Court freezes Mbale municipal council accounts over Shs 146m debt

The High court in Mbale has frozen two bank accounts belonging to Mbale municipal council over unpaid debts amounting to Shs 146 million. The two accounts include one in Housing Finance Bank and the other in Kenya Commercial Bank (KCB). 

The decision follows a suit filed by Buharera Investments Limited, a company that was contracted in August 2015 to maintain the composting site in Namatala, Mbale Municipality. The company is now demanding a total sum of Shs 146,475,000 for its services.  

The court, through the deputy registrar Lillian C.N Mwandha ordered that Mbale Municipal Council settles the Shs 146 million debt and also pays an additional Shs 10 million to Buharera Investments.  

Mbale municipal council chief finance officer Michael Mabala said that they are working out a way to settle the matter. However, Yusuf Muhub, the councillor representing IUIU Ward, suspects that the case between Buharera Investments Limited and the municipal council is a connivance between the two entities to swindle public resources. He says the council is unaware of any running contract between Mbale municipality and the said company.

 

"I don’t remember, and I have never heard about that company that you’re talking about. Is it Buharera or whatever. It was my first time to hear about that company. In any case, we had someone who was asked to collect money as he remits, I don’t know if it was pre-qualified or not. Because the problem we have with the council is one; these technocrats conceal information. They don’t give us the information. If they were to give us the information they did not give information on time," said Muhub.  

Madagi Kassim, the Male Youth councilor says he only got to know about the debt when some members were presenting the court ruling to him. 

 

"This is the first time we're hearing about this company and that the municipal council owes it money. As council we have never been informed about this and now minutes are being forged and passed through the finance committee to pay the company. We're very suspicious because they are targeting municipal money coming through in the second quarter.

Yasin Wabomba, the Mbale municipality deputy speaker dismissed the court ruling, saying that the registrar issued the order in error. In a letter dated November 14 and addressed to the Mbale High court resident judge, Wabomba contends that the order contradicts sections of the Local Government (Amendments) Act, 2015 which provides that no execution or attachment shall be issued enforcing payment by a local government on its property before a period of six months from the date of judgment, order or decree.   

“Whatever was entered happened on the May 29, 2019, and orders were made on November 13, 2019” the letter partly reads.   

Secondly, he says, the amount demanded indicated that the order that has been granted amounts to a double payment.

 

"The garnishee was for Shs 137,075,000 instead of Shs 146,475,000. The judgment debtor had been paid Shs 29,000,000 implying that the balance was Shs 108,075,000," the letter adds. 

This is not the first time the accounts are being frozen, in September 2012, Eastern Auto Parts, a company that collected property rent, secured a High court order for the seizure of the municipal’s main accounts in Stanbic bank, Mbale branch.