Africa-Press – Uganda. A computer distributing firm has sued government over breach of five contracts worth more than Shs71.8m. The money arises from wrongfully retained sums due to Value Added Tax (VAT), which SBS Systems claims was withheld under a misconception that it had been paid.
In a case filed against the Attorney General, the legal representative of government, SBS Systems, acting through Agaba Muhairwe & Co. Advocates, claims that between November 2018 and October 2019 it supplied specialised IT equipment and services worth Shs444.14m to different projects under Ministry of Water.
However, according to documents filed before the Commercial Division of the High Court, SBS Systems claims that under all the five contracts the money paid was less than the contractual sum due to various Value Added Tax (VAT) deductions, which were outside the agreement.
Court documents indicate that under the first contact, which was worth Shs4.95m (inclusive of Shs756,000 VAT) only Shs4.2m was paid, while in the second one which was worth Shs357.8m, Shs64.4m was wrongfully retained on claims of VAT deductions.
Documents further indicate that under the third and fourth contacts, which were worth Shs39.8m and Shs2.3m respectively, Shs6m and Shs362,520 was retained due to VAT while under the fifth contract, worth Shs1.7m, only Shs1.4m was paid.
This, SBS Systems says, was inconsistent with the contract and pleas to access details from the Ministry of Water warranting the retention of VAT on grounds of being deemed paid have been in futile. Consequently, SBS Systems claims that Ministry of Water owes it Shs71.8m.
Therefore, SBS Systems wants court to enter judgment in its favour and against the Attorney General for a refund of Shs71.8m being VAT wrongfully retained by the Ministry of Water, general damages, costs to the suit and interest on the VAT above 12 per cent.
