Ruling for BoU case against Sudhir and Meera Investments set for August

By Our Reporter

Court has set 26 of August as the date when Commercial Court judge, Justice David Wangutusi, will give a ruling in the case brought against Sudhir by the Bank of Uganda (BoU) through Crane Bank Limited (CBL) in receivership. Crane Bank in receivership had dragged Sudhir being a majority shareholder to be jointly sued by Sudhir objected.

In the main case BoU had asked court to compel Sudhir pay Shs397 billion. Sudhir’s lawyers led by Kabatsi objected and reasoned that an institution in receiver has no right to sue because  it is an illegality and as such the institution of the suit is an illegality  quoting section  92.25a of the Financial Institutions Act (FIA).

BoU lawyer led by Byamugisha say the actions weren’t commenced by BoU but rather by Crane Bank that could sue and be sued.

Byamugisha further said it is only the company with the right to sue but not the board because the board is suspended. However, this was contested by Sudhir’s lawyers.

In May 2019, Sudhir Ruparelia and Meera Investments lodged an application seeking court to dismiss a suit in which CBL in receivership sued the two applicants yet it had no legal capacity to do so.

BoU (receiver) took-over CBL before it connived with Dfcu to sell it at a throw away price.

“…I have been advised by…lawyers, which I advise I verily believe to be true, that the respondent has no legal capacity to sue applicants,” reads part of the application.
Mr. Sudhir and Meera Investments also in the application want the recovery, transfer and return of freehold property from CBL in receivership. “…I have been advised by lawyers, Kampala Associated Advocates, which advice I verily believe to be true, that under the Constitution and the Land Act, the Respondent cannot own and hold freehold property and is therefore, not capable of holding the suit property in its names,” the application continues.

Mr. Sudhir also in the application argues that he was sued as a sole shareholder of CBL, which is not true and that the respondent has no powers to commence against CBL shareholders or Sudhir himself.
“The orders sought against the 2nd applicant in HCCS 493 of 2017 are barred by law. The respondent cannot maintain an action against the 2nd applicant for recovery, transfer and return of freehold property when the respondent is a non-citizen within the meaning of the law” reads the suit.
In the application Sudhir wants CBL in receivership to pay National Social Security Fund (NSSF) the statutory debts. CBL in receivership was in the hands of BoU between October 20, 2016 and January 25, 2017 before its assets were controversially transferred to Dfcu bank by BoU.
“The claim by National Social Security Fund could only be made against the respondent,” the application states.

The application was lodged on April 30, 2019 and court has set July 3, 2019 as date to decide whether the plaintiff has no locus standi to commence actions against the applicant in High Court Civil Suit (HCCS) No 493 of 2017 against the applicants.
Court also will rule whether the plaint does not disclose the cause of action against the applicant and determine whether orders against second applicant (Meera Investments) are barred by the law but court will also determine whether the suit will be dismissed with costs as desired by applicants.