled 10 from hurope without the matter being dealt with and. he said he felt obliged to mc.:{c ,:, pro'1isional comp·Jtation. He said that as more information was needed he instructed Massawe to make the necessary follc,, up. lJ.:, ,\'el'!'':; on ".·o tell the court that he never came into conta.ct with '..'ancon accu .... nts until Mr. Ntagazwa the Finance Deputy Minister call~~ a mee~ing~ J1.i ;~~d that the Deputy Minister wanted the Tuncon tax file and thLt t~ Crew the , attention of the Deputy fvJj ,\ster or: ~lie 1,rovis:i.,Jc•: cf section 3 of the Income T~i Act. He said that the Principal ~~c~etary directed him to ~ . over tlTe file to the Deputy Jv,.;.nister-. He said that later 20 tlle .Lleputy lVJinisi:er ca~_led ,.t meeting whicr he attended together He se.id , that during that meeting he disc civered thu t the .uep:1ty Minister had previously discussed the '.L\,.ncon tc.t;,...at.ion with tis juniorso He said that after the meeting he ~old

~he Minister of Finance that if there w~s any doubt abuut h:i rn he should appoint a committee to deal with the matter~ ~e said he appointed a committee of ten senior a,;sessors and directed them to r(view the whole accounts and call e.ny evictence • .H.e ref,erred the court to bxhibit P.11. He informed th• court that in,Uctober, 1983 the committee submitted a report 30 to him ~xhibit P.12 and that later he asked PW.11 to go through it before making his submissiQns to the Minister. He said that PW.11 eould not do the job as he was assigned by PW.8 to verify the Tancon ~ccounts. Re alleged that he had been charged for the decision of I.In}\.~ and that the assessment of the committee of five had never been brought to his attention and he has never been given a ehance to express his opinion. tie stated that the committee of five were wront:, .irl di,s-allowing interest paid to Ambro Bank, det.\.pre-c.iation 1 cc:1.pai l,::.lised freight. and insurance, costs in temporary buildings.. lle said that c..lJ.. the inf'.orma-ti.on needed was 40 ·I - 29 ... in the file •. He challenged the r~port ( exhibit P18) of .t"W11 as wrong. r1bout the committee of fiye he stated that J:<wechungura was ,_,,~~tfr~c.-- by Mall;fci and Minja. He challenbed hinja by stating tmi.t he first approved and recommended the computation of Kezilahabi (Pw1) only to distance himself about two yectrs later, He

challenged Mass~we • He has denied negligencej wilful~act or ommission or that he caused any loss to the Government. When cross-ex~mined the ac~ubed told the court that the main items he w&nted verified were head ofitoe. expenses, interest, expa~riate sal~ries, ullo~ances and meuical expenses, freight and 10 insurunce. He stbieri that M~ss~we tliti not Cc.,,1ry out the instructions u~til Tu.neon repre~ehtc.,,ti~es went to the uepu.rtment on 16/12/1981. lie said thut h~ss~we tiid not write the notes of interview when instructed to do· so cJ.l thought he t.ook. dow:ri the minutes on 16/12/1981. lie udmitted to have written a letter on 17/12/1981 to •rancon thc..t the department w~s in u pesition to iu~ue a provisional computation subject to verific&tion. He udmittbd thut he wrote exhibit P8 bijt adued thc.tt it Wc,,S u.n admillistra.tive ~cti-0::i..- He alleged that he :i.netructed Nassc:.we to w:;:·.:_te the :i,.,rovisional computation and that Has.sawe had refused. lie s1:...id the1t he then instruct.e<i...Kezilahabi t.{). 20 · tiheck the o.ccounts. he stated th<.!t h.ezilahabi advised him that Tancon had overhead expenses of shs~3,ooe,OOO/=. He produced J:iJfhibit 118. lie stetted also thut he guve the 1'ancon file to the late ~ulaya. Un steps tuken th&t the government did not lose revenue he denied that his minute to Massawe prevented him from {aking steps. ~e jaid that the

lMw does not allow the department to block or seize people I s prop(~rty unlec s l(n b.Soessment is issued. He admiU:ttd•.' to have seen ~uditors report on the need of v~rification. He stated that he and Kezil&habi t~ct verifi~d the accounts and found a loss ~nd thut the auditors r~port wDs not a comput~tion but only an 30 audit enquiry. He suid the.st he uppointed Ndunguru, the hde Ku'laya, Busigur~ und Mweri to go through the ~uditors report~ He s~id that ~fter thut he went ~bro~u &nd he h~ti nev~r sen the findings of their work. lie insist-=d th"'t he is n:ot negligent. He st~ted that he •Knd h.ezibl!:.i.hb.bi checkeu '.l'uncon uccot.tnts before he issued exhibit P8. he saiu he verified the no.ture 1.1.nd rel:.sona.bleness of ·the expenditure !=lnrl then c~lcul~ted the rQtio of expenditure. he stctted t~ut on 13/8/1985 Minja.instructed Hwechunguru to h ... ve the computation reudy for decision on 1j/8/1985. '.J.'he t:tccuseu st"'tecl clS regurus .t-iussuwe thctt on 14/8/85 S"mssc..we w~rned J.v1allyi ltt,ainst iss~ ing a non-agreed assessment RS i·t 40 . was illegal but he s~id the s~me Massuwe, on 22/8/1985 advised ~llyi to jssue o. non-agreeu t..sses:::;ment ago.inst his own p.dvii;e .. he s~iu th~t the' assessment was co~municatetl by telex whicb he ma.rtainaiLj.a agidnst the 1£.w... 'l'o de1;10nstra.te his susptcion the accus~d IL,..,...,.;...~- :u ... _._... -. 30 - ·

stated. that Nallyi refused to n.eet l:i1u, c.nd the Principal .S.e.creta_ry to the Treasury w&s i~timid~teG th~t if ac uEul is alJowed into his office he would be prosecutE:d. J.,.t t ~11;;: I 1~.1r::: tc.1.r1c c of the 1-<.epublic the .. '·~ accused tenuered Exhibit D4. he int i1:1~1ed • thc.t this Wi:.S plot by his subordinates 1;1guinst him. he stc.-.ted tnut the committee of five would have c_ome to b. lobs of shs.4;0u0,000/= if they did not dis~llow the dispute~ items. He went on to tell tne '·(nrt tht t u.fter muking the comput/:.(tion he took steps .... s a prec.autio_nt~ ensure. . th.:.,.t t8.x is paid if . ' ·. later it was revealetl ~h~t there w~s u t~x~ble.income. He suid th~t he insttucted Mussuwe to i8SUe ug&ncy notice &hd when he found that ·Massawe had f~iled !o comply he instructed the_late Kulaya to do $0~ lie said that chc1.rges were rb.ise<.l on four buildings worth shs_.50,000,00•/=. he skid that he instructeJ th~t bbrUJi Company should not release Tshs .. 4 1 000,000/= and l.Jutch guiluors 7,000 1 000/= t.o,.:Tancon. He said •thQt motor vehicles unJ other ~ssests belonging to Tancun were also under charge.. he said thut the value of all these properties was over shs.120,000,000/= for which the government could recoup itself. ·····••131 . - 31 .. i ,i -ci1ti.sa~x;ami:nation Finally he told the court .7·• i:,- · that 1982 assessment ia under objection and

1981 assessment has not been accepted and that Taneon had appealed to the minister. Ee said that Tancon did not appeal to the tax appeul boa.rd as to do so would condone an illegal assessmerit. .He 'f·ehemently denied· that he is .n.aglig.ant or that he had caused any ioss to the government~ The accused has called Cuthbert-S. Ntema (n •. w.3). He is a principal tax collector~ He told the' court that accused has issued instructions to ensure .that Tanccn met its tax liability. He said that he raised charges on six houses whose total_ya:tue was Shs.60,000,000/=• He also informed the Court that he also isGued distress over moveable 10 assets and seized four motor vehicles valued £it Shs.2,000,000/=. He alleged further thct he seised suncry iteW-s including air conditioners, deep freezeers, fridges worth Sh:).1 1 500,000/=. He said that he also flame to lmow that there were agency notices issued to Saruji Company in respect of Tsh:-4~600 1 000/= ar.d :Dutch {:uilders "".Orth - 7,875,000/= • which is worth Tsh~120,ooo,ooo/=. i.:o w:,id that they issued an attachment order to ·n~:o.c. and obfai:cv~(! ;3~1S,;13,203,ooo/= and finally he wrote to the Bank of Tanzania requesting them not to repatriate funds belonging to Tancon abroad. When cross-examined D, W. 3 stnted tl1Dt in this case he was first 20 s~pposed to collect shs.8?,odo,ooo/~_2n<l later Slis.97,000,000/= from Tancon. He

said ttlflt i--,--< ---::llrJc--~ors receive► copies of assessment which show the date when tax is due for payrxmt. He further stated that if tax is not paid on the due dc::te then tax collectors explore the best J •. r.-..- :.;,.-.~) He said he was instructed in June 1983 to.collect the tax from Tancon'8S before that there was no assessment. He said that the steps taken were protective in nature to ensure that the. government does not lose revenue. :\s regards the value of the houses D~W.3 stated that.he could not nake any submissions because one . anti-corruption · . 30 · Msangi of the · • . v. . squad had taken the file. He said that filassawe had told him this. That is the evidence regarding count 4. The accused has b.een charged under paragraph 11 (1) of the Fi.rst.;;6.chedule to the Economic and Organised Crime Central Act. That paragraph reads: "Any person who, whether or not he is an employee o.f a · specified authority by any i'.'ilful act or omission, or by his negligence or rtlisconduct 7 or by reason of his failure to take reasonc!bl0 care or to discharge his duties in a reasonable rn.:mner, oe1:1aee . any specified authority to suffer a pecu..~iory loss or cause any 40 d?mage to any property owned by or in the possession of a specified authority, is 7 notwithstanding any 'V'l'ritten law to -b~"! contrary, guilty of an offence under this pr:·~·agrapb.11 • - 32 .. It

is apparent that an offence tm.(er J\;l'r:1gr2ph 11 (1) of the First Schedule to the Economic ·and G:?.'[-;2.nii· ..:~: C\:-::':ile Control Act is committed: (a) by any person whE¥the:r employ~1 or not by a specif'ied authority-. ~ (b) causes specified ;;,utho:r-:;ity to su~·fer a pecuniary loss or damage to any 'toperts ovrt1ecl by that authority and ,,.. (c) that loss is due to (i) Wilful act or omission, or (ii) negligence or misconduct, or (iii) failure to fake reason.::1·)1e c2re or discharge his duties in 8 reasonable manner. In order to succeed the prc0,ecution hrwo to establish the above ingredients. There is no difficulty in establishing (a) above. A 11 person 11 and r l'Sp~9;i.:(;'ied authori ty h,WC been defined in section 11 2 of the Act and we are satisfied that th8t ingredient has been established. The prosecution have next to prove either a pecuniary loss or damage to property. In the charge sheet the accused is alleged to have caused a loss of Shs. 97 ,A· 74 ,465/:::.· 'I'he issue is whether that loss has been established. Mr, LaltlJ.a learned Counsel for the accused. ·has submitted that there is no evidence to prove that there was a loss of Shs.97,474,465/=. He argued that nll the prosecution are basing the loss on two figures of ,3hs. 72,000,000/= and Shs.24,565,240/=. He stated that all the witnesses o.greed that the accused was not involved in the sum·of

Shs.24,565,240/=. He therefore queried the fairness of fharging the accu~ed for c;ometbing 'he did not do. On this the Republic did not :reply. We have considered the testimony of P.r.-.1, P.'i'.r.2, P.w.3, P.w.11 and P.H,12 on this issue. P.W.1 made a provisional assessment which showed that T·ancon had a taxable income of Sh.s.108,000 ,OOO/::: and tax payable was shs.59,000 9000/=. Although this amount we.s approved and recommended by r.w.2 and P,W.3 the same disapproved the assessment of J?.W,1. P.W.3 made his own. r:oompntation showing a taxable income of .Shs.159,542,398/= and-assessed the tax payable by Tancon to the government as Shs.87,748,;18/=• P.W.11 found the computation of P.W.3 wrong. P.W.11 has denied in his evidence that he made any computation. If we accept the testimony of P,W,11 that the computation by P.W.3 is ,vrong and that he made no computation then we mu.st find other evidence to prov8 the loss of Shs.97,474,465/=• • t -· 33 - -- We have exa~ined bXhibit P.18. -~e thick that ~~.11 has told a naked and white lie when he said that he did not make any computation. ~xhibit ~.18 contains an annexure which is a egmpv.tation showing a taxable income of shs.118,000,000/= and he assepsed the tax due to the Government ~t shs.64,900,000/=. lhere is yeti fourth fibU{e, the cnild of the committee of five showing a taxable income of shs.1)2,j07,6bb/= which attracts

tax liability due to the government at shs.72,879,228/=. Again if this f~~ure ,, is accepted it means that the assessment of PW.11 is wrong. .t<weohungura (Pvi.12) the mazi,.who played the most active part in l ♦ ·W Tanton taxation in four different stages disagreed with the as6essment of PW.11 and the committee of five. He··testified that 'te.ncon had made a loss and that there was no·L:taxalnle income. This hae in assehce, been echoed by the testimony of PW.4,PW.5, Pw.6 and PW,7 that the committee of ten found no t~xable income. We have con- ►: sidered the 11 neutrality 11 stance taken by .l:-'W.5 and PW.6. They did _J not quarrel with the principles followed by the committee. They had no reason to suspect that the chairman Devine ~as giving false information. All the witnesses heve agreed th&t the accused i~J.lJOt be .held responsible for the assessment of 1982. We accept 20· .. the testimony of .l:'W .4, h,. 5 ,Pv1. 6, Pw. 7 and hJ .12 that Tanc on had no t9-~able income for 19u1 and further find 'that the te°l:imony of l-'W.1 J:-'w,Z,-P~✓ -3 and J:lW.11 does not establish the loss of shs.97,474,465/= ~e e,lleged in count 4 and we find as fact that such loss has not been proved. I ./-\.ssuming that there w&..s lo&s the prosecution must prove that th~t loss was due to either the wilful act or ommission of the a~cused or due to his negligence or misconauct or due to

his f~~iure to take _reasonable care or failure to discharge his duties ¥1 a re~sonabie manner for occasioning loss to the government in ,ise~J is_. not a criminal offenc-e. This was stated by this Court ,ivia~ame J, as he then was) in lJujukano vso Hepublic (1971) HCU 446. •here must therefore be proof of either of the above elements. Mr. Lakha learned counsel complained that he does not know with wllat the accu.s.e-d has been charged. He stated that after making the tompute.tion the accused had taken steps to see that the department dges not lose income. He submitted that accused directed that charges Qe raised on 'ran-con property, he appointed the committee of ten to vqify a:id revie\,f the accounts, that he askfyd P~v.11 to review the fep~rt of the committee of ten, thut he appointed a committee of four 40 \o work on the report by ~~.11. He submitted al~o that all the pr~secution witnesses had ~dmitted th~t the accused w&s not negligent. t"!i• ~haidi learried Senior .Gtc1.te Attorney has art,:.ued tho.t the ace.used ha.4 accepted block accounts. he stated that this was a wilful act to allow '.!.'an.con- to submit block accounts instead of yearly accounts. ~eeondly he submitted that - 34 - Ke·::ilababi made a computation showii1G a taxable income which Tancon objected. He S3id that accused directed Massawe to verify certain issues but before verification was done the

acci.,.sed made an assessment showing rf,loss of Sbs.3,OOO,O00/=. He subillitted that this a wilful aft on the part of the accused. Next he stated that.Minja made a computation showing a tnx2bJ.e incot.,e of Shs.159,00O,OOO/= and instead of submiting the assessment of Shs.87,OOO 7 OOO/= to accused he hand picked a ten man committee. He submi tt,ed that ia' not submitting Minja' s assessment to Tancon the accused has f2iled to discharge his duties in a reasonable manner. Lastly Mr. Shaidi stated thnt :r.vr.11 made a report and pointed 10 out areas to·be verified. He stated that the accused overlooked the verification. He su.mi tted that this was a wilful om.issi_on. The prosecution contended that this ;;,&Jllounted to wilful act or omission; or negligence or misconduct, or'" failure to take reasonable Cf.,r·e or to discharge his duties in a reasonable manner. As regard block accounts there is no evidence on record that the accused allowed Tancon to file block accou.."tJ.ts. J,ccording to the testimony of P. w.4 T~on applied to him for extc:nsioi1,,lt8cgfil?~t accounts and that he refused. He. stated that there after the file ,-1~J.S fon•;ordcd to the he~d quarters. In exhibit P. 8 the accusc➔d :::;toted the follov1ing: 2ft "you have presented a i 1bloclc o.ccount" covering .five years after Qbtoining clear~nce from this· Department. I would like the ccrapeny to note and

appreciate that as a general rule the Department does not prefer this prsctice. As a matter of fact there \'i8S a mi:Y.: up in agr~eing to your reque::t in ny office though you do not bear any blame for thisn. If the accused had permitted -~ancon to present a block account he would not have j)Ointec1 out tl·_1is onomaly and 11 mix-up" in his office. We 30 are satisfied that the accused did not 2llow Tancon to present block accounts. As regards the failure by the accused to submit the asseasment by KezUahabi and Minja. We think with respect to the learned Senior State ith Attorney he is confused. The accused is not chargeWhe loss of money assessed by P.W.1 or P.W.3. Even if it were true that accused did not submit those assessments to Tancon llis f.:,ilure would not have caused the loss of Shs.97,OOO,OOO/= alleged in the cho.rge sheet. Besides P_W.3 had reje,ted the computation of P.W.1. Hot only that the accused stated that the accounts submitted by Tanco:p. had.all the information needed and challenged :e_-vt1i1 on this. He said that the accounts were properly prepared and P.W.12 40 eorrobora.ted this by st1.-ting thc,t the accounts were computerised and that there was no likeli.houLi of errors being coumitted. Again we have seen thai jJ'l Exh.P .8 the accused st2.tcd to Tancon that it was necessary to obtain reconciliation, clarification or comments on certain areas.

In EJcb1P11O we have noted that I,Iinja (:r.11.3 instructed Kezilahabi (P.w.1) to discU$sion 1ake certain stepf followinc; the · · ··· in the office of the accused. - 35 ~ P W 3 pointed ·out what nppears to be t:·1c maJor areas of controversy in 1 1 the ca.se. Then· the accused app,:.dnteu t:1e coL1mi ttee · of ten. We have considered the evidence of P.Yl.11 who stated that accused requested ' him to review the report the committee of ten on Tancon accounts. He even appointed the cornmi ttee ot fo'tn~ to work on the report, of P. W.11. On the evidence we are sutisficii tila·~ -the accused had taken concrete steps to verify the computations. :hen Mr. Shaidi dramcJ.t.i,s_a.d one point on nee;ligence. He stated in his submission that on 17/12/81 after finding Tancon had made a loss, the aecused wrote a letter to Tancon shov1i::.1g his gladness that Tancon 10 had made a loss.. He stated that sccuse<1 vvrote "I Rm now glad· to present the company.ls loss''., We think that I.Ir. Sroidi has :rriade two erro:r:.s, one of which is deliberate. ·The first is that he f9:1sreadi;he sentence. The sentence in question reads and we quote nrollowing from these I am now 'glad to ·present .to you the .c.ompany 1 s profit/loss for income -tax purpose as astertained under the provision of the Income Tax Act•~••••••" (~p~ais eupp~d) Secondly the following passage in Elx:h.P~S does not potray the

accused as a man who enjoys seeing the government losing ineome1 He states in paragraph 4 in :Cxh.P.8 and we make no apology for 'f quoting it, It reads: 2• "Finally pending outcome of point under 3 ab0ve the Department must secu:re her . interest ov_er -goods or assets or funds of your company". The ate.used has used the word nmust 11 and he meant what he said. In Ex:h•P,10 l.VI:i.nja P. \'i. 3 informed Kezilalwbi that agency notices have been issued to banks and Saruji compa:o.y and directed hiii1 to take steps to recover • the money from the bank and Saruji Company. j ,, .I' . We have heard the evidence.,of J:Ttema (D. ···• 3 ). on the stc:_Js he took and placed Tancon property woei11Shs 1120,000,000 under ~harge# Uith greatest humility we reject , the cont~n that the accused was 11 glad" that Tancon had made a loss.

3. We would also refer to the testimony of P.W.l]; on the issue of negligence. He stated in .cross-examination: 11 Ye~ I bave been in touch with the accused from time to time.~ He has the competence and courage to say no to a foreign tax advisor if l1c forms the opinion that the advise he is gd.ven is wrong. Yes he wanted the tax in the national interest. Aq~q~utely he is competent in ·tax administration. In i:,Y examining the. -files t>f~Tancon I did not find the a~cused negligent ••••• I agree th8t the accused acted in all reaconablo manner that the 41 tax payer was properly taxoo "-• . P;)lJ. was not alone in saying that accused was not negligent. P.W.3 a tted in orosa-exaroination th3t in assessing a loss to Tancon that the a~u.sed was not negligent. we· agree. Ther·e i-s no evidence that accused was negligent. We are s~tisfied that the pro1ecution have failed to prove that accused caused ·the loss, if there was any loss, - 36 - due to his wilful act or o:oission or neglicence or misconduct or failure to take reasonable c,aT-e or failure to discharge his duties -i.n a reasonable manner. There is one point more. T:·,e c:ccused hns complained that this prosee~tion is a plot by Nassawe J:5inj::i and reiallyi. We have to consider ._i.f the evidence and deci~~:{there is 2.11.y merit iu the complaint. Both Massawe and Minja gave evidenc·e but MaJ.lyi, though his statement

waG recorded was not summoned. We hi.3.d no opportunity to see and bear llm':11. We have seriously considered the testimony of accused, Massawe and · , cred·b·l~t 11 ., , Minja. The evidence on record ·Gends to lend c.:r ,::"l~:.h ·:;:,.-Yto accu~ed suspicions. In 1981 both Massawe and i'.{inja had approved the assessment by Kezilahabi and reccornmended it to accused. Later Minja made his own assessment which N.tassawe found correct. They did' not tell the court the circumstances which made them disassociate themselves with Kezilahabi 1 s assessment.· Both Massawe_and Minja were separately called by the Deputy Wij.nister Mr. Ntagazwa over the computation of Tancon. This was done at the back of the aocused. Minja has the g-~~3::~g\o state in court that he was not bound to tell the accused what v12s fiscussed over Tancon off airs between .l:r:i'.in· and Mr._,Ntagazwa, the -~'ino:a.ce Deputy Minister. :But Minja lmew that the accused ·had made a computation. The accused ~ · his boss. He did not tell the court vlny he decided to hide the f a1t of the meeting with the· Deputy :1.iinister. On 16/12/81 Massawe · toolt: minute of interviews betY:een hii.m and Toncon officials. He refused to write down the_ minutes ·when asl:ed to dGi-:)s_c,, on the grounds that the accused had made a computation showing a loss. That is true., Does that prevent him from wri tin:g the mfuuites: of the

meeting? We ' do not thinlc so. These are two differrent issues and we think that the refusal amounts to insubordination. lg2in on 14/8/85 Massawe had w:ritten in Exh.D.l that he was 11 v:earily d•isc.-om·f,orte:.ki by the fact that there have been as many and divergent opinions as the ·colours of the raj.]mb'oi.itV' 31 and he made the following plea: "Finally, I would' beg to be excluded from being involved in detail in this case i:r. perc,on for reasons of profe- ssional and ethical·.e:x~<fiel'OO.iesof which you are aware" Yet on 21/8/85 L'Iassav,e, against his. own senses of profession and ethics, and with the insis-irenc.e of Ninja (p. \!. 3) advised >allyi to issue a non-agreed amended assessment.; We have statec~ t:r. .2 ..J.c ··:e r::3.ve not been able to see and he9' Mally± •.. ;13ut we heard and se.\7 :.'.:::;'::;s2\',c ancI !'1i:.:l.ja. They appear to us like "whipping tops i;. T.r~ei woul(1 E;O~, on. lengths to changes against their own advises and recomi-u.endotions. As :ceg2rds I.'iallyi 9 Mr. Lakha 41 -t as asked the court to draw.an adverse in:fcrence against the failure . :~. . ~. ;, . to ,all- hiill as a vvi tneE:is. · Th~ accused oo;;1plo.ined that Mallyi refu_sed . ' .-,'37 .- to admit hirr. in the office, that he ia onef;,'tie three subordinates who have :rtanupulated public insti tutioj_1 fo:r: t:·,8ir own use in order to undo him. At the instance of t~ie

prcsecution the accused tendered EXI,{.D.5. This exhibit contain very serious allegationo. The purpose of producing an exhibit is to prove or disap~rove the existance or non-existance of a certain fact or allegation. Tetking the evidence of accused and the contents of Exh.D.5 we believe th1:1t Mallyi wv.s deliberately not . his summoned to shield him from the truth ofLrole in this plot. This reminds me of what Lady Viola in Shakes::_:ieare 1 s '.rv,el tli Hight when she complained: 11 There is nothing blemish but the mind. l Hone is unkind but mankind 11 The aeoused can be excused for he has every reason to suspect that Wassawe, Idirtja a:1d Mallyi has a hand in thj_s cr1se. Vie now come to another point whicl: was roised during a submission of no case to answer and again during submission. We reserve our reasons which we now give· Mr. Lakha submitted that the ~harge as laid is bad for duplicity._ He stated that under paragraph 11·(1) of the Efonomic and organised Crime Control .,~ct loss can be caused in three different ways which are distinct from, and in(ependent of, each other. He urged that theprosecution should have alleged which of the three limbs 2f they relied upo~. He •op.tended that the manner the prosecution have _ framed the charge has prejudiced the accur-Jed. The Court was referred to the case of~~ v R (1969) EA 197 s.nd Cherere v R (1955) 22 EACA 4 78. Mr.

Shaidi has subE1itted, on the other lu:md that the information or tharge is not duplex and that it has been properly laid by including all the three limbi;i. He referred to section 135 b (i) of the Criminal Prooed•..rre Act and the case of R. 'V. Jo.sc:Jh Cho_pala vR (1970) HOB No.49. The issue of duplicity in a chc.1 rgc 1120 been considered in various authorities. First we start wHh the Cdse of Joseph ,G.hapala (supra). In that case the offence w::.is l,Jic: under section 3 (1) of the Prevention of Corruption 0rdinonce._ The particulars 21lege that the accused obtained the sum of Shs.1,500/= 11 for hi:,r:elf or ot:1er'.'iise on account of the Resident Magistrate 1' . I:-,. ti:1nt c2:;e t~1e 1-.igh nourt (Mustafa, J., as be then was) held, after referrfr.g to sectiGi:.. 1:58 (b) (i) of the Criminal PrOQ.edure Code which is sii::ilnr to section l35(b)(c) as ,follows: "The substantial offence id :t~-;;e corruptly obtaining money, c~ll'l. vhet-'=1.er it v1c1s for himself or on accotmt of tl1e :'1esident MagistrE.te is mereby the coa~,1l1lission of the offence in either c,-,_x!city. Indeed it can be said to be o:a.e inrlivisihle act which involve~ e:L ther _pers~m. I 'j; is wrong to say that two distinct offences have been charged in the sm.1e count ~ , .••• q. .,.. 38 - We respectfully agree that in Cb.:.ip2.la 1 s case the ms1.4,'1 offence is the obtaining money corruptly and 11

for hiro.self or otherwise on .. . account of 11 de_&• ~t create any offence. In the JCipg v Surrey Justices ;:~,+·:.··~~~ Ex parte Witherick ' (1931) 1 KB 450 the appellant was oonvicted of an offence under the Road Traffic Act 1930 of Bngland. The particulars allege that he drove a motor vehicle 011 o road "without due care and attention or without reasonable considerat.!i.on ,,·. for other persons using the road" . AV0RY J held that the section um1er which appellant was charged e:i;-eates two offences, one of ariving without due care and attention, and the second of driving without reasonable consideration for other road 10 users, He went on to state at page 452 thus: 11 . an · .elementary It is . . 1 e t'r:~,"G, an i.nf orma t·ion mus t princip not charge offences in the 2lternotive 1 since the defendant cannot then know with precision vr.Lth what he is charged and of what he is convicted and may be prevented on a future oecasion from plending au.trefois convict". Thj.s decision was followed in the famous c2ses of R v Wilmot 24 Cr. APJ?• It, 63a. and R v Disney 24 Cr.AJ2I2• R 49. In Dis11e;r' s case the a·ccused was .fharged that llby night unlawfully took or destroyed game or rabbits in land or was in the said land by night with a gun net or other instrument 2t tor the purpose of unlawfully taking· or destroying game or rabbits. In Wilmot the accused was charged with an

offence under the traf'fic att and it is alleged in the information that he "drove a motor car ~lessly or at a speed or in a manner which was dangerous to the public having regard to all the em-oumstances of the case~' The court held that r. more than one offence was charged in one count and it was held to be duplex~ It should be noted thet in these cases the charges were laid in the alternative. ln Mai ~haka s/o Gichinga v R (1963) BA 627 the supreme Court of Kenya ?~t'•. had to grapple with a charge whose particulars alleged that the atcused drove a motor v~hicle "in a -.eckless manner and at a speed which was dangerous to the public havt~ regard to all the circumstances of the •ase n, RUDD J said at page 629. ·;, "There is really very ·little in the judgment in Wilmot I s case to cast d?, tJ,h \,n the correctness of this distinction but neverTuJF.iless some doubts appear to have been entertained ::is to that in certain quarters as a result of the decission in Wilmot's case •• ,....... Uowever the matter has been settled beyond doubt by the Court of Appeal in England ·in the recent c2se of R v Clow where the distinction drawn in l~ v Jones, ~arte Thomas.J.. R v Surrei JJ ex;,eai~te \'ii therick was ... 39 -· firmJy rc,.,€stai,1istcc~. In r: v ;.'ilmot the part- icula:c:., of the of.fe;~c e v;cr.:! t;·.a+.:' t'.1-e · appellant drove a rnctor car -,.·,:·1··7 ec•sl-, r"" -:t a

speed · which was da~1ge:r:ou; :· ··--Th~Ls ~'._,ai..:::..11:1d to be bad for duplici t.y, three S<:\J::.,rate offences having been charge9. in the alterr:ative. :n R v Clow the appellant was charged with causing d ~ by dangerous driving, the particulars being that he drove a motor car at a speed and in a manner dange1:ous to the pub~_ic having regard to all the citcums'i:;c:,.nces.. :r."-.:H.D P./illX.1--;;R c.J, delivering the judgment of the Couxt referred to .and approved R v Wiimot but 13ffirmed the d.isthlc.tion between charging offences in the .:lter112tive, and charging that a man by 0ne act hus corlilli ttoo. two offences. The result .is that v:..;.e::.·e two sepc,rate offences are charged in the alternative, that is disjunctively using the word "or 11 then se:_:>oi•~te offences are charged in one cO\m.t and that is bad for duplicity, but ho1,,vever illogicc:l it may seem, even if these are separate offences, it is pGrmissible to charge them 2• conjunctively us:l_ng the word nand 11 if the matter relates to one single act". We agree with these decisions. In the present case the accused has been charged disjunctively. 'iio think that paragraph 11(1) of Act - l~/84 is intended to deal with three district, and not necessarily the same, classes of people v:ho csuse loss to specified authority. These are those people who CDuse loss by wilful act or omission, secondly those

people who cause loss by negligence or miscondn<ri!tand 30 lastly those who C::'.USe loss "Jy failure to take reasonable care or discharge their ciuties in a :.·er:n3onable manner. But it has been argued secti011 135(b) (i) Crir:tinal Procedure Act allows charges to be laid in the alternotive. This subuission has been considered in the cas_es of R v .Mollo;x: (~.921) 2 KB '.364; Shah v R (1968) EA 197 and Cherere s/o Gukuli v R (~955) 22 EA.CA 478. In Kc~_loy 1 s case the court considcreq. · the effect of rule 5 . of £ngland of the Schedule to the Int.ictment Act 1915. That rule is identical to section ~35 (b) (i) of our Criminal Procedure Act. It was held - in that case that rule 5 does not 2uthorise the charging in one 4f count of two offences. In Sheh v Rand Cherere s/o Gukuli v Rdted above the Kenya High Court conside!'ed section 137 (b) (i) of the Kenya Criminal Procedure-Code. That section is identical to our section 135 (b)(i) c.P.,A. It was stated ii~ Cherere 1 s case that 11 The rules describing the formulation of cbarges and information in the Criminal Procedure Code are sufficiently akin to the rules under the !n:.dictment /,ct 1915 to make relevant English decisions on those rules, ::md we think we con properly 5 acopt as a test for duplicity pass3ges fr-om the judgment of' thG Court of Criminal Appeal in R Y I/Iolloy (1921) 2 K3 364 11 • ' • tp ~p.esent cctse the

uccu.secl uc..-s uE.:en chc.:.rt',ed disjuctively and we afe satisfied on the authorities t':-:;.t section t35(b){:t) does not u~tllo•il;ie alternative churges to be lc-tiil in vne count. N1 to l\1r. 1akha' s submission tnat the accused has been pr@Juuicecl in his de.fence we clc, not think so4 The accused has (,,.U@QU'1tely uefenue<.. himself, 111 tLis case the core of the prosecution f&~;, was lack of verificc:.tivn by the ~ccused. lie h~ pr-Qperly a.~1.<ressed himself cl.nd we hold thut no inJustice was done to the ace.used by tbe du~licity in count 4. for the reasons which h&ve given above we are satisfied that the ;i• . ehaJg;e · against the accused have nut be.en proved beyond any sasie doubt. Wt tj.p.d the accuse·t.l not guilty in all the counts ~nd we acquit him ati ordingly. JULJlil!; .:i gd. Kidyalla (Lay mem·ber) ij-Gfe~ on 12/6/1987, i,.tw,~ • .:ienior 0ta.te 1,tt.orney, f'lsi:tn 6 i, Law vfficer - btate Attorri.fY for hepublic.