Nagad Returns to Owner’s Control as Court Rejects Administrator Appointment
Mobile financial service provider Nagad is now officially back under the control of its original ownership, following a Supreme Court ruling that upheld a prior High Court decision, declaring the attempt to place the company under an administrator-led board as legally unjustified.
The Appellate Division’s chamber judge court delivered the verdict in response to a writ petition challenging the appointment of an administrator to Nagad. As a result of the ruling, the company will now continue operations under the regulatory framework established by Bangladesh Bank.
Referring to the judgment, Barrister Muhammad Jamir Uddin Sarkar, the lead counsel representing Nagad's ownership, stated, “The ruling makes it clear that appointing an administrator and forming a new board to control Nagad was not lawful.”
Previously, on May 7, the chamber judge court suspended a High Court ruling that had dismissed the writ as non-admissible, giving the petitioner eight weeks to file a regular leave-to-appeal.
The legal dispute dates back to February 16, when the High Court rejected the writ petition filed by Md. Shafayet Alam, an independent director of Nagad, who had sought judicial intervention to appoint an administrator. The court had clearly stated that such a move was unacceptable and declared Bangladesh Post Office as Nagad’s agent.
Subsequently, on September 17 last year, the High Court issued a rule asking why the memo issued on August 21, appointing an administrator without adhering to Sections 31(1) and 31(2) of the 2004 Payment and Settlement Systems Act, should not be deemed beyond legal authority. While the rule was pending, the petitioner filed a supplementary petition seeking a ban on the administrator’s activities. On December 18, the court ordered all parties to maintain the status quo on internal administrative actions. This interim order was later extended.
After completing the final hearing, the High Court dismissed the writ petition on February 16, concluding it was not admissible.
Shafayet Alam subsequently filed an appeal seeking to overturn the High Court decision. The matter was heard on May 7 by Justice Md. Rezaul Haque of the Supreme Court’s chamber judge court, which suspended the earlier verdict. A copy of the order was received on Monday, said Jamilur Rahman, one of the lawyers representing the petitioner.
“This ruling is immensely significant for the country’s economic future,” said Rahman. “It proves that no entity can be taken over by forcibly appointing an administrator. The Supreme Court has delivered a bold and just verdict that reflects the rule of law.”
Economic analysts believe the ruling sets a critical precedent for the entire fintech sector in Bangladesh, strengthening investor confidence and reinforcing the autonomy of the private sector.
Commenting on the matter, Tanvir A Mishuk, founder and former Managing Director of Nagad, told reporters, “I’ve been engaged over the past eight months in Germany with a RegTech project that’s on the verge of becoming another unicorn. Therefore, I won’t be returning to the role of Managing Director at Nagad, and I have already informed the board of this decision. However, Nagad is like a child to me. If the new board or CEO ever seeks my advice, I’ll always be available.”
