Stalemate between SARS and Alliance Fuel continues

Date: 15 August 2024 By: Andries van Zyl

More than a month after the South African Revenue Services (SARS) raided Louis Trichardt-based fuel company Alliance Fuel, effectively shutting down its local depot as well as the company’s depot in Meyerton, Gauteng, the stalemate between the two parties continues.

SARS shut down the two depots, pending an investigation into the alleged contravention of, among other things, the Customs and Excise Act (Act 91 of 1964) regarding the illicit and/or illegal trade, storage, transport, and mixing or blending of fuel products. According to a whistleblower, the allegations include the movement and sale of illegally mixed diesel across the country. A further allegation is that the mixing and removal of the A1 marker in the diesel occurred at the Meyerton depot. Oil companies mark their paraffin with a SARS-approved tracer, called the A1 marker. If this marker is detected in diesel fuel above 1 mg/ℓ, then the inference is that the diesel has been illegally adulterated with paraffin. It is further alleged that Alliance Fuel may have under-declared just over R3 billion.

Since 10 July, Alliance Fuel has been in a legal battle to reopen its depots, a battle fought in the Limpopo High Court in Polokwane and the High Court in Johannesburg as the depots fall within the two courts’ respective jurisdictions. The same arguments were raised in both courts: for SARS to release the application(s) that motivated the ex parte orders, which has become moot considering that SARS capitulated; and that SARS be interdicted from conducting further searches, considering that the warrant was date and time specific (the newspaper elaborated extensively on these court proceedings in previous articles).

Acting on Alliance Fuel’s behalf is TAYFIN Forensic and Investigative Auditors (Tayfin). Alliance Fuel secured what many considered a major victory in the Limpopo High Court in Polokwane on Thursday, 25 July, with Acting Judge Nathi Gaisa ordering, among other things, that SARS be interdicted from conducting any further searches or seizures at the Alliance Fuel premises in Louis Trichardt under the warrants initially granted; and that SARS be interdicted from using, for any purpose whatsoever, any materials, information, or data seized or obtained during the search conducted on 10 July 2024. SARS was also ordered to pay costs. The judgement, in essence, means that SARS will not be able to use any possible evidence seized, including what was seized on 10 July, as evidence against Alliance Fuel.

The above judgement was, however, only in respect of evidence seized at Alliance Fuel’s Louis Trichardt depot. The company was less fortunate in the Johannesburg High Court with reference to evidence gathered at the Meyerton depot, when Judge J Malindi, on 19 July, dismissed with costs of two counsels Alliance Fuel’s application, despite it being the exact arguments raised in the Limpopo High Court. “We have a scenario of conflicting judgements on the same cause of action,” said Mr Mahier Tayob of Tayfin after the judgement.

With two conflicting High Court judgements and SARS appealing the Polokwane High Court judgement, Alliance Fuel is still prohibited from reopening its depots. “We requested reasons for the Johannesburg judgement and are awaiting the same. We have also launched a reconsideration application as ordered by the Limpopo court,” said Tayob on Monday this week.

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Andries van Zyl

Andries joined the Zoutpansberger and Limpopo Mirror in April 1993 as a darkroom assistant. Within a couple of months he moved over to the production side of the newspaper and eventually doubled as a reporter. In 1995 he left the newspaper group and travelled overseas for a couple of months. In 1996, Andries rejoined the Zoutpansberger as a reporter. In August 2002, he was appointed as News Editor of the Zoutpansberger, a position he holds until today.

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