The High Court in Mombasa has barred Treasury Cabinet Secretary Njuguna Ndung’u from implementing a proposal to remove 35 per cent duty on refined edible oil.
Judge Olga Sewe issued the directive after hearing Julius Ogogoh’s application challenging the implementation of the new policy.
“A stay of implementation by Prof Njuguna of the Trade Cabinet Secretary Moses Kuria’s proposal of a new policy on removal of 35 per cent duty on edible oils and its substitution with 10 per cent Export and Investment promotion Levy be and is hereby granted pending the hearing and determination of the applicant’s substantive judicial review application,” the judge said.
At the same time, Justice Sewe ordered Prof Njuguna, Mr Kuria, and Attorney-General Justin Muturi to file responses to the substantive judicial review application and serve the applicant within two weeks.
The order halting the new policy’s implementation was issued despite the AG’s protest that the applicant failed to serve his office with the court documents in time for it to file a response.
“The applicant has not served us with the application, preventing us from filing a response. The applicant is familiar with our office; he has previously served us in other cases we have handled. We ask that he do the same in this case,” said litigation counsel Emmanuel Makuto.
In the proposal made last month, Mr Kuria stated that the importation of crude oil into the country, estimated at Sh102 billion, continues to draw back local manufacturing.
So, in order to support local manufacturing in the edible oils value chain, the removal of 35 per cent duty and its substitution with 10 per cent Export and Investment Promotion Levy would reverse this trend.
He added that it would also contribute to growth of palm , soya and sunflower farming According to the CS , the proposed substitution was to be effected once the levy came into effect , .
Mr Ogogoh moved to the court last month seeking to block the proposal arguing that it will have a negative impact on businesses.
He said that the notion that imported and manufactured crude edible oil is detrimental to local food manufacturing is baseless as there is no data to support this claim. He has termed the trade CS’s actions as arbitrary, ill-advised and malicious.
“This court has no option but to quash the same and issue an order prohibiting any such further illegalities,” said Ogogoh.
The court had certified the matter as urgent and granted Mr Ogogoh permission to apply for judicial review orders quashing the entire proposal.
The applicant argues that the new tax regime will directly impact the pricing of refined edible oils in the local market, consequently affecting the cost of living in the country, which he says is already high, and thus placing a heavy burden on the common mwananchi.
“Justice would be better served if the draft policy directive is quashed and Prof Ndungu prevented from implementing the proposed removal of the 35 per cent duty,” he said.
He has argued that the proposal will jeopardize the rights of the citizenry and undermine the sanctity of the rule of law if it is not challenged.
Mr Ogogoh has also termed as discriminatory the invoking of the Fifth Schedule of the East African Community Customs Management Act in the proposal.
According to him , the duty-free importation of refined edible oil should not be limited to the Kenya National Trading Corporation, but should apply to all importers to avoid harming the industry.
He has further argued that all decisions made by public bodies and officers should be subject to rigorous public participation exercises and follow natural justice principles.
The case will be mentioned on September 27, for further directions.
