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Vedanta lose suit against KCM liquidator

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  • But Vedanta says it is disappointed at the judgement and continues to believe that the provisional liquidator is currently contravening the limitations of its office and will be consulting its legal team as to its next steps.

By GRACE CHAILE-LESOETSA

THE Lusaka High Court has dismissed a matter in which Vedanta Resources Holdings Limited and two others sued Konkola Copper Mine (KCM) provisional liquidator, Milingo Lungu, challenging the reorganisation of the mining firm.

High Court Judge Dr. Winnie Mwenda said the application for leave was improperly before the court and it had no jurisdiction to entertain it.

But Vedanta says it is disappointed at the judgement and continues to believe that the provisional liquidator is currently contravening the limitations of its office and will be consulting its legal team as to its next steps.

Last December 28, Mr Lungu issued a management brief to KCM employees, announcing the reorganisation of the giant mining firm.

Under the reorganisation, Mr Milingo proposed to restructure KCM into two subsidiary companies effective February 1, this year.

But the three, Vedanta Resources Holdings Limited, Vedanta Resources (Jersey II) Limited and Vedanta Resources Limited challenged the splitting of the firm in the Lusaka High Court.

They argued that Mr Lungu did not have the power to carry out the reorganisation of KCM business, assets and affairs in the manner he announced on December 28.

Vedanta Resources Holdings and others also wanted an order of injunction restraining Mr Lungu from undertaking any reorganisation of KCM or transferring, disposing of, selling or dissipating the assets until the determination of the proceedings.

The three stated that by the proposed actions of Mr Lungu and KCM they would continue to suffer loss and damage.

Mr Lungu however argued that the reorganisation and restructuring of KCM is within the mandatory power as provisional liquidator of the mine.

He stated that no order of court is required for him to carry out functions that are incidental to the powers given to him by the court.

Mr Lungu stated that KCM Smelter Company Limited and Konkola Mineral Resources are subsidiary companies owned by the State therefore it is not true that the reorganisation is intended to remove the assets of the mine (KCM) from the supervision of the court.

Ms Justice Dr. Mwenda in her ruling yesterday, said a wrong process was used by the plaintiffs to apply for leave to commence proceedings against Mr Lungu, a company in  provisional liquidation.

“This is the basis for my stating earlier on in this ruling that the plaintiffs’ notice of motion has no leg to stand on. I accordingly, dismiss it. I set aside the ex parte order granting leave to the plaintiffs to commence an action against the first defendant and dismiss the matter before this court. The ex parte order of injunction dated 18th January, 2021, is accordingly, discharged forthwith. Leave to appeal is denied,” Justice Dr. Mwenda ruled.

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