During proceedings to confirm the June 2021 preservation order which greenlit the seizing of assets worth millions belonging to Iqbal Sharma, his wife Tarina Patel, and the Gupta family via Islandsite Investments, the deteriorating relationship between the Gupta family and the practitioners assigned to rescue their businesses - Knoop and Kloppers - took centre stage. The state, represented by Suna de Villiers, is of the view that because Islandsite Investments is under business rescue, it cannot be represented by the company’s directors in asset forfeiture proceedings but rather by the business rescue practitioners assigned with running the business.

Senior Counsel Mike Hellens, appearing on behalf of Islandsite Investments, vehemently disagrees with this argument, telling Bloemfontein High Court Judge President, Cagney Musi, that the BRPs are not the appropriate parties to represent the company because they do not have knowledge of the businesses’ affairs during the time in question. Hellens further argues that divorcing this civil matter from the criminal proceedings is nonsensical because “will the BRPs represent Islandsite Investments during the trial”. De Villiers, on the other end, says there is provision legally for the BFP’s to delegate matters pertaining to this case to the Islandsite Investments directors - who have submitted affidavits in the matter - but they haven’t done so. Hellens quips that that is because the BRPs have “abandoned” the company.

Judge Musi will next week decide on whether Islandsite Investments can be represented by its Directors or must be represented by the BRPs, come the continuation of the asset forfeiture matter on 18 November.

Islandsite Investments, which according to reports owns 40% of Oakbay Investments, the controversial Gupta mansion in Saxonwold and the family's Cape Town home, has been linked to the near R25 million Vrede dairy feasibility study that has been deemed the catalyst of the alleged looting and money laundering that took place regarding the project.

In 2011, the Free State Agriculture Department paid over almost R25 million to Nulane Investments, which was owned by former Transnet board member, Sharma, for the Vrede feasibility study. Nulane Investments – represented by Sharma’s brother-in-law Dinesh Patel – then negotiated and subcontracted the same feasibility study to the forensic auditing firm, Deloitte, for R1,5 million. They went further and subcontracted the work already carried out by Deloitte to Gateway Limited, and paid them R19 million. The state alleges the funds were thereafter laundered into varied accounts, including that of Islandsite Investments. It is because of the money laundering that occurred that the Gupta family has now been linked to the case.

Those already arrested for the case, include government officials: Former Free State Agriculture Department Head, Peter Thabethe; current Deputy Director-General at the Department of Cooperative Governance and Traditional Affairs (Cogta), Sylvia Dlamini; and Bloem Water Chief Executive Officer (CEO) Limakatso Moorosi, as well as Patel and Sharma. Patel and the aforementioned government officials have since been released out on R10 000 bail. Sharma was denied bail by the Bloemfontein Magistrate’s Court, but was promptly released by the aforementioned High Court on R500 000 bail.

The state has, in light of the money-laundering allegations, approached Interpol to have them issue red notices for Atul and Rajesh Gupta, as well as their wives Chetali and Arti. Whilst red notices for the Gupta family are under consideration, the notices have been issued for their associates: former Nulane Investment's Bank of Baroda account signatory Ankit Jain;  the director of Wone Management, Ravindra Nath; and the Directors of Pragat Investments, Ramesh Bhat and Jagdish Parekh.

Meanwhile, the Guptas are battling it out with the business rescue practitioners in the Constitutional Court, the judgment of which is yet to be handed down.

OFM News