The high court yesterday restrained the Bank of Baroda Kenya and other two businessmen from taking over the operations of Thika Nursing Home and Thika School of Medical and health sciences over Ksh 370 Million debt.
Justice Alfred Mabeya of the commercial and tax division in Nairobi issued the temporary orders pending the hearing of a suit filed by the two institutions claiming that the Bank has taken over the two institutions and listed them with the Credit Reference Bureau (CRB).
The Nursing Home and the School through lawyer Professor Tom Ojienda in court documents claim that they have been taking loan facilities to expand their businesses and prior to March 2020 before the Covid-19 pandemic struck, they were substantially compliant with all its loan obligations with the Bank.
“After the pandemic, business became low as expected. As a result, just like many businesses, the Applicant started to struggle with repayment of its loan facilities. The disputes thus became inevitable,” states Doctor Barham Dev. Vasisht, the Managing Director of both institutions in court documents.
The two institutions claim that they sought to restructure their debts with the Bank, but the challenges persisted due to slow growth in the economy caused by the pandemic.
Through Prof Tom Ojienda, Thika nursing home and Thika School of Medical and Health Sciences claim that the bank kept on piling pressure on them by issuing threats meant to paralyse the operations of the institutions which made them move to court.
It is their contention that on 20th April 2021, the court issued an order of temporary injunction restraining the Bank from downgrading or interfering with the two institutions credit rating and listing or in any way whatsoever interfering with their loan accounts.
They say the Bank still went ahead and listed the two institutions with the Credit Reference Bureau (CRB), making things even more difficult for them to finance their operations and repay the facility.
The bank then moved quickly to appoint two businessmen namely Ponangipalli Venkata Ramana and Swaroop Rao Ponangipalli as the administrators on account of three debentures.
“It was thus very clear that the Bank was never interested in having the Applicant to repay its facility but preferred to maliciously frustrate and handicap it to fail in its financial obligations so that it can eventually take over its businesses through proxies,” argues the Managing Director in court documents.
It is their contention that the Bank appointed administrators to take over the operations of the instructions has crippled the operations of the two institutions.
The court has directed the application to be served upon the respondents within 14 days.
*This article was written by Meshack Makau for Uzalendo News. Email: uzalendonews24@gmail.com to submit your story.
SUBSCRIBE TO OUR YOUTUBE CHANNEL
