N Thanavathy A/P Rajah v 1. ) Majidee Park Auto Spares & Services Sdn Bhd (JA-28PW-217-12/2022)

KETUA PENGARAH JABATAN INSOLVENSI MALAYSIA … RESPONDENTS  GROUNDS OF JUDGEMENT  S/N HC2vXWpxykeIkcqsQ4Netg INTRODUCTION [1] This is the Applicant’s application for leave to remove the appointed liquidator, Jayapalasingam a/l Kandiah (Enclosure 1) as the liquidator and to be replaced with the Director General of Insolvency (the “DGI”) pursuant to subsection 453 (2) and/or paragraph 482(b) read together with section 471 of the Companies Act 2016 [Act 777]. [2] After considering all cause papers and the submission of the parties, I allowed the Plaintiff’s application and order each party to bear their own costs. [3] The 1st Respondent and 2nd Respondent have filed an appeal against the said decision. [4] Below are the grounds of my decision. BRIEF BACKGROUND [5] The background facts in this application are gathered from the Affidavits and submissions filed by the parties and stated in chronological order. [6] The First Respondent, Majidee Park Auto Spares and Services Sdn. Bhd. (”1st Respondent”) was incorporated on 24.5.1985 by one N Rajah s/o Rashu (the “founder”). The 1st Respondent was operating a petrol kiosk known as “Petron Kebun Teh” which was licensed by Petron Malaysia Berhad . A Service Station Licence Agreement was signed on the 23.10.2018. S/N HC2vXWpxykeIkcqsQ4Netg [7] The Applicant is the daughter of the founder in which she became the director of the 1st Respondent on 10.7.2015. The other directors are Somas Kanda Rajah and Punithavathy a/p N. Rajah. [8] The Applicant is also the shareholder of the 1st Respondent in which she held 19,200 shares. [9] The Petrol Kiosk was managed by Punithavathy a/p Rajah (“Punithavathy”). On the 17.12.2019, the dispute between the shareholders led to the filing of the winding-up petition by the grandchildren of the founder, Obana N Rajah and Somendran N Rajah (Johor Bahru High Court, Winding-Up Petition No: JA- 28NCC-308-12/2019). [10] Pursuant to the winding-up petition, the 1st Respondent was ordered to be wound-up by the court on 17.12.2019. The Second Respondent (“2nd Respondent”) was appointed as the liquidator of the 1st Respondent. [11] On 26.10.2021, the Applicant received a letter from the Lembaga Hasil Dalam Negeri (“LHDN”) that the 1st Respondent had not settled the sums RM107,622.56 which was due and owing to LHDN since 16.2.2022 and the sum was based on the “Penyata Kedudukan Cukai” issued by LHDN. [12] The Applicant then appointed a solicitor to write to the 2nd Respondent as to the status of the 1st Respondent’s liquidation process which allegedly took place since 1.2.2021. The letter dated 26.4.2022 was issued to the 2nd Respondent and copied to S/N HC2vXWpxykeIkcqsQ4Netg the DGI. The 2nd Respondent replied that he was in the midst of obtaining further information as to the affairs of the 1st Respondent from the directors since the existing information in the Statement of Affairs (“SOA”) did not show proper details of debtors and creditors for the purpose of lodgment with the Companies Commission of Malaysia (“SSM”). [13] The 2nd Respondent informed that he has received the SOA and Affidavit Verifying the SOA from Punithavathy along with the Balance Sheet as at 31.7.2021 and the Profit and Loss Accounts for the financial year of 2021. All these documents were exhibited in the Respondents’ Affidavit in Reply. [14] However, the 2nd Respondent contended that the SOA was incomplete as it lacked sufficient information and/or documents to support the statements made in the SOA. Furthermore, several documents were illegible due to damage caused previously by a flood. As such, several letters and reminders were sent to the Applicant and the directors requesting for relevant information and documents to support the SOA but did not receive any response. [15] The 2nd Respondent contended that to date, he has yet to receive all the necessary information and/or supporting documents required to lodge the necessary documentation with SSM as regards to the affairs of the 1st Respondent and complete the liquidation of the 1st Respondent. [16] It is the contention of the 2nd Respondent that the Applicant has neglected and/or failed and/or refused to respond to his letters and reminders. The only time the Applicant attempted to contact S/N HC2vXWpxykeIkcqsQ4Netg the 2nd Respondent was when the Applicant discovered that she could not exit the country due to her status with the Inland Revenue Board , which was on 22.4.2022, which now leads to this application by the Applicant. [17] The Applicant submitted the following reasons justify the removal of 2nd Respondent as the liquidator of the 1st Respondent:

the 2nd Respondent has failed to perform his duties with promptitude and has delayed liquidating the company in the exercise of his duties considering the fact that the Winding–Up Order and the 2nd Respondent’s appointment was made almost two years ago, on 1.2.2021;

no creditors of the 1st Respondent and the 2nd Respondent has possession of the account books and records but yet the 2nd Respondent still without reasons failed to perform his duties. The 2nd Respondent claimed that he is “looking out for the creditors of the company” but no evidence of advertisement has been put up and no creditors have come forward except for LHDN which submitted its Proof of Debt on the 3.10.2022;

the 2nd Respondent had concealed that there was balance of monies in the 1st Respondent’s bank accounts and when the issue was raised by the Applicant in her letter to the DGI dated 2.3.2023 (refer to page 25 to 28 of Enclosure 21), the only reply by the 2nd Respondent’s S/N HC2vXWpxykeIkcqsQ4Netg solicitors letter dated 15.3.2023 is that the Statement of Account of the 1st Respondent is incomplete;

the 2nd Respondent have failed to deal with the settlement of the liabilities of the 1st Respondent particularly the outstanding sum due to LHDN when statutory payments ought to be paid pursuant to Twelfth Schedule (Part 1) (section 472 of Act 777) and the 2nd Respondent kept on giving reasons that he has to assess all the affairs of 1st Respondent before making payment to any creditors regardless of the priority. No other creditors have come forward so far except for LHDN and yet the 2nd Respondent has yet to resolve the statutory payment due till to date; and

the 2nd Respondent has kept on repeating his requests for documents which are already in his possession and seeks to review accounts that had been passed and accounted for. The 2nd Respondent attempts to do forensic accounting when there are no other creditors but failed to carry out his duty to liquidate and settle the outstanding liabilities of the 1st Respondent. ISSUE TO BE DETERMINED [18] I find the only issue to determine is whether the Applicant has succeeded to show cause warranting the removal of the 2nd Respondent. [19] In order to determine the issue, I have to examine whether a S/N HC2vXWpxykeIkcqsQ4Netg reasonable cause shown by the Applicant for the removal of the 2nd Respondent and it is in the interest of the creditors and contributors of the 1st Respondent. ANALYSIS AND COURT’S FINDINGS The Law On Removal Of Liquidator [20] The removal of a court appointed liquidator is governed by section 482 of Act 777 (previously subsection 232(1) of the Companies Act 1965) which provides as follows: “A liquidator or interim liquidator appointed by the Court may –

resign from office in accordance with the rules, or

on cause shown, be removed from office by the Court.”. [Emphasis added] [21] I refer to the Federal Court decision in the case of Wong Sin Fan & Ors v Ng Peak Yam @ Ng Pyak Yeow & Anor [2013] 2 MLJ 629 where the Federal Court has cited Ng Yak Gee & Anor v CTI Leather Sdn. Bhd. (Metro Brilliant Sdn. Bhd. & Ors, interveners) [2006) 7 MLJ 28 when stating the principles of law governing an application to remove a provisional liquidator, as follows: ''[23) ... The principles of law governing an application to remove a provisional liquidator (or liquidator) are well set out as in the case of Ng Yak Gee & Anor v CTI Leather Sdn Bhd (Metro Brilliant Sdn Bhd & Ors, interveners) [2006) 7 MLJ 28 and include the following:

the court does not have an unfettered discretion, as cause must be shown a liquidator can be removed. The position is not the same as it is when a liquidator is first appointed and the court may choose between two or more competing candidates;

the normal grounds for removal are that the liquidator has a personal unfitness, has failed to act impartially or is in a position where his duty and interest are in conflict; and

the removal of the liquidator must be in the interest of all those who are interested in the company being liquidated. Thus, all the contributories and creditors of the company being liquidated must support such application to remove the liquidator.". [Emphasis added] [22] Further, in the case of Goh Siew Koon @ Eng Sing Kuan & Ors v. Lim Jit Kim @ Lim Tian Jee & Ors [2015] MLJU 2229 where Court of Appeal held that— “.. [21] There are, therefore, two situations where a Court appointed liquidator ceases to act as one, firstly where he resigns and secondly by being forcibly removed by the Court on cause being shown. It is not just any cause though that justifies a liquidator’s removal. It must be a cause that renders untenable his continuing to act as liquidator. [22] The words “on cause shown” have been held to mean, as a general rule, to some unfitness of the person. It may be from personal character, or from his connection with other parties, or from circumstances in which he is mixed up – some unfitness in a wide sense of the term: see In Re Sir John Moore Gold Mining Company {1879] 12 Ch.D 325 per Jessel MR. See also Re Adam Eyton, Limited Ex parte Charlesworth [1887] 36 Ch.D 299; Ng Yok Gee & [2015] 1 LNS 1222 Legal Network Series 9 Anor v. CTI Leather Sdn Bhd (Metro Brilliant Sdn Bhd & Ors, Intervener) [2006] 7 MLJ 28. [23] In Wong Sin Fan & Ors v. Ng Peak Yam @ Ng Pyak Yeow & Anor [2013] 2 MLJ 629 the Federal Court in affirming the principles as set out by the High Court in Ng Yok Gee & Anor (supra) emphasized at page 638: “The principles of law governing an application to remove a provisional liquidator (or liquidator) are well set out as in the case of Ng Yok Gee & Anor v. CTI Leather Sdn Bhd; Metro Brilliant Sdn Bhd & Ors (Interveners) [2006] 7 MLJ 28 and include the following:

the Court does not have an unfettered discretion, as cause must be shown before a liquidator can be removed. The position is not the same as it is when a liquidator is first appointed and the court may choose between two or more competing candidates.

the normal grounds for removal are that the liquidator has a personal unfitness, has failed to act impartially or is in a position where his duty and interest are in conflict.

the removal of the liquidator must be in the interest of all those who are interested in the company being liquidated. Thus, all the contributories and creditors of the company being liquidated must support such application to remove the liquidator.”. [Emphasis added] [23] This was further affirmed in the case of Yeo Ann Kiat & 238 Ors v Hong Leong Bank Berhad [2016] MLJU 729 where Vernon Ong JCA stated as follows: “..[22] The key words in subsection 232(1) relating to the removal of a liquidator are “on cause shown.” According to learned author Walter Woon in Company Law (2nd Ed) at page 706, cause may be shown when there is some unfitness of the person by reason of his personal character, or from his connection with other parties, or from circumstances in which he is mixed up. [23] It is settled law that the Court does not have an unfettered discretion as cause must be shown. The relevant principles of law applicable to an application to remove a liquidator are well set out by Ramly Ali J (now FCJ) in Ng Yok Gee & Anor v. CTI Leather Sdn Bhd; Metro Brilliant Sdn Bhd & Ors (Interveners) [2006] 7 MLJ 28, 37-38. Ng Yok Gee (supra) was affirmed by the Federal Court in Wong Sin Fan & Ors v. Ng Peak Yam @ Ng Pyak Yeow & Anor [2013] 3 CLJ 17;; [2013] 2 MLJ 629, 638). [24] In most instances, the common grounds advanced to justify the Court in removing a liquidator are (i) the liquidator’s personal unfitness, and/or (ii) the liquidator’s personal misconduct. Be that as it may, we do not think that the power of removal under subsection 232(1) is confined to that. The Court has the power to remove a liquidator if the Court is satisfied on the evidence that it is in the interest of the liquidation that he should be replaced; by that we mean all those who are interested in the S/N HC2vXWpxykeIkcqsQ4Netg company being liquidated (Chua Boon Chin v JM McCormack [1979] 2 MLJ 156 (High Court, Singapore) at p 158 per D’Cotta J; Re Adams Eyton, Limited Ex parte Charlesworth (1887) 36 Ch D 299, at pp 303-304 per Cotton LJ). Indeed, it has been said that the measure of due cause is the substantial and real interest of the liquidation (Re Adams Eyton Limited (supra) at p 306 per Lord Bowen).” . [Emphasis added] [24] Hence, it is trite that pursuant to section 482 of Act 777, the power of removal of liquidator is at the Court’s discretion based on cause shown by taking into consideration the circumstances of each case. In deciding such, I must be satisfied that there is a reasonable cause shown by the Applicant for the removal of the 2nd Respondent. [25] During the hearing of the Applicant’s application on 23 June 2023, the Applicant has informed the Court the licence of the 2nd Respondent is not renewed and therefore based on this reason alone, 2nd Respondent should be removed and replaced by DGI. [26] The 2nd Respondent did not deny that his licence has not been renewed. The 2nd Respondent contended the application should be dismissed or withdrawn since there is no liquidator to be removed now and the DGI will step in during the vacancy of the liquidator pursuant to section 477 of Act 777. [27] Subsection 433(1) of Companies Act 2016 provides that— “433. Qualification of liquidator

Subject to this section, a person other than the Official Receiver who is appointed interim liquidator or liquidator in a winding up by the Court shall not, except with the leave of the Court, be qualified for an appointment as an interim liquidator or liquidator of a company if— S/N HC2vXWpxykeIkcqsQ4Netg

he is not an approved liquidator;

he is indebted to the company or to a corporation that is deemed to be related to the company by virtue of section 7 in an amount exceeding twenty-five thousand ringgit;

he is an officer of the company….”. [Emphasis added] [28] It is clear from the provision above, the 2nd Respondent has been disqualified to be appointed as liquidator once his licence has not been renewed. The 2nd Respondent did not offer any explanation for the failure to renew his license and did not apply for leave of the Court for him to continue to act as the liquidator for the 1st Respondent as provided in subsection 433(1) of Act 777. [29] This ground alone will warrant the removal of the 2nd Respondent application without having a need to consider the merits of this application. Therefore, I am of the view that the 2nd Respondent is no longer able to act as the liquidator of the 1st Respondent pursuant to paragraph 433(1)(a) of Act 777. Thus, the 2nd Respondent must be removed as the liquidator of the 1st Respondent and be replaced by DGI pursuant to paragraph 477(1)(e) of Act 777. The contention of the 2nd Respondent that there is no liquidator to be removed is devoid of merits as 2nd Respondent is appointed pursuant to the Court order dated 1.2.2021 and thus, it needs to be removed by the order of the Court. [30] However, I have nevertheless proceeded to examine the merits of the substantive application filed by the Applicant. [31] Upon scrutinizing the cause papers filed in regards of this S/N HC2vXWpxykeIkcqsQ4Netg application, I find it is undisputed that numerous letters had been sent to the three (3) directors and the company secretary of the 1st Respondent. One of the directors, Punithavathy has submitted SOA along with the Balance Sheet as at 31 July 2021 and the Profit and Loss for the financial year of 2021 to the 2nd Respondent on 18.11.2021. The contentions between the parties is whether the SOA submitted by the Punithavathiy is incomplete as claimed by the 2nd Respondent and hence the 2nd Respondent could not complete the liquidation process. [32] The 2nd Respondent contended the SOA provided by Punithavathy is incomplete and several documents were illegible due to damage caused previously by a flood. The 2nd Respondent then vide few letters and e-mails kept on repeating his request for further information from the directors and the company secretary. The 2nd Respondent claimed that Punithavathy did not respond. [33] I have examined the documents filed through their affidavits and I find that the Respondent has taken a substantial amount of time to keep writing to all the directors and the company secretary despite there is delay in responding or receiving no response from them. [34] After waiting for almost 1 year from the date received the SOA, the 2nd Respondent wrote to the DGI on 14.11.2022 about the failure of directors to give co-operation in providing the necessary documents. The DGI had on 22.11.2022 informed the 2nd. Respondent to act against the directors under subsection 487(4) of Act 777 and to exercise powers of the liquidator under Part 1 S/N HC2vXWpxykeIkcqsQ4Netg and Part 2 of Twelfth Schedule. [35] The 2nd Respondent then filed the Pre-Action Discovery application on 16.12.2022 in suit JA-24NCC-37-12/2022 against Punithavathy. I find that this application was filed after the Applicant’s application (Enclosure 33) for an order for the 2nd Respondent to prepare and make payment of the outstanding sum to the LHDN, being dismissed by the Court on 13.9.2022. The 2nd Respondent has taken approximately 1 year from the date of received SOA, to file the application. I find that the 2nd Respondent did not act within a reasonable period of time despite the 2nd Respondent’s claim that the directors have delayed in providing the information requested. [36] It is pertinent to note that the reason for the appointment of a liquidator is to speed up the liquidation process, to realize the assets of the company and to pay off the creditors and other dues before finally putting the company in dissolution within the reasonable time. The liquidator will be paid remuneration or salary pursuant to section 479 of Act 777. Therefore, the liquidator is expected to discharge their statutory duties by exercising a high standard of care, skill, diligence and competence commensurate with their professional standards. [37] The general duties of a liquidator appointed in a compulsory winding-up was explained by Marks J in the Australian case of Corporate Affairs v Harvey [1980] VR 669 in the following terms: “The duties of a liquidator need to be clearly understood. Fundamentally, S/N HC2vXWpxykeIkcqsQ4Netg he must administer the estate strictly in accordance with the duties and obligations specifically imposed on him by the Companies Act and its Rules. It is obvious that everything to be done in a competent administration is not and cannot be specifically prescribed. Preserving the assets, giving proper attention to the administration, acting with due dispatch and ensuring adequate knowledge and understanding of the affairs of the companies are matters of common sense. If there is a difficulty at any stage of the administration then it is the clear duty of the liquidator to inform the Court and take directions…”. [Emphasis added] [38] Applying the principles stated in the above case, the 2nd Respondent is found to not have acted with promptitude to file an application under subsection 487(3) of Act 777 to seek direction of the Court regarding the delay in getting the information from the directors of the 1st Respondent. [39] Hence, I find that the 2nd Respondent has unreasonably delayed his duties where he must transact or dispose of the liquidation process promptly or expeditiously or as soon as practicable. [40] In this regard, I refer to the case of Re Keypak Homecare Ltd [1987] BCLC 409 where the liquidator was removed by the Court when he had failed to display sufficient vigour in carrying out his duties as liquidator, and in particular, although he had been in office for 3 months he had failed to conduct a thorough investigation of the company’s affairs. [41] Further, the Applicant contended that the 2nd Respondent has failed to pay the income tax pursuant to Part 1 of Twelfth Schedule of Act 777. The 2nd Respondent on the other hand submitted that the Court should not interfere with the decision simply because the opinion of the Court might differ from that of the liquidator and S/N HC2vXWpxykeIkcqsQ4Netg has cited the case of Andrew Christopher Chuah Eng Chuan v Ooi Woon Chee & Anor [2007] 2 MLJ 12 to support their contentions. [42] The 2nd Respondent contended identification of the debtors and creditors need to be finalized first in order to ascertain the assets and liabilities of the 1st Respondent before he could make any payment. In addition, the debts of the 1st Respondent shall be paid in accordance to the priority pursuant to section 527 of Act 777 and undue preference cannot be given to one creditor over another when the full affairs of the 1st Respondent has yet to be determined. [43] I refer to section 486 and Twelfth Schedule of Act 777 which provide as follows: “Powers of liquidator in winding up by Court. 486 (1) Where a company is being wound up by the Court, the liquidator may-

without the authority under paragraph (b), exercise any of the general powers specified in Part I of the Twelfth Schedule, and

with the authority of the Court or the committee of inspection, exercise any of the powers specified in Part II of the Twelfth Schedule.". [Emphasis added] "Twelfth Schedule: "The liquidator may (without authority)-

bring or defend any action or other legal proceedings in the name and on behalf of the company; …

make any payment as necessary in carrying on the affairs of the company in its ordinary course of business including payment of utility bills, statutory fees and all other such S/N HC2vXWpxykeIkcqsQ4Netg payment; …

(I) do all such other things as are necessary for winding up the affairs of the company and distributing its assets.". [Emphasis added] [44] Further, I refer to subsection 103(1) of Income Tax Act 1957[Act 53] which provide that— “(1) Except as provided in subsection (2), tax payable under an assessment for a year of assessment shall be due and payable on the due date whether or not that person appeals against the assessment.

…

Where any tax due and payable under subsection (1) has not been paid by the due date, so much of the tax as is unpaid upon the expiration of that date shall without any further notice being served be increased by a sum equal to ten per cent of the tax so unpaid, and that sum shall be recoverable as if it were tax due and payable under this Act.”. [Emphasis added] [45] Based on section 486 and paragraph (i) of Part 1 of Twelfth Schedule of Act 777, the 2nd Respondent is vested with the authority to pay for utility bills and statutory fees and others payment in carrying out the affairs of the company in the ordinary course of business. The issue arose is whether the payment of the income tax under subsection 107(1) of Act 53 is a statutory fee within the meaning of paragraph (i) above. [46] In this regard, I refer to section 527 of the Act 777, in particular paragraph (1)(f) which provides that the payment of the federal tax assessed before the commencement of the winding up or assessed at any time before the time fixed for the providing of S/N HC2vXWpxykeIkcqsQ4Netg debts has expired, is ranked sixthly. In the present case, the income tax was assessed based on “Penyata Kedudukan Cukai” dated 16.2.2022. Therefore, the outstanding sum of income tax although assessed after the winding up of the 1st Respondent, it falls within paragraph 527(1)(f) of Act 777 as proof of debts has been filed on 3.10.2022. The outstanding sum of income tax will be paid after other debts such as payment of costs and expenses of winding up, remuneration of the liquidator, wages and salaries of the workers and so on. I then rule that “statutory fees” in the context of paragraph (i) of Part 1 of Twelfth Schedule of Act 777 means the payment of any charges under any written laws in the carrying out the affairs of the 1st Respondent and it could not include the payment of the income tax under subsection 107(1) of Act 53. [47] I have perused the SOA filed by the director of the 1st Respondent, Punithavathy (see exhibit JK-9 in Enclosure 7), the secured creditors for the sum of RM451,546.90 has been detailed out in the Balance Sheet. It shows the creditors are the directors of the company for the sum of RM254,408.98, the payment of tax for the sum of RM3,405.92 and other creditor is for the sum of RM81,382.00. The receivable for the sum of RM244,847.29 although not detailed out, the 2nd Respondent is able to find out from the record and books of the 1st Respondent which are in their possession. [48] In this regard, I refer to an e-mail by Punithavathy on 18.2.2022 informed the officer of the 2nd Respondent, Mr. Kumar that documents and invoices are in the rented store and requested him S/N HC2vXWpxykeIkcqsQ4Netg to confirm date of collection (see page 125 of JK-12 in Enclosure 7). Punithavathy also informed that the rented agreement of the store was with one Justin Sha. However, Mr. Kumar in his reply, instead of informing her the date of collection of those documents, has requested particulars of the store and others. I find the 2nd Respondent has made unnecessary request where the 2nd Respondent is able to find out the details and location of the store by referring to the rented agreement which are in their possession. [49] I further refer to the report prepared by the 2nd Respondent dated 30.12.2022 as exhibited as JK-21 in Affidavit in Reply of the 2nd Respondent (Enclosure 18), in particular pages 70-71 which listed the money receipts and payments of expenses. There is a total sum of RM315,815.04 in the account of the 1st Respondent. [50] The 2nd Respondent’s in his Affidavit in Reply (Enclosure 23) has confirmed that there was a sum of RM 313,707.37 and the sum of RM245,847.29 being other receivables. I find the 1st Respondent has sufficient fund to pay the income tax amounting to RM107,545.82 to LHDN. Nonetheless, according the section 527 of the Act 777, it will be paid after all debts listed in paragraph 527(a) to (e) of Act 777 being settled. [51] The present case involved the familial dispute which led to winding up of the 1st Respondent. No evidence produced by the 2nd Respondent to show that the records and books of the 1st Respondent did not reveal the information of the debtors or creditors of the 1st Respondent, except numerous letters and e-mails sent to the directors and the company secretary kept on S/N HC2vXWpxykeIkcqsQ4Netg repeating the request for further information. Apart from that, no evidence to show any payment as listed in paragraphs 527(1)(a) to (e) of Act 777 which need to be paid prior to the payment of outstanding sum of income tax. [52] I find that the 2nd Respondent failed to perform his duties with promptitude and to settle the list of the contributors and the assets of the 1st Respondent within a reasonable period of time. Had the Applicant not discover that there was an outstanding sum unpaid to LHDN, the 2nd Respondent may have not taken any steps to file the Pre-Discovery application, instead simply lamenting that he does not have enough documents to proceed further with the liquidation of the company. [53] Further, I find the 2nd Respondent since his appointment, has not contacted any director and/or hold any meetings with the directors and the shareholders of the 1st Respondent under section 487 of Act 777 or carrying out any auditing on the 1st Respondent. The 2nd Respondent also failed to put up advertisement and no creditors have come forward except for LHDN which submitted its Proof of Debt on the 3.10.2022. [54] The directors and the shareholders of 1st Respondent have been left in the dark as to the liquidation process and the disposal of the assets of the 1st Respondent. [55] The failure of the 2nd Respondent to hold a meeting with neither the company secretary, directors nor the creditors pursuant to subsection 487(2) of Act 777 has acted in breach of his S/N HC2vXWpxykeIkcqsQ4Netg professional duties. Should the meeting be called, the 2nd Respondent would be able to get the information requested and finalize the assets and liabilities of the 1st Respondent, rather than keep writing to the directors and company secretary of the 1st Respondent. [56] I am aware that this Court should be slow in interfering with the decision of the liquidator. However, I am of the view that the Court has the discretion to remove the liquidator if it is proven that the liquidator has failed to perform his duties with promptitude and delay in liquidating the company. [57] From all these circumstances added by a lack of transparency in the conduct of the 2nd Respondent, I conclude that the 2nd Respondent had failed to discharge his statutory duties impartially and efficiently by taking into consideration the paramount interest of the creditors and contributories which has led to this liquidation process still pending after three (3) years from the date of his appointment. CONCLUSION [58] Based on the foregoing reasons, I allowed the Applicant’s application for the removal of the 2nd Respondent being the liquidator of the 1st Respondent and replaced by the DGI. I further order the parties to bear their own costs of this application. Dated 22 May 2024. S/N HC2vXWpxykeIkcqsQ4Netg Signed by: …………………….. Wong Mee Ling Judicial Commissioner High Court of Malaya Johor Bahru Johor Darul Ta’zim. Counsel/Solicitor: For the Applicant: Mr. G. Ravi with Ms. Aida Hassan Tetuan Aida & G Ravi No. 19, Jalan Setulang, Taman Stulang, 80300 Johor Bahru, Johor. For the Respondents: Ms Brenda Rangithan with Ms Maryam Jamilah Binti Mansoor Tetuan Bodipalar Ponnudurai De Silva D3-1-8, Solaris Dutamas, No. 1, Jalan Dutamas 1, 50480 Kuala Lumpur. Cases referred to:

Wong Sin Fan & Ors v Ng Peak Yam @ Ng Pyak Yeow & Anor [2013]

Goh Siew Koon @ Eng Sing Kuan & Ors v. Lim Jit Kim @ Lim Tian

Yeo Ann Kiat & 238 Ors v Hong Leong Bank Berhad [2016] MLJU 729

Corporate Affairs v Harvey [1980] VR 669

Re Keypak Homecare Ltd [1987] BCLC 409

Andrew Christopher Chuah Eng Chuan v Ooi Woon Chee & Anor [2007] 2 MLJ 12 Legislation referred to:

Companies Act 2016 [Act 777]

Income Tax Act 1957[Act 53]