Former Prasa CEO Lucky Montana is in a legal conundrum after failing to file an answering affidavit for more than a year in a R46m tax debt legal battle with the SA Revenue Service (Sars).
The Pretoria high court last month dismissed Montana’s condonation application for late filing of the answering affidavit. This means the hearing will proceed without an affidavit defending Montana in the case initiated by the tax authority for the attachment of his assets.
The application by the tax authority also requested that the MK MP be declared insolvent. Should Montana be declared insolvent, it threatens his job as the law states an unrehabilitated insolvent person cannot hold public office.
Sars initiated the legal action against Montana in May 2023 but could not locate him to serve the legal papers. Sars then obtained a court order in March 2024 to serve the sequestration application by way of publication in newspaper and email.
On April 5 2024, Montana filed a notice to oppose. He missed the deadline to file an answering affidavit and requested extensions.
On May 31 2024, Montana filed a condonation application detailing his reasons for late filing. One of these reasons was that his lawyer was ill and had been admitted to a hospital for three weeks.
The condonation application did not have the answering affidavit.
The tax authority opposed the condonation application and argued Montana was delaying the legal proceedings. Sars also launched a strike-out application to have some of the paragraphs in Montana’s condonation application removed.
Montana accused Sars of “indulging in a witch hunt” and being “motivated by a political agenda” in taking legal action against him. Sars argued it faced institutional reputational harm if such allegations were not struck out.
The high court late last month dismissed Montana’s condonation application and struck out paragraphs that were “scandalous and vexatious”.
In dismissing Montana’s condonation application the court said: “Montana’s answering affidavit was due in the sequestration proceedings on April 26 2024. Since then, he has failed to file the answering affidavit or to indicate in papers when it would be filed.
“Either way, the lapse of more than a year since the due date of the answering affidavit is sufficient an indicator that Montana is playing for time.”
This week Montana filed an application for leave to appeal the judgment before a full bench or to the Supreme Court of Appeal (SCA).
“The judge erred in dismissing the condonation application with costs. The judge ought to have granted the condonation application,” Montana’s court papers read.
He contended the court “erred in failing” to consider the interests of justice as an overriding criterion for condonation.
Montana said he would file the answering affidavit by next week.
“The claim against [Montana] involves a substantial amount of money, which [he] deserves to be afforded an opportunity to ventilate his defence in the answering affidavit for him not to be found liable for an incorrect debt,” his papers read.
“The court’s decision unjustifiably limited the [Montana’s] right of access to courts as guaranteed by section 34 of the constitution, by nonsuiting the respondent on the basis of a procedural omission without balancing it against substantive justice.”
Sars, in court papers, said it uncovered Montana’s historical debt after conducting an audit of his tax affairs from 2009 to 2019. The tax authority’s audit findings on Montana detail income and capital gains he did not declare in the 10-year period.
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