Steve Shim CJ (Sabah & Sarawak):

There are three appeals before us, all involving the same issue of law. As such, we propose to deal with them together. Leave to appeal was granted by the Federal Court on 22 February 2001 on the following questions:

(1) Whether an appeal against the decision in favour of a company under liquidation falls within the meaning of the phrase 'action or proceeding' in section 226(3) of the Companies Act, 1965, so that no appeal could be prosecuted without leave under the said provision.

(2) Whether an application for security for costs by a defendant in an action commenced by a company under liquidation falls within the meaning of the phrase 'action or proceeding' in section 226(3) of the Companies Act, 1965, so that no application for security for costs could be commenced and/or proceeded with, without leave under the said provision.

Although the questions turn essentially on s. 226 of the Companies Act 1965 (hereinafter "the Act"), a brief narrative of the background facts is in order. Asean Security Paper Mills Sdn. Bhd. (the respondent) was a company set up as an ASEAN Industrial Joint Venture to manufacture high quality security paper. On 6