Posted on: www.dailyguideghana.com
By
William Yaw Owusu
Thursday, July 17, 2014
The Attorney General’s (AG) refusal to coorporate
with an independent referee appointed by a High Court to look into claims filed
by Africa Automobile Limited (AAL) led to an award of GH¢8.3million paid by the
government to the vehicle dealing firm.
According to Ben Korley, a Chartered Accountant with
Messrs Intellisys the AG did not show any interest when they wrote to
government’s lawyer as independent referee, requesting them to provide
information on the Ministries Departments and Agencies whom AAL claimed were
owing them.
He told the Commission of Enquiry investigating the
payment of judgement debts that since the AG did not get back to them, Messrs
Intellisys went ahead to do the assessment based on what AAL had submitted
before the court.
AAL
Services
AAL reportedly provided services as well
as supplied spare parts to 17 MDAs from 1994/95 to 2010 but the government
failed to pay for them and that compelled them to go to court, suing the AG.
Unfortunately, when AAL filed the suit
against the government, the Attorney General did not contest the matter
compelling the Commercial Court to enter a default judgement in favour of the
claimant.
Documents available to the commission
indicated that the debts owed by the government to AAL stood at GH¢145,917.76
but it ballooned to GH¢8.3million in 2010 due to compound interest on the debt.
Furthermore, in the 2006 audited report
of the company, the amount owed by all AAL debtors including the Ministries,
Departments and Agencies (MDAs) stood at GH¢96,823.51 but when the company sued
in 2006 they claimed that the total debt owed by the MMDAs was GH¢145,917.76.
AAL’s
justification
When Mohammed Hijaazi, Executive
Chairman and Managing Director of AAL appeared before the commission recently,
he confirmed that AAL had indeed been paid GH¢ 8.3million as judgement debt and
justified the payments.
When Counsel for the commission, Dometi
Kofi Sorkpor asked Mr. Hijaazi whether he paid GH¢6.1million as tax on the GH¢
8.3million collected as indicated by the GRA, the witness said he did not
intend to pay.
“The interest was a loss that the
creditor suffered at the hands of the MDAs and I would not declare that as a
profit. I have not and I would not. It was a loss and not profit.”
When counsel asked further whether AAL
sued for loss of business he said “No, I haven’t. In fact you have reminded me
now and I am going to do that.”
“For 15 years, we have been reminding
the MDAs of their contractual obligation but they did not but here I am today
trying to make my claims and I am being branded a criminal,” Mr. Hijazi
lamented.
Independent
referee
Testifying yesterday, Mr. Korley said he did not
refer to the MDA’s to have their comments because the AG was the defendant and
they had written specifically to them for information on the matter saying
“there was no response from the AG following the letter we sent to them to help
us reconcile the figures put before the court by AAL..”
“There was no defence…the order from the court
requested that all information should be routed through the Registrar but it
never came.”
Mr. Korley added that it did not come to his notice
that the MDAs prior to the matter going to court had denied owing AAL for
services the company had rendered them and added that he based his work on the
purported agreement signed between the AAL and the MDAs.
Financial
statement
He said he did not study the financial statement of
AAL in the course of the work for the simple reason that the matter before the
court had specific information for them to validate adding “what we set out to
do was to confirm and obtain information from both parties to validate the
claim and to apply the interest as stated in the agreement that was before the
court. It did not refer to the financial statement of the plaintiff at that
time.”
Mr. Korley said they analyzed documents from 1993 to
2008 adding “the compound interest was applied on the basis of the agreement.
It was 30 days credit and that was used to calculate per the agreement. It was
such that if payment was not done within 30 days, it was to start accruing
interest monthly.”
The challenges we face was that the defendant (AG)
did not help our work at all. At the time the calculation started, the actual
claim was GH¢1,053.09 and the total amount at the close of 2006 stood at GH¢154,717.76.
This ballooned to GH¢8.3million in 2010 due to compound interest on the debt.”
“In my opinion that agreement was an unfair one
knowing that in the government system it will take more than 30 days by just
the processes and giving a credit for just 30 days was rather on the low side,”
and added that “it could have happened that because they (AAL) were not getting
their money, they might have understated their income.”
“The government accounting system is on cash basis
and if the person who received the invoice did not submit it for processing, it
will never show in the government’s account. And it will make the claimant look
as if he’s claiming for something that did not belong to him,” before calling
for an improvement in the government accounting system.
The Sole-Commissioner has expressed dismay at the
attitude of the AG’s office for its handling of cases before the commission and
subsequently directed the commission to write to the AG to urge them to respond
to its subpoenas.
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