Two directors of a flower firm accused of stealing Sh107 million from the company have failed to quash the criminal charges after a judge ruled that there was no proof that the prosecution was abusing the court process.
Mr Shailesh Kumar Rai and his wife Ranjeeta Pandey Rai, who are directors at Rosalia Blooms Limited challenged their prosecution arguing that the charges were illegal and that the trial court failed to distinguish the company as a separate entity from its directors as they cannot be held liable for the acts of the company.
The couple were charged in August last year, together with two employees Isaac Ikua Kihara and Chris Oyunge, and denied a total of nine counts including conspiracy to defraud and forgery.
The directors argued that the main dispute resulted from the sale of flowers by the company, which was within local markets, and the existence of another company running a competing business parallel with Heritage Flowers Ltd, contrary to the Articles of Association.
They maintained that the matter was a civil law concept incapable of criminal litigation.
The couple said the crux of the complaint is within a derivative suit, as the case involves breach of statutory duties, breach of trust, and the duty to avoid conflict of interests owed.
But Justice Lilian Mutende dismissed the case saying the charges were clear that the company was the main complainant and owner of the money.
The judge said other than the question of the company being defrauded as particularised in the charges, which they allegedly committed in their capacity as servants, directors, and agents of the company, there is the question of processing criminal proceeds to disguise their illegal origin such as operations.
“If proved should be interrogated and those involved brought to book. These actions amount to offences under the Penal Code which could be tried before a magistrate,” said the judge.
The court added that there is also the element of a criminal aspect which takes a different character that is not limited to the private interest of parties but calls for prosecution to conclusion by the Director of Public Prosecutions (DPP).
Justice Mutende also faulted the directors for challenging the charges too late. The court noted that a witness has already testified and has been cross-examined and documents tabled before the trial court and interrogated by the defence.
“The issues in the revision are pending determination at the trial court. Moreover, the applicants had already subjected themselves to the court’s jurisdiction,” said the judge.
The directors claimed that the charges were instigated by Punjani Riyaz after Ms Ranjeeta was appointed as a director by Mr Rai and the complainant’s (Riyaz) inability to access books and accounts.
They said although the company is listed as the owner of the stolen amount, there was no complaint brought by the company.
In the charges, Mr Rai, Ranjeeta, Ikua, and Oyunge denied conspiring to defraud Euros 368,416.71 (about Sh52 million) and $348,166.94 (about Sh45 million) of the property of Heritage Flowers Limited.
They are further alleged to have conspired to defraud Heritage Flowers cash of Sh10.5 million, an offence they allegedly committed between September 2021 and August 2022.
Mr Rai is also accused of forging a loan agreement between him and Rosalia Bloom Ltd as the lender and the former as the borrower.
