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Issue #19/2021 13 May 2021

New This Week Case(s) of the Week KETUA PENGARAH HASIL DALAM NEGERI v. CLASSIC JAPAN (M) SDN BHD & ANOTHER APPEAL [2021] 5 CLJ 86 Appeal Updates Appeal Updates Latest Cases Legal Network Series CLJ 2021 Volume 5 (Part 1) Articles LNS Article(s) Legislation Highlights Principal Acts Amending Acts PU(A) PU(B) Legislation Alert

KETUA PENGARAH HASIL DALAM NEGERI v.
CLASSIC JAPAN (M) SDN BHD & ANOTHER APPEAL [2021] 5 CLJ 86
HIGH COURT MALAYA, IPOH
SU TIANG JOO JC
[CIVIL APPEAL NO: AA-14-1-06-2019]
02 FEBRUARY 2021

REVENUE LAW: Income tax - Special Commissioners of Income Tax - Decision of - Appeal against - Claim by taxpayer for industrial building allowance for construction of factory - Whether taxpayer 'engaged in agriculture' - Whether taxpayer entitled to claim for tax incentive under Income Tax (Allowance for Increased Exports) Rules 1999 - Whether taxpayer's factory industrial building within statutory meaning - Whether Director General of Inland Revenue could impose penalty - Income Tax Act 1967

STATUTORY INTERPRETATION: Construction - 'engaged in agriculture' - Claim by taxpayer for industrial building allowance for construction of factory - Whether taxpayer required to plant flowers on its own and/or on its own land to be regarded as 'engaged in agriculture' - True intent of Parliament - Whether 'engaged in agriculture' ought to be read widely to include company engaged in export of agricultural produce - Income Tax (Allowance for Increased Exports) Rules 1999 - Interpretation Acts 1948 and 1967, ss. 15 & 16

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1. Majlis Agama Islam Wilayah Persekutuan v. Glomac Resources Sdn Bhd [2018] 1 LNS 2010 (CA) affirming the High Court case of Glomac Resources Sdn Bhd v. Majlis Agama Islam Wilayah Persekutuan & Anor [2017] 1 LNS 1013

2. Goh Wee Peng v. Standard Chartered Bank Malaysia Berhad [2018] 1 LNS 2179 (CA) affirming the High Court case of Re: Goh Wee Peng; Ex-Parte: Standard Chartered Bank Malaysia Berhad [2017] 1 LNS 1348

Legal Network Series

[2020] 1 LNS 5	COACH BUILDING SOLUTION SDN BHD lwn. MUHAMMAD AMAR ARNA SALAM & SATU LAGI Seorang pemiutang berhak untuk memulakan dan mempertahankan tindakan terhadap pengarah-pengarah syarikat untuk keberhutangan syarikat apabila pengarah-pengarah syarikat tersebut telah menjalankan perniagaan dan berurusan dengan pemiutang tersebut secara frod atas nama syarikat yang telah dibubarkan. PROSEDUR SIVIL: Pembatalan - Writ dan pernyataan tuntutan - Plaintif memulakan tindakan terhadap pengarah-pengarah syarikat dibawah s. 540(1) Akta Syarikat 2016 - Pengarah-pengarah syarikat menjalankan perniagaan secara frod atas nama syarikat yang telah dibubarkan - Sama ada plaintif adalah pemiutang dan berhak untuk menuntut keberhutangan syarikat daripada pengarah-pengarahnya - Sama ada tuntutan plaintif boleh dipertahankan Bagi pihak plaintif - T/n M Raman & Assoc. Bagi pihak defendan kedua - T/n Kal & Partners
[2020] 1 LNS 9	PP v. ABDUL AMRY SAWI It cannot be said that an exhibit seized was handled by the accused, or that he had possession, control or custody over it when the accused did not have any opportunity to have sight or verify the contents of the exhibit. EVIDENCE: Exhibits - Identity of exhibits - Drugs exhibited - Disparity in gross weight - Discrepancy as to nature of substance analyzed - Scientific officer admitted once during cross-examination to having examined slabs of drugs as opposed to crystalline substances as explained during examination-in-chief - Weight of drugs stated by arresting officer in his police report was slightly different from witness statement - Disparity not put to prosecution's witness - Whether there was break in chain of evidence from time of seizure to time of production of drugs in Court - Whether there was doubt as to identity of drugs - Whether difference of gross weight was mere de minimis CRIMINAL LAW: Dangerous drugs - Trafficking - Possession - Custody and control of drugs - Box containing drugs found at premise of accused - Accused instructed his employee to collect spare parts of vehicle from boat wharf - Employee collected wrong box - Accused did not have any opportunity to have sight and verify box collected by employee - Name stated on box different from accused's name - Whether there was evidence that accused had asked his employee to collect a specific box - Whether exhibit was handled by accused - Whether box containing drugs was in possession of accused CRIMINAL LAW: Common intention - Trafficking - Second accused a police personnel at exhibit store of police station was charged over missing drugs seized in case relating to first accused - Absence of eye witness that claimed to have seen 2nd accused taking drugs from exhibit store - Existence of bank statements showing a few transactions between first and second accused - Whether there was sufficient proof of trafficking with a common intention For the prosecution - DPP Yong Suk Hui; Jabatan Peguam Negara Malaysia, Sibu For the 1st accused - Murnie Hidayah Anuar, Jamilah Baharuddin; M/s Saifulnizam Sam & Jamilah Baharuddin and Associates, Kuching For the 2nd accused - Rosli Gapor; M/s Gapor & Co, Sibu
[2020] 1 LNS 25	PP lwn. RAVITERAN MUNIANDY Percanggahan keterangan saksi-saksi pendakwaan berkenaan masa serbuan dan pengendalian barang kes yang dirampas merupakan satu percanggahan yang material dan mewujudkan dua versi naratif di dalam kes pendakwaan. Kewujudan dua versi naratif di dalam kes pendakwaan akan menimbulkan keraguan dan seterusnya membawa padah kepada kes pendakwaan. PROSEDUR JENAYAH: Pendakwaan - Kes pendakwaan - Pembuktian kes prima facie - Penilaian maksima - Pertuduhan pengedaran dadah berbahaya dan pemilikan bahan racun - Kewujudan dua versi naratif kes pendakwaan - Percanggahan keterangan saksi pendakwaan berkenaan masa serbuan dan pengendalian barang kes yang dirampas - Sama ada percanggahan keterangan saksi-saksi pendakwaan adalah kecil - Sama ada kes pendakwaan telah terjejas akibat percanggahan keterangan saksi-saksi pendakwaan - Sama ada kewujudan dua versi naratif di dalam kes pendakwaan telah menimbulkan keraguan kepada kes pendakwaan
[2020] 1 LNS 41	DR. JOHNY KULADAIVELU v. AGILAANDESWARI VASUTHEVAN 1. Status quo as regards to continuity of care of children ought to be maintained by one party to minimise disruption to the children's lives when the children were already in the care of that particular party prior to the application for custody, care and control of the said children. 2. In granting an order for a parent to contribute to the maintenance of children, the Court is entitled to order an annual increase in the maintenance sum until the children reach the age of 18 years. FAMILY LAW: Children - Custody - Children of tender years - Application by father for joint custody, care and control of children - Mother opposed application and prayed for sole custody, care and control to be granted to her instead - Children lived with mother upon return to Malaysia - Father a foreigner - Preserving status quo - Continuity of care - Whether status quo as regards to continuity of care of children ought to be maintained by mother - Whether order for continuity of care by mother will minimise disruption to children's lives - Whether father was able to prove that mother is unfit in order to rebut presumption under s. 88(3) of Law Reform (Marriage & Divorce) Act 1979 - Whether it was in interest and welfare of children for sole guardianship to be granted to mother FAMILY LAW: Children - Maintenance - Sole custody, care and control of children given to mother - Annual increase in maintenance - Whether court is empowered to order father to provide maintenance for children - Whether court is entitled to order an annual increase in maintenance sum until children reach age of 18 years - Law Reform (Marriage & Divorce) Act 1979, ss 92 & 93 For the plaintiff - Nur Farah Hani Abdul Hamid & Thanraj Singh; M/s Rusmah Arunan & Associates For the defendant - Sheela Devi Palanisamy; M/s Sheela Devi & Co
[2020] 1 LNS 43	HEMALATHA KOBALAKRISNAN v. JAYA GANESAN MURUGAN 1. It is just, reasonable and appropriate for the court to proceed to hear a divorce proceeding once the matter is called and to make a decree of dissolution of marriage in the absence of one party to the proceeding provided that all papers relating to the said proceeding are in order and the absent party had been reasonably informed of the proceeding. Nonetheless, the absent party may apply to set aside the judgment or order within the prescribed time period by providing cogent and or reasonable excuse to justify his absence. 2. By virtue of s. 77(1) of the Law Reform (Marriage and Divorce) Act 1976, the court is entitled to make an order for payment of maintenance in one lump sum instead of periodical payment against the husband for the benefit of the wife. Prior agreement of parties is not a precondition for the court to award such payment of maintenance in one lump sum. FAMILY LAW: Divorce - Decree nisi - Application by respondent husband to set aside terms of decree nisi - Single petition - Setting aside of terms concerning granting of lump sum payment of maintenance - Respondent husband was not present during hearing - Application made 3 years after decree nisi was granted - Whether there was inordinate delay in filing application - Whether respondent husband had been reasonably informed of divorce proceedings - Whether it was just, reasonable and appropriate for court to proceed to make a decree for dissolution of marriage - Whether reasonable and believable excuse had been offered to justify absence FAMILY LAW: Maintenance - Wife - Lump sum maintenance - Power of court to grant lump sum maintenance - Whether court may grant a lump sum payment for maintenance in absence of an agreement between parties - Whether court is only entitled to award maintenance by periodical payments - Law Reform (Marriage and Divorce) Act 1976, s. 77, 80 CIVIL PROCEDURE: Judgments and orders - Setting aside - Principles and procedures - Application to set aside terms of decree nisi order - Intitulement to application failed to refer to O. 42 r. 13 of Rules of Court 2012 - Whether application should be dismissed in limine For the petitioner wife - Chan Szu Fu; M/s Chan, De Vries & Co For the respondent husband - Prema Subramaniam; M/s Sumitra Prema & Associates

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CLJ 2021 Volume 5 (Part 1)

While the court is inclined to conclude that a judgment entered for payment of a sum of money against several judgment debtors imposed upon each of them a joint and several liability to honour the entire judgment debt, and not merely an equal portion of it, unless otherwise stated, this conclusion is at variance with the decision of this court in Sumathy Subramaniam v. Subramaniam Gunasegaran and Another Appeal. The doctrine of stare decisis is among the pillars of the common law system and it facilitates engendering certainty in the law which is a matter of obvious importance. As such, a Court of Appeal may not depart from the ratio decidendi of its earlier decisions unless the exceptions identified in the case of Young v. Bristol Aeroplane are applicable.
Kejuruteraan Bintai Kindenko Sdn Bhd v. Fong Soon Leong [2021] 5 CLJ 1 [CA]

• SUBJECT
• CORAM
• COUNSEL

There is no duty, under general law, for a contracting party to give reasons when terminating a contract, to the other party, unless the contract itself stipulates the grounds for valid termination. In such a situation, the duty of the court is to give effect to the intention of the parties ie to not give reasons when terminating a contract. The court cannot imply words into the documents agreed by the parties or attribute to the parties an intention which they never had.
Aura Indah Jaya Sdn Bhd v. OCBC Bank (Malaysia) Bhd & Another Application [2021] 5 CLJ 24 [HC]

• SUBJECT
• CORAM
• COUNSEL

Apabila elemen-elemen kesalahan bawah s. 165 Kanun Keseksaan gagal dibuktikan terhadap Orang Kena Tuduh ('OKT'), dan keterangan saksi utama pendakwaan didapati mengandungi unsur niat mala fide, maka sabitan atas OKT tidak boleh dipertahankan dan OKT harus dilepaskan dan dibebaskan daripada pertuduhan-pertuduhan tersebut.
Azmi Nordin lwn. PP [2021] 5 CLJ 48 [HC]

• SUBJECT
• CORAM
• COUNSEL

Once a final award in an arbitration proceeding is handed down, the court is only seized with limited powers of intervention and the parties' recourse is only to enforce the award pursuant to s. 38 of the Arbitration Act 2005; the court's powers do no extend to reopening of matters already decided in the arbitration.
Danieli & C Officine Mecchaniche SpA v. Southern HRC Sdn Bhd [2021] 5 CLJ 71 [HC]

• SUBJECT
• CORAM
• COUNSEL

When there is doubt or ambiguity as to whether a taxpayer is entitled to claim for tax incentive, the law is to be read liberally, and not construed strictly, in favour of the taxpayer.
Ketua Pengarah Hasil Dalam Negeri v. Classic Japan (M) Sdn Bhd & Another Appeal [2021] 5 CLJ 86 [HC]

• SUBJECT
• CORAM
• COUNSEL

Where a vendor fails to deliver vacant possession pursuant to a sale and purchase agreement despite full settlement of the purchase price, the purchaser is entitled to treat the agreement as having been breached and rescind the contract; consequently, the purchase price ought to be refunded to the purchaser.
Thay Chee Huat & Anor v. Yeng Chong Realty Bhd [2021] 5 CLJ 127 [HC]

• SUBJECT
• CORAM
• COUNSEL

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LNS Article(s)

1. THE PERSONAL LIABILITY OF DIRECTORS AND THIRD PARTIES IN AN OPPRESSION SUIT
   A CASE NOTE* ^{[Read excerpt]}
   by Lyness Lim Wei Xeng [2021] 1 LNS(A) lxi

[2021] 1 LNS(A) lxi



MALAYSIA

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THE PERSONAL LIABILITY OF DIRECTORS AND THIRD PARTIES IN AN OPPRESSION SUIT
A CASE NOTE*

by
Lyness Lim Wei Xeng

Introduction

In the recent case of Auspicious Journey Sdn Bhd v. Ebony Ritz,^[1] the Federal Court addressed the issue of whether liability can be imposed on directors and third parties in an oppression action under section 181 of the Companies Act 1965 (“CA 1965”) (now section 346 of the Companies Act 2016 (“CA 2016”)). It was held that in an appropriate case, such liability can be imposed on directors and third parties.

Summary background facts

Auspicious Journey Sdn Bhd (“AJ”) and Hoe Leong Ltd (“HL”) entered a joint venture to form a joint venture company, namely Ebony Ritz Sdn Bhd (“Ebony”). AJ held 20% shareholding in Ebony whereas HL held the remaining 80%.

. . .

* Published with kind permission of M/s Shearn Delamore & Co.

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2. DEBATE ON 'ELECTRONIC PERSONHOOD': AN ISLAMIC PERSPECTIVE* ^{[Read excerpt]}
   by Shahino Mah Abdullah [2021] 1 LNS(A) lxii

[2021] 1 LNS(A) lxii



MALAYSIA

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DEBATE ON 'ELECTRONIC PERSONHOOD': AN ISLAMIC PERSPECTIVE*

by
Shahino Mah Abdullah

The status of personhood from a religious perspective is linked to the rational soul of natural men and women, including their intellect and will to bear responsibility and perform duties. The status of personhood in Islam represents a special position given only to human beings (insan), the prize of God Almighty's creation gifted with spirit (ruh), a rational soul (nafs) and intellect ('aql). Humans uphold the divine trust (amanah) that enable them to take care of the Earth as God's vicegerent (khalifah).

In Islam, one of the well-known qualities that differentiates humans and animals is 'aql, the ability to use intellect or logic to deduce laws, something animals do not possess, despite a degree of intelligence, the ability to be trained, and consciousness of their own existence.

. . .

* Published with kind permission of the International Institute of Advanced Islamic Studies (IAIS) Malaysia. (www.iais.org.my).

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3. PRICKING THE PUBLIC'S CONSCIENCE
   IMPLICATIONS OF R v. RADUNZ FOR THE FUTURE OF POLITICAL PROTEST IN AUSTRALIA+ ^{[Read excerpt]}
   by Serrin Rutledge-Prior* Tara Ward** [2021] 1 LNS(A) lx

[2021] 1 LNS(A) lx



AUSTRALIA

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PRICKING THE PUBLIC'S CONSCIENCE
IMPLICATIONS OF R v. RADUNZ FOR THE FUTURE OF POLITICAL PROTEST IN AUSTRALIA+

by
Serrin Rutledge-Prior*
Tara Ward**

Earlier this year an animal advocate who displayed images of Australian slaughterhouses in public was held by a court to be a public nuisance on the grounds that his behaviour was "offensive". In this article, Serrin Rutledge-Prior and Tara Ward of the Animal Defenders Office, which provided pro bono assistance to the advocate, considers the far-reaching consequences of this decision.

“…concerns about animal welfare are clearly legitimate matters of public debate across the nation. … Many advances in animal welfare have occurred only because of public debate and political pressure from special interest groups. The activities of such groups have sometimes pricked the conscience of human beings.” — Kirby J (2001)^[1]

. . .

+ Published with kind permission of the Law Society of the Australian Capital Territory. See Ethos Issue 259. Autumn 2021.

* Serrin Rutledge-Prior is a PhD Candidate at the Australian National University's School of Politics and International Relations and a volunteer Research Officer with the Animal Defenders Office.

** Tara Ward is the co-founder of, and the volunteer Principal Lawyer with, the Animal Defenders Office. The authors would like to thank fellow Animal Defenders Office volunteer Scott Dempsey for his contribution to this article.

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