Ys Chong Enterprise Sdn Bhd v Perkasa Jauhari Sdn Bhd (in Liquidation) (J-02(IM)(NCC)-465-03/2025)

The Construction Industry Payment and Adjudication Act 2012 (“CIPAA”) was enacted to provide the construction industry with a fast-track, interim mechanism for the resolution of payment disputes. Speed is of its essence. An adjudication decision is binding at once, even if it is later reversed by a court or arbitral tribunal. This quality — commonly described as the “temporary finality” of an adjudication decision — is both the genius and the inherent limitation of the CIPAA regime. It is the inherent limitation which is at the heart of these appeals.

The appeals raise, for the first time in the courts of this country, a question of considerable doctrinal importance at the intersection of construction law and insolvency law: what is the effect, upon a winding-up order against a company which was founded upon an adjudication decision obtained by that company’s creditor, of a subsequent final determination by the court which conclusively reverses that adjudication decision on the merits? More particularly, does the winding-up order — by itself, and notwithstanding that the adjudication decision upon which it was founded has been extinguished under s. 13(c) of CIPAA by the final court determination — have the effect of transmuting the adjudication decision into a binding, permanent debt which survives that final determination, and which the CIPAA claimant may thereafter invoke as a mutual set-off under s. 526 of the Companies Act 2016 (“CA 2016”) against a winding-up petition subsequently presented by the aggrieved debtor company whose claims were vindicated in those very court proceedings? Then judgment also examines the meaning of “finally decided by arbitration or the court” in s. 13(c), whether final determination means the decision must have been “decided, and no longer open to any form of challenge or appeal.

The significance of the main question is not to be understated. If the answer is yes, then a party who obtained a winding-up order on the strength of an undisputed adjudication decision — one which was subsequently overturned in its entirety by a final court determination — may nevertheless shelter behind that winding-up order, wielding the discredited adjudication decision as a permanent set-off weapon against the very party whose claims the court upheld. The temporary would become permanent; the provisional would become definitive; and the final determination of the court would, in effect, be neutralised by an incidental insolvency order made before it was given. That cannot be the law. Background Facts

The material facts are these. The Appellant (“YS Chong”) was a sub-contractor engaged by the Respondent (“Perkasa”) by a letter of award dated 27.11.2015 for the Mass Rapid Transit Lembah Kelang: Jajaran Sungai Buloh–Kajang project, for a fixed maximum contract sum of RM4,541,670.00. Perkasa paid YS Chong a total of RM4,302,875.82 for work carried out on the project. A payment dispute then arose. By a Revised Final Claim dated 17.1.2018, YS Chong claimed an additional RM2,504,810.67, said to be due for additional quantities of structural steel work. Perkasa, for its part, by a Statement of Final Account dated 14.2.2018, claimed RM2,824,886.03 from YS Chong, comprising (amongst other items) debit notes of RM65,591.26 (“Debit Notes”) and liquidated ascertained damages (“LAD”) of RM2,795,000.00 for delay. On 13.4.2018, Perkasa filed Kuala Lumpur High Court Suit No. WA-22C-30- 04/2018 (“the JBHC Suit”) against YS Chong, seeking declarations that a revised progressive payment certificate dated 30.11.2016 in the sum of RM2,504,810.67 was void, and claiming the Debit Notes sum of RM65,591.26 and LAD of RM2,795,000.00 referred to above. On 14.6.2018, YS Chong filed a defence and counterclaim seeking, amongst other things, payment of RM2,505,810.67 said to be due under the Revised Final Claim and the release of a retention sum of

Before the JBHC Suit was determined, YS Chong, on 15.3.2018, filed a notice of adjudication pursuant to ss. 7 and 8 of CIPAA, claiming a final account sum of RM2,504,542.42 (inclusive of the retention sum of RM228,400.00). Perkasa filed an adjudication response on 21.5.2018, advancing its LAD claim. It is not in dispute that the subject matter of the adjudication and of the JBHC Suit was substantially the same.

By an adjudication decision delivered on 1.8.2018 (“the Adjudication Decision”), the adjudicator allowed YS Chong’s claim and dismissed Perkasa’s claim for LAD. (The parties’ submissions before us differ as to the precise quantum of the sum awarded, YS Chong putting the adjudicated sum, inclusive of subsequent interest and costs, at RM2,458,513.54 and Perkasa putting the principal sum awarded at RM2,363,028.92, but nothing in this appeal turns on that difference). Perkasa did not pay.

On 13.8.2018 YS Chong filed Shah Alam High Court Originating Summons No. BA-24C-67-08/2018 (“OS 67”) for leave to enforce the Adjudication Decision pursuant to s. 28 of CIPAA, and leave was granted on 21.11.2018 (“the Enforcement Order”). Perkasa did not appeal, and the Enforcement Order became final.

YS Chong then relied on the judgment under the Enforcement Order to present a winding-up petition against Perkasa in the Shah Alam High Court, Winding-Up Petition No. BA-28NCC- 109-02/2019 (“YS Chong Winding-Up Petition”) on 25.2.2019, founded on Perkasa’s failure to pay the sum due under the Adjudication Decision and Enforcement Order. The High Court granted a winding-up order against Perkasa on 5.8.2019 (“the YS Chong Winding-Up Order”).

Perkasa appealed against the YS Chong Winding-Up Order on 7.8.2019, but withdrew that appeal on 2.3.2021. On 22.11.2019, Perkasa applied to amend the title of the JBHC Suit to reflect that it was now in liquidation. The amendment was allowed on 1.12.2019, and an amended writ and statement of claim were filed on 11.12.2019.

Notwithstanding the Adjudication Decision in YS Chong’s favour, the Enforcement Order and the YS Chong Winding-Up Order, the JBHC Suit, which concerned substantially the same underlying payment and LAD dispute, continued to trial. On 21.7.2020, the learned Judicial Commissioner, after a full trial, allowed Perkasa’s claim and dismissed YS Chong’s counterclaim, with costs of RM40,000.00 against YS Chong (“the JBHC Judgment”).

YS Chong appealed against the whole of the JBHC Judgment on 13.8.2020. Perkasa applied, on 14.10.2020, to strike out that appeal on the basis that Perkasa, being then in the course of being wound up by virtue of the YS Chong Winding-Up Order, required leave of the winding-up court to bring or continue proceedings. On 20.1.2021, this Court allowed that application in part. YS Chong’s appeal against the dismissal of its counterclaim was struck out for want of such leave, but its appeal against the decision allowing Perkasa’s claim was permitted to proceed.

YS Chong then applied, on 16.2.2021, for leave to appeal to the Federal Court against this Court’s striking-out order (“the 1st FC Motion”); the Federal Court dismissed the 1st FC Motion on 13.9.2021, with costs of RM10,000.00. As for the remaining portion of the appeal (concerning the original claim), this Court dismissed it on 30.3.2022, with costs of RM20,000.00. YS Chong’s further notice of motion for leave to appeal to the Federal Court against that dismissal, filed on 27.4.2022 (“the 2nd FC Motion”), was withdrawn on 31.10.2022, with agreed costs of RM10,000.00, as not meeting the threshold under s. 96(1)(a) of the Courts of Judicature Act 1964. As we explain below, however, it is the JBHC Judgment itself, delivered on 21.7.2020, and not the subsequent exhaustion of YS Chong’s appellate avenues, that constitutes the final decision by the court of the dispute referred to adjudication for the purposes of s. 13(c) of CIPAA (“the Final Determination”).

On 15.9.2022, pending the disposal of the 2nd FC Motion, this Court allowed a conditional stay of execution of the Final Determination, on terms that YS Chong deposit RM1,000,000.00 with its solicitors within 10 days, with an undertaking to release that sum to Perkasa should the 2nd FC Motion be dismissed; costs of RM3,000.00 were awarded to Perkasa. YS Chong did not comply with that condition.

On 17.10.2022, Perkasa (acting by its liquidator) served on YS Chong a notice of demand (“the NOD”) under ss. 465(1)(e) and 466(1)(a) of the Companies Act 2016 (“CA 2016”), demanding payment of what Perkasa described as the total outstanding sum then due under the various judgments and costs orders referred to above, namely RM3,600,325.18 (“the Total Debt”), exclusive of the further costs of the 2nd FC Motion. YS Chong did not satisfy the NOD within 21 days, giving rise to the statutory presumption of inability to pay debts under s. 466(1)(a).

On 9.11.2022, the day after the NOD expired, YS Chong applied for a Fortuna injunction to restrain presentation of a winding-up petition, by Originating Summons No. JA-24NCC- 31-11/2022 (“OS 31”). OS 31 was dismissed on 14.2.2023, with costs of RM5,000.00. On 21.11.2022, Perkasa presented the winding-up petition against YS Chong now under appeal, Winding-Up Petition No. JA-28NCC-157-11/2022 (“the Perkasa Winding-Up Petition”), and on 23.11.2023 a further application to appoint a private liquidator for YS Chong.

On 11.3.2025, the High Court allowed the Perkasa Winding-Up Petition and ordered the winding-up of YS Chong (“the Perkasa Winding-Up Order”), and a private liquidator was subsequently appointed for YS Chong by order of the same court. YS Chong now appeals against the Perkasa Winding-Up Order (“Appeal 464”) and, consequently, against the order appointing the liquidator (“Appeal 465”).

YS Chong’s case, in essence, is that the Adjudication Decision in its favour, enforced by the Enforcement Order and never set aside, gives rise to a debt still owed by Perkasa (in liquidation) to YS Chong, confirmed in YS Chong’s proof of debt of 15.10.2019 and in the report of the first creditors’ and contributories’ meeting in Perkasa’s liquidation, which YS Chong quantifies (with accrued interest and costs) at RM2,599,443.65. YS Chong contends that this sum is a genuine set-off against the Total Debt of RM3,600,325.18 (or, on YS Chong’s figures, RM3,600,326.18) claimed in the Perkasa Winding-Up Petition, leaving a net sum of RM1,000,881.53. YS Chong has since paid that net sum, RM1,000,881.53, into court pursuant to a further order of the Johor Bahru High Court dated 13.10.2025, which allowed a stay of execution of the Winding-Up Order and the order appointing the liquidator on that condition.

YS Chong further contends that by the YS Chong Winding Up Order, the adjudicated debt of RM 2,599,443.65, having been adjudicated by the Winding Up Court, can no longer be challenged, relying on the doctrine of res judicata or issue estoppel. Court’s Analysis and Determination The Statutory Framework

The analysis requires a close reading of four statutory provisions, which together form the framework within which the questions in this appeal fall to be decided.

Section 13 of CIPAA provides that an adjudication decision is binding on the parties unless: (a) it is set aside by the High Court under s. 15; (b) the subject matter is settled in writing between the parties; or (c) the dispute is finally decided by arbitration or the court. These three conditions are exhaustive and disjunctive. The occurrence of any one of them brings the adjudication decision’s binding force to an end.

Section 28 of CIPAA provides that a party may apply to the High Court for an order to enforce an adjudication decision as if it were a judgment of the High Court. Section 28(3) further provides that upon such an order being made, the adjudication decision may be executed in accordance with the modes of enforcement applicable to judgments of the High Court under Order 45 of the Rules of Court 2012 (“ROC 2012”). The critical phrase is “as if it were a judgment”: as we explain at [24]–[36] below, this is a statutory fiction for the purposes of enforcement, the survival of which is tied to the continued binding force of the adjudication decision under s. 13, and which is to be distinguished (limited to this aspect) from the actual transformation of an arbitral award into a judgment of the court under s. 38 of the Arbitration Act 2005.

Section 466(1)(a) of the CA 2016 provides that a company is deemed unable to pay its debts if it fails to satisfy a creditor’s statutory demand for a sum exceeding RM50,000 within 21 days. The winding-up jurisdiction of the court is then engaged under s. 465(1)(e) read with s. 466. A winding-up order once made is a judicial act that does not lapse by the operation of any provision of CIPAA. It remains in force until discharged, stayed, set aside or annulled by further judicial act.

Section 526 of the CA 2016 provides for mutual credit and set-off where, before the commencement of the winding-up, there have been mutual credits, mutual debts or other mutual dealings between the company and any creditor of the company proving or claiming to prove a debt in the winding-up, an account is to be taken of what is due from each party to the other in respect of those mutual dealings, and the sum due from one party is to be set off against the sum due from the other, with only the balance being claimed or paid, as the case may be. The operation of s. 526 is mandatory, not discretionary. Once the statutory conditions are met, the set-off must be applied and the company’s liability (or the creditor’s provable debt) is confined to the net balance. The Status of the Adjudication Decision and the Enforcement Order

We address first the status of the Adjudication Decision and the Enforcement Order obtained by YS Chong against Perkasa, since the resolution of this appeal turns substantially upon it.

The Adjudication Decision of 1.8.2018 was made in YS Chong’s favour for RM2,458,513.54. YS Chong applied for and obtained leave to enforce it under s. 28 of CIPAA on 21.11.2018 (the Enforcement Order). Perkasa did not appeal against the Enforcement Order, which became final. By force of s. 28(3) of CIPAA, the Adjudication Decision thereupon became enforceable “as if it were a judgment” of the High Court, executable in accordance with Order 45 of the ROC 2012.

Section 13 of CIPAA provides that an adjudication decision ceases to be binding upon one of three events: (a) it is set aside under s. 15; (b) the subject matter is settled in writing; or (c) the dispute is finally decided by the court or arbitration. The Enforcement Order, made under s. 28, did not of itself alter this position. It merely conferred upon the Adjudication Decision the procedural status of “a judgment or order of the High Court” for purposes of execution. Whether the Adjudication Decision remains binding, and whether the Enforcement Order’s effect as “a judgment” under s. 28 survives, are separate questions that fall to be answered by reference to s. 13(c) and to the subsequent history of the JBHC Suit, to which we now turn. Effect of the Final Determination in the JBHC Suit on the Adjudication Decision and the Enforcement Order

The JBHC Suit and the Adjudication Decision concerned, in substance, the same underlying dispute, namely, Perkasa’s claim for LAD and the validity of the revised progressive payment certificate, on the one hand, and YS Chong’s revised final claim and counterclaim for the retention sum, on the other. The Adjudication Decision, delivered on 1.8.2018, allowed YS Chong’s claim of RM2,458,513.54 and dismissed Perkasa’s LAD claim. The JBHC Judgment, delivered on 21.7.2020 after a full trial, allowed Perkasa’s claim (including the LAD claim that the adjudicator had dismissed) and dismissed YS Chong’s counterclaim (including the revised final claim that the adjudicator had allowed). YS Chong’s appeal against the JBHC Judgment, as confined by this Court’s order of 20.1.2021, was dismissed on 30.3.2022, and YS Chong’s application for leave to appeal to the Federal Court was withdrawn on 31.10.2022. As we explain below, it is the JBHC Judgment of 21.7.2020, and not the subsequent dismissal of YS Chong’s appeal or the withdrawal of its application for leave to appeal to the Federal Court, that constitutes the Final Determination for the purposes of s. 13(c) of CIPAA. Meaning of “the dispute is finally decided by arbitration or the court”

Before turning to the consequences of the JBHC Judgment, it is necessary to address a logically prior question, that is, at what point is a dispute “finally decided by arbitration or the court” for the purposes of s. 13(c) of CIPAA? Two readings are possible. On one reading, the phrase may bear the meaning that the dispute has achieved unappealable finality such that s. 13(c) is engaged only once all avenues of appeal from the court’s decision or, in the case of arbitration, the award, have been exhausted, abandoned, or have lapsed. On the other reading, the phrase can be taken to describe the character of the decision itself, that is, a final, as opposed to interim or interlocutory, decision on the merits of the dispute by the relevant forum, such that s. 13(c) is engaged from the moment the court of first instance, or the arbitral tribunal, delivers its judgment or award on the dispute referred to adjudication, irrespective of any pending or subsequent appeal.

We prefer the second reading, for the following reasons.

First, as a matter of ordinary language, “finally decided” is naturally read as an adjectival description of the decision as a final decision, in contradistinction to an interim, partial, or interlocutory one, rather than as a compressed description of a procedural state of affairs of the disputes having been “decided, and the decision has since become incapable of further challenge”. “The dispute is finally decided by the court” is not the same proposition as “the dispute is decided by the court with finality”, in the sense of unappealable finality. The former describes what the court has done as in rendering a final decision on the merits, whilst the latter describes the subsequent legal status of what was done in that the decision is no longer open to challenge. In our view, section 13(c) is concerned with the former.

Second, and in our view decisively, the disjunctive formulation of s. 13(c) that “the dispute is finally decided by arbitration or the court”, requires that the phrase “finally decided” bear a single, consistent meaning as applied to both limbs, arbitration and court. An arbitral award is final and binding on the parties upon its delivery, by virtue of s. 36 of the Arbitration Act 2005, subject only to the narrow grounds for setting aside under s. of that Act, such grounds of which, on a pending application, do not of themselves suspend the award’s binding character absent an order of stay. There is, in the ordinary case, no “appeal” from an arbitral award in the sense in which that term is used of court proceedings. If “finally decided” in s. 13(c) meant “decided, and no longer open to any form of challenge or appeal”, the arbitration limb of s. 13(c) would, in substance, be satisfied from the moment of the award’s delivery (a pending s. 37 application notwithstanding), while the court limb would not be satisfied until a multi-tier appellate hierarchy which, potentially extending to the Court of Appeal and, with leave, the Federal Court had been exhausted. The same statutory phrase would then bear materially different temporal meanings depending on which forum had decided the dispute, producing two different regimes for the cessation of an adjudication decision’s binding force according to the fortuitous circumstance of whether the underlying dispute happened to be litigated or arbitrated. We do not consider that s. 13(c) was intended to operate in so asymmetric a fashion. The reading we prefer, that “finally decided” refers to the delivery of a final decision on the merits, whether a judgment of the court of first instance or an arbitral award applies uniformly to both limbs and avoids this asymmetry.

Third, this reading is the more consonant with the policy of CIPAA. The “temporary finality” conferred on an adjudication decision by s. 13 exists to bridge the gap between the rapid, provisional resolution that adjudication provides and the final resolution that litigation or arbitration of the underlying dispute will, in due course, provide. Once the court of first instance, or the arbitral tribunal, has actually pronounced on the merits of the very dispute that was referred to adjudication, on fuller pleadings, evidence, and argument than was available to the adjudicator, and applying ordinary rules of procedure and evidence, the function that the adjudication decision’s temporary finality was designed to serve has been fulfilled, and the bridge has been crossed. The pendency of a possible or actual appeal from that first-instance judgment does not revive the cashflow rationale that justified treating the adjudication decision as binding in the interim. If anything, the first-instance judgment itself now carries its own judgment-strength enforceability (which the court hearing the appeal may, if appropriate, stay), and it is to that judgment, not to the superseded adjudication decision, that the parties’ attention and any further protective measures (such as a stay application) should properly be directed.

We add, for completeness, that we do not consider this conclusion to be undermined by the theoretical possibility that a first-instance judgment which triggers s. 13(c) might later be reversed on appeal. Whether, and if so how, a reversal on appeal might affect the position as between the parties is a question that does not arise on the facts of this appeal. The JBHC Judgment was not reversed, but affirmed, on appeal and we say nothing about it. It suffices for present purposes to hold that the delivery of the JBHC Judgment on 21.7.2020 was itself sufficient to engage s. 13(c), without need to await the outcome of YS Chong’s subsequent and ultimately unsuccessful appeal.

We should record, however, that we have not been referred to, and are not aware of, any reported Malaysian decision that has addressed, still less definitively resolved, the question of when a dispute is “finally decided by arbitration or the court” for the purposes of s. 13(c) of CIPAA. The conclusion we have reached is accordingly one of construction, arrived at on the ordinary meaning of the words used, on the structure of s. 13(c) as a single disjunctive provision, and on the policy of CIPAA as we understand it.

We are satisfied that the Final Determination constitutes a final decision by the court, within the meaning of s. 13(c) of CIPAA, of the very dispute that was the subject of the Adjudication Decision. The revised final claim and the LAD cross-claim, which the adjudicator determined in YS Chong’s favour and against Perkasa respectively, were the identical claims litigated to finality, on fuller evidence and after full trial, in the JBHC Suit, but with the opposite result. Section 13(c) does not require that the court proceeding be one brought for the purpose of, or styled as, an application to set aside the adjudication decision. It is enough that the dispute referred to adjudication has been finally decided by the court. That condition is met here. For the reasons given above, the Final Determination occurred, and the Adjudication Decision ceased, by operation of s. 13(c), to be binding on the parties, on 21.7.2020, the date the JBHC Judgment was delivered, not on 31.10.2022, the date YS Chong’s appellate avenues were ultimately exhausted.

It follows that the further question, namely, the effect of the Final Determination upon the Enforcement Order and the s. enforcement mechanism, must also be answered in YS Chong’s disfavour, though for a distinct reason which we elaborate above. It suffices for the moment to state that the Enforcement Order conferred upon the Adjudication Decision the status of a judgment for execution under s. 28(3) and Order 45 of the ROC 2012. The status operates only for so long as, and to the extent that, the underlying Adjudication Decision itself remains binding under s. 13. Once the Adjudication Decision ceased to be binding by virtue of the Final Determination under s. 13(c), the statutory predicate for the s. 28 judgment fell away, and the effect of the Enforcement Order as “a judgment” of the High Court for the purposes of s. 28(3) was correspondingly extinguished. The Enforcement Order does not survive as an independent judgment debt divorced from the Adjudication Decision which it merely enforced. In other words, its juridical life is parasitic upon, and coextensive with, the binding force of the Adjudication Decision under s. 13.

We accordingly hold that, with the Final Determination in the JBHC Suit, the Adjudication Decision, even though registered and enforced under s. 28 of CIPAA, is no longer binding on the parties, and the effect of the Enforcement Order as a judgment of the High Court under s. 28 has been extinguished. There is, in consequence, no subsisting debt owed by Perkasa to YS Chong under the Adjudication Decision or the Enforcement Order capable of being brought into account, whether under s. 526 of the CA 2016 or otherwise, against the sum due to Perkasa under the Final Determination which was the sum predicated upon in its NOD, the statutory demand. Whether the Perkasa Winding-Up Order Gives Rise to Res Judicata or Estoppel Protecting the Adjudication Decision

YS Chong submits, in substance, that the YS Chong Winding-Up Order of 5.8.2019, made on the footing of the Adjudication Decision and Enforcement Order, and left standing when Perkasa withdrew its appeal against it on 2.3.2021, constitutes a final and conclusive determination, binding as between the parties, that the adjudicated debt was due and owing. Put it differently, it is YS Chong’s submission that when the YS Chong Winding Up Order was made on 5.8.2019, that was the time when the Adjudication Decision and Enforcement Order had become a debt adjudicated by the Winding Up Court. On this submission, that debt is to be treated as having crystallised with the imprimatur of the Winding Up Court (as opposed to an Adjudication Decision). In this regard, the Final Determination of 21.7.2020 can no longer extinguish the debt which had been accepted by the Winding Up Court prior as a valid and enforceable debt against Perkasa.

With respect, we do not accept this submission. A winding-up order made under s. 218 of the (former) Companies Act 1965, or under the equivalent provisions of the CA 2016, is not an adjudication on the merits of the underlying debt in the sense required to found res judicata (cause of action estoppel) or issue estoppel. The function of the winding-up court, on a petition founded on an enforced adjudication decision (or any other judgment for that matter), is to determine whether the statutory preconditions to winding-up, namely, a valid demand, the requisite sum, and the company’s deemed or actual inability to pay, are satisfied, and whether any genuine, substantial dispute as to the debt has been raised. It is not the function of the winding-up court to try, or finally determine, the merits of the underlying dispute giving rise to the debt. Indeed, it is well established that a winding-up petition is not the appropriate vehicle for resolving substantial disputes of fact going to the existence of the debt, which are better tried by writ action.

The YS Chong Winding-Up Order accordingly determined no more than that. In other words, as at 5.8.2019, Perkasa had failed to satisfy a statutory demand founded on the then-extant Adjudication Decision and Enforcement Order, and was on that basis deemed unable to pay its debts within s. 218(1)(e)/s. (as applicable). It was not, and could not have been, an adjudication of the merits of the underlying payment dispute between YS Chong and Perkasa, that is, of whether YS Chong’s revised final claim or Perkasa’s LAD cross-claim was, in truth, the better claim. Those merits were, at that very time, the subject of the JBHC Suit, then pending trial before the Johor Bahru High Court between the same parties.

It follows that the YS Chong Winding-Up Order, not being an adjudication of the merits of the underlying dispute, does not give rise to any res judicata or issue estoppel as against the validity, finality, or continued binding effect of the Adjudication Decision. The withdrawal of Perkasa’s appeal against that order on 2.3.2021 likewise has no such effect. It left standing only the winding-up order itself (and any private rights as between Perkasa and its own creditors flowing from the fact of that winding-up), and did not, and could not, operate to immunise the Adjudication Decision from the operation of s. 13(c) of CIPAA. Indeed, on the chronology as we have found above, the point is, if anything, a fortiori in Perkasa’s favour. The Final Determination occurred on 21.7.2020, with the consequence that the Adjudication Decision had already ceased to be binding under s. 13(c) by the time Perkasa withdrew its appeal against the YS Chong Winding-Up Order on 2.3.2021. By that later date, there was therefore no longer any binding Adjudication Decision capable of being “left standing” or insulated by the withdrawal. Perkasa’s decision not to pursue that appeal cannot be read as an affirmation or revival of a debt which, in law, no longer existed. The chronological priority of the YS Chong Winding-Up Order (5.8.2019) over the Final Determination (21.7.2020) is, for this reason, immaterial, and indeed cuts the other way. Section 13(c) operates by reference to the finality of the court’s determination of the underlying dispute, not by reference to the date of any winding-up order made, on the strength of an adjudication decision whose continued validity that very dispute was, at the relevant time, in the course of being tried. Since the Final Determination preceded the withdrawal (2.3.2021), the Adjudication Decision had already ceased to bind by the time Perkasa declined to pursue its appeal. In effect, the withdrawal of the appeal against the YS Chong Winding Up Order is a non-event. The Debate on “As If It Were a Judgment”: ASM Development v Maju Holdings

The analysis above is illuminated, and we think confirmed, by the debate in the High Court as to the meaning and effect of the words “as if it is a judgment or order of the High Court” in s. 28(1) of CIPAA. In ASM Development (KL) Sdn Bhd v Econpile

(M) Sdn Bhd [2020] MLJU 282 (“ASM Development”), Darryl Goon J (as His Lordship then was, later JCA) held that an adjudication decision, even one enforced under s. 28, remains a disputable decision. His Lordship reasoned that an adjudication decision is, by its very nature, of “temporary finality” under s. 13, and that the formulation in s. 28(1) — “an order to enforce the adjudication decision as if it is a judgment or order of the High Court”, does not go so far as to deem or convert the adjudication decision into a judgment of the court. It merely permits the decision to be enforced as if it were one, for the purposes of execution under s. 28(3) and Order 45. His Lordship drew a contrast with s. 38(1) of the Arbitration Act 2005 (and its predecessor, s. 27 of the Arbitration Act 1952), under which an arbitral award is to be entered “as a judgment in terms of the award”, holding that this language effects an actual transformation of the award into a judgment of the court, in a manner that s. 28 of CIPAA does not replicate for an adjudication decision.

In Maju Holdings Sdn Bhd v Spring Energy Sdn Bhd [2020] MLJU 1196 (“Maju Holdings”), the High Court departed from ASM Development on this point. Having set out the rival formulations in s. 28(1) of CIPAA (“as if it is a judgment or order of the High Court”) on the one hand, and s. 38(1) of the Arbitration Act 2005 and s. 27 of the Arbitration Act 1952 (“entered as a judgment in terms of the award”) on the other, the High Court held that the distinction drawn in ASM Development between these formulations was, with respect, “a distinction without a difference”. In both cases, the underlying decision (the adjudication decision, or the arbitral award) does not merge into the judgment and remains capable of being stayed or set aside on its own grounds, and in both cases the statute treats the decision as equivalent to a judgment of the court only for the purposes of enforcement. Once the High Court makes an order under s. 28(2) including, where appropriate, an order for interest and costs that goes beyond the four corners of the adjudication decision itself, that order is, in every sense that matters for enforcement, a judgment or order of the High Court, no different from any other judgment or order the High Court makes in the exercise of its judicial power.

Central to the High Court’s reasoning in Maju Holdings was the point that an adjudication decision enforced under s. 28 cannot simultaneously be an “undisputed debt” for the purposes of execution under the rules of court, and a “disputed debt” for the purposes of a statutory demand and winding-up under s. 466(1)(a) of the CA 2016. If a judgment debt under s. 28(2) including any interest and costs ordered by the High Court, which form no part of the adjudication decision as such may be levied upon, garnished, or otherwise executed without further inquiry into the merits of the underlying adjudication, it would be incoherent to treat the very same judgment as open to challenge on the merits merely because the creditor instead elects to proceed by way of a statutory demand and winding-up petition. The character of the judgment as undisputed cannot shift depending on which of the available enforcement routes the judgment creditor chooses to pursue. To hold otherwise would, as observed by the High Court in Maju Holdings, adversely affect the enforceability of judgments made under s. 28 and run counter to the object of CIPAA of securing prompt payment and easing cashflow in the construction industry.

We respectfully adopt that reasoning, and apply it to the present case. It follows that there is, in truth, no distinction between a judgment entered under s. 28(1) of CIPAA and one entered under s. 38(1) of the Arbitration Act 2005 as to the indisputability of the debt which each represents. Both are, for so long as they subsist, judgments of the High Court in the full sense for the purposes of execution, of s. 466(1)(a) of the CA 2016, and of any winding-up petition founded upon them; neither can be treated as an undisputed debt for one purpose and a disputed debt for the other.

The only distinction we are able to identify between the two regimes is the one we have already drawn at above: namely, that a judgment entered under s. 28 of CIPAA is, by reason of s. 13 of CIPAA, liable to extinguishment upon a Final Determination of the underlying dispute by the court or by arbitration within the meaning of s. 13(c). It is a vulnerability built into CIPAA’s scheme of “temporary finality”, which has no counterpart in the Arbitration Act 2005. A judgment entered under s. 38 of the Arbitration Act 2005 in terms of an arbitral award is not, by the terms of that Act, rendered non-binding by a subsequent court determination of the same dispute on the merits. Its survival depends on its own grounds of challenge under the Arbitration Act 2005, not on the fortunes of parallel litigation. We accordingly hold that the distinction, if at all, between the wording of s. 28 of CIPAA and s. 38 of the Arbitration Act 2005 is confined to this point of extinguishment upon a s. 13(c) Final Determination. It is not, and does not extend to, any distinction in the indisputability of the debt represented by the judgment while it subsists. For as long as a judgment under s. 28 subsists, it is, exactly as a judgment under s. 38 of the Arbitration Act 2005 would be, an undisputed debt for all purposes, including execution and winding-up. It is in the aforesaid sense that, perhaps, the conclusion in Maju Holdings that “it is a distinction without a difference” may not be entirely correct.

We emphasise, for the avoidance of doubt, that this conclusion, that is, the extinguishment of the s. 28 CIPAA judgment, operates prospectively from the moment of the s. 13(c) Final Determination, and does not retrospectively impugn anything done in reliance on the Enforcement Order before that moment. The judgment under s. 28 was, up to and until the Final Determination became final, indisputable for the purposes of execution and winding-up, precisely as Maju Holdings holds, and for the reasons given at [31]–[35] above, no less indisputable than a judgment under s. 38 of the Arbitration Act 2005 would have been. It is only the supervening Final Determination, namely the JBHC Judgment delivered on 21.7.2020, that extinguished the s. 28 judgment effect of the Enforcement Order in the present case. Acts done, and orders made, on the footing of the Enforcement Order before that date, including the YS Chong Winding-Up Order of 5.8.2019, addressed above, are not thereby rendered void or impugned. They simply do not avail YS Chong as a continuing source of a set-off debt as against Perkasa for the purposes of the Perkasa Winding Up Petition now under appeal. Consequence: No Set-Off Under Section 526 of the Companies Act 2016

It follows from the foregoing that the premise of YS Chong’s case that a subsisting debt of RM2,599,443.65 is owed by Perkasa to YS Chong under the Adjudication Decision and Enforcement Order, falling to be set off under s. 526 of the CA 2016 against the Total Debt of RM3,600,325.18 due to Perkasa under the Final Determination cannot be sustained. Section 526 operates upon “mutual credits, mutual debts or other mutual dealings” subsisting between the company and the creditor as at the commencement of the winding-up. As at the presentation of the Perkasa Winding-Up Petition and at all times thereafter, the Adjudication Decision and Enforcement Order had ceased, by operation of s. 13(c) of CIPAA upon the Final Determination, to represent any binding or enforceable debt owed by Perkasa to YS Chong. There being no mutual debt on YS Chong’s side of the account, s. 526 has no application, and the NOD dated 17.10.2022 and the Petition founded upon it correctly stated the sum due as the Total Debt of RM3,600,325.18, without need for any set-off. Conclusions

For the reasons given above, we hold that the learned High Court Judge correctly treated the Adjudication Decision and Enforcement Order as having been superseded, in their binding and judgment effect, by the JBHC Judgment, and correctly declined to apply any set-off under s. 526 of the CA 2016 between the sum due to Perkasa under the JBHC Judgment and the sum claimed by YS Chong under the Adjudication Decision and Enforcement Order. The statutory notice of demand dated 17.10.2022 and the Perkasa Winding Up Petition founded upon it correctly stated the sum due, and the Perkasa Winding-Up Order made on 11.3.2025, together with the consequential order appointing a liquidator for YS Chong, were properly made.

For all the reasons above, we dismiss Appeal 464 and, consequentially, Appeal 465. We make the following orders:

(a) The order of the High Court dated 11.3.2025 in Winding-Up Petition No. JA-28NCC-157-11/2022, winding up YS Chong Enterprise Sdn Bhd, and the consequential order appointing a private liquidator for YS Chong, are affirmed;

(b) For the avoidance of doubt, we hold that, the JBHC Judgment delivered on 21.7.2020 having constituted the Final Determination for the purposes of s. 13(c) of the Construction Industry Payment and Adjudication Act 2012, the Adjudication Decision dated 1.8.2018 and the Enforcement Order dated 21.11.2018 ceased, by operation of that provision, to be binding as between the parties with effect from that date, and the effect of the Enforcement Order as a judgment of the High Court under s. 28 of that Act was thereby extinguished. No sum is accordingly due from Perkasa Jauhari Sdn Bhd (In Liquidation) to YS Chong Enterprise Sdn Bhd under the Adjudication Decision or the Enforcement Order capable of being set off under s. 526 of the Companies Act 2016 against the sum found due to Perkasa under the Final Determination;

(c) The sum of RM1,000,881.53 paid into court by YS Chong pursuant to the order of the Johor Bahru High Court dated 13.10.2025 shall, within 14 days of the date of this order, be released to Perkasa Jauhari Sdn Bhd (In Liquidation) (or its liquidator), and shall be applied in part-satisfaction of the sum found due to Perkasa under the Winding-Up Petition No. JA-28NCC-157-11/2022, without prejudice to Perkasa’s right to recover the balance, if any, remaining due;

(d) The costs of Appeals 464 fixed at RM30,000.00 are to be paid by YS Chong Enterprise Sdn Bhd (In Liquidation) to Perkasa Jauhari Sdn Bhd (In Liquidation), subject to allocator. We make no order of costs for Appeal 465. Dated the 7th day of July 2026 -sgd-ONG CHEE KWAN JUDGE COURT OF APPEAL Counsel for the Appellant :

Dato’ Mandave Singh Gill;

En Shanker Sivapragasam; and

Cik Nurrul Nadia Binti Norriza. (Messrs. K. Siladass & Partners) Counsel for the :

En S. Ravenesan; and Respondent

En S. Naveennesan. (Messrs. S. Ravenesan)