B.N Kotecha & Son limited wants the court to restrain Davesh Patel, his agents or servants from commencing the liquidation petition against their firm on the basis of the Statutory Demand dated 15th July 2022 and lodged in court on 19th December last year.
Kotecha is further seeking a permanent injunction against Patel from liquidating the firm over the debt.
“Unless this application is urgently heard and reliefs sought granted, the applicant and its employees would suffer much prejudice, and risk the danger of collapsing at the expense of the illegal and malicious actions of Patel,” says Kotecha.
Kotecha argues that Patel issued the statutory demand dated and later lodged it before the Deputy Registrar of the High Court.
“The Statutory Demand has not been served on the Respondent in accordance with section 384 of the Insolvency Act No. 18 of 2015 as it was not delivered at the Applicant’s registered office,” says Kotecha.
He argues that the 21-days under the Statutory Demand have since lapsed it may be presented any time to economic and financial ruin of the firm in the guise of recovering a debt that is wholly disputed on substantial grounds.
He further states that the first two attempts were the lodging of a criminal complaint against Kotecha by Patel and four others namely Manharbhai Radjibhai Patel, Bhavikumar Manharbhai Patel, Sajni Shah & Daxaben Manharbhai Patel.
The complaint was investigated and both the Director of Criminal Investigations and the Director of Public Prosecutions declined to prosecute the applicant.
Kotecha was charged before Milimani Chief Magistrate Court when he denied the charges.
In the case, Hemar Kishor Kotecha was accused that on 18 the of July ,2016 in Nairobi, with others not before court issued bad cheques each totalling to 39,310,000 million shillings in favour of Jumbo commodities ltd for an account held at GTB Bank limited when he had previously instructed the same bank not to honour the cheque.
In his application, he further argues that Patel and his four colleagues, maliciously issued a joint Statutory Demand dated 15th June 2021, in Insolvency Case. They also maliciously advertised the issuance of the Statutory Demand in daily newspapers on 1st and 2nd July 2021.
Kotecha Sons ltd on 17th August 2021, obtained an order suspending the Statutory Demand, pending the hearing of the application and an application to review that interim order was declined vide a ruling delivered on 18th March 2022. The application for the final setting aside of the Statutory Demand however, remains pending.
The sugar dealer adds that contrary to what is stated in the Statutory Demand, there was never a loan advanced by Patel to Kotecha and instead, Patel and his four colleagues, invested in Kotecha’s business.
“If the investment was profitable, Patel and his colleagues would benefit from the profits; if it was not, they would suffer the losses.There was therefore no agreement on when the investments would be repaid, nor was there any agreement on interest being paid on the amounts invested,” says Kotecha.
He claims that in fact, so far distributed Sh 23,3 million to Patel and his four colleagues and that is all that is so far available.
“Should there be more profits in future, the Respondents will receive them. In any event, Patel’s investment was not the Sh34,499,091.26 as he alleges.
The documents which he relied on in Insolvency case in alleged proof of the debt, are in fact inconsistent. The applicant is unable to discern the basis for claiming that sum,” claims Kotecha.