Judge slams State’s ‘stillborn, audacious’ case as all 8 Nulane corruption accused discharged

Limakatso Moorosi, Seipati Dlamini, Iqbal Sharma, Ronica Ragavan and Dinesh Patel appear at the Bloemfontein High Court on January 23, 2023 in Bloemfontein, South Africa. The suspects face charges of fraud, money laundering and breaching the Public Finances Act involving R24.9 million. (Photo by Gallo Images/Volksblad/Mlungisi Louw)

By Cathy Dlodlo and Victoria O’Regan

21 Apr 2023

As widely anticipated, the Free State High Court in Bloemfontein on Friday punished the State for its failure to prove its case against those accused in the R24.9-million Nulane Investments trial. The accused in the first State Capture Gupta-related case before court are now discharged without having to defend themselves, and this serves as another blow in the mission to bring the Guptas back to South Africa.

The National Prosecuting Authority’s (NPA) first State Capture case to proceed to trial came to an embarrassing end in the Free State High Court on Friday, with all of eight accused in the R24.9-million Nulane Investments matter being acquitted.

“The audacious manner in which this matter was investigated is truly to be lamented,” said Acting Judge Nompumelelo Gusha in handing down her damning ruling.

Judge Gusha granted seven of the accused – former Free State government officials Peter Thabethe and Seipati Dhlamini; high-flying businessman Iqbal Sharma and his brother-in-law Dinesh Patel; long-time Gupta enterprise employee Ronica Ragavan; and companies Islandsite Investment One Hundred and Eighty and Nulane Investments – the application of discharge they launched previously.

The seven accused applied for a discharge, last month, at the close of the State’s case, in terms of Section 174 of the Criminal Procedure Act 51 of 1977. The seven applicants believed the State had failed to produce evidence that required a defence from them.

Former head of the Free State department of agriculture and rural development Limakatso Moorosi was the only one who did not submit an application for discharge. However, in her verdict, Judge Gusha, also found her not guilty, and she was acquitted.

Not even once was this court ever favoured with even a shred of evidence against Moorosi, according to the judge.

The multimillion-rand Nulane Investments criminal trial kicked off on 23 January this year. It is this case that triggered law enforcement’s request for Red Notices for the now failed extradition of the fugitive Gupta brothers, Atul and Rajesh.

Now that the State has failed to prove its case against those before court, it raises the question of whether the Guptas could cash in on this victory by applying to Interpol to remove the Red Notices against them.

Read more in Daily Maverick: Nulane Investments trial: Inside the Gupta-linked R24.9m Free State fraud and money laundering case

The eight accused were on trial for charges ranging from fraud and corruption to money laundering in connection with a R24.9-million feasibility study that led to the controversial Vrede Dairy project – a flagship project for the Free State department of agriculture that cost the provincial department more than R280-million.

Limakatso Moorosi, Seipati Dlamini, Iqbal Sharma, Ronica Ragavan and Dinesh Patel in the Bloemfontein High Court on 23 January 2023, facing charges of fraud, money laundering and breaching the Public Finances Act involving R24.9 million. (Photo: Gallo Images / Volksblad / Mlungisi Louw)

The department appointed Nulane Investments to do the feasibility study, although it allegedly did not have the capacity to do so. The State further alleged that the department appointed the company without following a procurement procedure and instead wrote a deviation memorandum that cited Nulane Investments as a sole service provider.

Nulane then outsourced the service to Deloitte for a fee of R1.5-million – a fraction of what the provincial government paid to the company. Once paid to Nulane, the majority of the cash was allegedly laundered and diverted through a scheme of transactions into and through different bank accounts and Gupta-linked entities.

Judge’s criticism

On Friday, Judge Gusha repeatedly criticised the state’s shoddy investigation.

“To say that the manner in which the case was conducted is comedy, would be the understatement of the millennium,” she said.

The judge said the State had failed to meet even the barest of threshold to prove that all the accused had unlawfully and intentionally committed fraud (count two).

She said count three – money laundering – was the count that most invoked a sense of loss to the public, but regrettably the State failed to meet even the barest of threshold in proving its case. She said it was evident that R24.9-million left the State coffers, but the questions how and where it went have not been answered by the State.

The State’s case as presented was stillborn, said the judge.

“If I misdirected myself on the submission of documents into the court record, what weight would it render to the case – zilch,” she said.

The NPA failed to prosecute the case and scored an own goal in the process when the Judge found that a State witness, Shadrack Cezula, should be charged.

She said that his testimony was evasive and dishonest and fell apart during cross-examination.

Following Friday’s judgement, the NPA has indicated that it is weighing up options on whether to appeal the court’s ruling in the Nulane matter.

“We will be reflecting on the judgment with a view to determine legal avenues to explore. The outcome of this case has no bearing on our ability to prosecute other State Capture cases. We remain resolute in our commitment and ability to vigorously prosecute those responsible for State Capture and corruption,” said the NPA’s Investigating Directorate head advocate, Andrea Johnson. DM

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