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Billionaire Rai sons fight in court over father’s wealth

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Billionaire Rai sons fight in court over father’s wealth


Tycoon Jaswant Rai. FILE PHOTO | NMG

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Summary

  • The widow, Sarjij Kaur Rai, had teamed up with her sons, Jasbir and Iqbal, objecting to the Will, saying the patriarch could have been coerced in crafting the document that distributed his assets among his eight beneficiaries.
  • The widow, Sarjij Kaur Rai, had teamed up with her sons, Jasbir and Iqbal, objecting to the Will, saying the patriarch could have been coerced in crafting the document that distributed his assets among his eight beneficiaries.
  • The family is believed to have had close ties with the ruling elite in the Moi, Kibaki and Kenyatta administrations.

The fight for the control of the Rai family’s multi-billion shilling estate is set to unravel in court as two sons of the late tycoon take on their brother Jaswant Rai over the distribution of wealth left behind by their father.

At the centre of the dispute is the Will dated December 17, 1999, allegedly left behind by Tarlochan Singh Rai, who died on December 28, 2010, in Mumbai, India.

Jaswant Rai, the chairman of Rai Group, is the executor of the Will.

The widow, Sarjij Kaur Rai, had teamed up with her sons, Jasbir and Iqbal, objecting to the Will, saying the patriarch could have been coerced in crafting the document that distributed his assets among his eight beneficiaries.

They are also challenging Jaswant’s push to get the court’s permission to administer the multi-billion shilling business that has a presence across East Africa, Malawi, India and London.

Sarjij had started giving evidence before High Court judge Aggrey Muchelule before she died in January this year.

The widow, Sarjij Kaur Rai, had teamed up with her sons, Jasbir and Iqbal, objecting to the Will, saying the patriarch could have been coerced in crafting the document that distributed his assets among his eight beneficiaries.

The family is believed to have had close ties with the ruling elite in the Moi, Kibaki and Kenyatta administrations.

They have interests in cement production (Rai Cement), edible oils and soaps (Menengai Oil Refineries), sawmilling (Timsales, RaiPly and Webuye Panpaper), wheat farming, horticulture, sugar industry (West Kenya, which owns Kabras Sugar) and real estate (Tulip Properties).

Last year, the family acquired Dominion Farms in Siaya County’s Yala Swamp after its American owner pulled out under controversial circumstances.

Before her death, Sarjij and the two sons had wanted the court to summon company secretaries of Rai Investments Ltd and have them produce, among others, documents, the company’s minutes, all board resolutions, and shares register from 1992 to date and all other relevant company records.

She had wanted the company secretaries to also account for all the properties belonging to the family and Jaswant to produce a list of all assets of her late husband.

Justice Muchelule, however, dismissed the application, saying the court should first determine the validity of the will before calling the secretaries and Mr Jaswat to account. The judge said the application was premature.

“If they successfully invalidate the Will, then there will be no basis to ask the executor to avail any information regarding the estate to court,” the judge said.

Justice Muchelule said if the Will was quashed, then the court would appoint an administrator or administrators, who will give a full and accurate inventory of the Rai family asset.

Jaswant has defended the Will, arguing that his father distributed to each family member the rightful stake in the business empire.

Beneficiaries included his wife, Sarjij, his sons Jasbir, Jaswant, Sarbjit and Iqbal as well as daughters Hertej Ashwin Oza, Daljit Kaur Hans and Sarbjit.

The patriarch had also given some of his wealth to his son Tejpal, who died before him, according to Jaswant.

The widow and her two sons opposed the Will, saying Mr Rai had left nothing to Jasbir, Iqbal and daughter Daljit. She also said her daughter Hertej had not been sufficiently provided for in the Will, urging for an additional stake.

Sarjij accused her son Jaswant of tabling a Will that omitted a huge chunk of the family properties.

A list of properties provided by Jaswant in court includes Rai Plywoods (K) Ltd, Rai Produces Ltd, Rai Holdings Ltd, Rai Agriculture Enterprises Ltd, Rai Investments Ltd and Rai Ceramics Ltd.

Others are Tulip Properties Ltd, Rai Expo Park Ltd, and houses in Kampala, Runda in Nairobi and in Canada.

Tarlochan Singh Rai left behind money in an account at Absa, all estimated to be worth Sh329 million, and he had no liabilities, according to his son Jaswant.

But the widow opposed the list of the assets, their worth and liabilities. She reckoned that her husband declared in 1999 that he owned 42.72 percent of Rai Investments Limited, which Jaswant had placed at seven percent.

Jasbir and Iqbal told the court they had established that their father and brother were shareholders of Rai Holdings Limited in Kampala, which in 2006 bought a 51 percent stake in Kinyara Sugar Works at $33.5 million (Sh3.7 billion).

They also said that Tarlochan Singh Rai and Jaswant were shareholders in Rai Agro Industries Limited in Sangrur in India and companies known as Stonybrook Limited and Waterloo Limited both registered in Cayman Islands.

Other companies allegedly left out in Will are Rai Management and Technical Services Limited registered in the tax haven of Jersey Island and millions of dollars in accounts at Citibank outlets in London and New Delhi.

Before his death, Tarlochan Singh Rai was locked in a court fight over the control of Rai Plywoods (Kenya) Ltd with his wife and sons.

According to Sarjij, Mr Rai had made an undertaking in court not to interfere with assets of Rai Plywoods.

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