Businessman accused of filing false tax returns freed on bail

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The managing director of Aframax Uganda Ltd was Thursday (May 30) freed on bail, 10 days after being charged with filing false monthly tax returns.

Justus Friday Mugisha is accused of making a false statement to a tax officer at the Uganda Revenue Authority (URA) regarding taxes amounting to sh289 million.

He was initially charged on May 20 with two counts of making false statements, contrary to Section 58(1)(a) of the Tax Procedures Code Act, 2014.

He was charged before Senior Grade One Magistrate Christopher Opit at the Nakasero-based Anti-Corruption Court in Kampala, before being remanded to prison. 

Days later — on Thursday — Mugisha was back in court, and this time he was released on bail by Magistrate Opit after his lawyer, Mathias Nuwaine, presented three sureties.

The court found the sureties substantial. 

Nuwaine assured the court that his client would not abscond if granted bail.

Making further case for bail, he said Mugisha has a fixed place of abode in Nyamityobora in Uganda's western city of Mbarara.

Barnabas Nuwaha, a litigation officer at URA and part of the prosecution team, opposed the bail application, arguing that the accused man is a flight risk. 

A person accused of a crime is considered a flight risk if they are considered likely to try to escape out of the country or area before their trial begins.

Inside the courtroom, URA's Nuwaha stated that Mugisha had previously jumped Police bond. 

He also punched holes in the sureties presented by the defense team, arguing that they were younger than the accused and therefore would not be able to compel him to appear in court as and when required.

The prosecution team, led by Nuwaha and Sam Kwerit, are arguing that Mugisha and others still at large filed false monthly value-added tax (VAT) returns to URA through its electronic tax system from November 2020 to June 2021 in Kasese district.

Mugisha allegedly claimed to have purchased cement and other construction materials from Grace Nakito, trading as GM Hardware, amounting to sh1.2 billion, with a VAT implication of sh228.5 million, which the state said was false.

He is also accused of knowingly filing false monthly VAT returns to URA during July 2021 and August 2022 in Kasese.

Mugisha purported to have purchased multipurpose cement also from Grace Nakito, trading as GM Hardware, totaling sh169.4 million, with a VAT implication of sh30.5 million.

Mugisha denied the charges.

The case was adjourned until July 19 — three weeks away — for mention.

According to the law, a person convicted under Section 58(1)(a) of the Tax Procedures Code Act is liable to a fine of sh960,000 or a jail term not exceeding two years in jail.