The Management of the East African Portland Cement (EAPC) was put on the spot on Tuesday over the suspected alteration of land sale agreements, and uncertainties on the repossession of huge tracts of land illegally occupied by squatters.
Appearing before the National Assembly's Public Investments Committee on Commercial Affairs and Energy, EAPC Managing Director Oliver Kirubai was put to task to explain the company's continued disposal of huge tracts of land and several disputes lodged in court against the cement maker by private entities over land sales gone sour.
Among the contentious land transactions cited by the Auditor General, was the company's sale of 337 acres of land to a private developer in 2012 at a price of Sh2.2 million per acre.
However, the buyer defaulted on the sale consent by failing to provide an acceptable bank security.
The case was taken to Court during which both parties settled for a renegotiated proof of Sh4.5 million.
The company thereafter revalued the investment property to a carrying value of Sh5.1 million, resulting in an impairment loss of Sh230.5 million, against the initially renegotiated price.
During the MD's appearance before the Pokot South MP David Pkosing-led Committee, the company was also put on the spot over failure to settle statutory obligations; including Pay as You Earn (PAYE) of Sh2.2 billion, Sh656 million Value Added Tax (VAT) and Pension Liabilities amounting to Sh110 million.
Pkosing directed the company to file more detailed responses in two weeks, citing the inconclusiveness of the MD's responses regarding queries raised by the Auditor General.
"You have to take this matter very seriously, and return to this committee with all the answers in the next two weeks, before we retreat to write a report," Pkosing said.
Other audit concerns that came to the attention of the Committee include the non-remittance of employees' pension contributions, to the tune of Sh110 million by the 2020/2021 Financial Year.
The Auditor General also indicated that the company had failed to remit mining levies amounting to Sh407 million by the close of the same Financial Year.
