WESCOAL Holdings will bring an urgent interdict this week to stop what CEO Andre Boje called a "malicious" application to liquidate the coal-mining company in a fresh bout of bad news for the company, which was involved in a bitter battle with a disgruntled contractor earlier this year.

Wescoal is drawing up papers to sue privately owned Sutha Civils, which tried unsuccessfully to liquidate the JSE-listed company and which made a number of allegations against Wescoal and its operations in Mpumalanga that were strongly denied by the company's management.

The allegations hit Wescoal's share price hard around March this year.

Sutha Civils said it was owed money and Wescoal said the contract had not fulfilled its contractual obligations.

Now privately owned BSM Mining has lodged papers with the North Gauteng High Court in Pretoria asking for Wescoal's subsidiary, Wescoal Mining, to be placed under final or provisional winding-up, over alleged nonpayment of royalties worth R84146 to BSM due by October 15.

Boy Simon Mdau, the sole owner and MD of BSM, said in papers lodged on October 27 that Wescoal directors had informed him on October 14 and 19 that he had an unregistered VAT number. Wescoal withheld payments until it had a valid copy of a VAT registration certificate.

Mr Mdau said he had a certificate and included it in his application. "It is my submission that this is a delaying tactic by the respondent (Wescoal) to delay payment as it is not able to make payment to the applicant (BSM)," he said in his application.

Mr Mdau also raised doubts in his submission about Wescoal's ability to fund a rehabilitation liability at the Heuvelfontein property, which makes up the Khanyisa mine, estimated by him to be R42m.

Mr Boje rejected all Mr Mdau's claims and said Wescoal's lawyers were instructed at the weekend to prepare an urgent interdict that would be brought this week to stop BSM's application.

"You can see the malicious intent here. They gave you (Business Day) the file before they even got a notice of return from the sheriff that we've been served with the papers. We don't even have the papers yet," he said.

"It's an attempt to embarrass us. We'll get it interdicted and carry on with our lives.

"I have absolutely no idea where he got that R42m rehabilitation liability. We have to supply the Department of Mineral Resources every month with our rehabilitation figures.

"We have it surveyed every month and it's between R2m and R8m because we rehabilitate as we go," he said.

Wescoal has submitted an application to the department to transfer the mining rights over the Khanyisa property to Wescoal, invoking a clause in the contract BSM had with NuCoal Mining.