Mpisane and her Lamborghini ‘company car’

2013-05-05 14:00

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Durban construction boss Shauwn Mpisane used a Hummer to visit low-cost housing projects her company built for the eThekwini Municipality and the KwaZulu-Natal provincial government.

Auditors from the SA Revenue Service (Sars) allowed her to claim VAT on the Hummer because she used it for site work.

But auditor ­Waheeda Osman told the Durban ­regional court this week at the start of Mpisane’s tax-fraud trial, she drew the line at other posh cars.

“The accused said she needed the Hummer to get around construction sites. I could entertain that for the Hummer, but not for the Lamborghini, the BMW X3, etc,” said Osman.

Osman spent Thursday and Friday testifying about her audits of the Mpisane empire. These began with a lifestyle audit on Mpisane’s husband, S’bu, who was a constable in Durban’s metro police at the time.

Mpisane is charged with 119 counts of allegedly defrauding Sars of R4.7 million by falsifying VAT returns and submitting a fraudulently revised financial statement.

She has pleaded not guilty, blaming the fraud on her former book-keeper, Kishal Reddy, who has turned state witness against his former boss after pleading guilty to generating the fake invoices, claiming Mpisane ordered him to do so.

Osman testified that her team ­audited Shauwn Mpisane and her company, Zikhulise, when it became apparent S’bu’s lifestyle was ­financed by the company and not his police salary.

Zikhulise, she testified, declared a dividend of around R10.5 million in 2007. The following year this shot up to a massive R47 million, of which some R4.7 million was owed to Sars in dividend tax.

In her audit, Osman imposed a 100% penalty, which Mpisane ­objected to.

By 2009, Osman testified, Mpisane owed Sars about R33 million.

The two days of evidence saw several stoppages to allow prosecutor Meera Nair time to marshall documents she wanted to present to the court.

Magistrate Blessing Msani on several occasions tore into Nair over the delays and her failure to abide by his rulings about the admissibility of witness statements and other documents she wanted to use in court.

The case has dragged on for almost two years, with the state requesting adjournments and the defence bringing applications for the case to be withdrawn.

After one particularly heated exchange on Friday, Nair requested an adjournment to consult her superiors in the National Prosecuting Authority because “the impression created is that the court is frustrated with the state”.

Msani refused, telling the clearly rattled Nair: “The court orders you to carry on with your witness.”

Osman will continue her evidence when the trial, which is set down for the whole of May, resumes ­tomorrow.

» This week, eThekwini municipality officials confirmed Zikhulise received tenders valued at R445 million from the city using section 36 of the Municipal Finance Management Act, which allows for tender regulation to be bypassed in emergencies.

The awards were made despite Mpisane’s current prosecution and a previous conviction for tax fraud in 2005.

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