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Telkom fails to recover Sh217m phone debt from Kenya Railways – Business Daily

Telkom Kenya CEO Mugo Kibati. PHOTO | DIANA NGILA | NMG
Telkom Kenya has failed to recover Sh217.1 million from Kenya Railways Corporation for unpaid services dating back to more than three decades, pointing to long-standing cash flow challenges at the State-owned rail line operator.
The accumulating debt relates to unpaid voice and data services from late 1980s through 2007 when the struggling telco operated landline Public Switched Telephone Network (PSTN), according to court filings.
High Court judge Justice Anthony Ndung’u has thrown out a case by Telkom seeking orders to compel KRC to make payments in fulfilment of a court decree issued in February 2018 by late Justice Joseph Onguto.
Justice Ndung’u has faulted the struggling telco for failing to serve KRC with a ‘Certificate of Order against government’ that provides particulars of the payment when the judgment was made nearly five years ago.
“Naturally, the ex parte applicant [Telkom] is spot on in taking steps to enforce the decree through the instant application for the judicial review order of mandamus. The ex parte applicant has, however, omitted a crucial mandatory step in execution of a decree against the government or a government agency,” Justice Ndung’u ruled last week.
“There is no evidence, and it is admitted as much, that the respondent was never served with a Certificate of Order against the government as prescribed in law. This omission is fatal to this application.”
The judge noted that Telkom Kenya is at liberty to file a proper application if it wants. The company has been in court since 2015 trying to recover Sh128.46 million for voice and Sh88.64 million for data services.
Court documents show Telkom went to court after the railway operator failed to pay the bills even after acknowledging them in 2014 and 2015 following a meeting between the executives of the two firms in 2013.
Former KRC managing director Atanas Maina had unsuccessfully objected to the settlement agreement between the two firms on October 15, 2013 and letter of admission on November 19, 2014 on grounds that “not valid to bind the corporation in any manner”.
Mr Maina, who was hounded out of office on corruption allegations in 2018, had dismissed the invoices and bills as “merely computer generates” and claimed the demand for payment was “hopelessly time-barred”.
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Joseph Muongi

Financial.co.ke was founded by Mr. Joseph Muongi Kamau. He holds a Master of Science in Finance, Bachelors of Science in Actuarial Science and a Certificate of proficiencty in insurance. He's also the lead financial consultant.