GRA wins GH₵39.7m judgment debt suit

The Accra High Court Commercial Division has ruled in favor of the Ghana Revenue Authority (GRA) in a legal battle against Magnate Technology and Services.

The court dismissed a GH₵39.7 million claim made by Magnate Technology, citing a lack of evidence and declaring the contract between the parties illegal.

Magnate Technology claimed that the amount sought was revenue or fees it would have accrued over the remaining period or unexpired term of the Addendum.

The company argued that this sum was based on the average of historically verifiable figures between the parties.

However, the court found insufficient evidence to support the claim and concluded that the contract itself was illegal.

Justice Constant K. Hometowu, in his ruling, stated, “I am inclined to make an order for the Plaintiff to recoup its investment, but as I have stated above, the paucity of evidence does not offer any guidance. Simply stating in letters that over $7 million dollars has been invested is not sufficient under the circumstances.”

The court further explained that granting such relief would enforce an illegal contract, and there was a lack of evidence regarding the exact investment made by Magnate Technology.

Consequently, the court dismissed the action in its entirety, with no order as to costs.

Magnate Technology had initiated legal proceedings seeking a true interpretation of the agreement, restoration to its previous position, damages of GH₵39.7 million, interest from June 1, 2020, and legal costs of GH₵3 million.

The case revolved around an agreement made in September 2007, where Magnate Technology won an international bidding process to provide a system for securing all bonded warehouses in Ghana for a 10-year period. The actual operations began in August 2010 due to administrative delays.

The court found that the Addendum executed in December 2017, which aimed to renew the agreement for a further six years with a revised fee structure, breached statutory regulations.

The court emphasized that the Addendum lacked the signature of any representative from the Ministry of Finance, a crucial party to the original agreement.

The GRA argued that the Addendum was not a renewal but a new contract, requiring approval from the Public Procurement Authority and the Ministry of Finance.

The court concurred, stating that the Addendum was void and unenforceable, as it lacked the necessary statutory approval.

This ruling underscores the importance of adherence to legal procedures and statutory regulations in contractual agreements involving public entities, ensuring the judicious use of state resources.

Source:norvanreports