Malaysia Marine and Heavy Engineering Sdn Bhd v Mahkamah Perusahaan Malaysia (JA-25-4-01/2026)

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IN THE HIGH COURT OF MALAYA AT JOHOR BAHRU IN THE STATE OF JOHOR DARUL TA'ZIM MALAYSIA JUDICIAL REVIEW APPLICATION NO. : JA-25-4-01/2026 In The Matter Of Award No. : 1752 Of 2025 Of The Industrial Court Of Malaysia In The Matter Of Section 25(2) And Paragraph 1 Of The

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Schedule To The Courts Of Judicature Act 1964 In The Matter Of Order 53 Of The Rules Of Court 2012 BETWEEN MALAYSIA MARINE AND HEAVY ENGINEERING SDN BHD [COMPANY NO. : 0014558P] …APPLICANT 1. MAHKAMAH PERUSAHAAN MALAYSIA 2. SARAVANAN A/L Y YACOB [NRIC NO. : 781110-08-6349] …RESPONDENTS GROUNDS OF JUDGMENT INTRODUCTION 1. This is the applicant's application, by way of judicial review under Order 53 of the Rules of Court 2012 (“ROC 2012”), for an order of certiorari to quash Award No. : 1752 of 2025 of the Industrial Court of Malaysia (Johor Branch) dated 17 November 2025 (“the Award”), by which the Industrial Court held that the dismissal of the 2nd respondent by the applicant was without just cause or excuse and ordered the applicant to pay backwages and compensation in lieu of reinstatement totalling RM265,253.00. 2. The applicant, Malaysia Marine and Heavy Engineering Sdn Bhd, was the 2nd respondent's employer. The 2nd respondent, Saravanan a/l Y Yacob, was the claimant before the Industrial Court. 3. Leave to apply for judicial review was granted on 26 February 2026. By consent reached in late December 2025 the awarded sum of RM265,253.00 was paid on 31 December 2025 to the respondent's solicitors, to be held by them as stakeholder pending the final disposal of this application. 4. Before turning to the merits I must dispose of three threshold matters– (a) two preliminary objections raised by the respondent (defective service; and the availability of a statutory remedy), and (b) an objection by the applicant to the admissibility of the respondent's affidavit in reply. BACKGROUND FACTS 5. The respondent was employed by the applicant as a Technical Executive (Estimating) by a letter dated 3 April 2007 and commenced work on 14 May 2007. From 1 June 2013 until his dismissal he held the position of Executive, Contract & Cost Control, with a last drawn salary of RM7,169.00 per month. In that capacity he reviewed and signed off on claims (Summaries of Costing) submitted by subcontractors, including Temerity Marine Sdn Bhd (“Temerity”). 6. By a letter dated 18 August 2020 the Malaysian Anti-Corruption Commission informed the applicant of the respondent's arrest on 17 August 2020 to assist in an investigation. The applicant suspended the respondent and conducted an internal investigation. A show cause letter dated 23 September 2020 was issued and answered by the respondent on 29 September 2020. 7. The charge of misconduct, as framed in the Notice of Domestic Inquiry dated 6 October 2020, was in substance that in or about October 2015 the respondent had his car painted at a workshop in Permas Jaya and collected it without making payment, the painting (costing some RM3,500.00) having been arranged or paid for by or through Dzulkifli Wong, a director of Temerity - in effect, that the respondent had directly or indirectly received a benefit from a subcontractor under his charge. 8. A domestic inquiry was held on 14 October 2020. The respondent was found guilty and was dismissed by a letter dated 26 October 2020. 9. The respondent made representations under section 20 of the Industrial Relations Act 1967 (“IRA 1967”) on 25 November 2020. The Minister of Human Resources referred the representations to the Industrial Court under section 20(3) of IRA 1967; the date of reference recorded in the Award is 25 March 2021. After a full hearing the Industrial Court handed down the Award on 17 November 2025, which was delivered to the applicant on 20 November 2025. This application was filed on 29 January 2026. The Award under review 10. Before the Industrial Court the applicant called three witnesses – (a) Wan Kamarulbaharin bin Wan Farid (COW-1), (b) Syed Shaharum bin Syed Dabal (COW-2); and (c) Mohd Faiz Ong bin Abdullah (COW-3), while the respondent testified on his own behalf. 11. The Industrial Court correctly directed itself, by reference to the established authorities – (a) that in a reference under section 20, the Court must determine whether there was a dismissal and, if so, whether it was with or without just cause or excuse. [See : Wong Chee Hong v Cathay Organisation (M) Sdn Bhd [1988] 1 MLJ 92; Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd & Another Appeal [1995] 2 MLJ 753); (b) that the burden of proving just cause or excuse lies on the employer. [See : Ireka Construction Bhd v. Chantiravathan a/l Subramaniam James [1995] 2 ILR 11; Stamford Executive Centre v. Puan Dharsini Ganesan [1986] 1 ILR 101; and (c) that the standard is the civil standard on the balance of probabilities, flexibly applied. [See : Telekom Malaysia Kawasan Utara v Krishnan Kutty a/l Sanguni Nair & Anor [2002] 3 MLJ 129]. 12. The Industrial Court also directed itself that the findings of a domestic inquiry are not binding upon it and that it rehears the matter afresh. [See : Hong Leong Equipment Sdn Bhd v Liew Fook Chuan and another appeal [1996] 1 MLJ 481]. 13. The dismissal being admitted, the only issue was whether it was with just cause or excuse. On the evidence, the Industrial Court found that the applicant had failed to prove the charge on the balance of probabilities. Its essential reasoning was that – (a) the applicant's case rested principally on a statement attributed to one Teh Michael (an ex-director of Temerity) recorded by the applicant's investigation unit and on a handwritten logbook said to have been verified by Teh Michael; (b) Teh Michael was not called as a witness, so his statement could not be tested and was of no value to support the allegation; (c) the logbook was likewise unverified by its maker; (d) none of the three witnesses called gave direct proof that the respondent had received the alleged benefit, and there was no documentary or banking trail; and (e) the respondent's account – that the arrangement was made by his colleague Kalidasan, who told him not to worry about payment – was consistent throughout. 14. The Industrial Court accordingly held that the dismissal was without just cause or excuse. Finding the relationship of trust and confidence no longer subsisting, it declined to order reinstatement and instead awarded backwages of RM172,056.00 (RM7,169.00 X 24 months) and compensation in lieu of reinstatement of RM93,197.00 (RM7,169.00 X 13 months), a total of RM265,253.00. The grounds of the application 15. The applicant contends that the Award is vitiated by errors of law warranting certiorari. Its grounds, distilled, are that the Industrial Court – (a) asked itself the wrong question – namely whether the respondent had in fact directly or indirectly received the RM3,500.00 benefit – instead of whether the applicant had reasonable grounds to believe that the misconduct had been committed (relying on Ferodo Ltd v Barnes [1976] IRLR 302 and the cases adopting it), thereby imposing too high a burden; (b) ailed to take into account relevant considerations – the respondent's seniority and work scope over Temerity, his admitted knowledge of the Code of Business Ethics, the MACC arrest, the undisputed circumstances of the car-painting episode, the inconsistencies in his evidence, and the resulting breakdown of trust; (c) took into account an irrelevant consideration, namely the non-calling of Teh Michael, when COW-3 (the maker of the record of the statement) gave evidence and the statement and logbook were consistent; and (d) reached a decision so unreasonable that no reasonable tribunal could have arrived at it, and/or acted in excess of jurisdiction. The preliminary and procedural objections A. The respondent's objection on service (Order 53 rule 4 ROC 2012) 16. The respondent objects that the applicant's service of the cause papers was fragmented and piecemeal and did not comply with Order 53 rule 4(1) ROC 2012, which requires an applicant who has obtained leave to serve the order, the statement and all supporting affidavits on all persons directly affected. He says the supporting affidavit ran to several hundred pages across several volumes, that he was left to reconstruct the applicant's case and that he was thereby deprived of the procedural entitlement under Order 28 rule 3C ROC 2012 to twenty-one days within which to file his reply. On that footing he asks that the leave order be set aside and the application dismissed in limine. 17. I am not persuaded by this objection. First, on the record the cause papers were served by email on 9 March 2026 and by hand on 16 March 2026 and the hearing fixed in the Notice of Hearing (Form 110) was 2 April 2026, so that service was effected more than fourteen days before the hearing. Second, the respondent in fact filed and served his affidavit in reply on 30 March 2026, within the time available and was able to address the applicant's case fully. Third, Order 28 rule 3C ROC 2012is directed to proceedings begun by originating summons. [See : Order 28 rule 1 ROC 2012]. These proceedings are governed by Order 53 ROC 2012 and the respondent has not demonstrated that the twenty-one day period was engaged or, if it was, that any concrete prejudice flowed from its abridgement. 18. More fundamentally, a complaint of this nature is governed by Order 1A and Order 2 ROC 2012. Non-compliance with the rules is an irregularity which does not nullify the proceedings and the Court will not set aside a step for irregularity where no substantial injustice has been occasioned. The respondent, having received the papers in good time and having answered them on their merits within time, has shown no such injustice. I note in passing that no formal application to set aside the leave order was filed. The objection is taken by way of submission only. Accordingly, the objection on service is dismissed. B. The respondent's objection on alternative remedy (section 33C IRA 1967) 19. The respondent next objects that judicial review does not lie because the applicant had an adequate alternative statutory remedy. An appeal to the High Court under section 33C IRA 1967, introduced by the Industrial Relations (Amendment) Act 2020 [Act A1615]. Judicial review being a remedy of last resort (Majlis Perbandaran Pulau Pinang v Syarikat Bekerjasama-sama Serbaguna Sungai Gelugor dengan Tanggungan [1999] 3 MLJ 1), he says the applicant ought to have appealed and that this application is an abuse of process. 20. The difficulty with this objection is one of timing. Section 33C IRA 1967 came into force on 1 January 2021. Section 35 of Act A1615 is a saving and transitional provision. It provides, in material part, that representations for reinstatement made under section 20 of the principal Act before the coming into operation of the amending Act shall proceed and have effect as if the principal Act had not been amended. 21. The Court of Appeal in Rosli bin Saad v SG Concrete Products (M) Sdn Bhd and another appeal [2025] 4 MLJ 274 held that, by force of section 35, the determining factor is the date on which the representations under section 20(1) IRA 1967 were made. If the representations were made before 1 January 2021, the proceedings are governed by the unamended Act and the proper mode of challenge to the resulting award is judicial review and not an appeal under section 33C IRA 1967, even where the Minister's reference to the Industrial Court was made after 1 January 2021. The Court of Appeal there held that the High Court had erred in entertaining an appeal in such circumstances. The same principle was applied, on the opposite facts, by the High Court in Hasnah bt Hashim v Bina Puri Sdn Bhd & Anor [2025] 12 MLJ 1. There, the section 20 IRA 1967 representation was made after 1 January 2021, so that section 35 of Act A1615 did not apply, judicial review did not lie and the application was struck out as incompetent for want of an appeal under section 33C IRA 1967. The corollary is the present case, the representation having been made before that date, judicial review remains the proper, and indeed the only, mode of challenge. 22. In the present case it is undisputed that the respondent's representations under section 20 IRA 1967 were made on 25 November 2020, that is, before 1 January 2021. It is also apparent from the Award that the reference to the Industrial Court was made by the Minister under section 20(3) and not by the Director General. Since the amended Act vests the power of reference in the Director General, the fact that it was the Minister who referred is itself consistent with the unamended Act continuing to govern. On the authority of Rosli bin Saad, the right of appeal under section 33C IRA 1967 was therefore not available to the applicant and judicial review was the correct, and indeed the only, mode of challenge. The premise of the objection (that an adequate alternative statutory remedy existed) is accordingly not made out. The objection on alternative remedy is dismissed. C. The applicant's objection to the admissibility of the 2nd respondent's affidavit in reply 23. The applicant for its part objects that the respondent's affidavit in reply (Enclosure 18) is inadmissible because it was filed and served out of time, contrary to Order 32 rule 13(2) ROC 2012. The applicant says the reply affidavit was due on 30 March 2026 but that it received the hard copy only on 2 April 2026, a delay of three days and relies on Perbadanan Nasional Insurans Sdn Bhd v. Pua Lai Ong [1996] 1 MLRA 308 and Ting Hua Yiew v. Ace Commercial Enterprise Sdn Bhd [1996] 4 MLRH 494. The respondent answers that the applicable period in these Order 53 proceedings is twenty-one days under Order 28 rule 3C; that in any event the affidavit was filed and served on 30 March 2026, within fourteen days of service, as evidenced by the affidavit of service (Enclosure 20) and that the applicant filed its own affidavit in reply and responded fully, so no prejudice arises. 24. This objection too must fail. There is in truth no, or at most a marginal, delay; the respondent filed his affidavit within fourteen days of service. The authorities relied on by the applicant are distinguishable : Perbadanan Nasional Insurans concerned the point from which time runs (service of a sealed application) and not the exclusion of a reply affidavit properly filed in time; Ting Hua Yiew concerned a defect in the affidavit founding the originating process itself, going to the root of the proceedings, whereas here the impugned affidavit is a reply affidavit which the applicant has fully answered. As with the respondent's service objection, the matter is governed by Order 1A and Order 2 : a short delay occasioning no prejudice is an irregularity that does not warrant excluding evidence from the record. The applicant has demonstrated no ambush, surprise or injustice. In any event, the outcome on the merits turns on the Award and the record before the Industrial Court and not on the affidavits filed in these proceedings, so that nothing turns on the point. The objection is dismissed and the respondent's affidavit in reply is admitted. The law governing judicial review of an Industrial Court award 25. The principles are not in dispute between the parties. The supervisory jurisdiction of this Court extends to the three grounds identified in Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374 - illegality, irrationality and procedural impropriety. An error of law is disclosed where the decision-maker asks the wrong question, takes into account irrelevant considerations, omits relevant considerations, or misconstrues or misapplies the relevant law. [See : Syarikat Kenderaan Melayu Kelantan Bhd v Transport Workers Union [1995] 2 MLJ 317; Anisminic Ltd v Foreign Compensation Commission[1969] 2 AC 147]. Following R Rama Chandran v The Industrial Court of Malaysia &Anor [1997] 1 MLJ 145 and Akira Sales & Service (M) Sdn Bhd v Nadiah Zee bt Abdullah and another appeal [2018] 2 MLJ 537, the Court may in an appropriate case examine not only the decision-making process but also the substance of the decision. 26. That said, judicial review is not an appeal. The Court does not sit to re-hear the evidence, to reassess the credibility of witnesses or to substitute its own findings of fact for those of the Industrial Court merely because a different conclusion was open on the evidence. Where the Industrial Court has heard the witnesses and evaluated the evidence, its findings of fact attract curial deference and are not to be disturbed save where they are unsupported by any evidence or are otherwise infected by an error of the kind described above. This is the line the present application must cross. The function of the Industrial Court and the “reasonable belief” argument 27. Ground (i) is the foundation of the applicant's case and it is convenient to address it first as a matter of law. The applicant contends that the Industrial Court applied the wrong test by asking whether the respondent had in fact received the benefit, rather than whether the applicant had reasonable grounds to believe that the misconduct had been committed [the test in Ferodo Ltd v Barnes, as adopted in Ragubathy Pener Selvam lwn. OEL Distribution (Perak) Sdn Bhd [2016] MELRU 1009 and Roshidah Daud v USG Boral Sdn Bhd [2023] MELRU 1597]. 28. In my judgment that contention is, with respect, misconceived. In a reference under section 20 IRA 1967 the function of the Industrial Court is to determine whether the misconduct relied on by the employer as the ground of dismissal was in fact committed by the workman, and, if so, whether it amounted to just cause or excuse for the dismissal. [See : Goon Kwee Phoy v J & P Coats (M) Bhd [1981] 2 MLJ 129; Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd and another appeal [1995] 2 MLJ 753 ; Milan Auto Sdn Bhd v Wong Seh Yen [1995] 3 MLJ 537]. The Industrial Court rehears the matter afresh and is not confined to asking whether the employer's belief was reasonable. The “reasonable belief” or “band of reasonable responses” formulation derives from the English law of unfair dismissal and does not displace the Industrial Court's statutory duty to determine, on the balance of probabilities, whether the misconduct occurred. 29. Telekom Malaysia Kawasan Utara v Krishnan Kutty Sanguni Nair & Anor, on which both parties rely, does not assist the applicant. It establishes the standard of proof, the civil standard on the balance of probabilities, flexibly applied according to the gravity of the allegation - and not a substitute test of “reasonable belief” that would relieve the employer of proving the misconduct. When the Industrial Court asked whether the applicant had proved that the respondent directly or indirectly received the alleged benefit, it asked precisely the question the authorities require. Ground (i) therefore discloses no error of law. Disposition of the substantive grounds 30. The first ground, that the Industrial Court asked itself the wrong question, cannot succeed. As explained above, the Industrial Court directed itself correctly. The applicant's real complaint is that the misconduct ought not to have had to be proved at all, but the law required exactly that : in a section 20 reference the employer must establish the misconduct on the balance of probabilities. The Industrial Court held the applicant to no higher standard, and no error of law arises. 31. The third ground, that the Industrial Court took into account an irrelevant consideration, is likewise not made out. The applicant says that the Industrial Court wrongly fixed upon the non-calling of Teh Michael, but that is not, in my view, a fair reading of the Award. Teh Michael was the source of the only direct assertion that Temerity had paid for the respondent's car and his statement, recorded by the applicant's investigators, remained untested as to the truth of its contents. That COW-3 recorded and produced the statement made him the maker of the record only and not the maker of the substantive assertion it contained. It is true that the Industrial Court is not bound by the technical rules of evidence (section 30(5) IRA 1967) and that an employer need not call every witness. [See : Rosalind Tan Kheng Suan v Penang Medical College Sdn Bhd [2023] 2 MELR 462; Charles Mok Ngoh Check v. Allied Marine & Equipment Sdn Bhd [2008] 1 ILR 421]. The weight to be given to an untested out-of-court statement is, however, a matter quintessentially for the tribunal of fact. In giving the statement no weight, the maker not having been called and there being no other proof, the Industrial Court was evaluating the evidence before it, not taking into account an irrelevant consideration. This ground fails. 32. The remaining grounds, that the Industrial Court failed to take into account relevant considerations and that its decision was irrational, may be taken together. The considerations said to have been overlooked, namely the respondent's seniority and work scope over Temerity, his knowledge of the Code, the MACC arrest, the undisputed features of the car-painting episode and the asserted inconsistencies in his account, were in substance invitations to the Industrial Court to infer that the respondent must have received a benefit. An inference of misconduct, however, can be drawn only from established primary facts. The Industrial Court found the foundational fact, that payment was made on the respondent's behalf by or through Temerity, to be unproved. That being so, neither the respondent's seniority nor the surrounding circumstances could supply the missing proof, still less reverse the burden resting on the employer. As for irrationality, the threshold is a high one and a decision supported by cogent reasons is not rendered irrational merely because the evidence might have been assessed differently. These grounds also fail. 33. Viewed as a whole, the applicant's complaint is, in substance, that the Industrial Court ought to have evaluated the evidence differently and drawn the opposite inference. That is the language of an appeal, not of judicial review. As the respondent rightly submits, this Court may not re-weigh the evidence or substitute its own view of the facts for that of the tribunal that heard the witnesses. 34. For these reasons the applicant has not established any error of law, jurisdictional defect, irrationality or procedural impropriety on the part of the Industrial Court. The Court is not satisfied that the Award should be disturbed. CONCLUSION AND ORDER 35. In the result, the respondent's preliminary objection on service is dismissed; the respondent's preliminary objection on alternative remedy is dismissed; and the applicant's objection to the admissibility of the respondent's affidavit in reply is dismissed. 36. On the merits, for the reasons given, the application for judicial review is dismissed and Award No. : 1752 of 2025 of the Industrial Court of Malaysia is affirmed. 37. Consequentially, the conditional stay granted on 26 February 2026 is discharged and the sum of RM265,253.00 held by the respondent's solicitors by consent is to be released to the 2nd respondent, less any statutory deduction. 38. As to costs, the Court orders the applicant to pay the 2nd respondent costs of RM10,000.00, subject to allocatur. Dated : 24 June 2026 -signed- (DR NORADURA BINTI HAMZAH) Judicial Commissioner High Court Civil 2 Johor Bahru Counsel for the Applicant : : Thavalingam together with Teo Wen Chyi Messrs. Shim & Co. Counsel for the Second Respondent : : R. Vigneshwaran a/l Raju together with Roshini a/p Ramasamy Messrs. The Chambers of Waran