The High Court on Tuesday directed the government and Bangladesh Bank to explain in 10 days why the appointment of an administrator to Nagad, the state-owned mobile financial service provider, should not be declared illegal for non-compliance with the Payment and Settlement Systems Act 2024.
Under the law, an administrator can only be appointed to a company if it is deemed necessary in the public interest or if the company鈥檚 operations are found to be detrimental to its customers.
Nagad鈥檚 counsel, Mustafizur Rahman Khan, argued that the order appointing the administrator lacked any clear justification or satisfactory reasoning to meet these legal requirements.
The court issued a rule asking the finance and telecommunications secretaries, the Bangladesh Bank governor, and Nagad administrator Muhammad Badiuzzaman Dider to respond.
The vacation bench of Justice Farah Mahbub and Justice Muhammad Mahbub Ul Islam passed the order after hearing a writ petition filed by Md Shafayet Alam, an independent director of Nagad.
The writ challenged the central bank鈥檚 August 21 decision to appoint Dider, a former director of Bangladesh Bank鈥檚 Chattogram office, as Nagad鈥檚 administrator following allegations of operational irregularities affecting its 9 crore customers.
Shafayet, who holds a 13 per cent share in Nagad, filed the petition after his directorship was terminated following the administrator鈥檚 appointment.
Attorney general Md Asaduzzaman, representing Bangladesh Bank, informed the High Court that the appointment of an administrator for Nagad was necessitated by a capital shortfall at the mobile financial service provider.
In response, Nagad鈥檚 counsel argued that the shortfall amounted to Tk 317 crore, of which Tk 269 crore had already been adjusted.
The remaining deficit is expected to be cleared by December 2024 as per directive from the Bangladesh Bank, the lawyer stated.
Senior lawyer Muhammad Zamiruddin Sircar appeared for the petition while lawyers BM Elias and ASM Sazzad Haider assisted the attorney general.
