Judge asked to make landmark ruling

In the first ruling of its kind, the Durban High Court has been asked to decide if a confidentiality agreement between the South African Revenue Service (SARS) and taxpayers prevents officials from giving evidence in prosecutions not instituted by them.

Judge Hilary Squires, presiding in the trial of Durban businessman Schabir Shaik, was asked to make the ruling after the state indicated that it wished to call a Durban tax official, Rob Reid, as a witness.

Shaik faces a charge of tax evasion as an alternative to the fraud charge against him.

He has also been charged with two counts of corruption.

He has pleaded not guilty to all the charges against him.

To prove the tax evasion charge, the state would need to call Reid and hand in Shaik's tax returns.

The SARS yesterday went to court to ask for clarity on whether it could do this or whether it needed a court order compelling it to do so.

"The commissioner is not taking sides on whether the evidence should be given or not," said advocate Peter Olson (sic - Olsen) SC, for the SARS.

Advocate Guido Penzhorn SC, for the state, said that the prosecution team believed the SARS could hand over documents and give evidence in the course of their duties.

Shaik is opposing the handing in of the evidence.

It will be the first time in legal history that the court will rule on this issue.

Squires has reserved judgment on the matter.

The court also heard yesterday that Shaik had bought the furniture that was in a flat he had rented for Deputy President Jacob Zuma, but took the items away without paying for them.

The landlord, Tracy O'Brien, found some clothes, paintings and ornaments belonging to Zuma after he had moved out of the flat in Mallington (sic - Malington) Place, Durban.

The state alleges that the rent was one of the payments Shaik made in advancing what it alleges was a "general corrupt relationship" between Shaik and Zuma.

O'Brien said the owner of the flat was Paul Saad.

She had rented the premises from him and advertised to sublet it.

Shaik had answered the advertisement in August 1996.

Shaik's counsel, Francois van Zyl SC, said his client would say that Zuma had occupied another flat in the same block.

O'Brien said the flat was first used by the Nkobi group of companies' financial director, Colin Isaacs.

But she then found out that the flat was in fact occupied by Zuma.

She told the court that she had been informed of this by the body corporate of the block, which complained about Zuma's armed bodyguards.

"Every month the rent was late. It was eventually always paid.

"Some of the cheques bounced. But it (the rent) was always late," O'Brien told the court.

She said that the rent was paid by a number of companies in the Nkobi group, but that she did not really care which of them coughed up because she was "just grateful to get them (the payments)".

After a while she decided to terminate the sublease with Shaik.

She then decided to sell the furniture in the flat.

Shaik came to have a look and told her that he would buy the furniture for "Zuma's house in Zululand".

O'Brien said the furniture was removed and transported to Empangeni without her knowledge, and was never paid for.

Zuma, she explained, left behind some of his personal belongings, including clothes, ornaments and paintings.

Van Zyl has indicated that Shaik would say that Zuma moved into the flat after his house was burned down and that the intelligence services believed that his life was in danger.

The trial continues.

With acknowledgement to Estelle Ellis and the Daily News.