Durban - The eThekwini Municipality has not backed off from its court bid to liquidate the company which runs the city’s bus service, insisting in its final papers filed on Tuesday that in spite of getting more than R776 million in subsidies since 2009, the company still owes it R40.3m.
“It is clear Tansnat has been the author of its own misfortune and despite generous subsidies, is unable to efficiently provide the bus service,” City Treasurer Krish Kumar said in his affidavit filed with the Durban High Court on Tuesday.
Mayor James Nxumalo has also put up a confirmatory affidavit in what is the final written salvo in the battle, and the matter will be set down for hearing by a judge soon.
The city launched the urgent application for a provisional liquidation order in January, at a time when the bus service had been disrupted because drivers had not been paid.
By the time it came to court, the drivers were back at work and the application was postponed to allow Tansnat, which is owned and run by taxi boss Mandla Gcaba, a chance to oppose it.
Kumar, in his original affidavit, accused Gcaba of giving himself a R30.7m unsecured loan from the coffers of the company and a report by a city official attached to the court documents recommended an urgent takeover of Tansnat’s financial affairs, one of the reasons being to “ring-fence Durban transport from other personal and business affairs of Mr Gcaba”.
Kumar said the city was constantly bailing out the company and it was resisting any attempts to cancel the contract when it obviously could not pay its bills.
Short-changed
Gcaba, however, has blamed the company’s financial woes on the city, saying he had been short-changed and could not operate a proper commercial venture.
The city had promised to put this right, but never had.
He claimed that “certain liabilities” had been debited to his loan account without his knowledge, but he was sorting that out.
“An audit will reveal that any payments to me are negligible and nowhere in the region of the amount stated. In any event I am in a position to discharge this loan if required to do so.”
He said the application was an attempt to take back the bus service – which has about 450 buses and carries 50 000 passengers a day – “via the back door”.
He described as “mischievous” allegations that the company could not pay what it owed to Sars and the provident fund, saying both alleged debts were “miscalculations”.
But Kumar, in his latest affidavit, said Gcaba had not put up “a stitch of evidence” of these miscalculations. “It cannot be that every creditor’s claim is occasioned by a miscalculation... it is rather a case of the respondent seeking to avoid liability.”
He denied there was ever any “future agreement” to increase compensation to Tansnat and said all bailouts were because of its inability to pay its debts.
“On Gcaba’s own version it would be just and equitable for Tansnat to be wound up,” he said.
The Mercury