The man who headed a panel to decide the winner of a R335million state forestry deal received payments from the company that won the bid.

Andile Nkuhlu, chief director in the Department of Public Enterprises, was paid R55 000 by Zama Resources Corporation after it was announced as one of two preferred bidders in the deal.

The payments were made through a firm of auditors, on written instruction from Zama, for "services rendered to Zama" and to "reimburse . . . staff members of Zama".

Three months later, in March this year, Zama won the deal with a R335m bid. It will now take over vast tracts of land that were owned by the parastatal South African Forestry Company Limited.

As chairman of the interdepartmental bid evaluation committee, Nkuhlu was one of the three-man panel that recommended Zama as the winner.

Contacted by the Sunday Times on Friday, Nkuhlu denied that he had received money from Zama or its chief executive, Mcebisi Mlonzi.

"How can I receive money from Zama? People say Mlonzi sponsored my wedding - that's not true. There is no relationship between me and Mlonzi; we are not even friends."

Nkuhlu said Mlonzi was not invited to his wedding in East London on December 15 but had attended because it would have been "un-African" for him not to be there.

"He was not even on the guest list. He gatecrashed," Nkuhlu said.

But on Saturday Mlonzi told the Sunday Times that he had paid for Nkuhlu's wedding. But he said that an administrative error had led to company funds being used instead of money from his personal account.

Also on Saturday, lawyers acting for Nkuhlu said that he had now discovered that money had been paid into his bank account by Zama without his knowledge and he had demanded an apology.

Zama yesterday issued a statement saying that it would hold an investigation after it had found that company funds had "inadvertently been used as a contribution for Nkuhlu's wedding". Zama apologised to Nkuhlu for "embarrassment and inconvenience caused" as a result of an "administrative error".

Documents in the possession of the Sunday Times show just how close Mlonzi and Nkuhlu were:

Nkuhlu's telephone records show that he called Mlonzi more than 120 times between November last year and February this year. One call after midnight lasted more than 19 minutes;

On November 20, Zama made a request to its auditors, Marwick & Company Inc, by fax to put R15 000 into Nkuhlu's Standard Bank account in Hatfield, Pretoria. That day Nkuhlu telephoned Mlonzi twice on his cellphone;

On November 21, the government announced that Zama was one of two preferred bidders for the Komatiland forests. Nkuhlu again made two calls to Mlonzi's cellphone;

On November 30, Zama instructed its auditors to pay R40 000 into Nkuhlu's bank account. Again he called Mlonzi twice on his cellphone;

The Sunday Times is in possession of Nkuhlu's bank account details, which show that deposits totalling R55 000 were made into his account by electronic transfers, and that he spent the money.

Nkuhlu now faces an investigation in terms of the Public Service Code of Conduct, which orders that senior civil servants have to report any financial interest or remuneration they receive outside their jobs.

As a chief director, Nkuhlu would have had to get permission from his director-general.

But according to the Director-General of Public Enterprises, Dr Sivi Gounden, this was not done. He said Nkuhlu would now face an immediate investigation.

"We view such allegations in an extremely serious light and the public of South Africa can rest assured that the government will take the appropriate action should these allegations be proved in an investigation that will follow immediately."

Professor Stanley Sangweni, head of the Public Service Commission, said senior civil servants had a duty to declare outside interests to prevent a conflict of interest.

Besides the privatisation of Safcol, Nkuhlu is also in charge of the restructuring of Spoornet.

Within the next few weeks, the government will sign the contract for Zama to take over 130 000ha of the Komatiland plantation, stretching from Louis Trichardt to Piet Retief along SA's eastern escarpment.

With acknowledgements to Mzilikazi Wa Afika, Jessica Bezuidenhout and Sunday Times.