Kang Hwee Gee J:

This Is My Oral Judgment

[1] This is a petition under s 218(1)(i) of the Companies Act 1965 to wind up the company on the just and equitable principle.

[2] The respondent company was conceived pursuant to a joint venture agreement called Peijanjian Usahasama between three shareholders - Padiberas Nasional Berhad (the petitioner), Konsortium Pemborong Beras Melayu (Kelantan) Sdn Bhd and Konsortium Perdagangan Pantai Timur Sdn Bhd.

[3] The main object of the company under its Memorandum and Articles of Association is to:-

- to act as agents, negotiators or intermediaries for or in relation to any business or trade or any contracts, orders, tenders, concession or privileges in connection therewith;

- to carry on the business of general merchants, general importers and exporters, manufacturers, commission agents and wholesale or retail dealers of articles and products of all kinds and to buy, sell, barter exchange or otherwise deal the same; and

- to carry on any other business which may seem to the company capable of being conveniently carried on in connection with its business or calculated directly or indirectly enhance the value of or render profitable any of the company's property or rights.

[4] In the event of a conflict between the terms of the joint venture agreement and the provisions of the Memorandum and Articles of Association of the company the terms of the joint venture agreement will prevail and be regarded as the terms to be adhered by the parties to the joint venture agreement.

[5] The company is at present dormant having stopped its business on 10 May 2002.

[6] The petitioner owns 800,001 shares in the respondent company. Konsortium Pemborong Beras Melayu (Kelantan) Sdn Bhd owns 800,000 shares and is opposing this petition. The other shareholder Konsortium Perdagangan Pantai Timur Sdn Bhd who owns 399,999 shares did not oppose this petition as it has not filed any affidavit to do so.

[7] Mr Clinton Gomez For Konsortium Pemborong Beras Melayu (Kelantan) Sdn Bhd (The Opposing Party)

i. The decision of the respondent company which was wholly controlled by the petitioner to stop the supply of rice by the petitioner through the petitioner's subsidiary known as Edaran Beras National Sdn Bhd was made in breach of the joint venture agreement in that the said decision undermined the purpose of the joint venture agreement which was to sell rice at a profit and without any unfair competition. Such decision was made without consulting the Konsortium Pemborong Beras Melayu (Kelantan) Sdn Bhd which was required under the joint venture agreement. As a result the company is now facing financial difficulties as the company has now lost its business.

ii. The action of the respondent resulted in the suit being filed by my client under s 181 of the Companies Act 1965. There was also a derivative action being filed. The suits were filed against the petitioner. In the event the petitioner is made liable then damages would have to be paid to the respondent company by the petitioner.

iii. There were other decisions which were taken by the respondent company through the petitioner who is the controlling shareholder which has led the respondent company to suffer losses. Such decision had been made without consulting my client.

iv. The petitioner in short has not come to this court with clean hands to wind up the respondent.

Encik Amir Salleh For The Petitioner

[8] The respondent company commenced its business in December 2001. Under cl 12 of the joint venture agreement Konsortium Pemborong the opposing party was responsible for providing the management expertise for the respondent company and also responsible for training and developing a group of professionals to carry out the business of the company as Konsortium Pemborong was based in Kelantan and was in control of the management of the respondent company whose business was in Kelantan. They failed to fulfil their promise under cl 12 resulting in loss to the respondent company