Clement Skinner JC:

This is an application made under the inherent jurisdiction of the court to have a winding-up petition presented against Ngan Yin Groundnut Factory Sdn Bhd (hereafter the respondent) struck out on the grounds that it constitutes an abuse of the process of court. The petition is presented persuant to s. 218(1)(i) Companies Act 1965 and was filed on 25 June 1998. The persons who seek the winding-up are Ngan Tuck Seng (Tuck Seng) and Ngan Tuck Hoi (Tuck Hoi) (the petitioners), two of the shareholders of the respondent who until 4 October 1996 and 9 January 1997 respectively were directors of the respondent. They say it is just and equitable that the respondent should be wound-up for reasons that will be gone into shortly.

The petition is opposed not only by the respondent but also by Gan Tuck Meng (Tuck Meng) and Gan Tack Kong (Tack Kong) both of whom are shareholders and directors in the respondent, as well as by Ngan Yee San @ Ngan Mei Lang and Ngan Mei Wan @ Ngan Hau Yoong as trustee of the estate of Lee Poh Peng @ Lee Soon, both of whom are also shareholders in the respondent.

The Respondent And Shareholders

The respondent was incorporated on 14 October 1975 with an initial authorised capital of RM1,000,000 divided into 1,000,000 shares of RM1 each until 5 July 1976 when it was increased to RM2,000,000 by the creation of 1,000,000 ordinary shares of RM1 each. The three founding members of the respondent and the shares subscribed for by each on incorporation were: Ngan Yin ... 1 share Madam Lee Poh Peng @ Lee Soon ... 1 share Madam Ngan Mei Lang ... 1 share

Madam Lee Poh Peng was the wife of Ngan Yin and Madam Ngan Mei Lang is a daughter of that marriage (I shall hereafter refer to these two persons as the two ladies). Ngan Yin also had a second wife, one Madam Wong Kwan Fong. Of the above persons, Ngan Yin and Madam Lee Poh Peng have passed away.

The late Ngan Yin had 4 sons from his union with his two wives. They are: Tack Kong (an opposer) Tuck Meng (an opposer) Tuck Seng (a petitioner) Tuck Hoi (a petitioner)

The principal objects for which the respondent was incorporated and its principal business till today is the manufacture of groundnuts.

Prior to the incorporation of the respondent, the late Ngan Yin was running a groundnut business in partnership with his sons Tack Kong, Tuck Meng and Tuck Seng, known as Ngan Yin Groundnut Factory (the partnership business). Within about six months of the incorporation of the respondent, an agreement (the takeover agreement) was on 27 April 1976 entered into between the respondent and the above mentioned persons whereby the respondent would take over the assets and liabilities of the partnership business. In exchange, the respondent would allot 1,000,000 share of RM1 each in the respondent to the following: Ngan Yin and Nominees ... 400,000 shares Gan Tack Kong ... 200,000 shares Gan Tuck Meng ... 200,000 shares Ngan Tuck Seng ... 200,000 shares

Pursuant to the takeover agreement, the respondent issued 999,997 shares, so that the shareholding in the respondent as reflected in its relevant annual returns, stood as follows: Ngan Yin ... 399,998 Gan Tack Kong ... 200,000 Gan Tuck Meng ... 200,000 Ngan Tuck Seng ... 200,000 Lee Poh Peng ... 1 Ngan Mei Lang ... 1

Out of his shareholding, the late Ngan Yin transferred 200,000 shares to Wong Kwan Fong who subsequently transferred these 200,000 shares to Tuck Hoi. The late Ngan Yin passed away on 19 July 1980 leaving a will in which he devised his residuary estate to his four sons in equal shares. The list of assets annexed to the grant of probate to the will of the late Ngan Yin shows the number of shares held by him in the respondent at the date of his death as 199,998 shares.

Increase In Paid Up Capital

After incorporation and until 4 January 1993 the issued and paid up capital of the respondent stood at RM1,000,000. On 4 January 1993, an extraordinary general meeting of the respondent was held. Two t