News / National
Masuka in court over US$94 000 loan
19 May 2022 at 06:36hrs | Views
AGRICULTURE Minister Anxious Masuka has allegedly failed to pay back a US$94 000 loan advanced to him five years ago in the form of tobacco farming inputs.
A Chinese tobacco contracting firm Tianze Tobacco Company Limited (Tianze), which advanced the loan, has resorted to recover the money via the courts.
Court papers seen by NewsDay show that in January 2017, Masuka acknowledged his indebtedness to Tianze for a sum of US$93 911,89.
At the time, Masuka undertook to offset the debt on, or before October 2019.
In terms of the agreement, Masuka was supposed to pay back in local currency, wherein Tianze would rate the payment made to the equivalent of United States dollars at the prevailing rate on the date of payment.
According to Tianze's heads of argument, the Agriculture minister signed a commitment document wherein he revised his payment terms and acknowledged owing the Chinese company.
On May 20, 2021 Masuka, through his lawyers, admitted owing the Chinese company money for tobacco inputs, but insisted, instead, that "the debt was denominated in RTGS dollars and that they had finished payment of same".
"Defendant (Masuka) has been making ridiculously low ZWL$ payments which were being rated at the prevailing interbank rate of that day by plaintiff (Tianze)," the court documents read.
As of October 2021, Masuka was in arrears of US$83 937,52 or its equivalent in local currency at the prevailing interbank rate.
"Despite lawful demand, the defendant has failed, and, or neglected to pay the amount outstanding. Plaintiff prays for judgment against defendant as claimed in the summons," the papers read.
Tianze prays that Masuka pays the balance including interest at the prescribed interest rate from the date of summons to the date of full payment.
In his head of arguments, Masuka said Tianze caused summons in December 2019 claiming inter alia US$85 699,73. Masuka proposed to pay back the loan in instalments, and that proposal was allegedly accepted.
"Between January 2020 and May 2021, the respondent fully paid back the debt in the Zimbabwe dollar. In February, respondent was surprised to be told that his Zimbabwe dollar payments were being converted to the United States dollar at the official rate of the day when payment was made. Respondent had paid the debt in the Zimbabwean dollar due to Statutory Instrument (SI) 33 of 2019," Masuka avers.
SI 33 ordered the transacting public to use the Zimbabwe dollar as the sole legal currency, among other things, from the effective date of February 22, 2019 for accounting and other purposes.
This ideally meant that the debt was converted at 1:1.
A Chinese tobacco contracting firm Tianze Tobacco Company Limited (Tianze), which advanced the loan, has resorted to recover the money via the courts.
Court papers seen by NewsDay show that in January 2017, Masuka acknowledged his indebtedness to Tianze for a sum of US$93 911,89.
At the time, Masuka undertook to offset the debt on, or before October 2019.
In terms of the agreement, Masuka was supposed to pay back in local currency, wherein Tianze would rate the payment made to the equivalent of United States dollars at the prevailing rate on the date of payment.
According to Tianze's heads of argument, the Agriculture minister signed a commitment document wherein he revised his payment terms and acknowledged owing the Chinese company.
On May 20, 2021 Masuka, through his lawyers, admitted owing the Chinese company money for tobacco inputs, but insisted, instead, that "the debt was denominated in RTGS dollars and that they had finished payment of same".
"Defendant (Masuka) has been making ridiculously low ZWL$ payments which were being rated at the prevailing interbank rate of that day by plaintiff (Tianze)," the court documents read.
As of October 2021, Masuka was in arrears of US$83 937,52 or its equivalent in local currency at the prevailing interbank rate.
"Despite lawful demand, the defendant has failed, and, or neglected to pay the amount outstanding. Plaintiff prays for judgment against defendant as claimed in the summons," the papers read.
Tianze prays that Masuka pays the balance including interest at the prescribed interest rate from the date of summons to the date of full payment.
In his head of arguments, Masuka said Tianze caused summons in December 2019 claiming inter alia US$85 699,73. Masuka proposed to pay back the loan in instalments, and that proposal was allegedly accepted.
"Between January 2020 and May 2021, the respondent fully paid back the debt in the Zimbabwe dollar. In February, respondent was surprised to be told that his Zimbabwe dollar payments were being converted to the United States dollar at the official rate of the day when payment was made. Respondent had paid the debt in the Zimbabwean dollar due to Statutory Instrument (SI) 33 of 2019," Masuka avers.
SI 33 ordered the transacting public to use the Zimbabwe dollar as the sole legal currency, among other things, from the effective date of February 22, 2019 for accounting and other purposes.
This ideally meant that the debt was converted at 1:1.
Source - NewsDay Zimbabwe
