Business Times

Nisol directors deny all charges of fraud

Directors of Nisol Corrugated Cartons Ltd have denied all allegations made by Samapth Bank in an application filed in the High Court, alleging fraud and misconduct on the part of the directors.

Nisol Corrugated, which is seeking liquidation based on insolvency, has several high profile directors including Sohli Captain, Russi Captain and Nigel Austin, all of whom are being held personally responsible under certain clauses in the Companies Act No. 7 of 2007, for Rs.108 million owed to Sampath Bank.

According to proceedings of 12 October 2009 before Colombo High Court judge E.A.G.R. Amarasekera, attorney-at-law Nihal Fernando appearing on behalf of the directors stated that the serious allegations of fraud and misconduct alleged in the petition have been denied by the respondents who were summoned by the Court.

Mr. Fernando submitted that material facts have been totally suppressed in the petition and stated that in any event, whether in civil or in criminal proceedings, allegations of fraud has to be proved beyond reasonable doubts. He stated that since it is apparent that this application has been made maliciously by blackmailing the respondents to get them to make payment to the creditors, the respondents reserve the right to claim damage from Sampath Bank and the directors or officers responsible. However, attorney-at-law for Sampath Bank Chandaka Jayasundera stated that all allegations have been made based on the audited accounts of the company.

Mr. Fernando added that in terms of the law, the directors of the company have already furnished the statement of affairs to the liquidator and co-operated with the liquidator on all matters. Observations of the liquidator are to be filed on 17 December 2009. Objections are to be filed on 18 January 2010.

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