Salima Sugar in K798m spat
The Public Private Partnership (PPP) venture Salima Sugar Company Limited (SSCL) has been embroiled in yet another dispute over sugar worth in excess of K790 million a businessperson allegedly obtained without payment.
According to court documents Weekend Nation has seen, Rmart Investment, which trades in sugar business and is owned by Rajesh Salian entered into two separate agreements with Salima Sugar to purchase sugar on credit.
In one agreement, Rmart acted as SSCL sales agent and in another agreement the Lilongwe-based sugar trading company was to purchase sugar on credit as a customer.
However, according to the court documents, in performing its agreement, Rmart started purchasing sugar from SSCL on credit facility and by November 2023 it accumulated a net sum of K798 015 550.15 which it failed to settle.
SSCL claims Rmart has neglected or wilfully opted not to settle the net balance despite several reminders which has resulted in the company suffering loss and damage.
Lawyer representing Salima Sugar Chrispine Ndalama said in an interview that these transactions were done under the SSCL management of former chairperson Shirieesh Betgiri.
He said when the new leadership led by executive chairman Wester Kosamu followed up with Rmart, the owner claimed that the previous management gave him a one-year amnesty not to pay.
However, Ndalama said there was no documentation to prove there was any amnesty between the two companies.
He said: “There is no evidence of the purported agreement that they were given one-year amnesty.”
The lawyer claimed if any agreement between SSCL and Rmart Investment was made, then it was unlawful or Betgiri may have unilaterally agreed with the company to pay after a year.
According to the documents, SSCL is claiming the arrears including compound interest on the sum at two percent above the current National Bank lending rate from the time the sums became payable.
The case, which is under commercial cause number 48 of 2024, has been filed at the High Court Commercial Division Lilongwe Registry and Judge-In-Charge Chifundo Kachale has assigned Justice Charlotte Malonda to preside over it.
Kachale gave Rmart Investment 28 days, from April 3 2024, if it intends to contest the proceedings, to file and serve a defence and a list of documents.
There was no immediate response from Rmart Investment as we went to press.
Over the past months SSCL has been embroiled in controversies since government commissioned a forensic audit which revealed massive financial fraud.
The audit, which was carried out by Audit Consult, uncovered that K51 billion was abused between 2016 and 2022 and some of the people implicated in the loot included politicians and senior civil servants.
This was followed by the termination of a shareholding deal between Greenbelt Authority (GBA) and AUM Sugar and Allied Limited (AUM SAL) of India due to what government described as breach of contract.
Before the termination, SSCL had 40 percent of shares owned by Malawi Government while 60 percent was held by AUM SAL.
Later, police arrested Betgiri and issued arrest warrants for other SSCL directors Prashant Sharma, Vikas Hirawatt, Sachin Nikam and former GBA chief executive officer Henri Njoloma who are all suspected to be outside the country.
Attorney General Thabo Chakaka Nyirenda said the previous management opened a bank account in the name of Salima Sugar Company Limited in Dubai without the knowledge of government.
