Human rights defender Okiya Omtatah is challenging the decision to allow Commercial Bank of Africa (CBA) and NIC Bank not to pay tax for their planned merger.

In a petition filed in the High Court on Friday, Omtatah, who has won many landmark public interest cases, claims the move by the National Treasury was secretive, opaque, irregular, unlawful and unconstitutional and wants the court to intervene and stop it.

“The impugned tax waiver which was granted on July 26 but was only announced in August 18 is irregular, unlawful and unconstitutional,” the petition filed under a certificate of urgency reads in part.

He has sued the National Treasury Cabinet Secretary and the Attorney General while the two lenders are listed as interested parties.

In his suit papers, Omtatah avers  no sufficient public participation was undertaken and that taxpayers stand to suffer a great loss estimated at Sh350 million in lost tax revenues that would otherwise accrue to public coffers.

“This Court must intervene immediately to stop this abuse and improper use of power by the National Treasury CS,” adds Omtatah.

CBA is majority owned by the Kenyatta family through Enke Investments Limited and Ropat Nominees Limited. Others are Livingstone Registrars Limited and billionaire businessman Naushad Merali’s Yana Investments Limited.

NIC Bank’s major shareholders are listed as former Central Bank of Kenya Governor Philip Ndegwa’s First Chartered Securities Ltd and ICEA Lion Asset Management Ltd. Other main shareholders are Livingstone Registrars Ltd and Rivel Kenya Ltd.

The merger was announced in December last year in a deal that will seethe 34 shareholders of CBA will in aggregate own 53% of the then issued shares in NIC Group, whilst existing NIC Group shareholders will own 47% of the then issued shares in NIC Group.

The merger plan has since been approved by both the Central Bank of Kenya and the Competition Authority of Kenya.