Ali Zahir loses MVR 2.3 million case against MCB at Supreme Court

Former Chief of Staff at President's Office Ali Zahir has lost the case concerning MVR 2.3 million he owes to Mauritius Commercial Bank (MCB) even at the Supreme Court today, after the court ruled in favour of maintaining the Civil and High Court verdicts.

In 2018, MCB notified Zahir to pay the sum to the bank after funds were overdrawn from his account for an MVR 2.3 million cheque he issued to a third party.

Zahir issued the cheque after he received a document stating MVR 4 million was credited to his account. However, the funds were not yet in his account at the time, and the bank proceeded to release the MVR 2.3 million for the cheque.

After releasing the funds, MCB asked Zahir to pay back the MVR 2.3 million, which prompted Zahir to escalate the matter with the Civil Court with a request to quash the bank's notice. Despite Zahir's request, both Civil Court and High Court ruled that Zahir has to pay the amount to the bank.

He then appealed the case with the Supreme Court.

In its ruling today, the court said that banks have the legal authority to issue funds even if sufficient balance is lacking in accounts. The agreement made with MCB customers and the bank also allow the bank to issue funds as overdraft, the ruling further said.

As such, the Supreme Court maintained that there is no reason to reverse the ruling that Ali Zahir needs to pay the bank.

The ruling was made by Justice Dr Azmiralda Zahir and Justice Aisha Shujune.

However, Justice Ali Rasheed Hussain's decision was that Zahir does not need to pay the bank. Justice Ali Rasheed's opinion is that the bank's authority to issue funds as overdraft is within limits, and pointed out that Zahir's bank balance was only MVR 500 when the MVR 2.3 million was released for the cheque.

As such, he said that it can be assumed MCB issued the funds mistakenly, and that MCB should recover the funds from the party the funds were released to.