JUDGMENT
Introduction
[1] This appeal concerns a claim of fraudulent trading pursuant to s 304 of the former Companies Act 1965 ("the CA 1965") and conspiracy to defraud. The claim was brought by a creditor in respect of an alleged write-off of debts owed to the debtor company, which effectively depleted assets that otherwise could have satisfied the creditor's claim. Central to the appeal are critical questions in respect of the veracity and reliability of accounting entries in financial statements, and the structural framework and legal effect of an asset sale in a Sukuk Al-Ijarah transaction.
[2] This appeal is against the decision of the Court of Appeal, which had earlier dismissed an appeal by the Appellant against the dismissal of its writ action as the plaintiff, against the Respondents at the High Court. This appeal, as it was at the Court of Appeal, is only between the Appellant and the 4th Respondent (the 4th Defendant at the High Court). The other three respondents did not enter an appearance, and never participated in the earlier proceedings. There was also no appeal against the dismissal of a counterclaim filed by the 4th Respondent.
[3] In the final analysis, we unanimously found no errors in the judgment of the Court of Appeal which had affirmed that of the High Court. This judgment of the Court contains the full reasons for our decision.
Key Background Facts
The Suit And The Litigants
[4] The Appellant plaintiff is a creditor of Pandan Indah Medical Management Sdn Bhd ("PIMM"). PIMM was at the material time a wholly owned subsidiary of Talam Transform Berhad ("Talam"), a company listed on Bursa Malaysia, being the 4th Respondent herein. PIMM had become a wholly owned subsidiary since 29 July 2005, and PIMM remained so until 31 October 2012 when the 4th Respondent disposed of its entire shareholding in PIMM to Plenitude Silver Sdn Bhd for RM2.00.