The High Court Commercial Division has dismissed an attempt by Shumuk Aluminium Industries Ltd and businessman Mukesh Shukla to stop Bank of Baroda (Uganda) Limited from enforcing a judgment requiring them to pay more than Shs16 billion, dealing a major blow to their efforts to halt recovery of the disputed debt.
In a ruling delivered on August 28, 2026, Justice Patience T.E. Rubagumya dismissed the application for a stay of execution, holding that the applicants had failed to satisfy key legal conditions required for the court to freeze enforcement of the judgment.
The court also ordered Shumuk Aluminium Industries Ltd and Shukla to pay the bank’s costs of the application.
The ruling arises from a long-running commercial dispute in Civil Suit No. 138 of 2019, in which Shumuk Aluminium and Shukla challenged Bank of Baroda’s handling of credit facilities extended to the company.
The applicants had accused the bank of breaching their loan agreement, unlawfully recalling the credit facilities and making excessive and illegal debits to their accounts through interest charges.
Bank of Baroda denied the allegations and instead filed a counterclaim seeking recovery of all outstanding sums, interest, foreclosure and costs.
Shumuk ordered to pay Shs16 billion
On June 2, 2026, the Commercial Division entered judgment in favour of Bank of Baroda and ordered Shumuk Aluminium Industries to pay Shs16,029,628,120.90, together with US$122,900.05, representing the outstanding balance arising from overdraft and letter-of-credit facilities advanced to the company.
Shukla, who had personally guaranteed the facilities, was separately ordered to pay up to Shs6.36 billion under the terms of his personal guarantee.
The judgment transformed the dispute from a contest over the legality of the bank’s loan recovery measures into a major debt-recovery battle involving billions of shillings.
Rather than immediately accepting the judgment, the applicants sought to stop its execution while pursuing an appeal at the Court of Appeal.
They told the High Court that they had filed a notice of appeal and had requested certified proceedings to enable them to prepare their memorandum and record of appeal.
They argued that unless execution was stopped, their intended appeal could be rendered worthless.
Court finds crucial appeal evidence missing
But the application ran into a fundamental problem.
Justice Rubagumya found that although Shukla claimed a notice of appeal had been filed and attached to his affidavit, the court record did not contain a copy of the alleged notice of appeal.
The judge further noted that the applicants had admitted that their memorandum of appeal had not yet been filed.
As a result, the court said it had not been provided with proof of the existence of the appeal necessary to assess whether it had any likelihood of success.
The court therefore found that the applicants had failed to satisfy this condition.
That finding struck at the heart of the application because filing a stay application does not, by itself, automatically suspend execution of a court judgment.
Bank accuses Shumuk of delaying debt recovery
Bank of Baroda mounted a strong attack on the application, describing it as legally misconceived and part of what it characterised as a continuing pattern of attempts to frustrate and delay recovery of money it says is owed to it.
The bank argued that merely filing a notice of appeal and requesting certified proceedings does not amount to a stay of execution.
It also argued that the intended appeal was essentially a speculative repetition of complaints that had already been determined by the trial court and that the applicants had not demonstrated any serious error capable of giving the appeal a reasonable prospect of success.
The bank further told court that the judgment was fundamentally a money decree, meaning that even if the applicants ultimately succeeded on appeal, the money could be refunded.
Bank of Baroda also stressed that it is a regulated commercial bank under prudential supervision and was financially capable of refunding the decretal amount should the appeal eventually succeed.
Applicants challenge billions in interest calculations
The applicants, however, maintained that their intended appeal raised serious questions of both law and fact.
Among the issues they wanted the Court of Appeal to consider was whether the trial judge was wrong to uphold the conversion of US$1.25 million, rather than US$1.1 million, at an exchange rate of Shs3,884 per US dollar.
They argued that the bank had unilaterally applied the exchange rate and that the trial court improperly placed the burden of disproving it on them.
They also challenged the court’s reliance on documents identified as DEX 20 and DEX 21, which they described as unilateral computations of unapplied interest generated by the bank long after the facilities had been written off in 2019.
According to the applicants, those computations had not been independently verified or reconciled.
The applicants further argued that the trial court had disregarded testimony that reconciliation of the accounts was still ongoing and that some repayments made by Shumuk Aluminium had allegedly not been credited to the loan accounts.
They also questioned whether Bank of Baroda’s default and recall notices complied with the terms of the sanction letter and the Mortgage Act.
Another proposed ground of appeal concerned the trial court’s decision to enter judgment on the bank’s counterclaim for the entire amount claimed despite evidence of part-performance and disputes surrounding interest and penal-interest calculations.
Shumuk warned of possible loss of mortgaged properties
The applicants’ strongest argument was that execution could result in the sale of properties they described as specific and unique.
They identified the properties as LRV 2909 Folio 9 Plot 24, Mukabya Road, Kampala, and a sublease on LRV 2566 Folio 23 Plot M700 at UMA Lugogo Naguru Showground, Kampala.
They argued that if the properties were sold to bona fide third-party purchasers before the Court of Appeal heard the case, they could not simply be recovered even if the appeal eventually succeeded.
In their view, a refund of money would not adequately restore ownership of the properties.
But the High Court was not persuaded.
Justice Rubagumya found that the applicants had not proved that execution had actually commenced or that there was a serious and imminent threat of execution.
Their claim that the bank was likely to proceed with execution was, in the court’s view, unsupported by evidence.
Court rejects claim of irreparable loss
The judge also rejected the argument that execution would necessarily render the appeal nugatory.
The court relied on established authorities holding that where a judgment is essentially monetary and the successful party is capable of refunding the money, payment during execution does not ordinarily destroy the value of a pending appeal.
Justice Rubagumya found that neither execution nor substantial damage had been proved in the case before her.
Consequently, the applicants failed on another crucial requirement for obtaining a stay.
Application filed quickly — but that was not enough
The court did acknowledge one point in the applicants’ favour.
The application had been filed on June 11, 2026, just nine days after the judgment delivered on June 2.
Justice Rubagumya therefore found that there had been no unreasonable delay in bringing the application.
But prompt filing alone could not rescue an application that had failed to establish the other essential requirements.
The applicants had also indicated that they were willing to abide by any security conditions the court might impose for the due performance of the decree.
The court, however, found it unnecessary to impose security because the applicants had already failed to prove most of the conditions necessary for a stay.
Shumuk’s legal battle now moves to appeal
The dismissal does not determine the substantive appeal itself. Rather, it removes the requested protection against execution while the applicants pursue their challenge.
The immediate consequence, however, is significant: the June 2 judgment in favour of Bank of Baroda remains enforceable, subject to any further orders from a higher court.
The Commercial Division’s decision underscores the danger for judgment debtors who seek to suspend enforcement merely by announcing an intention to appeal without placing sufficient evidence before court.
For Shumuk Aluminium and Shukla, the stakes are particularly high.
The company faces a judgment debt of more than Shs16 billion plus US$122,900, while Shukla’s personal guarantee exposes him to liability of up to Shs6.36 billion.
Their challenge to the bank’s calculations, interest charges, loan recall procedures and treatment of repayments may still be pursued through the appellate process, but the High Court has now declined to shield them from execution on the evidence presented in this application.
Justice Rubagumya concluded bluntly that the applicants had failed to satisfy most of the conditions required for a stay and dismissed the application with costs to Bank of Baroda.
The ruling was signed and delivered electronically on August 28, 2026, through Uganda’s Electronic Court Case Management Information System (ECCMIS).
