Koperasi Anak Kelantan Perantauan Malaysia Berhad v Pengarah Tanah dan Galian Negeri Kelantan (DA-25-9-12/2025)

1.

KERAJAAN NEGERI KELANTAN … RESPONDEN-RESPONDEN

This is an application for judicial review by the Applicant against the decision of the R2 communicated through the letter of R1 dated 15.10.2025, refusing the Applicant’s application to renew its mining licence.

The Applicant seeks certiorari to quash the said decision, declarations that the decision is null and void or ultra vires the Mineral Enactment 2001 and Articles 5(1) and 8(1) of the Federal Constitution, and an order of mandamus compelling the Respondents to approve the renewal of the license.

The application was resisted by the Respondents. In essence, the Respondents contended that the impugned decision was made pursuant to the statutory discretion conferred by section 43 of the Kelantan Mineral Enactment 2001 (“the Mineral Enactment”), that there was no illegality, irrationality or procedural impropriety, and that the Applicant was attempting to convert an internal dispute within the cooperative into a public law challenge.

After considering the affidavits, exhibits, submissions and authorities cited by parties, I dismissed the application for the reasons I will elaborate in the following paragraphs.

The Applicant is a cooperative registered under the Cooperative Societies Act 1993. It had been granted prospecting licence PL 2/2024 for gold mining in respect of land at Mukim Ulu Nenggiri, District of Bertam, Jajahan Gua Musang. The licence was registered on 6.3.2024 for a period of one year and expired on 5.3.2025.

The Applicant applied for renewal of the said licence vide an application submitted in September 2024. Upon receipt of the renewal application, the Respondents sought technical comments from relevant agencies.

The State Authority subsequently refused the renewal application and informed the Applicant of the decision. The Applicant now seeks to challenge that decision by way of judicial review.

This application would ordinarily be a straightforward challenge against a refusal to renew a licence. However, the affidavits reveal a much wider factual narrative. The Applicant’s complaint is not merely that the renewal application was refused. A substantial part of its grievance concerns the conduct of one Karumidin @ Kamarudin Bin Ibrahim, the former chairman of the Applicant, and the alleged involvement of its joint venture partner, Dynasty Agro Mining Sdn Bhd.

The Applicant says that several applications and dealings concerning the license had been made without proper authorisation or approval of the Applicant. It also says that the relevant joint venture arrangements had been cancelled by the Applicant.

The Applicant further says that Karumidin convened a meeting on 8.3.2024 without complying with the Applicant’s internal rules culminating in police reports being lodged, show cause letters issued to the said Karumidin and that the Applicant later took steps to invalidate the said meeting and require Karumidin to hand over his duties.

This factual background is important, not merely because it explains how the dispute arose, but because it identifies the true nature of the controversy before the Court. Whilst the application is framed as a challenge against the refusal to renew the licence, a careful reading of the affidavits reveals that the Applicant's principal complaints are directed at the conduct of its own former office bearer, the validity of its internal resolutions, and the actions of persons whom it says acted without authority. Those matters dominate the Applicant's evidence. They explain why the Applicant considers itself to have been wronged. They do not, however, necessarily establish that the Respondents acted unlawfully in exercising their statutory powers.

This Court does not for a moment suggest that those allegations are trivial. If ultimately established, they may well give rise to remedies in another forum. However, this Court is not presently concerned with determining whether Karumidin exceeded his authority, whether the resolutions of the cooperative were validly passed, or whether Dynasty Agro Mining Sdn Bhd acquired any enforceable rights. Those are private law or internal governance issues. The only question before this Court is whether the Respondents committed a reviewable public law error when refusing the renewal application under section 43 of the Mineral Enactment.

The issues which arise for determination are as follows:

Whether the decision was illegal or ultra vires the Mineral Enactment 2001;

Whether the Respondents failed to consider relevant considerations or took into account irrelevant considerations;

Whether the decision was irrational, disproportionate or unreasonable in the Wednesbury sense; and

whether there was procedural impropriety by reason of the alleged failure to afford the Applicant a hearing or to give adequate reasons. The Statutory Framework

The starting point must be the statute. The decision challenged before this Court was a decision on renewal of the mining licence. The relevant provision is section 43 of the Mineral Enactment 2001 which is reproduced below: “(2) Sesuatu permohonan untuk membaharui suatu lesen mencarigali atau lesen penjelajahan hendaklah dibuat kepada Pihak Berkuasa Negeri dalam bentuk yang ditetapkan:

dalam hal lesen mencarigali, sekurang-kurangnya enam bulan;dan

dalam hal lesen penjelajahan, sekurang-kurangnya dua belas bulan sebelum habis tempoh lesen mencarigali atau lesen penjelajahan itu, mengikut mana-mana yang berkenaan.” Section 43(4) provides: “(4) Jika permohonan untuk membaharui suatu lesen mencarigali dibuat kepada Pihak Berkuasa Negeri sekurang-kurang enam bulan sebelum habis tempoh lesen itu, Pihak Berkuasa Negeri atau mana-mana pegawai yang diberi kuasa secara bertulis olehnya hendaklah, dalam masa tiga bulan dari tarikh pendaftarannya, membaharui lesen itu selama suatu tempoh tidak melebihi dua tahun jika-

Pemegang lesen itu telah mematuhi terma atau syarat yang dinyatakan dalam lesen itu;

Pemegang lesen itu telah mematuhi peruntukan Enakmen ini;

Pemegang lesen itu boleh menunjukkan sehingga memuaskan hati Pihak Berkuasa Negeri atau mana-mana pegawai yang diberi kuasa secara bertulis olehnya bahawa mencarigali selanjutnya adalah wajar; dan

Jumlah tempoh lesen mencarigali itu termasuk apa-apa pembaharuan tidak melebihi empat tahun.” (emphasis added) Section 43(6) provides: “(6) Jika suatu permohonan untuk pembaharuan dibuat kepada Pihak Berkuasa Negeri —

dalam hal lesen mencarigali kurang daripada enam bulan; atau

dalam hal lesen penjelajahan, kurang dari dua belas bulan, sebelum habis tempoh lesen mencarigali atau lesen penjelajahan itu, mengikut mana yang berkenaan, Pihak Berkuasa Negeri boleh —

menimbangkan untuk meluluskan permohonan itu jika pemegang lesen itu memenuhi syarat yang dinyatakan dalam subseksyen (4) atau (5); tetapi hendaklah mengenakan ke atas pemegang lesen itu apabila membaharui lesen itu, suatu fee pengemukaan lewat mengikut apa-apa amaun yang ditetapkan; atau

(ii) menolak permohonan itu.”

The language employed by section 43 does not create an automatic right of renewal merely because a licence holder has previously been granted a licence. Instead, renewal is expressly made conditional upon the satisfaction of the statutory requirements prescribed by the Legislature. The burden therefore remains upon the Applicant to satisfy the State Authority that those statutory requirements have been fulfilled.

The use of the expression "sehingga memuaskan hati Pihak Berkuasa Negeri" in s. 43(4) is of considerable importance. It demonstrates the legislative intention that the evaluative judgment should remain with the State Authority. It is therefore not for this Court to ask whether it would itself have been satisfied that a renewal was justified. The Court's supervisory jurisdiction extends only to examining whether that statutory discretion was exercised lawfully and not whether a different conclusion could reasonably have been reached.

The Applicant’s case proceeds on the premise that once it explained the conduct of Karumidin and Dynasty Agro Mining Sdn Bhd, the Respondents were bound to renew the licence. With respect, that is not what section 43 says. Even if the Applicant was blameless in relation to the conduct of Karumidin, it must still satisfy the statutory requirements for renewal. The Applicant’s internal explanation does not itself create a legal entitlement to renewal.

It is well settled that judicial review is not an appeal on the merits. The court is concerned only with the legality of the decision-making process. This principle was stated in Chief Constable of North Wales Police v Evans [1982] 3 All ER 141. It is trite that judicial review is directed at the manner in which a decision is made and not at the correctness of the decision itself.

This principle has been consistently applied by the Malaysian courts. In T. Ganeswaran v Suruhanjaya Polis Diraja Malaysia & Anor [2005] 3 CLJ 302, the Court of Appeal held: “Judicial review is not an appeal from a decision but a review of the manner in which the decision was made, and, therefore, the court is not entitled on an application for judicial review to consider whether the decision itself was fair and reasonable. Judicial review is concerned, not with the decision, but with the decision-making process. Unless the restriction on the power of the court is observed, the court will in my view under the guise of preventing the abuse of power, be itself guilty of usurping power”

Although judicial review is concerned with the decision making process, the Court is not restricted to scrutinise the impugned decision only for the process, but have to also look into the substance. The recognised grounds of judicial review were stated in Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374. They are illegality, irrationality and procedural impropriety. These grounds too have been recognised and adopted by Malaysian courts in numerous cases, including the Federal Court in R Rama Chandran v Industrial Court of Malaysia & Anor [1997] 1 MLJ 145 and Akira Sales & Services (M) Sdn Bhd v Nadiah Zee Bt Abdullah And Another [2018] 2MLJ 537.

What is meant by illegality, irrationality and procedural impropriety was explained by Lord Diplock in CCSU case above. For completeness, it is reproduced below: “By ‘illegality’ as a ground for Judicial Review I mean that the decision maker must understand directly the law that regulates his decision making power and must give effect to it. Whether he has or not is par excellence a justiciable question to be decided, in the event of a dispute, by those persons, the judges, by whom the judicial power of the state is exercisable. By ‘irrationality’ I mean what can by now be succinctly referred to as ‘Wednesbury unreasonableness’ (see Associated Provincial Picture Houses Ltd v Wednesbury Corp [1948] 1 KB 223). It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it. Whether a decision falls within this category is a question that judges by their training and experience should be well equipped to answer, or else there would be something badly wrong with our judicial system. To justify the courts’ exercise of this role, resort I think is today no longer needed to Viscount Radcliffe’s ingenious explanation in Edwards v Bairstow [1956] AC 14, of irrationality as a ground for a court’s reversal of a decision by ascribing it to an inferred though undefinable mistake of law by the decision maker. ‘Irrationality’ by now can stand on its own feet as an accepted ground on which a decision may be attacked by Judicial Review. I have described the third head as ‘procedural impropriety’ rather than failure to observe basic rules of natural justice or failing to act with procedural fairness towards the person who will be affected by the decision. This is because susceptibility to Judicial Review under this head covers also failure by an administrative tribunal to observe procedural rules that are expressly laid down in the legislative instrument by which its jurisdiction is conferred, even where such failure does not involve any denial of natural justice.”

The Federal Court in R Rama Chandran v Industrial Court of Malaysia & Anor (supra) recognised that the Court may, in appropriate cases, examine whether a decision is supported by evidence. However, this does not convert judicial review into an appeal on the merits. This limitation was reiterated in Petroliam Nasional Bhd v Nik Ramli Nik Hassan [2004] 2 MLJ 285.

I turn first to what I consider to be the central issue in the Applicant’s case. At first glance, this appears to be a challenge to the refusal to renew a mining licence. But when the affidavits are read as a whole, the true grievance becomes clearer. The Applicant’s dissatisfaction is substantially directed at events within its own organisation and against persons who allegedly acted without proper authority.

The Applicant devotes considerable attention to Karumidin, Dynasty Agro Mining Sdn Bhd, cancellation of joint venture arrangements, unauthorised applications, internal meetings, police reports, show cause letters, termination of membership and internal resolutions. The Applicant says those matters should have persuaded the Respondents that any adverse matter connected with Karumidin or Dynasty Agro Mining Sdn Bhd should not be held against the Applicant.

The Court readily accepts that these allegations are important from the Applicant's perspective. They explain the Applicant's dissatisfaction and perhaps even its sense of injustice. If ultimately established, they may well justify relief in another forum. However, judicial review is not intended to determine disputes concerning the internal governance of a cooperative, the authority of its office bearers or competing contractual rights arising from commercial arrangements. Those questions belong elsewhere.

However, judicial review is not the proper vehicle to determine adjudicate on internal matters of the Applicant. Those are not issues of public law merely because they form the background to an administrative decision.

A private dispute does not become a public law wrong simply because a public authority later makes a decision which may seem to be affected by the internal disputes. The Applicant must still show that the Respondents committed a reviewable error.

Even if I assume, for the purpose of this application, that every allegation made by the Applicant against Karumidin is true, it still does not follow that the Respondents were legally bound to renew the licence. Section 43 requires the State Authority to be satisfied that the statutory requirements are met and that the renewal is justified. That discretion remains with the State Authority.

The Applicant’s internal dispute therefore cannot be used to shift the statutory satisfaction from the State Authority to the Court.

I am unable to accept the Applicant's contention that the impugned decision was ultra vires the Mineral Enactment. The Respondents did precisely what section 43 authorises them to do. They considered an application for renewal of the licence and reached a decision in the exercise of the statutory discretion entrusted to them by the Legislature. There is no evidence that they relied upon an incorrect statutory provision, misunderstood the scope of their powers or exercised a power which the Enactment did not confer.

The Applicant’s real argument is not that the Respondents had no power to decide. The real argument is that the Respondents should have decided differently. That is a merits complaint, not illegality.

Section 43(4) clearly provides that the renewal is conditional. Renewal follows only if the statutory conditions are satisfied. Those conditions include the requirement that the holder show to the satisfaction of the State Authority that renewal is justified, which cannot be ignored by the court.

The Applicant also relies on Articles 5(1) and 8(1) of the Federal Constitution. I am not persuaded that those provisions assist the Applicant on the facts. The refusal to renew the licence does not amount to deprivation of life or personal liberty. Nor has the Applicant shown unequal treatment in the constitutional sense. The complaint remains, in substance, that the State Authority did not accept the Applicant’s explanation and refused renewal, which in my view does not establish constitutional invalidity.

The Applicant contends that the Respondents failed to take into account relevant considerations. These include the cancellation of the joint venture agreements, the police reports, the termination of Karumidin’s membership, the Applicant’s alleged compliance with the licence and the absence of enforcement action against the Applicant.

I accept that these matters were important to the Applicant. But not every matter important to an applicant is a mandatory relevant consideration in public law. The question is whether the decision-maker failed to take into account something which the statute expressly or impliedly required it to consider, or whether the decision-maker took into account something legally irrelevant.

Section 43 directs attention to compliance with licence terms, compliance with the Enactment, justification for renewal, and the overall statutory requirements for renewal. The Applicant’s internal disputes may provide context but do not dictate the answer.

The Applicant is, in substance, inviting this Court to reassess the weight to be attached to each item of information that was before the Respondents. However, that is not the function of this court in judicial review. Unless it can be shown that the Respondents acted upon irrelevant considerations, ignored mandatory relevant considerations or otherwise exercised their discretion unlawfully, the Court cannot interfere merely because another decision might also have been open.

A licensing authority need not resolve every collateral dispute before deciding whether to renew a licence. If it had to do so, every licensing decision could be paralysed by internal disputes between directors, members, office bearers or contracting parties. That is not what section 43 requires.

The Court must therefore distinguish between matters which the Applicant wished the State Authority to accept, and matters which the State Authority was legally bound to treat as determinative. The Applicant has not shown that the Respondents ignored any mandatory relevant consideration. Nor has it shown that the Respondents relied on any prohibited consideration.

The threshold for irrationality is high. It is not enough for the Applicant to show that a different decision could have been made or that the Court might have taken a different view. The Applicant must show that the decision was so unreasonable that no reasonable authority could have reached it.

The Respondents were dealing with a renewal application for a mining licence. They were also aware of the broader circumstances surrounding the licence. The refusal of renewal in those circumstances cannot be characterised as outrageous, absurd or irrational in the Wednesbury sense.

There is a difference between sympathy for the Applicant’s predicament and legal irrationality. The Court may understand why the Applicant feels aggrieved. But sympathy does not supply a ground for judicial review.

The Applicant submits that it ought to have been heard before the decision was made. It says that it had a legitimate expectation to be heard because it was the holder of the licence and because the decision affected its interests.

The principle of procedural fairness is flexible. Its content depends on the statute, the nature of the decision, the subject matter, the consequences of the decision and the circumstances of the case. It does not follow that every refusal of a renewal application requires an oral hearing.

Section 43 does not prescribe an oral hearing. The decision was made on a renewal application submitted by the Applicant. The Applicant had the opportunity to put forward its application and supporting materials. The Respondents considered the application in the context of the statutory requirements.

The Applicant’s complaint is really that it was not given a further opportunity to be heard. In this regard, I find that the Respondents were not conducting a disciplinary hearing against the Applicant but were merely considering whether to renew a licence, and the onus to convince the State Authority lies on the Applicant when it submitted the form for renewal wherein it has to put forward all its justification to the satisfaction the State Authority that the license ought to be renewed.

I have perused the application form exhibited in this proceedings, and I find that there is no justification whatsoever was provided by the Applicant when it submitted the renewal forms. Therefore, the Applicant cannot now complain that it was not given the right to be heard having chosen not to be heard when given the opportunity to do so.

The Court must be careful not to impose a trial procedure upon an administrative renewal process unless the statute or fairness clearly requires it. On the facts, I am not satisfied that procedural fairness required an oral hearing before the refusal.

The Applicant also submits that the Respondents failed to give adequate reasons. The Applicant relied on Kesatuan Pekerja-Pekerja Bukan Eksekutif Maybank Bhd v Kesatuan Kebangsaan Pekerja-Pekerja Bank & Anor [2018] 2 MLJ 590 to support its contention that the Respondents ought to give reasons for the non-renewal of the license.

I accept the importance of reasoned decisions. However, the duty to give reasons must be applied with regard to the nature of the decision and the circumstances in which it is made. The question is not whether the reasons could have been fuller. The question is whether the absence or inadequacy of reasons automatically caused procedural unfairness or concealed an unlawful decision.

In this case, the Applicant knew that the decision concerned the renewal of the license under section 43 and knew the statutory basis for renewal. It also knew the factual matters which it itself had raised concerning the licence. The Respondents’ position, as explained in these proceedings, is that the decision was made pursuant to section 43 which was communicated vide the letter dated 15.10.2025.

The Applicant has been able to mount a full challenge in these proceedings. It has not been prevented from understanding the nature of the decision. Nor has it shown that fuller reasons would have revealed illegality. I do not accept that the reasons point invalidates the decision.

For the reasons stated above, I conclude that the Applicant has not established illegality, irrationality or procedural impropriety. The decision was made under the relevant statutory framework. It involved the exercise of discretion conferred upon the State Authority. The Respondents considered the renewal application and relevant circumstances. The Applicant’s disagreement with the outcome is insufficient.

The Applicant’s real grievance lies in the internal affairs of the cooperative and in the conduct of persons formerly or allegedly connected with it. Those grievances may be pursued elsewhere if the law permits. They do not justify this Court quashing the State Authority’s decision or compelling the State Authority to renew the licence.

This Court’s jurisdiction is supervisory, not appellate. It does not permit the Court to substitute its view for that of the statutory decision-maker merely because another decision may also have been open.

The application is therefore dismissed with costs of RM10,000.00 to the Respondents jointly. This Grounds of Judgment is dated 12.7.2026 SHAMSUL BAHRIN BIN ABDUL MANAF Pesuruhjaya Kehakiman Mahkamah Tinggi (3) Kota Bharu Kelantan PIHAK-PIHAK: Peguam bagi pihak Pemohon: Tetuan Najib Hisham Isa SB-06-01, Paragon @ Pan’gaea, Persiaran Bestari, Cyber 11, 63000 Cyberjaya, Selangor. Peguam bagi pihak Responden-Responden: Penolong Penasihat Undang-Undang Pejabat Penasihat Undang-Undang Negeri Kelantan, Blok 5, Aras Bawah, Kota Darulnaim, 15050 Kota Bharu, Kelantan.