Construction company fined for VAT fraud

A COMPANY which received several government contracts for school repairs was fined by a Port of Spain magistrate after it, and its director, pleaded guilty to five charges of invoicing and collecting value added tax (VAT) payments although it was not registered for VAT.

Magistrate Adia Mohammed fined Sukhai Industries Ltd, of 20 Midway Park, Freeport, and its director Sanjeev Sukhai, a total of $57,000 or three years’ hard labour in default.

The company and its director were charged by the Board of Inland Revenue (BIR) for recovering VAT while not registered, contrary to section 23(2) of the VAT Act.

The BIR, represented by attorney Evans Welch, argued the company was part of the school repair programme under the National Maintenance Training and Security Company.

Tenders went out and Sukhai received contracts for the Monkey Town Government Primary, Rio Claro SDMS, Palo Seco Government Primary and the Flanagin Town RC School.

After completing the repairs, Sukhai submitted five invoices for payment, which included VAT.

The application was processed and on examination of the invoices, it was observed that the company was not registered for VAT. The application and the invoices were sent to the criminal tax investigation unit for further action.

After its investigations, by tax investigator Rawle Sookhoo, it was discovered that the total amount of VAT recovered by the company amounted to $58,505.

In March 2020, the company registered for VAT with the BIR.

The charges were read to Sukhai on November 18, and the company and its director pleaded guilty.

On Friday, in sentencing the company and Sukhai, the magistrate considered the facts presented to the court and that such offences defrauded the State, and by extension taxpayers, of taxes. She also held that it was not mere inadvertence, as suggested by the company, which allegedly told the tax investigator it was an error made by an employee of the company.

Sukhai Industries and its director were represented by Anita Ramnanan.