Banks DIH Limited has filed a $28B lawsuit against the Guyana Revenue Authority (GRA) and the government for what it says is the overpayment in consumption taxes with interest for the period 2001 to 2006, in light of a settlement last year between fellow beverage company DDL and the agency.
At a press conference yesterday, General Secretary of the People’s Progressive Party (PPP), Bharrat Jagdeo said that the case vindicated his opposition to the DDL settlement, which saw the company paying $1.5B last year to settle all claims rather than paying a liability of $5.3B for the same period.
By way of an action filed on December 16, 2016, Banks DIH, represented by attorneys Rex McKay SC, Dr. Claude Denbow, Neil Boston SC and Donna Denbow, is seeking a declaration that it is entitled to $28.457B, which represents repayment of $9,094,107,699 plus interest of 10% compounded over the period in light of the DDL settlement.
It also seeks a declaration that the $12.8B in consumption taxes that it paid for the period 2001 to 2006 were paid “under a mistake of law,” while citing a previous Court of Appeal judgment in the favour of DDL against the GRA.
It also seeks a declaration that the payment of the sum represented an overpayment of $9B, when compared with DDL, which only paid $3.7B during the same period, while noting that the overpayment only became manifest when the terms of the consent order for the settlement between DDL and the GRA became public.
Banks DIH also wants the court to declare that the Co-operative Republic of Guyana “will be unjustly enriched” if it were to retain the $9B.
As a result, it has sought an order for repayment of $28.457B or an order for repayment of such sum found to be overpaid for consumption tax for 2001 to 2006 after a reassessment by the GRA. Meanwhile, Jagdeo last year questioned whether the decision to settle was made by the Commissioner General, the Board of Directors of the GRA, the Finance Minister or the Cabinet. “We don’t know and we have been unable to find out…,” he said yesterday.
“Once you make that settlement you are going to basically trigger a request for refund and it has happened now so Banks DIH is claiming $28 billion of refund only for the period 2001- 2006.
When we come to see what happened between 2006 [and] 2016, there could very well be another claim over maybe $30B more,” Jagdeo told a news conference yesterday, while recalling his warning last year that the settlement would have set off such lawsuits.
He said that “a decision made somewhere by this government would expose us to $80B in liabilities and we can’t find $1.7B a year to keep Wales open; that would keep that entire West Bank basically earning and thousands of people more employed there….”
He lashed out too that the government could not find $10B to subsidize the cash-strapped Guyana Sugar Corporation – GuySuCo – to bring in foreign exchange from the sale of sugar.
