Dar es Salaam: Barclays loses Shs.424 million debit case

By  Julius Bwahama.

The Commercial Division of the High Court has ordered Barclays Bank to pay SCI Tanzania Ltd Sh424.4 million after being satisfied that the bank unlawfully debited the company’s money to a wrong account.

Apart from Barclays Bank other defendants in the suit include Temm Power Solutions and CRDB Bank.

Justice Robert Makaramba also ordered Barclays to pay 18 per cent interest on the principal amount per annum from August 2008 to April this year.

The court found another defendant in the case Temm Power Solutions and CRDB innocent of an allegation that they acted fraudulently in transferring the money.

SCI had alleged in court that in August 2008, by usual order, instructed Barclays to transfer Sh424,458,799.29 to the Tanzania Revenue Authority (TRA) as VAT. But to their surprise on September 17, 2009, the tax authority wrote them complaining of failing to remit VAT payments. When SCI pursued the matter with its banker, the bank denied to have received such instructions but acknowledged to have made the payment to TEMM Power Solutions.

This was later denied by a defence witness during a cross questioning that the bank received Tanzania Inter-bank Settlement System order instructing it to transfer the money to TRA.

SCI’s counsel Audax told the court that the mistake denied his client the use of the money for over two years from August 2008 to the date of filing the suit. The defendants were presented by Mr Evance Laswai.

Mr Audax also claimed that his client had suffered general damages in form of loss of credit and confidence from TRA, its clients and the public at large.

Barclays has all along denied the claims, leaving the firm with no option but to sue the bank in January 2011.

SCI had asked the court to order Barclays to refund Sh424.4 million and pay interest of above 25 per cent per annum from August, 2008 to the date of judgment.

Source: http://www.thecitizen.co.tz/News/-/1840392/1863042/-/ewe1atz/-/index.html