HABIB JEWELS SDN BHD

W-05-592-12/2019 Kand. 61 11/05/2022 12:27:05 IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. W-05-11-01/2020 BETWEEN BADAN PERHUBUNGAN UMNO NEGERI PAHANG - APPELLANT AND PUBLIC PROSECUTOR - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. W-05-67-02-2020 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND PERTUBUHAN KEBANGSAAN MELAYU BERSATU - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. W-05-68-02-2020 BETWEEN 1 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal PUBLIC PROSECUTOR - APPELLANT AND WANITA MCA - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. W-05-591-12-2019 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND BADAN PERHUBUNGAN UMNO NEGERI KEDAH & 4 ORS - RESPONDENTS HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO.W-05-592-12-2019 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND HABIB JEWELS SDN BHD - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO.W-05-94-02-2020 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND 2 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal BINSABI SDN BHD - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO.W-05-95-02-2020 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND PERANO SDN BHD - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO.W-05-13-01-2020 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND K & Z ENTERPRISE SDN BHD - RESPONDENT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA AT PUTRAJAYA (APPELLATE JURISDICTION) CRIMINAL APPEAL NO.W-05-117-03-2020 BETWEEN PUBLIC PROSECUTOR - APPELLANT AND HATTATEX TRADING - RESPONDENT 3 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal CORAM: ABDUL KARIM BIN ABDUL JALIL, JCA HADHARIAH BINTI SYED ISMAIL, JCA ABU BAKAR BIN JAIS, JCA JUDGMENT Introduction [1] There are nine (9) appeals. The appeals are: (i) W-05-11-01-2020 between Badan Perhubungan UMNO Negeri Pahang v Public Prosecutor; (ii) W-05-67-02-2020 between Public Prosecutor v Pertubuhan Kebangsaan Melayu Bersatu; (iii) W-05-68-02-2020 between Public Prosecutor v Wanita MCA; (iv) W-05-591-12-2019 between Public Prosecutor v Badan Perhubungan UMNO Negeri Kedah & 4 Ors; (v) W-05-592-12-2019 between Public Prosecutor v Habib Jewels Sdn Bhd; (vi) W-05-94-02-2020 between Public Prosecutor v Binsabi Sdn Bhd; (vii) W-05-95-02-2020 between Public Prosecutor v Perano Sdn Bhd; (viii) W-05-13-01-2020 between Public Prosecutor v K & Z Enterprise Sdn Bhd; and 4 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (ix) W-05-117-03-2020 between Public Prosecutor v Hattatex Trading. [2] These appeals arose from the prosecution’s nine (9) Notice of Motions for Forfeiture Applications under section 56 (1) of the Anti Money Laundering, Anti Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (the Act). [3] From the nine appeals,eight appeals are by the prosecution against the dismissal of the forfeiture application and one appeal is by Badan Perhubungan UMNO Negeri Pahang against the order of the High Court allowing forfeiture. [4] All nine appeals were heard together as they raised a common issue ie whether the monies in the respondents’ bank account were the subject matter or evidence relating to the commission of an offence under subsection 4 (1) of the Act or the proceeds of an unlawful activity under section 23 of the Malaysian Anti Corruption Commission (MACC) Act 2009. [5] For ease of reference, the appeals are divided into three groups as follows: (i) Group One: Badan Perhubungan UMNO Negeri Pahang; 5 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (ii) Group Two : Political Entity (Pertubuhan Kebangsaan Melayu Bersatu, Wanita MCA and Badan Perhubungan UMNO Negeri Kedah); (iii) Group Three : Business Entity (Habib Jewels, Binsabi, Perano, K & Z Enterprise and Hattatex). The Prosecution’s Nine (9) Forfeiture Applications [6] As a brief background, the nine (9) Notice of Motions had the following common features: (i) All Notice of Motions were filed on 19.6.2019. (ii) Each application is supported by the following affidavits: a. Affidavit of the Deputy Public Prosecutor, Allan Suman; b. Affidavit of the investigating officer for the predicate offence, Nur Aida binti Ariffin ; and c. Affidavit of the investigating officer under the Act, Nurul Huda binti Abdul Rahman or Woon Yee Nee. (iii) In all nine cases, the property sought to be forfeited were monies in the respondents’ bank account; (iv) The monies in the respondents’ bank account were freezed on 25.6.2018 and seized on 21.9.2018; (v) The prosecution alleges the seized monies were the subject matter or evidence relating to the commission of an offence 6 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal under subsection 4 (1) of the Act or the proceeds of an unlawful activity; (vi) The unlawful activity refers to the unlawful activity committed by Dato’ Seri Mohamad Najib bin Tun Abdul Razak (DSN) under section 4 (1) of the Act and also section 23 of the Malaysian Anti Corruption Commission (MACC) Act 2009; (vii) The prosecution alleges DSN had abused his position as the Chairman of the Board of Advisors of 1 Malaysia Development Berhad (1 MDB) and as the Finance Minister and had caused a huge sum of monies to be transferred from 1 MDB’s funds to his personal bank account for his own use. DSN, then transferred out the monies to various third party including the respondents herein. (viii) The prosecution alleges during the period from 2011 to 2014, DSN has transferred or paid out monies from his personal account and deposited them into the respondents’ bank account. The prosecution alleges these monies were proceeds of unlawful activity alleged against DSN. (ix) The prosecution alleges the monies remaining in the respondents’ bank account which were sought to be forfeited is part of the monies transferred or paid out by DSN to the respondents’ bank account and thus were proceeds of the unlawful activity. (x) It is common knowledge that DSN was charged under section 23 of the MACC Act 2009 with an addition of 21 charges under section 4 (1) of the Act. 7 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [7] For ease of reference, we produced below a table to show the amount of monies sought to be forfeited against each respondent. DATE OF DATE OF AMOUNT OF BANK & ACCOUNT NO RESPONDENT FROZEN SEIZURE PROPERTY NO 1. Badan Perhubungan 25.06.2018 21.09.2018 RM 2,479,300.18 Maybank No: UMNO Negeri Pahang 006016211499 2. Pertubuhan Kebangsaan 25.06.2018 21.09.2018 RM CIMB No: Melayu Bersatu 192,965,413.61 8600002579 3. Wanita MCA 25.06.2018 21.09.2018 RM 300,000.00 Maybank : 514057157831 4. Badan Perhubungan 25.06.2018 21.09.2018 RM 827,250.00 RHB Bank : UMNO Negeri Kedah & 25204600004687 4 org 5. Perano Sdn. Bhd 25.06.2018 21.09.2018 RM 337,634.78 Maybank : 514598222223 6. K & Z Enterprice Sdn. 25.06.2018 21.09.2018 RM 138,359.60 Hong Leong Bank : Bhd 11400009655 7. Hattatex Trading 25.06.2018 21.09.2018 RM 111,590.00 Maybank : 514347209397 8. Habib Jewels Sdn Bhd 25.06.2018 21.09.2018 RM 100,000.00 RHB Bank : 21227310006650 Islamic Affin : 106710000210 9. Binsabi Sdn. Bhd. 25.06.2018 21.09.2018 RM 827,250.00 RM 277,250.00 Maybank Islamic : 562263022072 RM550,000.00 [8] In respect of the claims against the political entity, the following facts are agreed : (i) The respondents admitted they have received certain amount of monies from DSN via personal cheques issued by DSN which were deposited into the respondents’ respective bank accounts; and (ii) The monies given by DSN have been utilised by the respondents. [9] In respect of the claims against the business entity, the following facts are agreed: 8 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (i) The respondents have received monies from DSN as payments for services rendered and goods delivered by the respondents to DSN. (ii) Services have been rendered and goods were delivered. (iii) The respondents had no knowledge of the source of the monies given by DSN. Background facts Appeal No.11 (Badan Perhubungan UMNO Negeri Pahang) [10] Briefly, the facts are as follows. From investigation carried out by MACC, DSN has issued five (5) cheques from his personal bank account and deposited them into the appellant’s Maybank current account No.006016211499 (Account 1499). The five cheques are as follows : (i) AmIslamic Bank cheque No. 571553 dated 4.2.2012 for RM760,000.00. (ii) AmIslamic Bank cheque No. 571560 dated 7.5.2012 for RM1,000,000.00. (iii) AmIslamic Bank cheque No. 571572 dated 5.8.2012 for RM1,170,000.00. (iv) AmIslamic Bank cheque No. 572084 dated 11.4.2013 for RM15,000,000.00 (v) AmIslamic Bank cheque No. 571911 dated 20.4.2013 for RM15,000,000.00. The total sum of the five cheques is RM32,930,000.00. 9 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [11] As at 13.5.2019, the appellant’s Account 1499 had a balance sum of RM2,479,300.18 and this amount was seized. The respondent alleged the seized monies were monies from the 1 MDB funds. [12] At the High Court, the respondent submitted as follows. The appellant has failed to prove the said sum of RM32,930,000.00 were from lawful source. The appellant has failed to prove RM2,479,300.18 is not from the sum of RM32,930,000.00. The appellant could not have a balance sum of RM2,479,300.18 if not because it has received RM32,930,000.00 from DSN. That whatever balance sum available in the appellant’s bank account will be classified as proceed of unlawful activity. Even though the entire RM32,930,000.00 have been spent, the appellant is bound to refund the same. [13] In response, learned counsel for the appellant submitted that the said sum of RM32,930,000.00 received from DSN have been fully spent by the appellant for the benefit of the people in the state of Pahang and the monies seized is not from the said sum of RM32,930,000.00. That the seized monies is from other legal source and belongs to the appellant. [14] The learned High Court Judge found in favour of the respondent and held inter alia : (i) Based on the affidavit of Nur Aida binti Ariffin and Nurul Huda binti Abd Rahman, the respondent has proved the commission 10 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal of the predicate offence under section 23 of the MACC Act by DSN. (ii) Inference can be made against the appellant that the appellant knew, had reason to believe or had reasonable suspicion that the said RM2,479,300.18 were proceed of unlawful activity under section 4 (2) (a) of the Act. (iii) The fact that the appellant admitted receipt of RM32,930,000.00 but have spent the entire monies does not mean the appellant is not liable to refund the same. (iv) The appellant, without any reasonable excuse, failed to take reasonable step to ascertain whether or not the said RM32,930,000.00 received from DSN were proceed of unlawful activity. (v) The appellant could not have RM2,479,300.18 in their bank account if not because they have received RM32,930,000.00 from DSN. (vi) The appellant failed to prove RM2,479,300.18 is their own money and not part of the said RM32,930,000.00. For the aforesaid findings, the learned High Court Judge concluded that he was satisfied that RM2,479,300.18 seized by the respondent were proceed of unlawful activity and allowed the respondent’s application. Appeal No.67 (Pertubuhan Kebangsaan Melayu Bersatu) [15] The facts in brief is as follows. Between April 2013 and August 2013, DSN has issued seven (7) cheques from his personal bank 11 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal account and deposited them into the respondent’s CIMB current account No. 8600002579 (Account 2579). The seven (7) cheques issued by DSN are as follows : (i) AmIslamic Bank Cheque No. 572079 dated 9.4.2013 for RM100,000,000.00. (ii) AmIslamic Bank Cheque No. 571902 dated 19.4.2013 for RM50,000.00; (iii) AmIslamic Bank Cheque No. 571903 dated 19.4.2013 for RM50,000.00; (iv) AmIslamic Bank Cheque No. 571904 dated 20.4.2013 for RM50,000,000.00; (v) AmIslamic Bank Cheque No. 571905 dated 20.4.2013 for RM50,000,000.00; (vi) AmIslamic Bank Cheque No. 571948 dated 19.6.2013 for RM25,000,000.00; and (vii) AmIslamic Bank Cheque No. 571854 dated 1.8.2013 for RM20,000,000.00. The total sum of the seven cheques is RM255,000,000.00. [16] As at 13.5.2019, there was RM212,965,413.61 in the respondent’s Account 2579. The appellant amended the amount to be forfeited to RM192,965,413.61. [17] The appellant alleged whatever amount left in the respondent’s Account 2579 were part of the RM 255,000,000.00 received from 12 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal DSN and thus were proceeds of an unlawful activity alleged against him and ought to be forfeited to the Government of Malaysia. [18] The respondent resisted the appellant’s application and contended : (i) the monies received from DSN have been fully utilised; (ii) the seized monies were not part or balance of the monies received from DSN; and (iii)the monies sought to be forfeited were contributions received from other sources which were as follows : (a) RM400,000,000.00 on 11.10.2017 from Seaport Terminal (Johore) Sdn Bhd through CIMB Cheque dated 9.10.2017; (b) RM100,000,000.00 on 16.4.2018 from Syarikat Seri Yakin Sdn Bhd through CIMB Cheque dated 16.4.2018; (c) RM60,000,000.00 on 28.3.2018 from Syarikat Temasek Padu Sdn Bhd through a Maybank Cheque dated 20.3.2018; and (d) RM457,731,808.59 in May 2018 from other sources. [19] In reply, the appellant contended that any amount left in the respondent’s bank account is deemed to be proceeds of unlawful activity once they are mixed with the monies deposited by DSN. 13 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [20] The learned High Court Judge agreed with the respondent and dismissed the appellant’s application. The decision is derived at based on the following findings of fact: (a) The amount in the respondent’s bank account currently remaining could not be said to be from or part of the amount paid by DSN. (b) There is nothing left from the monies paid DSN into the respondent’s bank account left to be forfeited; (c) An order for forfeiture under section 56 of the Act can only be made against the property itself, which is in this case the monies deposited by DSN; (d) Section 56, unlike section 55 of the Act, makes no provision for the court to forfeit, or order the respondent to pay a penalty equivalent to the same amount sought to be forfeited; (e) The monies in the respondent’s account were monies from other sources. The appellant cannot forfeit monies which were no longer in existent, even if it was to be assumed that the monies were proceeds of an unlawful activity. It is therefore not necessary to go into the merits of the appellant’s other grounds for the subject matter of the forfeiture is no longer there. Appeal No.68 (Wanita MCA) [21] In this case, it is not in dispute that DSN had issued two cheques from his personal bank account and deposited them into 14 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal the respondent’s Maybank Current Account No. 514057157831 (Account 7831) as follows: (i) AmIslamic Bank Cheque No. 571674 dated 11.12.2012 for RM100,000.00;and (ii) AmIslamic Bank Cheque No. 571961 dated 7.2.2013 for RM200,000.00. [22] As at 17.5.2019, there was a balance sum of RM2,119,626.75 remaining in the respondent’s Account 7831. The amount seized and sought to be forfeited by the appellant was the sum of RM300,000.00 given by DSN. The appellant alleged the said RM300,000.00 were proceed of unlawful activity committed by DSN being monies taken from 1 MDB funds. [23] The respondent objected and contended as follows. The monies given by DSN have been spent. The seized monies were proceed from the sale of its landed property known as HS (D) 95411, Lot 484, Seksyen 47, Bandar Kuala Lumpur, Daerah Kuala Lumpur together with a 4 ½ storey shop house erected on the land. The shop house was purchased on 27.2.1981 for RM560,000.00. By a Sale and Purchase Agreement dated 21.7.2017, the said shop house was sold to Kamal Medical Books Sdn Bhd for RM2,170,000.00. The respondent substantiated its allegations by producing a copy of the sale and purchase agreement, marked as exhibit “HSK-4”. The respondent appointed the legal firm of Messrs Koh Nai Kwong to act as their lawyer in the sale and purchase transaction. The full purchase price has been paid by the purchaser as evident by copies 15 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal of the cheques and cheque deposit receipt marked as exhibit “HSK- 5”. For the aforesaid reasons, the respondent contended the said sum of RM300,000.00 and the balance sum in the respondent’s bank account 7831 are the proceeds from a bona fide sale of a shop house in 2017 and the respondent is the legal owner of the seized monies. [24] Appeal No.68 was heard by the same High Court Judge who heard Appeal No.67. Inevitably, the learned High Court Judge arrived at the same conclusion i.e since the monies paid by DSN have been spent, there is nothing left to be forfeited. His Lordship held the respondent has proven that the sum of RM300,000.00 sought to be forfeited by the appellant was the proceeds of the sale of the respondent’s shop house, a lawful activity. Accordingly, the learned High Court Judge dismissed the appellant’s application. Appeal No. 591 (Badan Perhubungan UMNO Negeri Kedah & 4 Ors) [25] In 2012 and 2013, the first respondent has received six (6) cheques from DSN which were deposited into the first respondent’s RHB Bank Current Account No. 25204600004687 (Account 4687). The six cheques are as follows: (i) AmIslamic Bank Cheque No. 572042 dated 25.4.2012 for RM1,000,000.00; 16 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (ii) AmIslamic Bank Cheque No. 571615 dated 6.6.2012 for RM1,000,000.00; (iii) AmIslamic Bank Cheque No. 571697 dated 10.1.2013 for RM2,000,000.00; (iv) AmIslamic Bank Cheque No. 571985 dated 6.3.2013 for RM5,000,000.00; (v) AmIslamic Bank Cheque No. 572069 dated 5.4.2013 for RM5,000,000.00; and (vi) AmIslamic Bank Cheque No. 571949 dated 19.6.2013 for RM1,000,000.00. The total sum of the six cheques is RM15,000,000.00. [26] As at 25.4.2019, there was a sum of RM1,054,019.22 left in the respondent’s Account 4687. This amount was seized and sought to be forfeited by the appellant on the basis it is part of the aggregate sum of RM15 million paid by DSN. That this RM1,054,019.22 were proceeds of unlawful activity committed by DSN in relation to an offence under section 23 of the MACC Act 2009. [27] The first respondent admitted it has received RM15 million from DSN in 2012 and 2013 but denied the said sum of RM1,054,019.22 is proceed of an unlawful activity. In resisting the appellant’s application, the respondent raised three legal points. Firstly, the monies paid by DSN has been utilised for the first respondent’s party expenses. Secondly, the appellant failed to show 17 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal RM1,054,019.22 were proceeds from an unlawful activity. Thirdly, RM1,054,019.22 were monies contributed by resources other than from the account of DSN. The other sources are: (i) RM1,000,000.00 was deposited into the first respondent’s account on 9.1.2017 and 25.1.2017 by a contributory through cash deposit (see exhibit “AUK-6” in Enclosure 9 RR Jilid 3 (3) p.568); (ii) RM500,000.00 was deposited into the first respondent’s account on 7.11.2017 by contributories via cheques No. HLBB128918, HLBB128919 and HLBB 128920 (see exhibit “AUK-7” in Enclosure 9 RR Jilid 3 (3) p.568); (iii) RM2,000,000.00 was deposited into the first respondent’s account on 23.11.2017 by a contributory through cheque No. AMB/050385 (see exhibit “AUK-8” in Enclosure 3 RR Jilid 3 (3) p.568); (iv) RM100,000.00 was deposited into the first respondent’s account on 26.2.2018 by a contributory through cash deposit (see exhibit “AUK-9” in Enclosure 3 RR Jilid 3 (3) p.569); (v) RM100,000.00 was deposited into the first respondent’s account on 12.3.2018 by a contributory through cash deposit (see exhibit “AUK-10” in Enclosure 3 RR Jild 3 (3) p.569); (vi) RM2,120,000.00 was deposited into the first respondent’s account on 2.4.2018 by a contributory through Maybank Cheque No. 072563; 18 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (vii) RM300,000.00 was deposited into the first respondent’s account on 2.4.2018 by a contributory through Maybank Cheque No. 072564; (viii) RM80,000.00 was deposited into the first respondent’s account on 2.4.2018 by a contributory through Maybank Cheque No. 072565; (ix) RM67,300.00 was deposited into the first respondent’s account by a contributory through Maybank Cheque No. 072566 (see exhibit “AUK-11” in Enclosure 3 RR Jilid 3 (3) p.570); (x) RM1,000,000.00 was deposited into the first respondent’s account on 19.4.2018 by a contributory through cash deposit (see exhibit “AUK-12” in Enclosure 3 RR Jilid 3 (3) p.570); and (xi) RM996,800.00 was deposited into the first respondent’s account on 27.4.2018 by a contributory through cash deposit (see exhibit “AUK-13” in Enclosure 3 RR Jilid 3 (3) p.570). [28] In a nutshell, the first respondent contended that for the period from January 2018 to June 2018, a sum of RM28,401,704.65 was deposited into the first respondent’s account from other sources. This shows the balance sum of RM1,054,019.22 in the first respondent’s account is from other sources and not from the monies paid by DSN. [29] Upon considering the law, the facts and submissions of parties, the learned High Court Judge dismissed the appellant’s application on three grounds: (i) There were insufficient evidence to prove the 19 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal predicate offence under section 23 of the MACC Act 2009 has been committed by DSN. Since predicate offence is not proved, the issue of unlawful proceeds does not arise; (ii)The monies paid by DSN have been spent and there is nothing left to forfeit; and (iii)The appellant failed to prove the seized monies ie RM1,054,019.22 is the proceeds of an unlawful activity. Appeal No.592 (Habib Jewels Sdn Bhd) [30] Briefly, the facts are as follows. The respondent carries on the business of selling jewellery, gold and gemstones. [31] In 2013 and 2014,DSN purchased jewelleries from the respondent. In November 2013 and June 2014, the respondent received two cheques from DSN for the sale of jewelleries from the respondent to DSN as follows : (i) AmIslamic Bank Cheque No. 000094 dated 27.11.2013 for RM90,000.00 which was deposited into the respondent’s RHB Bank Current Account No. 21227310018356 (Account 8356); and (ii) AmIslamic Bank Cheque No. 000377 dated 23.6.2014 for RM100,000.00 which was deposited into the respondent’s RHB Current Account No.21227310006650 (Account 6650). [32] On 21.9.2019, the appellant seized monies in the sum of RM485.66 in the respondent’s Account No. 8356 and a sum of RM100,000.00 in the respondent’s Account No. 6650. 20 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [33] On 1.9.2019, the appellant filed a Notice of Motion to remove RM485.00 which was initially sought to be forfeited. The amendment application was allowed by the Court on 13.9.2019. Hence, the appellant seeks to forfeit RM100,000.00 in the respondent’s Account No.6650. [34] The appellant alleged RM100,000.00 is part of the sum of RM190,000.00 paid by DSN to the respondent via the two cheques and is the proceed of an unlawful activity committed by DSN. [35] The respondent denied the appellant’s allegations and contended that the two cheques were received by the respondent in good faith for valuable consideration for the sale and purchase of jewelleries. To substantiate their allegations, the respondent exhibited Sale Receipt dated 3.12.2013 as “SNR-02” and Sale Receipt dated dated 25.6.2014 as “SNR-05”. [36] Before the High Court, the learned DPP for the appellant submitted the respondent has failed to prove the sum of RM100,000.00 sought to be forfeited is from lawful source. It is further submitted that the respondent ought to have reason to suspect the financial sources of DSN and the respondent did not comply with Bank Negara Malaysia’s Anti-Money Laundering guidelines. 21 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [37] On the other hand, the respondent submitted that the appellant has failed to prove on the balance of probabilities that the seized monies are the proceeds of an unlawful activity on the grounds:- (i) The appellant has failed to show with sufficient evidence that a predicate offence has been committed; (ii) The respondent has no involvement in the commission of any offence and did not aid or abet in any such offence. (iii) The respondent has shown that the monies sought to be forfeited were received for valuable consideration and in good faith for the lawful sale and purchase of jewellery in the ordinary course of business; (iv) The monies sought to be forfeited have been together with other monies from legitimate sources and the appellant has failed to show which monies were from illegal as compared to legitimate sources. (v) Compliance with Bank Negara Malaysia’s policies is not a relevant consideration for this forfeiture application as the respondent had no reason to suspect the legitimacy of DSN’s income. [38] The learned High Court Judge agreed with the respondent and dismissed the appellant’s application. The learned High Court Judge’s finding of fact was that the monies sought to be forfeited were received by the respondent as a valuable consideration in good faith for the sale of jewellery to DSN in the course of the respondent’s ordinary business as jeweller. That the sale and purchase were 22 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal substantiated with contemporaneous documents. More so the appellant did not dispute the sale transaction. Hence, based on Ng Hee Thoong & Anor v Public Bank Bhd [1995] 1 ML J 281, the respondent’s averment that the monies received by the respondent from DSN were payment for the sale and purchase of jewellery is deemed admitted. In conclusion, the learned High Court Judge said he was not satisfied that the requirements under section 56 of the AMLATFPUAA have been met to justify the granting of an order for forfeiture as applied for. Appeal No.94 (Binsabi Sdn Bhd) [39] Briefly, the facts are as follows. The respondent carries on the business of supplying logistic equipments ( technical and canopies) for corporate functions.In 2011 and 2013, the respondent has supplied the equipments for an official function at the official residence of the Prime Minister and for general election at Pekan, Pahang, respectively. [40] In July 2011 and March 2013, the respondent received three (3) cheques from DSN for the services rendered to him as follows: (i) AmIslamic Bank cheque No.562728 dated 4.7.2011 for RM350,000.00 which was deposited into the respondent’s Maybank current account No. 562263022072 (Account 2072); (ii) AmIslamic Bank Cheque No. 571977 dated 5.3.2013 for RM200,000.00 which was deposited into the respondent’s Maybank current account No.562263022072.]; 23 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (iii) AmIslamic Bank cheque No. 571993 for RM277,250.00 which was deposited into the respondent’s Affin Bank current account No. 106710000210 (Account 0210). [41] As at 27.5.2019, the amount remaining in the respondent’s Maybank Account 2072 was RM1,233,237.33 and the amount in Affin Bank Account 0210 was RM558,038.42. [42] In this forfeiture application, the appellant sought to forfeit the sum of RM277,250.00 in the respondent’s Affin Bank Account 0210 and RM550,000.00 in the respondent’s Maybank Account 2072. [43] The appellant alleged that the monies paid by DSN into the respondent’s bank accounts were proceeds of the offences alleged against him. [44] The respondent resisted the forfeiture application and contended as follows. The respondent received the monies from DSN in good faith as payment for the services rendered. The respondent substantiated its contention with invoices marked as exhibits “DHSAA- 4” and “DHSAA-11”. As a business entity, the respondent had utilised the monies received from DSN to pay its suppliers and workers. That from the time the respondent received the monies from DSN to the time the monies were seized, the respondent also received payments from other businesses. In gist, the respondent alleged that 24 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal the current amount in its bank accounts could not be said to be part of, or wholly from the amount paid by DSN. [45] In response, he appellant contended that any amount in the respondent’s bank accounts is deemed to be classified as proceeds of an unlawful activity, once they are mixed with the amount paid by DSN. [46] Having considered the evidence in its entirety, the learned High Court Judge concluded at paragraph 28 of His Lordship’s grounds of judgment as follows : “[28] It is clear that the funds in the respondent’s bank accounts could not be credibly said to be from DSNR’s payments, and were instead funds from other sources. The prosecution could not seek to forfeit monies which were no longer in existence, or credibly identified, even if it was assumed that the monies were proceeds of unlawful activities. It is therefore not necessary to go into the merits of the prosecution’s application, nor the respondent’s other grounds, for the subject matter of the forfeiture is no longer there. I am therefore left with no alternative but to dismiss the prosecution’s application.” Appeal No.95 (Perano Sdn Bhd) [47] The respondent carries on the business of selling textile and head scarfs. On 17.9.2014 and 19.9.2014, members of UMNO Pekan, Pahang purchased head scarf from the respondent for the total sum 25 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal of RM350,000.00. As proof of the sale, the respondent produced a cash bill, marked as exhibit 2. [48] In October 2014, the respondent received one cheque from DSN for the goods sold and delivered as follows: (i) AmIslamic Bank Cheque No. 000322 dated 9.10.2014 for the sum of RM350,000.00 which was deposited into the respondent’s Maybank current account No. 514598222223 (Account 2223). [49] The appellant alleged that the payment made by DSN into the respondent’s bank account 2223 were proceeds of the offences alleged against him. [50] As at 13.5.2019, there was a sum of RM337,634.78 left in the respondent’s bank account 2223. [51] The appellant alleged the said sum of RM337,634.78 were liable to be forfeited as it was the proceeds of an unlawful activity committed by DSN under section 4 (1) of the Act and also section 23 of the MACC Act 2009. [52] The respondent contended that there had since been many transactions in its account, where not only the respondent has spent the RM350,000.00 sought to be forfeited, but it had also received 26 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal monies larger than RM350,000.00. In gist, the respondent contended the amount left in its account could not be said to be part of or wholly from the amount paid by DSN. [53] In response, the appellant contended the respondent would not have that much of money in its bank account had it not been for the payment made by DSN. It is further contended that any amount in the respondent’s bank account is deemed to be classified as proceeds of unlawful activity once they are mixed with the amount paid by DSN. [54] On perusal of the respondent’s bank statement, the learned High Court Judge find there are multiple transactions in the respondent’s bank account between the time DSN made payment to the time the respondent’s bank account was frozen. That in fact there were payments made into the respondent’s account that were more than RM350,000.00 paid by DSN. This,according to the learned High Court Judge lend credence that the monies deposited by DSN in October 2014 had been spent, if not entirely, most of it. [55] Based on the above finding, the learned High Court Judge concluded “It is clear that the funds in the respondent’s bank account could not credibly be said to be from DSN’s payment and were instead funds from other sources. The prosecution could not forfeit monies which no longer exist or credibly identified as proceeds of unlawful activity. ”Therefore, His Lordship dismissed the appellant’s application. 27 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal Appeal No.13 (K & Z Enterprise Sdn Bhd) [56] The respondent carries on the business of selling textile, clothing and garment accessories. In 2013, the respondent has supplied 148,877 pieces of T-Shirt to the Secretariat Hal Ehwal Bandar, Pemuda UMNO Malaysia. To proof the sale and purchase transaction, the respondent produced an invoice dated 28.4.2013, marked as “KZ-6”. [57] In March 2013, the respondent received one cheque from DSN for the supply of the said 148877 t-shirt as follows : (i) AmIslamic Bank Cheque No. 571992 for RM1,125,000.00 which was deposited into the respondent’s Hong Leong Bank Account No. 11400009655 (Account 9655). [58] As at 13.5.2019, the amount in the respondent’s Account 9655 was RM138,359.60. This is the amount the appellant sought to forfeit to the Government of Malaysia on the premise it was the proceeds of unlawful activity committed by DSN under section 4 (1) of the Act and section 23 of the MACC Act 2009. [59] At the High Court, the appellant argued that the respondent knew or had reason to believe that the said RM138,359.60 is the proceeds of unlawful activities because the t-shirts was supplied to Media Prima Berhad, payment was claimed from Secretariat Hal Ehwal Bandar, Pemuda UMNO Malaysia and payment via cheque was made by DSN. The appellant alleged the three layered 28 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal arrangements create a reasonable suspicion, but the respondent did not take steps under section 4 (2) (b) of the Act. Therefore, the appellant submitted that inference can be made that the respondent had reasonable suspicion that the property was the proceeds of an unlawful activity. [60] The appellant also argued that RM138,359.60 was monies from 1 MDB’s funds. That the respondent would not have a balance sum of RM138,359.60 if not because it received a cheque from DSN. That the balance amount in the respondent’s bank account is still classified as proceeds of unlawful activity within the meaning of section 3 (1) of the Act. That the respondent has failed to prove on the balance of probabilities the sum of RM138,359.60 was not monies from the cheque given by DSN. [61] In response, the respondent argued as follows. The appellant must show that the respondent knew or had reason to believe that RM138,359.60 was the proceeds of unlawful activity. The transaction to supply t-shirt is a lawful ordinary business of the respondent. The respondent had no reason to believe or suspect that the payment received via cheque is the proceed of illegal activity. It is none of the respondent’s business or duty to ask DSN whether the monies in the cheque is from legal or illegal source. The respondent had no direct dealing with DSN. The respondent conduct its business in good faith for valuable consideration. The respondent could not be faulted and penalised for carrying out its ordinary business. The cheque received also did not have the name of the account holder. 29 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [62] The learned High Court Judge found in favour of the respondent. His Lordship dismissed the appellant’s application on the following grounds:- (i) The appellant failed to prove on the balance of probabilities that the sum of RM1,125,000.00 given by DSN to the respondent were from the 4 transfers of monies into DSN’s bank account because the withdrawal amount is much more than the amount received by DSN. Therefore, RM138,359.60 cannot be said to be from proceed of unlawful activity; (ii) Alternatively, RM1,125,000.00 received by the respondent is payment for the supply of 148877 t-shirts and payment was received in good faith; (iii) The appellant has failed to prove that the respondent knew or had reason to believe that the cheque for RM1,125,000.00 is proceeds from unlawful activity. Appeal No.117 (Hattatex Trading) [63] The respondent was in the business of supplying, selling and sewing of cloth. In 2012 and 2013, DSN has ordered goods from the respondent. To proof the sale and purchase transaction, the respondent produced invoices No. 3642, 3620, 3634 as exhibit “MH- 1” and invoice No.4108 as exhibit “MH-2”. [64] In August 2012 and August 2013, the respondent received two cheques from DSN for the supply of the goods as follows : 30 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (i) AmIslamic Bank Cheque No. 571650 dated 2.8.2012 for RM74,590.00 which was deposited into the respondent’s Maybank current account No. 514347209397; (ii) AmIslamic Bank Cheque No. 000053 dated 26.8.2013 for RM37,000.00 which was deposited into the respondent’s Maybank current account No. 514347209397 (Account 9397). The total sum of the two cheques is RM111,590.00. [65] As at 13.5.2019, the available balance amount in the respondent’s Account 9397 is RM120,239.71. [66] Investigation by MACC revealed the two cheques amounting to RM111,590.00 were issued by DSN from his personal account. [67] The appellant sought to forfeit RM111,590.00 on the premise this sum of monies were proceeds of unlawful activity in relation to an offence committed by DSN under section 23 of the MACC Act 2009, the commission of which the appellant claims has been proven on the balance of probabilities. [68] The respondent denied RM111,590.00 was proceeds of an unlawful activity. The respondent contended the said RM111,590.00 was payment for goods sold and delivered to the Prime Minister’s Office. The respondent substantiated their claims with invoices. The respondent contended they received RM111,590.00 in good faith for 31 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal valuable consideration and they had utilised the monies to pay the supplier of the goods.It is contended that the respondent would suffer great losses if RM111,590.00 is forfeited to the Government of Malaysia because they have supplied the goods. For the aforesaid contentions, the respondent submitted that the RM111,590.00 seized from its bank account is their monies, belongs to them and not part of the two cheques given by DSN. [69] The learned High Court Judge found in favour of the respondent and dismissed the appellant’s application. In arriving at his decision, the learned High Court Judge made the following finding of facts: (i) The respondent did not know, had no reason to believe or had no reasonable suspicion that the said sum of RM111,590.00 seized was the proceeds of an unlawful activity; (ii) The purchase and payment for the goods were handled by the private secretary of the Prime Minister. The respondent never had any direct dealing with DSN; (iii) There is no necessity for the respondent to take a reasonable step to ascertain whether or not the said sum of RM111,590.00 paid by DSN was the proceeds of an unlawful activity; (iv) The appellant has failed to prove on the balance of probabilities that the said sum of RM111,590.00 was the proceed of an unlawful activity; (v) In the alternative, RM111,590.00 is payment for goods sold and delivered. 32 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal The Law on Forfeiture [70] Section 56 of the Act reads as follows : 56. Forfeiture of property where there is no prosecution (1) Subject to section 61, where in respect of any property seized under this Act there is no prosecution or conviction for an offence under subsection 4 (1) or a terrorism financing offence, the Public Prosecutor may, before the expiration of twelve months from the date of the seizure, or where there is a freezing order twelve months from the date of the freezing, apply to a judge of the High Court for an order of forfeiture of that property if he is satisfied that such property is – (a) the subject – matter or evidence relating to the commission of such offence; (b) terrorist property; (c) the proceeds of an unlawful activity; or (d) the instrumentalities of an offence. (2) The judge to whom an application is made under subsection (1) shall make an order for the forfeiture of the property if he is satisfied- (a) that the property is – (i) the subject-matter or evidence relating to the commission of an offence under subsection 4 (1) or a terrorism financing offence; (ii) terrorist property; (iii) the proceeds of an unlawful activity; or (iv) the instrumentalities of an offence ; and (b) that there is no purchaser in good faith for valuable consideration in respect of the property. 33 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (3) Any property that has been seized and in respect of which no application is made under subsection (1) shall, at the expiration of twelve months from the date of its seizure,be released to the person from whom it was seized. (4) In determining whether the property is- (a) the subject matter or evidence relating to the commission of an offence under subsection 4 (1) or a terrorism financing offence; (b) terrorist property; (c) the proceeds of an unlawful activity; or (d) the instrumentalities of an offence, the court shall apply the standard of proof required in civil proceedings. [71] Forfeiture proceedings under section 56 of the Act is subject to section 61 which reads as follows : Bona fide third party 61. (1) The provisions in this Part shall apply without prejudice to the rights of bona fide third parties; (2) The court making the order of forfeiture under subsection 28L(1) or section 55 or the judge to whom an application is made under subsection 28L(2) or 56 (1) shall cause to be published a notice in the Gazette calling upon any third party who claims to have any interest in the property to attend before the court on the date specified in the notice to show cause as to why the property shall not be forfeited; (3) A third party’s lack of good faith may be inferred, by the court or an enforcement agency, from the objective circumstances of the case. (4) The court or enforcement agency shall return the property to the claimant when it is satisfied that - 34 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (a) the claimant has a legitimate legal interest in the property; (b) no participation, collusion or involvement with respect to the offence under subsection 4 (1) or Part IVA, or a terrorism financing offence which is the object of the proceedings can be imputed to the claimant; (c) the claimant lacked knowledge and was not intentionally ignorant of the illegal use of the property, or if he had knowledge, did not freely consent to its illegal use; (d) the claimant did not acquire any right in the property from a person proceeded against under circumstances that give rise to a reasonable inference that any right was transferred for the purpose of avoiding the eventual subsequent forfeiture of the property; and (e) the claimant did all that could reasonably be expected to prevent the illegal use of the property. [72] Based on the wordings of section 56, it is clear that an order for forfeiture under section 56 (2) of the Act can only be made by the High Court Judge if he is satisfied that the monies in the respondents’ bank account were the subject matter or evidence in relation to the commission of an offence under subsection 4 (1) of the Act, or proceeds of an unlawful activity under section 23 of the MACC Act; and there is no purchaser in good faith for valuable consideration in respect of the monies in the appellant’s and the respondents’ bank account. [73] Therefore, the core issue in all nine appeals is whether the monies in the respondents’ bank accouns aret the subject matter of 35 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal the offence of money laundering under section 4 (1) of the Act or the proceeds of an unlawful activity under section 23 of the MACC Act. [74] Section 4 (1) of the Act reads : 4. Offence of Money Laundering (1) Any person who - (a) engages, directly or indirectly, in a transaction that involves proceeds of an unlawful activity or instrumentalities of an offence; (b) acquires, receives, possesses, disguises, transfers, converts, exchanges, carries, disposes of or uses proceeds of an unlawful activity or instrumentalities of an offence; (c) removes from or brings into Malaysia, proceeds of an unlawful activity or instrumentalities of an offence; or (d) conceals, disguises or impedes the establishment of the true nature, origin, location, movement, disposition, title of, rights with respect to, or ownership of, proceeds of an unlawful activity or instrumentalities of an offence, commits a money laundering offence and shall on conviction be liable to imprisonment for a term not exceeding fifteen years and shall also be liable to a fine of not less than five times the sum or value of the proceeds of an unlawful activity or instrumentalities of an offence at the time the offence was committed or five million ringgit, whichever is the higher. (2) For the purposes of subsection (1), it may be inferred from any objective factual circumstances that- 36 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (a) the person knows, has reason to believe or has reasonable suspicion that the property is the proceeds of an unlawful activity or instrumentalities of an offence; or (b) the person without reasonable excuse fails to take reasonable steps to ascertain whether or not the property is the proceeds of an unlawful activity or instrumentalities of an offence. [75] ”Proceeds of an unlawful activity” is defined under section 3 (1) of the Act as follows: “proceeds of an unlawful activity” means any property,or any economic advantage or economic gain from such property, within or outside Malaysia- (a) which is wholly or partly- (i) derived or obtained, directly or indirectly, by any person from any unlawful activity; (ii) derived or obtained from a disposal or other dealings with the property referred to in subparagraph (i); or (iii) acquired using the property derived or obtained by any person through any disposal or other dealings referred to in subparagraph (i) or (ii); or (b) which, wholly or partly, due to any circumstances such as its nature, value, location or place of discovery, or to the time, manner or place of its acquisition, or the person from whom it was acquired, or its proximity to other property referred to in subparagraph (a) (i), (ii) or (iii), can be reasonably believed to be property falling within the scope of subparagraph (a) (i), (ii) or (iii). 37 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal [76] The expression ‘unlawful activity’ is defined under section 3 (1) of the Act to mean inter alia any activity which constitutes any ‘serious offence’. The term serious offence is defined in the same section as to include any of the offences specified in the Second Schedule of the Act. [77] In this case,the serious offence is the offence under section 23 of the MACC Act, being one of the predicate offences specified in the Second Schedule of the Act. [78] Section 23 of the MACC Act reads as follows : (1) Any officer of a public body who uses his office or position for any gratification, whether for himself, his relative or associate, commits an offence. (2) For the purposes of subsection (1), an officer of a public body shall be presumed, until the contrary is proved, to use his office or position for any gratification, whether for himself, his relative or associate, when he makes any decision, or takes any action, in relation to any matter in which such officer, or any relative or associate of his, has an interest, whether directly or indirectly. (3) For the avoidance of doubt, it is declared that, for the purposes of subsection (1), any member of the administration of a state shall be deemed to use his office or position for gratification when he acts contrary to subsection 2 (8) of the Eight Schedule to the Federal Constitution or the equivalent provision in the constitution or Laws of Constitution of that State. 38 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (4) This section shall not apply to an officer who holds office in a public body as a representative of another public body which has the control or partial control over the first-mentioned public body in respect of any matter or thing done in his capacity as such representative for the interest or advantage of that other public body. [79] Since the prosecution alleged that the monies in the respondents’ bank account is the proceed of the commission of an offence under section 23 of the MACC Act by DSN, the following elements has to be proved: (i) DSN has committed an offence under section 23 of the MACC Act; (ii) The monies in the respondents bank account were the proceeds of the offence committed by DSN; and (iii) The respondents knew the monies in their bank account were the proceeds of the offence committed by DSN. [80] In these cases, it is not in dispute that the respondents herein did not participate or abet the commission of the unlawful activity. They are mere recipients of monies given by DSN. In the circumstances, we are of the view that in a forfeiture proceedings under section 56, the owner of the account, the appellant or the respondents herein, can challenge the applications by showing among others that they are bona fide purchasers, have a legitimate legal interest in the property, did not in any way participate, colluding or involve in the commission of the concerned offence or offences, 39 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal lacked knowledge and did not in any way assisting to avoid forfeiture of the property. To a certain extent, they can be treated as third parties and the defences provided under section 61 of the Act may be relied upon to defeat the forfeiture proceedings. Our Decision Group One : Badan Perhubungan UMNO Negeri Pahang [81] The appellant’s main complaint in this appeal is the learned High Court Judge has failed to consider paragraphs 39 - 41 of the appellant’s affidavit in reply which states that the sum of RM32,930,000.00 received from DSN have been utilized and the sum of RM2,479,300.18 seized by the respondent is the appellant’s monies and is not part of the monies given by DSN. Both facts were not disputed or challenged by the respondent. Instead, the learned High Court Judge had stated that paragraph 41 in the appellant’s affidavit in reply is a bare assertion. [82] For convenience, we reproduce the said paragraphs 39-41 of the affidavit in reply affirmed by Mohd Soffi bin Abdul Razak, the Treasurer of Badan Perhubungan UMNO Pahang below: “39. Saya juga mengesahkan bahawa kesemua wang yang telah diterima daripada DSNR melalui 5 cek di eksibit “NHAR-11” dalam affidavit IO AMLA telah habis digunakan sepenuhnya untuk aktiviti responden sebagai sebuah cawangan parti politik di Negeri Pahang. 40 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal 40. Saya juga mengesahkan bahawa wang daipada DSNR melalui cek di eksibit “NHAR-11” dalam affidavit IO AMLA tersebut telah digunakan untuk manafaat rakyat. 41. Saya mengesahkan bahawa wang RM2,479,300.18 yang disita di dalam akaun bank responden adalah milik responden yang diperolehi bukan daripada 5 cek di dalam eksibit “NHAR-11”. [83] In her affidavit in reply to the affidavit of Mohd Soffi bin Abdul Razak, Nurul Huda binti Abd Rahman (the investigating officer of AMLATFPUA) averred in paragraphs 8 and 9 as follows: “8. Bagi menjawab kepada perenggan 39 dan 40 affidavit jawapan tersebut, ingin saya menegaskan bahawa isu tersebut bukanlah isu yang relevan. Apa yang penting ialah responden telah memperoleh secara tidak langsung sebahagian haasil daripada aktiviti haram dari kesalahan predikat yang telah pun dipertuduhkan. Walaubagaimanapun pihak pemohon meletakkan beban pembuktian yang penuh terhadap pernyataan responden ini. 9. Bagi menjawab perenggan 41 dan 42 affidavit jawapan tersebut, saya mengulangi pernyataan saya di perenggan 8.” [84] The appellant contended that, as the investigating officer under the Act, Nurul Huda binti Abdul Rahman is unable to confirm or deny that the sum of RM32,930,000.00 have been spent. It is insufficient for the investigating officer to merely states the fact that the monies no longer exist. We are dealing with fact. Not opinion. Forfeiture application is tried by way of affidavit evidence. Based on the case of Ng Hee Thoong & Anor v Public Bank Berhad [1995] 1 CL J 609, the appellant submitted the facts deposed by Mohd Soffi bin Abdul Razak in paragraphs 39 - 41 of the appellant’s affidavit in 41 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal reply is deemed admitted by the respondent. We agree with the appellant. Failure to reply on the non - existence of RM32,930,000.00 means the respondent has admitted that the sum of RM32,930,000.00 given by DSN no longer exist and the seized monies could not be part of or related to the sum of RM32,930,000.00. Therefore, it is incumbent on the respondent to prove that the monies seized in the appellant’s bank account originates from an offence under section 23 of the MACC Act 2009 allegedly committed by DSN. We find there was no evidence proferred by the respondent to prove DSN has committed an offence under section 23 of the MACC Act. The affidavit evidence of Nur Aida binti Ariffin, the investigating officer of the predicate offence merely state the movement of monies from the various foreign entities into DSN’s bank account. Likewise, there was no explanation or reasons given by Nurul Huda as to how she concluded the monies in the respondents’ bank account were proceeds from an offence under section 23 of the MACC Act. Instead, the appellant has made a positive assertion that the sum of RM2,479,300.18 was the appellant’s monies and not from the monies given by DSN. This assertion is not challenged by the respondent and is deemed admitted. This being the case, we agree with the appellant that the learned High Judge had erred in His Lordship’s ruling that paragraph 41 of Mohd Soffi’s affidavit is a bare assertion. The only reason the respondent linked the seized monies to an unlawful activity is simply because the appellant had received RM32,930,000.00 from DSN and therefore, whatever amount remaining in the appellant’s account is still considered as part of the monies paid by DSN. Thus, the respondent is making an assumption, which is wrong in law. The law requires the respondent to prove the said RM2,479,300.18 is 42 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal derived from an offence under section 23 of the MACC Act allegedly committed by DSN within the meaning of section 56 (2) (a) (iii) of the Act. We find the respondent has failed to do so. On this ground alone, we find merit in the appellant’s appeal. We, therefore allow the appeal and set aside the order of the High Court. Group Two: Pertubuhan Kebangsaan Melayu Bersatu; Wanita MCA: and Badan Perhubungan UMNO Negeri Kedah & 4 Ors. [85] In these appeals,the appellant has raised an issue that the learned High Court Judges had erred in failing to make an order for forfeiture under section 56 and a pecuniary penalty order under section 59 of the Act. [86] The appellant contended they have satisfied the requirements in section 56 (2) (a) (iii) of the Act based on the following facts: (i) The affidavit of Nur Aida binti Ariffin and Nurul Huda bt Abd Rahman proved the seized monies is the proceeds of an offence under section 23 of the MACC Act committed by DSN; (ii) The respondents admitted they have received monies from DSN’s bank account; (iii) The monies in DSN’s bank account originates from 1 MDB’s funds; (iv) The respondents would not have the seized monies if not because DSN gave them the monies; 43 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (v) The respondents have obtained an economic gain flowing from the proceeds of an unlawful activity; (vi) Irrespective of whether the entire monies received from DSN have been utilized, whatever balance amount remaining in the respondents’ bank account is classified as the proceeds of an unlawful activity. (vii) The learned High Court Judges had erred in dismissing the forfeitures’ application solely on the ground the monies received from DSN have been utilized and there is no more monies in the respondents’ account which can be associated or linked to the monies given by DSN; (viii) Since the courts have found that the respondents’ account no longer has the monies given by DSN, the High Court should make a pecuniary penalty order under section 59 of the Act. [87] We find no merit in the appellant’s contentions for the following reasons : A. Requirements under s.56 (2)(a)(iii) of the Act have not been met. (i) There is insufficient evidence to satisfy the High Court that the monies seized is the subject matter or evidence relating to the commission of an offence or proceeds of unlawful activity under section 23 of the MACC Act. 44 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (ii) The affidavit deposed by Nurul Huda bt Abd Rahman merely disclosed the movement of the monies deposited into and transferred out of DSN’s bank account between 22.3.2013 until 10.4.2013 without proving the origin of the monies. There is not a shred of documentary evidence produced by the appellant in order to support their allegation that the monies in DSN’s bank account and the respondents’ bank account originated from 1 MDB’s funds. (iii) The monies deposited by DSN into the respondents’ bank account has co-mingled with the respondents’ own monies from other sources. The appellant admitted that the funds in the respondents’ bank account have mixed with the monies from DSN. Despite the admission, the appellant erroneously concluded that any amount left in the respondents’ bank account is deemed to be classified as proceeds of an unlawful activity once they are mixed with the monies deposited by DSN. (iv) The appellant merely show the transfer of money from DSN’s bank account to the bank account of the respondents and nothing more. The court should not be left on its own to make the connections between the money received and the alleged unlawful activity purportedly committed by DSN. (v) In contending the seized monies is part of the monies given by DSN, the appellant is making an assumption or presumption 45 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal when the law require proof on the balance of probabilities. The appellant has failed to proof the link between the seized monies and the offence under section 23 of the MACC Act. (vi) At para 13 of her affidavit, Nurul Huda binti Abdul Rahman simply averred that monies were deposited into the respondents’ bank account from DSN’s first account through cheques and erroneously concluded that the said monies were proceeds of unlawful activity in relation to an offence under section 23 of the MACC Act. There was no explanation in her affidavit as to how the monies seized could be linked to the offence under section 23 of the MACC Act. (vii) As the investigating officer for the predicate offence, Nur Aida binti Ariffin has failed to set out clearly in her affidavit sufficient evidence to support her findings that an offence under section 23 of the MACC Act has been committed. She simply begins most of her averments in the affidavit by saying “based on her investigation“ without disclosing in details whose statements were recorded as part of her investigation. (viii) We are satisfied that there was absence of link whatsoever between the monies in the respondents’ bank account and the funds allegedly misappropriated from 1 MDB. It is therefore, evident that the offence under section 23 of the MACC Act has not been proven and consequentially, the monies which 46 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal are sought to be forfeited were not traceable to the alleged offence of unlawful activity under section 23 of the MACC Act. (ix) From the appellant’s affidavits and the documents exhibited thereto, it has not been shown that the monies which had been received by DSN from the various entities is a result of his office or position as the Chairman of the Board of Advisors of 1 MDB or as the Minister of Finance or from any action or decision taken by DSN in any of these capacities. Additionally, it has not been demonstrated how DSN had used his position for gratification or money laundering other than merely showing that DSN had received monies from various entities without any clear evidence of impropriety. (x) There is no explanation or reason proffered in the affidavits to arrive at the conclusion that the impugned monies received by DSN from these various entities are gratification from any use of office or position within the scope of section 23 MACC Act. No detailed narrative was given as to the investigation conducted and the sources of information which satisfied the appellant that the predicate offence under section 23 of the MACC Act has been committed or that the monies in the account of DSN are the proceeds from an unlawful activity. The money trail between 1 MDB and DSN has not been established. 47 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (xi) From the affidavits filed by the appellant, the nexus between DSN’s involvement in matters pertaining to 1 MDB and the subsequent depositions of monies into his account is tenuous, such that it plainly cannot be said that the predicate offence under section 23 of the MACC Act has been committed. If the predicate offence is not proved, the issue of proceeds deriving therefrom does not arise. B. The monies received from DSN have been utilized. (i) From the beginning, the appellant has admitted that the monies received by the respondents from DSN herein have been spent. The wordings used in s.56 (1) is “…apply to a judge of the High Court for an order of forfeiture of that property.. ”We find the learned High Court Judges were correct in interpreting the word “that property” refers to a specific property. In the instant appeals, ”that property” refers to the monies received by the respondents from DSN. Since the monies given by DSN were no longer in existent, the effect are two folds : (i) there is no monies from DSN to be forfeited; and (ii) whatever amount remaining in the respondents account cannot be said to be part of the monies given by DSN. To the contrary, the respondents have proved to the satisfaction of the court that the monies in the respondents’ account were respondents’ monies obtained from other sources. We find the decision of the learned High Court Judges to dismiss the appellant’s application solely on the ground the monies given by DSN were no longer in existent were not plainly wrong. We see no 48 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal good reason to disturb the finding of facts made by the trial courts. C. Pecuniary penalty order under s.59 of the Act rightly refused. (i) Section 59 of the Act provides as follows: 59. Pecuniary orders (1) For the purpose of proceedings under section 55 or 56, the court shall issue a pecuniary penalty order against a person from whom property is forfeited in respect of benefits derived by the person from- (a) the commission of an offence under subsection 4 (1) or a terrorism financing offence; (b) terrorist property; (c) the proceeds of an unlawful activity;or (d) the instrumentalities of an offence. (2) The court may, if it considers appropriate, assess the value of the benefits so derived and order that person to pay to the Federal Government a pecuniary penalty equivalent to that amount. (3) Where a forfeiture order has been made under section 55 or 56 against any property which is- (a) the subject matter or evidence relating to the commission of an offence under subsection 4 (1) or a terrorism financing offence; (b) terrorist property; (c) the proceeds of an unlawful activity; or (d) the instrumentalities of an offence, 49 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal the pecuniary penalty to be paid under subsection (2) shall be reduced by any amount equivalent to the value of the property as at the time of the making of the order under subsection (2) and any such penalty shall be recoverable as a civil debt due to the Government of Malaysia and shall not be subject to any period of limitation prescribed by any written law. (4) In determining whether the benefit derived from – (a) the commission of an offence under subsection 4 (1) or a terrorism financing offence; (b) terrorist property; (c) the proceeds of an unlawful activity; or (d) the instrumentalities of an offence. the court shall apply the standard of proof required in civil proceedings. (ii) Before us, the appellant argued the learned High Court Judges had erred in failing to apply section 59. We find no merit in the argument. A plain reading of the section show section 59 is not applicable in the instant cases. Our view is section 59 can only be invoked if the appellant’s forfeiture application under section 56 is allowed by the court, which is not the case here. In addition, section 59 is not specifically pleaded in the appellant’s notice of motion. It is trite law that the court cannot grant any relief which was not asked for and not proven by the applicant. (iii) In Appeal No. 67, the learned High Court Judge had taken note that the appellant did not submit as to whether it could seek to forfeit an amount equivalent to the monies deposited by DSN. His Lordship has referred to section 55 and not 50 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal section 59. At para 30 of the grounds of judgment (at page 21 Record of Appeal Jilid 1), His Lordship concluded: “Section 55 of the Act, unlike s.56, concerns an application for forfeiture against a person charged with an offence under s.4 (1) of the Act, or a terrorism financing offence. Similar to s.56,it makes provision for the forfeiture of a property that is the subject matter of the offence that the accused is charged for. However, unlike s.56, s.55 makes provision for a situation where the property sought to be forfeited “has been disposed of, diminished in value or cannot be traced”, in which case the court is empowered to order the respondent to pay as a penalty a sum equivalent to the value of such property. This is clearly provided for under s.55 (2) of the Act. There is no corresponding provision under s.56.” [88] We find the approach adopted by the learned High Court Judge is correct. His Lordship merely explained the difference between section 55 and section 56, but the outcome to the appellant remain the same. [89] For the aforesaid reasons,we dismissed the appellant’s appeals and affirmed the decision of the High Court in all three cases. Group Three : Habib Jewels Sdn Bhd; Binsabi Sdn Bhd; Perano Sdn Bhd; K& Z Enterprise Sdn Bhd and Hattatex Trading. [90] Under this group, the appellant contended the learned High Court Judges had erred: 51 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal (i) In only considering one issue namely money received from DSN was received as payment for services rendered and goods delivered; (ii) In holding that the appellant has failed to show the respondents knew or had reason to believe payments from DSN via cheques is from an unlawful activity. [91] We find no merit in both points raised by the appellant. The respondents in all five cases have adduced evidence and documentary proof to show that they have supplied the goods /services to DSN and the payments from DSN were received in good faith for valuable consideration. It is not in dispute that the respondents did not deal directly with DSN in the transactions. It is also not disputed that the cheques issued for payments do not have the name of the account’s holder namely DSN. [92] The learned High Court Judges in all five cases have found as a fact that the sale and purchase transactions between the respondents and DSN were bona fide and lawful business. The High Court Judges also found the monies in the respondents’ account belongs to the respondents being monies received in good faith for value. We know of no law that imposed an obligation on the seller to investigate the source of payment. The law as it stands today is, as long as the transaction is not against the law, the seller is entitled to accept payment from anybody, including a third party who pay on behalf of the purchaser. In these cases, the respondents were dealing with DSN’s private secretary and the prime minister’s 52 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal office. In the circumstances, the High Court Judges held that there is no reason for the respondents to suspect they will receive payments from illegal monies. In fact, the appellant’s affidavit did not aver that the respondents knew or had reason to suspect that the payments received were from illegal source. We agree with all the finding of facts made by the High Court Judges. To accede to the appellant’s argument would result in losses to the respondents because they had delivered the goods and services. Whilst the objective of the Act is to prevent any person from gaining the proceeds of an unlawful activity, we do not think the Act is intended to cause injustice to a bona fide purchaser by forfeiting their legitimate hard earned monies. [93] Accordingly, we find there is no appealable error that warrant appellate intervention. Therefore we dismissed the appellant’s appeals and affirmed the decision of the High Court in all five cases. Dated 1st November 2021 Hadhariah binti Syed Ismail Judge Court of Appeal For the Appellant : Dato’ Syed Azimal Amir bin Syed in Appeal No.11 Abu Bakar (Mohd Shukri bin Ahmad Mansor & Noorizwa binti Jurish with him); 53 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal Messrs Sharif Ridzuan & Co. For the Respondent : Deputy Public Prosecutors: in Appeal No.11 Muhammad Saifuddin bin Hashim Musaimi and the Appellant Kamal Baharin bin Omar; in Appeals No. 67, 68, ; Samihah binti Rhazali; Nik Haslinie binti 591, 592, 94, 95, 13 Hashim; & Mahadi bin Abdul Jumaat. & 117 For the Respondent : Dato’ Hariharan Tara Singh in Appeal No.67 (Ms Tania Scivetti & Syazwani binti Mohd Zawawi with him); Messrs Scvetti & Associates. For the Respondent : Datuk Ben Chan & Syazwani Mahmud; in Appeal No.68 Messrs Ben Chan For the Respondent : Mr Nadaraja a/l Gopalakrishnan & in Appeal No.591 R. Hanita a/p Ramachandran; Messrs R Hanita & Associates. For the Respondent : Mr Khoo Guan Huat & Mr Gooi Yang in Appeal No.592 Shuh; Messrs Skrine For the Respondent : En Mohd Hasif bin Hassan & in Appeal No.94 Mohd Khalil bin Tajuddin; Messrs Hasif Kumar & Co. For the Respondent : Ms Thevini Nayagam & in Appeal No.95 Habizan bin Rahman; Messrs Rahman Rohaida. For the Respondent : Ms Thevini Nayagam & Habizan bin 54 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal in Appeal No.13 Rahman; Messrs Rahman Rohaida. For the Respondent : En Mohd Shukri bin Ahmad Mansor; in Appeal No.117 Messrs Asmah Shukri & Co. 55 S/N X9r0RFM6oEiRbssHtw/JQ **Note : Serial number will be used to verify the originality of this document via eFILING portal