The Villa Group has been denied a stay order on the tourism ministry’s seizure of two lagoons in a court battle that could bankrupt one of the Maldives’ largest companies.
The civil court yesterday rejected a request by Villa, which is owned by opposition Jumhooree Party (JP) leader Gasim Ibrahim, for the stay order, paving the way for the tourism ministry to take control of the lagoons.
Villa Group is currently locked in a series of lawsuits against the state over the seizure of several leased properties as well as a notice to pay US$100 million allegedly owed as unpaid rent and fines.
The opposition claims the government is unfairly targeting Gasim’s business interests following the JP’s split from the ruling coalition. The government denies any political motivation behind the moves.
Villa has filed ten cases at the civil court contesting the tourism ministry’s termination of amended lease agreements as well as the US$100million notice.
The company is seeking stay orders halting the enforcement of the notices until the court decides on its legality.
But in yesterday’s ruling over the termination of lease agreements for the Maadhihgaru and Kanuhuraa lagoons in Kaafu atoll, the court ruled that Villa Hotels will not suffer “irrevocable losses” if the stay order is not granted as the state could compensate the company if the case is concluded in its favour.
The tourism ministry had also terminated lease agreements with Villa for three more islands shortly after the JP formed an alliance with the main opposition Maldivian Democratic Party (MDP) in early February.
Requests for stay orders in the other cases are still pending. Former Prosecutor General Ahmed Muiz is representing Villa in the lawsuits against the tourism ministry and the Maldives Inland Revenue Authority (MIRA).
MIRA had initially asked Villa to pay US$100million by late March, but extended the period until mid April.
Gasim has said the government is planning to freeze Villa’s accounts if the company is unable to pay the amount, warning that it would bankrupt the company and leave his 5,000 employees jobless.
In early February, the civil court granted a stay order halting the seizure of the five properties in separate litigation. However, on February 24, the High Court overturned the stay order.
Gasim meanwhile met Supreme Court Chief Justice Abdulla Saeed yesterday following the apex court’s refusal to accept an appeal for the High Court decision.
Gasim told reporters after the meeting that he expressed displeasure with the Supreme Court registrar rejecting the appeal without offering a reason.
The chief justice told him to submit a letter and that matters cannot be settled verbally, Gasim said.
Villa Group is one of the largest companies in the Maldives with the holding company Villa Shipping and Trading Pvt Ltd conglomerate operating businesses in shipping, import and export, retail, tourism, fishing, media, communications, transport, and education.
The three islands and two lagoons at stake in this case were leased as part of a settlement agreement signed with the government in December 2013 after the Supreme Court ordered the state to pay Villa over US$9 million as compensation.
Lagoons are generally leased for purposes of land reclamation for either industrial or tourism purposes.