Lubricleum Sdn. Bhd. v Pendakwa Raya (JA-43-13-06/2026)

This is a criminal revision application brought by Lubricleum Sdn. Bhd. ("the Applicant") pursuant to Section 325 of the Criminal Procedure Code ("CPC") against an order of the Sessions Court at Johor Bahru dated 30.06.2025 in case number JA-63-28-05/2024.

Pursuant to a plea bargain agreement between the Prosecution and one Ong Kong Hong ("the Accused"), the learned Sessions Court Judge ordered the forfeiture of a Volvo motor lorry (Registration No. PNH 2425) and a semi-trailer (Registration No. T/N 8454) ("the Vehicles") to the Government of Malaysia.

The Applicant, as the registered owner of the Vehicles, seeks to set aside the forfeiture order on the grounds that the order was made in breach of the rules of natural justice and the Applicant’s constitutional right to property under Article 13 of the Federal Constitution.

The object of the revisionary powers of this Court is to ensure the accuracy, legality, and propriety of any finding, sentence, or order recorded by a subordinate court. As observed by the High Court in Liaw Kwai Wah & Anor v. PP [1987] 2 MLJ 69: "...to confer upon criminal courts a kind of paternal or supervisory jurisdiction, in order to correct miscarriage of justice arising from misconception of law, irregularity of procedure, neglect of proper precautions or apparent harshness of treatment..."

In the case of PP v. Kulasingam [1974] 2 MLJ 26, Hashim Yeop A Sani J (as the Lordship then was) had spoken about the supervisory powers of the High Court:- "The powers of the High Court in revision are amply provided under s. 325 of the Criminal Procedure Code, subject only to sub-ss. (ii) and (iii) thereof. The object of revisionary powers of the High Court is to confer upon the High Court a kind of "paternal or supervisory jurisdiction" in order to correct or prevent a miscarriage of justice. In a revision, the main question to be considered is whether substantial justice has been done or will be done and whether any order made by the lower Court should be interfered with in the interest of justice."

The learned Sessions Court Judge exercised the power of forfeiture under Section 26(1)(aa) of the Control of Supplies Act 1961 ("CSA 1961") which states: "(1) Where any person is convicted of an offence against this Act, the court may order the confiscation in whole or in part of— ... (aa) any property of the accused, vehicle, vessel or other article, by means of which the offence has been committed or which is intended to be used for the commission of an offence against this Act..."

The word "may" in Section 26(1) signifies that the power of forfeiture is discretionary. It is a settled principle that such discretion must be exercised judiciously.

A judicious exercise of discretion mandates that the Prosecution establish a clear and sufficient nexus between the subject property and the alleged unlawful activity. In PP v Kuala Dimensi Sdn Bhd & Ors [2019] 6 MLRA 637, the Court of Appeal dismissed a forfeiture application because the Public Prosecutor failed to establish, on a balance of probabilities, that the property was actually the proceeds of or connected with the predicate offences.

The courts have consistently held that the discretion to order forfeiture must be exercised based on sound legal principles and the specific facts of the case. In Protasco Bhd v PT Anglo Slavic Utama & Ors [2020] 6 MLRH 491, the High Court emphasised that the discretion vested in the court must be exercised judicially and not arbitrarily or capriciously. Scrutiny is required to ensure that the "ends of justice" are met, particularly when a party’s property rights, which are protected under Article 13 of the Federal Constitution are at stake.

In the instant case, the Accused was charged under Section 21 of the Control of Supplies Act 1961 with illegal possession of 46,000 liters of diesel. The charge reads as follows: - “Bahawa kamu pada 17 April 2022, kira-kira jam 4.00 petang di dalam premis tanpa nama, No.21, Jalan Cenderai 21, Taman Kota Putri, 81750 di dalam daerah Johor Bahru di dalam negeri Johor, didapati telah ada dalam milikan barang kawalan berjadual minyak diesel sebanyak 46,000 liter dalam keadaan menimbulkan syak yang munasabah untuk melakukan kesalahan melanggar Peraturan 3(1) Peraturan-Peraturan Kawalan Bekalan 1974 iaitu berurusan dengan minyak diesel tersebut secara runcit atau borong atau mengilang tanpa lesen dan dengan itu kamu telah melakukan kesalahan di bawah Seksyen 21 Akta Kawalan Bekalan 1961 (Akta 122) dan boleh dihukum di bawah Seksyen 22(1) Akta yang sama. HUKUMAN Seksyen 22(1) Akta Kawalan Bekalan 1961 (Pindaan 2015) Seseorang selain dari badan korporat tetapi termasuk pengarah atau pegawai sesuatu korporat yang melakukan kesalahan terhadap Akta ini, apabila disabitkan boleh didenda tidak melebihi satu juta ringgit (RM1,000,000.00) atau di penjara tidak melebihi 3 tahun atau kedua-duanya sekali.”

On 30.06.2025, the Accused pleaded guilty pursuant to a plea bargain under Section 172C of the Criminal Procedure Code (CPC) which reads as follows: -

Upon the Accused’s plea of guilt, the learned Sessions Court Judge meted out the following sentence: - a) The Accused be fined RM110,000.00, in default, an imprisonment of eight (8) months; b) The said Vehicles be forfeited to the Government of Malaysia; c) One (1) Hino motor lorry with registration number JKR 3436, T/J 9262 and one (1) Hino motor lorry with registration number JJC 9244 be returned to the Accused; and d) The proceeds from the sale of the confiscated goods amounting to RM115,000-00 shall accrue to the Government of Malaysia as revenue.

The Sessions Court’s order is reproduced as follows: DI HADAPAN HAKIM MAHKAMAH SESYEN CHE WAN ZAIDI BIN CHE WAN IBRAHIM PADA 30 JUN 2025 MAHKAMAH TERBUKA PERINTAН TINDAKAN INI telah dipanggil pada hari ini dengan kehadiran Timbalan Pendakwa Raya Shafiq Bin Mahadi, Pegawai Pendakwa Loganthan A/L Subramaniam dan Izzat bin Muhtar, peguambela bagi Ong Kong Hong No. K/P: 800523-01-5603 tertuduh dan tertuduh hadir. Mahkamah mendapati tertuduh membuat pengakuan bersalah melalui rundingan akuan (plea bargaining) dibuat secara sukarela dan kedua-dua pihak telah mencapai persetujuan denda sebanyak RM110,000.00 gagal bayar lapan (8) bulan penjara. MAKA ADALAH DIPERINTAHKAN bahawa barang kes satu (1) buah kenderaan jenis M/Lori Model Volvo Nombor Pendaftaran PNH2425, T/N8454, tanker Nombor Pendaftaran TW5435 dilucuthakkan kepada Kerajaan, satu (1) buah kenderaan M/Lori Model Hino Nombor Pendaftaran JKR3436, T/J9262, satu (1) buah jenis M/Lori Model Hino Nombor Pendaftaran JJC9244 dikembalikan kepada tertuduh dan hasil jualan barang rampasan sebanyak RM115,000.00 dijadikan hasil Kerajaan Malaysia. Diberi di bawah tandatangan saya dan meterai Mahkamah pada 30 Jun 2025.

As part of the agreed sentence, the Prosecution and the Accused consented to the forfeiture of the Vehicles.

During the proceedings, the Prosecution produced a Road Traffic Department (JPJ) search (Exhibit P18) which clearly identified the Applicant as the registered owner of the Vehicles. It was also established that the Applicant had previously secured temporary release of the Vehicles by way of a bond. Despite this knowledge, the learned Sessions Court Judge proceeded to order the forfeiture of the Vehicles without summoning the Applicant or providing them with an opportunity to be heard.

The central issue before this court is whether a court may exercise its discretionary power of forfeiture under Section 26(1)(aa) of the Control of Supplies Act 1961 against a known third-party owner of a seized property without first conducting a "show cause" inquiry. For ease of reference, Section 26(1)(aa) is reproduced and reads as follows: - “Section 26: 1) Where any person is convicted of an offence against this Act the court may order the confiscation in whole or in part of-

(a) any controlled article, in respect of which the offence has been committed, which has been seized by or has otherwise come into the possession of the Controller or any person acting under his authority; (aa) any property of the accused, vehicle, vessel or other article, by means of which the offence has been committed or which is intended to be used for the commission of an offence against this Act; 2) Where confiscation is ordered under subsection (1), the court shall deliver the controlled article, proceeds of sale, property of the accused, vehicle, vessel or other article confiscated (if not already in possession of the Controller) to the Controller or to any person designated by him, and shall give directions as to their disposal.” LEGAL ANALYSIS a) The Discretionary Nature of Section 26

The Respondent (Prosecution) was correct in its contention that under Section 26(1)(aa) of the Control of Supplies Act 1961, the court has a discretionary power to forfeit any vehicle used in the commission of an offence and this power is not only restricted to vehicles owned by an accused.

In PP lwn Chang Siew Fah (2015) MLRHU 1196, the High Court held that the categories in Section 26(1)(aa) are to be read disjunctively. This means that the Court may order the forfeiture of the property of an accused, or any vehicle, or any vessel, or any other article, as the case may be. This finding was affirmed by the Court of Appeal.

Consequently, the fact that the Applicant is the registered owner of the Vehicles does not, in itself, automatically protect the Vehicles from forfeiture if they were proven to have been used to facilitate the unlawful possession of diesel.

Where the Court is vested with the power to forfeit or confiscate property used in the commission of an offence, it must exercise heightened scrutiny and carefully examine the facts and circumstances surrounding the ownership of the property in question. This is to give effect to Article 13 of the Federal Constitution which provides as follows: “(1) No person shall be deprived of property save in accordance with law.”

Section 26(1)(aa) provides that the court “may” order the forfeiture of a vehicle used in the commission of an offence. The use of the word "may", confers a discretionary, rather than a mandatory power.

In Sing Hoe Motor Company Ltd v. PP [1968] 2 MLJ 54, it was established that such discretion must be exercised “judiciously”. Judicial discretion cannot be said to have been exercised soundly if the Court overlooks the claims of a registered owner who bears no involvement in the alleged offence. Raja Azlan Shah J (as his Majesty then was) held that because the power is discretionary, the court must conduct an inquiry into the true ownership before exercising that discretion: “Such circumstances will normally be found in the facts of each particular case, and in order to exercise such discretion properly, the known circumstances with regard to the particular motor-vehicle should be fully considered. That implies an enquiry as to the true character of the motor-vehicle concerned, whether it is the subject of a hire-purchase agreement or otherwise. That this seems to be desirable is implicit in a statute which entails penal consequences, that no violence must be done to its language to bring people within it, but rather care must be taken that no one must be brought within it who is not within its express language. Therefore, to adopt that narrow approach as applied by Ali J in Public Prosecutor V. Ong Keng Seong [1966] 1 LNS 146 in not enquiring beyond the bare fact of registration is unrealistic to be acceptable and tends to work injustice on an innocent party.”

On the question of what amounts to a judicious exercise of discretion, this Court found excerpts from the following judgments to be highly instructive -

(i) Dato’ Sri Mohd Najib bin Hi Abdul Razak v Public Prosecutor [2023] 3 MLJ 40 at page 75, wherein Abdul Rahman Sebli CJSS explained: “A judicious decision is a decision that is well-considered; discreet; wisely circumspect: see Black’s Law Dictionary (Deluxe 9th Ed). A discretion that is not exercised judiciously is not a valid exercise of discretion and is liable to be set aside.” And

Productions Ltd & Ors v Hamilton & Anor [1983] 1 AC We might add that a decision will be set aside on appeal if the Court has failed to act in accordance with recognized principles.” b) Breach of Natural Justice and Article 13

The Applicant’s primary grievance is the denial of the right to be heard (audi alteram partem).

Article 13(1) of the Federal Constitution guarantees that no person shall be deprived of property save in accordance with law. The term “law” encompasses the fundamental rules of natural justice, specifically the principle of audi alteram partem. Article 13(1) of the Federal Constitution provides: "No person shall be deprived of property save in accordance with law. "

In the case of SS Petroleum Sdn Bhd v. PP [2024] MLRHU 2682, the High Court set aside a forfeiture order under similar circumstances, holding that the failure to notify a known third-party owner constitutes a serious procedural irregularity. Chan Jit Li J held: “As the applicant was never a party to Sessions Court case, the avenue of appeal was not available to him. Hence, the applicant had applied for a revision of the forfeiture order. In this revision, the applicant seeks the return of the vehicle on the grounds that he was unaware that the vehicle would be used in the commission of the offence and that he had been advised by the Investigating Officer in the Sessions Court case that the vehicle would be returned to him. It was also because of the belief that the vehicle would be returned to it, the applicant did not take any steps at the Sessions Court to secure the return of the vehicle prior to the forfeiture order being made. [7] Chang Siew Fah is distinguishable. In that case, the accused was the registered owner of the vehicle which was forfeited. In the instant case, the registered owner of the vehicle is a stranger to the offence and criminal proceedings. This is evidenced by the fact that the facts of the case tendered by the prosecution makes no mention of the applicant…. ….. Accordingly, I am of the view that the order of forfeiture cannot be allowed to stand and I do order that it be set aside. I further order that the matter in dispute should be remitted to the original court for a determination of the merits of the forfeiture order after the applicant is heard. I declined to grant the relief sought by the applicant for the immediate return of the vehicle as the Sessions Court being the court of first instance is more acquainted with the facts of the offence. The Sessions Court is, therefore, the most appropriate forum to determine whether or not the forfeiture order should be made.”

In the present case, the Prosecution produced a JPJ search (Exhibit P18) identifying the Applicant as the owner. The disclosure of ownership via the JPJ search in the present case triggered a duty for the court to summon the Applicant to show cause before depriving them of their property, premised upon Article 13 of the FC. Section 413(2) of the CPC in furtherance, requires that if the person entitled to the seized property is known, the court shall cause a notice to be served on that person. Section 413(2) reads as follows: “(2) If the person so entitled is known, the Magistrate may order the property to be delivered to him on such conditions, if any, as the Magistrate thinks fit, and shall in that case cause a notice to be served on that person informing him of the terms of the order and requiring him to take delivery of the property within such period from the date of the service of the notice (not being less than forty-eight hours) as the Magistrate may in the notice prescribe.”

Though not directly applicable to the present application, Section 413(2) of the CPC provides the manner of dealing with seized property belonging to known third parties. By failing to summon the Applicant, the Applicant was deprived of the right to be heard and to show cause as to why the Vehicles should not be forfeited.

Notwithstanding the learned Sessions Court Judge’s jurisdiction to order the forfeiture of the third-party vehicles, the deprivation of the registered owner’s (the Applicant) right to be heard constitutes a clear contravention of the principle of audi alteram partem and the rules of natural justice as well as Article 13 of the Federal Constitution.

In the case of Totti Trading v. PP [2017] MLJU 1900, the Court of Appeal ruled that a forfeiture order obtained without the owner's knowledge is a breach of natural justice and is liable to be set aside ‘ex debito justitiae’ (as a matter of right). “[29] It was not disputed by the respondent that the forfeiture order was obtained without the knowledge of the appellant. What the learned Deputy argued before us was the delay in the appellant to file their application to set aside the forfeiture order. It was not denied as well that the appellant was not heard before the forfeiture order was churned out by the learned Judge. In this respect, we agreed that it was crystal clear that the rule of natural justice had been breached.” c) The Inefficacy of Plea Bargains Over Third-Party Rights

The Respondent’s reliance on Section 172C of the CPC to justify the forfeiture as part of a plea bargain is fundamentally flawed. While a plea bargain is a valid procedural tool, its binding effect is strictly confined to the immediate parties, namely the Prosecution and the Accused. A plea bargain cannot, by its very nature, divest the rights of an uninvolved third party.

The Accused, who had mere possession of the Vehicles at the material time, had no legal standing to "agree" to the forfeiture of properties he did not own, that is, to surrender the Applicant’s properties. This court applies the principle of nemo dat quod non habet (no one can give what he does not have), as recognized in the Federal Court case of Sia Hiong Tee & Ors v. Chong Su Kong & Ors [2015] 4 MLJ 188 which held: "[34] ... The nemo dat rule literally means ‘no-one can transfer what he has not got’... The nemo dat rule protects the true owner of the goods (right of ownership)."

This Court is of the view that, during plea bargaining, the Prosecution owes a duty of full and frank disclosure to the Court, including disclosing that the person charged is not the owner of the Vehicles and that the Vehicles had previously been released to its owner upon the execution of a bond. The failure to make such disclosure deprives the Court of the material facts necessary to exercise its discretion “judiciously”.

The Accused could not, through the mechanism of a plea bargain, compromise or relinquish the Applicant's constitutional right to the ownership of his properties. Accordingly, the learned Sessions Court Judge had erred in accepting a plea bargain that purported to dispose of, or otherwise affect, the constitutional rights of a third party.

Additionally, the forfeiture order was made in a procedural vacuum without due process, in the absence of the very party whose property was being forfeited. As a result, the order occasioned a manifest miscarriage of justice. As noted in Lee Kwan Woh v. PP [2009] 5 MLJ 301: "...procedural fairness is incorporated in arts. 5(1) and 8(1) of the Federal Constitution... the audi alteram partem rule, in essence, requires that no person shall be penalised by decisions which affect him or her without prior notice of the case and a fair opportunity to answer..."

The case of PP v Chang Siew Fah [2016] 3 CLJ 811 cited by the Respondent could be distinguished on its facts. In that case, the accused was the registered owner of the vehicle that was forfeited and had clear knowledge of the order made by the court. In the instant case, the registered owner of the Vehicles is a third party unrelated to the offence and criminal proceedings.

The Court must also be fully apprised of the circumstances in which the Accused came into possession of the Vehicles used in the commission of the offence.

In PP v Tan Chin Seng [1951] 1 MLJ 84, it was held that a vehicle should be released if the registered owner can show they did not "connive in or facilitate the offence in any way."

While the Control of Supplies Act 1961 does not explicitly mention that notice must be given to third parties, the courts have integrated the principle of audi alteram partem into the forfeiture process through constitutional and common law safeguards.

Once the court is made aware of the existence of a third-party owner, it must conduct an inquiry to identify the owner and afford that party an opportunity to be heard. Proceeding to forfeit the Vehicles without such an inquiry constitutes a failure to exercise judicial discretion “judiciously”.

The situation would have been different had the learned Sessions Court Judge exercised his discretion to confiscate or forfeit the vehicles in accordance with Section 26(1)(aa) of the Control of Supplies Act 1961 upon conclusion of the trial and finding the Accused guilty; or, in the instance where the Accused had pleaded guilty, without the intervention of the plea bargaining process, where the parties would be in a position to “negotiate” an outcome by making concessions.

Furthermore, in the order made by the learned Sessions Court judge, there were two (2) other vehicles, which were seized together with the Applicant’s vehicles, namely Hino lorries bearing registration numbers JKR 3436, T/J 9262 and JJC 9244 respectively. These lorries were subsequently released to the Accused, presumably as part of the plea-bargaining exercise.

In Re Hillman Minx No SU 3503 [1962] 1 MLJ 250 the High Court held that, as a matter of procedural fairness, the owner of the property must be called upon to show cause and given an opportunity to be heard before any forfeiture order is finalised. At the remittal hearing, the Applicant will need to prove that they took reasonable precautions to ensure the vehicle was not used for any illegal purposes to successfully secure its release.

This court is mindful of the Court of Appeal cases of Chang Siew Fah v PP (R-09-342-12/2015) and PP v Agus (J-09- 384-12/2014) cited by the Respondent. However, the background facts of this revision can be distinguished from those cases. Moreover, in this revision, this court is not ordering an immediate return of the Vehicles to the Applicant. Rather, the matter is remitted to the Sessions Court for the Applicant to show cause as to why an order of forfeiture should not be made.

The Applicant must "show cause" by establishing that he was an innocent owner who took reasonable precautions to prevent the Vehicles from being used for an unlawful purpose. If the Applicant's explanation is found to be unconvincing or if the Applicant is found to be complicit in the unlawful use of the Vehicles, the court may nevertheless exercise its discretion to uphold the forfeiture in the interest of public deterrence.

Accordingly, in the exercise of this Court's revisionary powers under Section 325 of the Criminal Procedure Code, this Court hereby makes the following orders: a) The order of the Sessions Court dated 30.06.2025 in respect of the forfeiture of the Volvo motor lorry (Registration No. PNH 2425) and a semi-trailer (Registration No. T/N 8454) is hereby set aside; b) The matter is remitted to the Sessions Court for a fresh inquiry; and c) The Sessions Court is directed to call upon the Applicant to show cause against the forfeiture of the Vehicles and to resolve the matter on its merits after hearing all parties. Dated the 24th July 2026 - TT - Abdul Fareed bin Abdul Gafoor Pesuruhjaya Kehakiman Mahkamah Tinggi 3 (Jenayah) Johor Bahru Pemohon : Tetuan Hassharri & Partners Hasshaari Bin Johari Mawi & Mohd Faris Iqmal Space U8, Level 1, Unit No. 2-11-1 Persiaran Pasak Bumi, Taman Bukit Jelutong Seksyen U8, 40150 Shah Alam Selangor Darul Ehsan Responden : Nur Sulehan Bt Abd Rahman Timbalan Pendakwa Raya Kementerian Perdagangan Dalam Negeri dan Kos Sara Hidup Johor Menara Ansar, Jalan Trus 80000 Johor Bahru Johor Darul Ta’zim