UMSC loses appeal to stop sale of its prime properties over Shs19b debt

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Muslims leave Old Kampala Mosque after prayers recently. PHOTO/ FILE

What you need to know:

  • Their appeal has been dismissed. 

The Uganda Muslim Supreme Council (UMSC) Wednesday lost an appeal in which it hoped to stop auctioning of its several prime properties to pay off a Shs19b debt they owe a businessman.

The properties due for auction include land occupied by Gaddafi National Mosque in Old Kampala.

In a ruling delivered Wednesday morning, Justice Christopher Gashirabake, who sat as single judge of the Court of Appeal, held that the balance of convenience is to allow businessman Justus Kyabahwa to sell off the eight prime properties to recover his money.

“In the circumstances of this case, the applicant (UMSC) has failed to prove that it has a likelihood of success in the pending appeal or that it will suffer any damage or harm that cannot be atoned for by an award of damages. Clearly, the balance of convenience would be in not granting this application for stay of stay of execution but to allow the party (the businessman) with the judgment in hand to proceed with the execution process,” ruled Justice Gashirabake.

He continued: “Consequently, for the reasons I have given above, this appeal is dismissed. The costs shall abide by the outcome of the appeal.”

Lawyer for the businessman Ahmed Kalule welcomed court’s decision saying “they are ready to auction the earmarked properties come December 24- should the UMSC fail to pay his client all the outstanding debt by then.”

The UMSC unsuccessfully appealed against a decision by the Commercial Division of the High Court which they ordered the auctioning of several properties for the businessman to recover his money.

According to a court attachment order seen by Monitor, properties to be attached are land comprised in lease hold register Volume KKCA 149 Folio 16 land at Kampala City William Street 30, land comprised in lease hold register volume 2771 Folio 2, Old Kampala Plot 23-25 where the Gaddafi national Mosque sits, Kyadondo Block 195 Plot 5463 land at Kyanja, one Square Mile of land at Bukwe, Hoima.

Others are one acre piece of land located at Lumbas, Jinja, Plot of land at Mbale, Shares in Uganda Ranchers Ltd and Commercial Holdings Ltd; subsidiaries to Uganda Moslem Supreme Council that owns two square miles of land at Migyera-Buluri and plot in Entebbe opposite Victoria Mall.

Background to the case

The attachment court order arose out of a protracted sale of land in which the UMSC sold land located in Sembabule District to Kyabahwa at Shs3.5billion.

However, Kyabahwa could not take possession of the said land since it was already leased out to Enterprise Handling Services Limited (ENHAS) for 15 years from 2013 to 2028.

So, since Kyabahwa could not take possession of the land, the UMSC was supposed to refund his money immediately but did not and had not paid him for the past 15 months.

This saw interest charged at 12 percent per month, catapulting the money that the UMSC is supposed to pay him to amount to about Shs19b.