EconomyNext – Creditors and shareholders of a Sri Lankan sugar company taken over by the state and being wound up for non-payment of dues are still waiting for compensation, the stock exchange has been told.
Liquidators of Pelwatte Sugar Industries told the Colombo Stock Exchange they have asked the Compensation Tribunal to seek the advice of the government’s chief legal advisor, the Attorney General’s Department, over compensation claims.
This was after the Compensation Tribunal claimed they have no mandate to assess the compensation claims of the Liquidators since what was seized by the state was only the leasehold land held by the company, auditors SJMS Associates said.
"Even though a meeting in this regard was convened by the Attorney General’s Department in April 2014, unfortunately it was postponed indefinitely."
A number of creditors and shareholders of the company have submitted their claims against the company to the liquidators.
The government took back the land leased to Pelwatte Sugar Industries in 2011under a controversial law called the Revival of Under-performing Enterprises Act that raised concern over private property rights.
In 2012 Agstar Fertilizers Plc, which deals imports and sells fertilizer, filed action in the Colombo High Court seeking the winding up of Pelwatte Sugar Industries for non-payment of dues. Agstar claimed Pelwatte owes it over 18 million rupees in unpaid bills.
SJMS Associates said in a stock exchange filing they are still waiting for an inventory of assets of the firm from the Competent Authority appointed by the state.
"The inventory of the assets taken over by the state has not yet been furnished to us by the Competent Authority," they said.
Before the winding up order of the court, the Competent Authority who is the Secretary to the Ministry of Sugar Industries took over all the assets of the company and its business operations.
The Competent Authority was asked to hand over the balance assets not vested in the state but had not responded "despite several reminders," SJMS Associates said.
The settlement of claims will be made under the Companies Act depending on the amount of compensation to be awarded by the Compensation Tribunal.