By GRACE CHAILE LESOETSA
DEVELOPMENT Bank of Zambia (DBZ) has denied breaching the provisions of the banking and financial services Act of 2017, saying Chita Lodge limited is justly indebted to it in the amount of K97 Million.
In this matter, DBZ has sued Chita Lodge, Mr James Chungu and another shareholder, Babsie Bulaya over an unpaid debt of K97 million.
The applicant is seeking interest on the amount due of K97, 907,282.31 as at October 25 this year.
It also seeks an order of possession of the properties namely, stand no.3705, Lusaka, stand no.1450, Samfya and Subdivision no.21 of farm no.484a, Lusaka.
DBZ wants an order of foreclosure of the mortgaged properties and that the same properties are put on sale.
It wants the court to order Mr Chungu and Bulaya as guarantors to pay the said amount.
But in an affidavit in opposition, Mr Chungu has submitted that the company had paid a total of K 26,746,302.40 from the total disbursement of K24, 825,268.82.
He argued that the claim of K97, 907,282.31 on a facility of K24, 825,268.82 is a violation of the provisions of the banking and financial services Act, 2017.
But DBZ in reply has stated that it was inconceivable for the respondents to deny the debt when the Lodge through its managing director Mr Chungu on February 13, 2020 did confirm and agree that the outstanding balance as at December 31, 2019 was K88, 627,116.48.
“ The applicant did not violate the provisions of the banking and financial services Act , 2017 as the first respondent’s loan was restructured and later capped in line with the provisions of the banking and financial services Act, 2017 as evidenced by exhibit ‘GL 22” and “GL 23” revealing the suspended charging interest,” the applicant stated.
DBZ stated that it decided to commence legal action against the respondents because the several settlement discussions claimed by them did not yield any positive results in favour of the financial institution but worked to delay its recovery of monies owed.