Miwani land circus: How Mumbai-based ghost figure plotted auction of Miwani Sugar

A fierce battle is raging over one of Kenya's largest public land assets, with a powerful cabal of State operatives and private interests manoeuvering to seize the 9,394-acre Miwani Sugar Mills property, The Standard can reveal.

Internal government correspondence and court documents have exposed a bid orchestrated from the highest levels of the Executive to legitimise a fraudulent land acquisition and transfer a colossal public asset to private hands. 

At the centre of the controversy is a contested title deed held by the obscure Kisumu-based company, Crossley Holdings Limited, which investigators have described as having a "fake title deed" that rose from a questionable auction and a void court judgment. 

This week's investigation delves into a secretive government directive, the courageous stand of the Miwani Sugar lawyers, and the shadowy network of powerful individuals, including Head of Public Service, Felix Koskei, who is accused of pulling the strings to hand over this ancestral land in Kisumu County. 

The foundations of Kenya’s sugar industry were laid in Miwani in 1924 when Australian sugar magnate George Russell Mayers established the Victoria Nyanza Sugar Company, which farmed approximately 15,000 hectares.

By 1928, Kenya had five sugar factories located at Kibos, Miwani, Muhoroni, Ruiru and Ramisi.

The Devji Hindocha family later purchased the enterprise and turned it into one of the most successful enterprises in the region.

By 1946, Miwani was producing 20,000 tonnes of sugar from its 15,000 acres. It also employed 4,200 people, making it one of the biggest in the region. 

The vibrant township that grew around the mill was a testament to its prosperity and a 260-bed hospital was built, saving lives in the area.

A nearby school, once a preserve of the children of the middle-class working in the area, now lies in shambles. 

The glory days of Miwani Sugar came to an abrupt end when the Hindocha family fled the country in 1988, leaving behind an entity neck-deep in State-guaranteed loans.

On June 20, 1988, the company was placed under receivership by three creditors, Bank of Baroda (Kisumu and London), Chase Manhattan, and a little-known firm, Finn Culter Ltd. 

In April 1990, the government purchased the company at Sh354 million through promissory notes, acquiring its land and assets from the receivers. In February 1991, it handed control of Miwani to Ketan Somaia, who had just purchased Delphis Bank.

Once in control, Delphis Bank lent hundreds of millions to Miwani. A few years later, on February 21, 2001, Delphis put the company under receivership.

The Kenya Sugar Board, which is still holding the original title deed, with a 49 per cent stake, watched helplessly as the mill was driven into the ground. 

The plot to seize the massive land began on December 24, 2007, in a secretive 'public auction'.

According to documents in our possession, the genesis of the current crisis started in 1993 when Nagendra Saxena, a businessman allegedly residing in Mumbai, India, filed a lawsuit in Kisumu, HCCC No. 225 of 1993, against Miwani Sugar Mills Limited.  

He claimed the company owed him $400,000 (Sh52 million at current rates) for services rendered back in 1987. His advocate, a Mr Hawala, filed the court case and obtained a summons, but nothing happened since the summons was never served. 

The case gathered dust as lawyer Hawala died. Fourteen years passed and on a Wednesday in May 2007, the ghost awoke.

A new advocate, Ian Gakoi Maina, appeared before Deputy Registrar Abdul El-Kindy. Gakoi made an unusual request to extend the validity of summons that had expired more than a decade earlier, and re-issue them. 

The Deputy Registrar, without hearing any opposing party, granted the order on the spot and ordered that a summons be issued and served within two weeks. 

What happened next defied legal gravity and shows shadowy figures in action, salivating for public land. Within days, the advocates claimed they had served Miwani Sugar Mills by registered mail and courier. 

On June 20, 2007, they requested a judgment without the presence of representatives from Miwani. The Deputy Registrar granted it the same day, giving $400,000 plus interest at 20 per cent per year dating back to 1987. 

On December 24, 2007, a public auction was allegedly held where Crossley Holdings Limited emerged as the highest bidder, purchasing Miwani Sugar land for Sh725 million. 

On that very same Christmas Eve, immediately after the auction, the advocates filed an application to confirm the sale and issue a certificate of sale.

The Deputy Registrar granted all orders that same day. He also issued a penal notice to the Land Registrar in Nairobi, warning that disobedience would lead to six months' imprisonment.

The entire process from auction to certificate happened in hours, not days. 

The law required that judgment debtors be given some time to challenge a sale, but in this case, it did not happen. Under Section 71 of the Registration of Titles Act (Cap 281), “the registrar before issuing a Provisional Certificate shall give at least ninety days’ notice in the gazette of his intention to do so.”

But the provisional title was issued a mere 37 days after the alleged auction of December 24, 2007. 

When Miwani Sugar Mills finally learned what was happening, they instructed advocates to investigate and what they discovered shocked them. A lawsuit from 1993, dormant for 14 years, had been revived without proper jurisdiction. 

The Deputy Registrar had no power to extend a summons after 24 months, let alone 14 years. Only a judge could do that. And the application to extend time should never have been heard without a representative from Miwani. 

They rushed to court to set aside the judgment but before their application could be heard, Justice John Mwera raised his own questions, asking if court fees were ever paid on the original case in 1993 and if the deputy registrar had jurisdiction to re-issue summons after 14 years.

After hearing both sides, Justice Mwera made a declaration that the re-issue of summons was a nullity, the deputy registrar had no jurisdiction; therefore, everything that followed the judgment, the decree, the auction, the sale, and the transfer of land to Crossley Holdings was equally void. 

The file about the earlier case, upon which the auction was given the legal green light, had disappeared and could not be found within the court system. 

Three years later, the Kenya Anti-Corruption Commission (KACC) turned its gaze upon the transaction. In January 2010, they published a report in the Kenya Gazette where their investigators said the sale and transfer were riddled with fraud and irregularities.

They alleged that the original court summons back in 1993 had been forged, that a deputy registrar had overstepped his authority by re-issuing the summons 14 years late, and that no money had actually changed hands for the purchase of the property. 

They enlisted Immigration and the National Intelligence Service, which claimed no one by the name Nagrenda Saxena from Mumbai had ever set foot in Kenya. 

KACC recommended prosecution, and the Attorney General agreed with the matter, moving to court under Miscellaneous Application No 12 of 2010.

In court documents seen by The Standard, the AG argued in court that everything about the process was fraudulent.

The original summons had been forged since Justice Olga Sewe testified she never signed them. The Land Control Board consent was fake, bearing the same serial number as a consent issued for an entirely different property two years earlier.

The Land Control Board letter recognising the sale and granting authority to Crossley Holdings to take over the land was dated December 4, a whole 20 days before the auction happened!

Court fees had never been paid on the original plaint, meaning the case was not before any court and the order to auction Miwani land was a forgery.

So the AG filed criminal charges against eight people and one company stood accused of conspiracy to defraud, fraudulent disposal of public property, fraudulent acquisition of public property, and forgery. 

Among the accused were Ian Gakoi Maina (the advocate), Odongo Philips Kabita (the government valuer who undervalued the property), Sukhwinder Singh Chatte (a director of Kibos Sugar Limited), Epainto Apondo Okoyo (accused of forging the Land Control Board consent), and Crossley Holdings itself. 

The trial stretched on for years before Chief Magistrate Julius Ng'arng'ar in Kisumu. Thirty prosecution witnesses testified, including judges, advocates, land registrars, bankers and government officials.

The evidence seemed overwhelming: forged documents, fraudulent court orders, a conspiracy that wound through the Judiciary, the Llands ministry and private companies. 

But on May 20, 2019, the magistrate delivered a ruling where he acquitted all the accused persons of all charges under Section 210 of the Criminal Procedure Code, saying that the prosecution had failed to establish its case, as it had not proved ownership of the land.

Was it truly public property or had Miwani Sugar Company (1989) Ltd ever been registered as the owner, the judge asked in his ruling.

The title still showed Miwani Sugar Mills Limited and without proof of ownership, the entire case crumbled and there was no proof of conspiracy to defraud the public. 

The Director of Public Prosecutions appealed to the High Court. 

Before justices Mumbi Ngugi and John Onyiego, the DPP argued that the magistrate had made errors because the land might not have been formally registered in Miwani Sugar Company's name but the government had created that company to take over Miwani Sugar Mills' assets.

The Ministry of Finance had issued bonds to pay off the original financiers. The land was public property in every practical sense. 

The judges noted that it did not require a signed agreement to prove conspiracy to defraud the public since the chain of events spoke for itself—the same people, the same documents, the same fraudulent process, all leading to Crossley Holdings acquiring the land. 

The judges reviewed the evidence and concluded that the forged summons, the fake Land Control Board consent, the improper court orders, the rushed auction, and the questionable stamp duty payments partly funded by a company linked to Sukhwinder Singh Chatte were all illegal.

In mid-April this year, the Cabinet met and resolved to settle the Miwani Sugar land "out of court". According to a source within the Cabinet, the item was introduced by Mr Koskei. The Cabinet, without a full briefing on the matter, decided to hand over the land to Crossley Holdings. 

On April 22, the receiver manager got a directive from Principal Secretary in the State Department for Agriculture, Dr Kiprono Rono, instructing him to have his lawyers sign a consent settling the matter. 

In his letter addressed to Kenya Sugar Board CEO Jude Chesire, the PS instructed the board to instruct its lawyers- a Kisumu-based firm, Owiti, Otieno and Ragot Advocates, to sign a consent settling the matter so that ownership can revert to Crossley Holdings.

The consent, drafted by government lawyers, was reportedly sanctioned by a Cabinet decision. It declares that Crossley Holdings is the rightful owner of the entire 9,394 acres, and that the company has "agreed to cede 2,000 acres thereof for the establishment of a Special Economic Zone" and for any other purpose of a public nature as the government may deem fit. 

The lawyers, however, refused to sign the consent, saying a Cabinet decision cannot be taken as a legal decision.  

"Not a cent was paid for the property by the alleged purchaser, and the processes by which Crossley Holdings Limited acquired it appear to be illegal and fraudulent from start to finish," states a letter written by David Otieno, the lead counsel for the receiver manager of Miwani. 

Mr Otieno told the receiver manager, "I have not seen the Cabinet decision and therefore cannot tell whether the consent as drafted is in line with the cited Cabinet decision. The proposed settlement is completely incongruent with what they have consistently advised.

"It will be a very odd step for us to execute and file a consent in a matter which has not even started. I still do not understand how that can be done. The appeal is still active in the Court of Appeal. Cabinet decisions do not have the force of law and are not legally binding," Otieno wrote. 

The letter, dated May 6, added: "You will recall that in your letter of Appeal No. 261 of 2008 filed by the person who allegedly held the decree which was issued execution birthed the alleged sale and title, the Court of Appeal, in dismissing the appeal against you, reiterated that the entire process by which the property was sold and title issued to Crossley Holdings Limited was based solely on a void judgment and the process could not pass any title to anyone."

Suba South MP Caroli Omondi has emerged as the most vocal opponent of the attempted land grab.

"This matter has been pending for a very long time. The fraud started many years ago and has since been investigated. Courts have already determined that this is public land.

"We have established that there was no auction and no money was ever paid. There is no evidence and no documents at all to indicate that Crossley Holdings ever bought this land. When we called Crossley Holdings directors to appear before us in Parliament, they claimed they didn't remember to whom or which account they paid Sh750 million. Who forgets such information? Mr Omondi says.

The Standard reached out to Mr Koskei to ask about his involvement in the matter, but he did not respond. His communications aide, Carren Cherotich, asked that we forward the questions to State House spokesman Hussein Mohammed. We reached out to Mohammed, who did not respond to our queries.

Efforts to get in touch with Sukhwinder Singh Chatthe bore no fruit as he did not respond to phone calls, messages or emails. His handler, Hariharan Chatte, picked up our calls and hung up upon being asked questions pertaining to the Miwani land. He did not respond to SMS or WhatsApp messages. 

The Solicitor General, in whose office the consent was drafted, did not respond to inquiries about the matter.

According to official records from the Business Registration Service, Crossley Holdings Limited (Company Number C.73036) was registered on October 3, 1996. The ownership structure reveals that Sukhwinder Singh Chatthe is the majority shareholder and director, holding 999 ordinary shares, representing 99.9 per cent. 

The registered office of the company is within Kisumu East District, and the company's email address is listed as raju@kibossugar.com.