Water Authority demands Sh2 billion from salt company
5 days ago, 12:13
: The High Court has ordered a second salt manufacturer to pay Water Management Resources Authority (WARMA) Sh 2 billion for water used in manufacturing the cooking commodity.
The decision by Justice Kossy Bor that firms ought to pay for the sea water means that the cost of putting the salt in your food will shoot up as the companies are also expected to pay taxes to the Kenya Revenue Authority (KRA).
On average, the cost of a kilogram of salt is Sh 25 and the smallest packet, 250 grams, cost sh 5. It is one of the commonly used commodities that has not experienced cost rise over a long period of time.
Krystalline Salt Limited put a spirited fight, just as Kensalt which was facing a Sh 270 million demand that water is God given hence the authority had no audacity to claim money.
Justice Bor dismissed Krystalline’s argument and decreed that the Constitution places management of all natural resources in the hands of the Government.
“The Constitution enjoins the State to utilize the environment and natural resources for the benefit of the people of Kenya. This is the basis of charges imposed by the State on water use and other resources,” Justice Bor ruled.
WARMA asked to charge Krystalline for a period spanning to 10 years, between 2007 and 2017.
Each year, the State Corporation demanded for an interest of Sh 185, 000.
Kensalt was first to approach High judge Oscar Angote hoping that he would get the much needed reprieve but the scales of Justice fell to WARMA’s side.
The judge struck out the case before it went for trial.
Aggrieved, it moved to the court of Appeal expecting that judges would order that it should not pay the charges.
While denying liability, the firm argued it uses water that naturally flows into its land and thus it cannot pay even a penny.
The company in its court papers also argued that no one can claim ownership or control of the sea water.
“The respondent has no powers or jurisdiction to demand water use charges for sea water,”Kensalt argued.
WRMA replied that the Government has powers to regulate the use of sea water within the territorial sea.
According to authority, Kensalt and Krystalline are engaged in large-scale salt production using raw sea water from which it makes huge profits and for that reason the charges were proper and necessary.
Court of Appeal judges Asike Makhandia, William Ouko and Kathurima M’inoti overturned the High Court’s decision, noting the judge erred by not allowing the dispute to go to a full trial.
The court ordered the case be taken back to a different environment court judge for hearing. But Kensalt moved to the Supreme Court where the case is now waiting to be heard.
It now remains to see who between WARMA and the salt companies will win the battle.
Category: business news