• They claim Sarrai’s activities have been emboldened by utterances made by politicians in public meetings that no one can stop Sarrai from operationalising Mumias.
• The creditors now claim that Sarrai misinterpreted the stay orders and is stealing machinery and equipment from Mumias.
The Mumias Sugar lease dispute has taken a new twist, with creditors accusing Sarrai Group of intending to smuggle sugar from Uganda.
In an application filed on Friday last week, the creditors claim that Ugandan firm wants to smuggle sugar from Uganda and sell it in Mumias Sugar packaging.
“The only source of sugarcane that Sarrai will produce to the general public will be imported sugar smuggled from its factories in Uganda, which it intends to sell in Mumias Sugar packaging material,” court papers read.
According to court papers, this is a very serious public interest issue that can easily turn into a public health crisis if poisonous sugar is allowed to be smuggled into the country through Mumias platform.
They have pleaded with the court to stop Sarrai from further vandalising the factory pending hearing of their application.
“If Sarrai is allowed to continue being in possession of and with no security provided to ensure Mumias assets are not destroyed or stolen, Sarrai will deliver the kiss of death to Mumias leaving it as a shell right before our eyes,” they argue.
They also claim that Sarrai’s activities have been emboldened by utterances made by politicians in public meetings that no one can stop Sarrai from operationalising Mumias.
The Mumias Sugar Company roared back to life after the management of the Sarrai Group started a test run of the mills.
In April this year, the court cancelled the lease awarded to Sarrai, but the company later got stay orders for the judgment by Justice Alfred Mabeya.
The creditors now claim that Sarrai misinterpreted the stay orders and is stealing machinery and equipment from Mumias.
They claim that in June this year a vehicle belonging to Rai Cement, a company owned by Sarrai Group, went to the sugar mill and removed several machinery, motors and other equipment in unclear circumstances.
“Sarrai’s sole intention is to strip, dismantle and cannibalise Mumias assets to leave a shell and completely obliterate any prospects that creditors have to recover their debt,” court papers read.
The creditors argue that all this is happening away from the glare of the court because there is currently no oversight over Sarrai activities since it’s unclear what steps the new administrator has taken to secure the assets of Mumias.
According to the creditors, Sarrai has been operating Mumias Sugar assets without any legal authority, accusing them of disobeying court orders.
They want the court to stop any dismantling, stripping, removal, transfer or disposal of any moveable or immovable assets of Mumias Sugar Company with immediate effect.
Meanwhile, Gakwamba Farmers, who are in support of Sarrai group running the sugar mill, have also filed an application seeking a three-judge bench to determine the dispute.
They argue that it is in the interest of justice that the matter is determined before an uneven number of judges because the case will affect insolvency legal framework and practices in the country.
“The issue in this matter raises substantial questions of law necessitating to be heard by an uneven number of judges being not less than three,” the application read.
In her direction on Monday, Justice Wilfrida Okwany directed parties to file responses to both applications by close of business today (Tuesday).
The case will be mentioned on July 27 for purposes of taking directions with regards to the pending applications.
Edited by A.N