By Andrew Irumba
Kampala: City businessman Sudhir Ruparelia has prayed to the commercial court to dismiss a case filed against him by the Bank of Uganda in 2017, over the closure of Crane Bank. The lawyers made the objection when the case filed in January 2017 came up for hearing today before the commercial court.
Sudhir argues that the Central Bank overstepped its mandate in commencing court proceedings against him and his Meera Investments Company. Bank of Uganda sued Sudhir, his wife Joystna Ruparelia, Meera Investments Group and Others for allegedly fleecing his own bank-former Crane Bank of Shs397 billion through carrying out fraudulent transactions.
However, Sudhir, through his lawyers of Kampala Associated Advocates, on Wednesday presented an objection against Bank of Uganda (BOU) case before Commercial Court judge David Wangutusi. According to the Lawyers’ submissions, when dissolving Crane bank, BoU had three options including putting someone else in its management- what is termed as statutory management, receivership or liquidation.
However, Sudhir’s lawyer Elison Karuhanga argued that BOu chose to go for receivership yet Under the law, specifically only the manager and the liquidator of the said bank is mandated to file a suit and not a Receiver . He further explained that BOU as a Receiver could only dissolve or sell Crane Bank within 12 months but not sue it’s managers.
However in his response to the submissions of Sudhir’s lawyers, BoU through its lawyer Dr Joseph Byamugisha, told court that when a financial institution is placed under receivership the power to commerce or to continue with a civil suit does not stop.
BoU Case Details
BoU on January 25, 2017 placed Crane Bank under receivership. Later that same year, the central bank alongside Crane Bank sued Sudhir and his Meera Investments Company for allegedly fleecing his own bank of Shs397billion in fraudulent transactions. Sudhir denied the allegations and counter-sued BoU, seeking compensation of USD8m (Shs28b) in damages for breach of contract.