BackGupta firms lose bid to have Bank of Baroda remain in South Africa
A group of almost 20 South African companies linked to the Gupta family have lost a court bid which sought to have Bank of Baroda, the last lender doing business with the firms, maintain operations in the country
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Johannesburg: A group of almost 20 South African companies linked to the Gupta family have lost a court bid which sought to have India’s Bank of Baroda, the last lender doing business with the firms, maintain operations in the country, court documents showed on Monday.
Bank of Baroda’s South African division was thrust into the spotlight two years ago when it agreed to take on the Guptas after South Africa’s major banks turned their back on the family’s businesses. Bank of Baroda said a month ago that it had pulled the plug on its South African business, citing a strategic decision to slim down in international markets.
The Guptas, a trio of India-born brothers, have been accused by the South African public anti-graft watchdog of using their friendship with former president Jacob Zuma to influence policy decisions. Zuma and the Guptas deny any wrongdoing.
In his ruling, Judge Ntendeya Mavundla said Bank of Baroda’s right to trade or not to trade supersedes whatever right, if any, the applicants might have, a copy of the judgment obtained by Reuters showed.
“Consequently, I refrain to exercise my discretion in favour of the applicants and accordingly decline to grant them the relief sought," the judgment said, dismissing the application with costs.
This will make it all but impossible for the companies to operate in South Africa. Some of their assets such as the Optimum coal mine, are currently in business rescue proceedings. Official documents showed last month that at least eight companies owned by the wealthy Gupta family had filed for protection from creditors.
Officials from the Gupta companies and Bank of Baroda could not be reached for immediate comment.
The country’s chief prosecutor last month declared Ajay Gupta a “fugitive from justice" after he failed to hand himself in to police, who are conducting an investigation on the family. Pressure has been mounting on the Guptas since Zuma was forced from office last month by the ruling African National Congress party.
His resignation came just hours after police raided the luxury home of the Gupta family.
Indian tax inspectors last week raided premises of the Gupta family. Amrendra Kumar, a senior income tax official in India’s Uttar Pradesh state, told Reuters that the Gupta brothers were suspected of finding ways to bring “illicit money" they had earned abroad into India. Reuters
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