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Gupta blow as bid to stop NPA attaching assets fails

Law firm has no legal standing to represent company, court rules

Isaac Mahlangu Senior reporter
Atul Gupta and his family suffered a blow with the high court giving the National Prosecuting Authority the green light to attach assets worth millions of rands.
Atul Gupta and his family suffered a blow with the high court giving the National Prosecuting Authority the green light to attach assets worth millions of rands.
Image: Kevin Sutherland

A high court ruling has given the National Prosecuting Authority the green light to attach assets owned by the Gupta family worth millions of rand.

This comes after the Gupta family suffered another blow when the Bloemfontein magistrate's court ruled that their lawyers have no authority to oppose a preservation order against one of their companies linked in a corruption case amounting to about R25m.

The Free State High Court delivered the judgment on Wednesday which ruled in favour of the National Director of Public Prosecutions (NDPP) who had successfully argued that a law firm appointed to represent Gupta company Islandsite Investments has no legal standing to represent the company.

The family's two brothers Atul and Rajesh and their wives are among 17 accused in a R24.9m procurement fraud case that is before the Bloemfontein magistrate's court for which the NPA's Investigating Directorate had sought a preservation order on the assets of Islandsite, a company owned by the family which still has assets in SA.

The family, which is embroiled in a legal battle to remove the business rescue practitioners appointed three years ago, tried to oppose the preservation application despite not being in control of the company.

Judge president of the Free State High Court Cagney Musi found that BDK Attorneys, which was appointed to represent Islandsite Investment, does not have a legal standing to represent the company.

“I therefore conclude that the company had no right to authorise BDK to oppose proceedings on its behalf, without authority of the business rescue practitioners. Therefore BDK had no proper mandate to appear on behalf of the first defendant [Iqbal Sharma]," Musi ruled.

The case also involves three former heads of the Free State agriculture and rural development departments who are indicted alongside the Gupta brothers and their associates, including Sharma and his company, Nulane Investments.

In 2011, a controversial feasibility study contract which also benefited Islandsite Investment was awarded to Nulane Investment in preparation for work to rollout the Vrede dairy project.

Islandsite Investments had been in business rescue since February 2018, however a fallout between the business rescue practitioners and the family has led to a court battle, which looks set to end up in the Constitutional Court.

Chetali Gupta, the wife of Gupta brother Atul, went to the Pretoria high court in November 2018 where her application to remove Kurt Robert Knoop and Johan Louis Klopper as business rescue practitioners was granted, however the court's ruling was overturned in the Supreme Court of Appeal in Bloemfontein in December last year.

She has now applied for a condonation in the Constitutional Court for a late filing of the court papers as she's trying to escalate the matter to the apex court.

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