Court throws out M&CC’s $517M tax claim against Houston Estates

HIGH Court judge, Justice Nareshwar Harnanan, recently ruled that the Plantation Houston Sugar Estates Company Limited does not owe the Georgetown Mayor and City Council (M&CC) $517M in taxes. The company, which is owed by Guyanese businessman, Michael Vieira had taken the City Council to court over accusations of tax fraud which were levelled against the proprietors of the estate. City Mayor Ubraj Narine had accused the estate owners of selling lands in the Houston, East Bank Demerara area for billions of dollars without remitting the rightful taxes to the council.
In 2019, City Hall went as far as to halt the company’s land sale transaction. However, the representatives of the estate had denied all accusations, claiming instead that the council had agreed to waive the taxes in exchange for estate cleaning and desilting of the canals in Houston and the surrounding areas.
On February 22, Justice Harnanan found that the City Council acted in excess of its statutory jurisdiction, improperly and unreasonably exercised its discretion in its decision to issue the General Rate Demand Notices 2019 and 2020, to charge the applicant rates on the properties at 400% their assessed value, and also to charge interest on purported arrears of rates compounded daily at 21%.

He also found that the City Council acted without the ambit of its power under sections 202, 204, 206, 209, 216 and 218 of the Municipal and District Councils Act (MDCA) when it purported to issue the General Rate Demand Notices 2019 and 2020.
This resulted in the court granting an Order of Certiorari directing that City Council quash its decision to charge $517,112,222 in rates to the applicant in respect of its properties situated at South Half Plantation Houston and North and South Halves Plantation Rome.
It was further ordered and declared that the decision taken by the council in 2005 to increase rates payable on the properties from 40%, their assessed value, to 400% that value, was an unreasonable exercise of its discretion and ultra vires the power of the council under the provisions of the Municipal and District Councils Act, Cap. 28:01 [MDCA]. Noting that the decision was void, the court in its ruling quashed and set it aside.
Lasty, the court ordered that the applicant was not indebted to the council for payment of rates in respect of the properties as set out in the said General Rate Demand Notices 2019 and 2020.

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