TIONG SING CHIONG 1. ) Kerajaan Malaysia 2. ) Ketua Pengarah Insolvensi Malaysia

WA-24NCvC-589-02/2024 Kand. 19 18/04/2025 15:06:47 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN, MALAYSIA SAMAN PEMULA NO: WA-24NCvC-589-02/2024 ANTARA TIONG SING CHIONG …PEMOHON (No. K.P.: 591124-13-5597) DAN KETUA PENGARAH INSOLVENSI …RESPONDEN GROUNDS OF JUDGMENT INTRODUCTION [1] This is an application by the Applicant seeking- 1) Satu injuksi deklarasi bahawa Responden tiada sebarang hak kepada syer Pemohon sebanyak 1/18 atas tanah yang dipegang di bawah Sibu Lease 45865, TRN: 03-SSL-000-000, 45865, Area 1.2019 Ha more or less, Locality of Land Bukit Lima, Sibu pada ketika ini. (selepas ini dirujuk sebagai ”Hartanah tersebut”); 2) Satu perintah injuksi interim bahawa Responden ataupun ejen-ejen mereka dihalang daripada memasuki premis hartanah tersebut, ataupun S/N oPfxP8smlE8gH0E3p1Ztg 1 **Note : Serial number will be used to verify the originality of this document via eFILING portal menjual/mencagar/memindah hakmilik kepada pihak ketiga; dan selepas pendengaran secara Inter-Partes satu perintah injunksi mutlak; 3) Bahawa Responden hendaklah menandatangani semua dokumentasi dan melakukan apa yang perlu untuk memindah balik 1/18 syer Pemohon kepadanya; 4) Sekiranya Responden telah menjual ataupun melelongkan hartanah tersebut, hasil jualan dipulangkan kepada Responden; 5) Kos bagi dan berkaitan dengan permohonan ini dijadikan kos dalam kausa; dan 6) Lain-lain perintah Mahkamah yang mulia ini dianggap adil. [2] This Court allows the application. The reasons are as deliberated. BRIEF FACTS [3] The Applicant is a discharged bankrupt. He was adjudged bankrupt on 7.1.2016 by the application of Masteron Sdn Bhd in Suit No. 29NCC- 721-02/2015. [4] The Respondent is the Director General of Insolvency. [5] On 10.10.2022 the Applicant filed an Application For Discharge in Suit No. WA-29PB-1153-10/2022 under Section 33(1) of the Insolvency Act 1967. S/N oPfxP8smlE8gH0E3p1Ztg 2 **Note : Serial number will be used to verify the originality of this document via eFILING portal [6] It was not disputed that the Applicant was granted the Order for an absolute discharge on 27.9.2023. [7] Prior to the bankruptcy, the Applicant has a share of 1/18 of a piece of land under Sibu Lease 45865, TRN: 03-SSL-000-000, 45865, Bukit Lima, Sibu, Sarawak (Land), transferred as a gift from his mother. [8] Accordingly, during the period when the Applicant was an undischarged bankrupt, the Respondent acts as the administrator of the bankrupt’s estate and the Land is vested in the Respondent’s name. Contention of Parties [9] The Applicant contended that despite the fact that the Land was vested in the name of the Respondent since 2019, no action has been taken by the Respondent pertaining to the Land to assist in the payment of the Applicant’s debt and now that the Applicant has been granted an absolute discharge, it is only fair that his Land to be returned to him. [10] The Applicant further contended that the Respondent has not declared in the Respondent’s report under section 33 of the Insolvency Act 1967, about the Land during the discharge application on 27.9.2023. S/N oPfxP8smlE8gH0E3p1Ztg 3 **Note : Serial number will be used to verify the originality of this document via eFILING portal [11] The Applicant also contended that according to the Respondent’s Report under section 33 of the Insolvency Act, submitted to the Court, the Respondent had admitted that- a) The applicant had achieved the target contribution of his provable debt as determined by the DGI; b) No creditors showed up during the hearings of the application to discharge in particular Masteron Sdn Bhd who had made him a bankrupt, despite being informed by the OA; and c) They had also failed to show up at the Creditors Meetings. [12] Therefore, the Applicant contended that his 1/18 share should revert back to him as his bankruptcy discharge was an absolute discharge. [13] The Respondent, on the other hand, contended that the Land has been vested in the name of the Respondent and will remain so as the Land has been registered under the name of the Respondent in the document of title of the Land. The Respondent further contended that the Respondent has the discretion to produce the Bankrupt’s part for the benefit of the creditors who filed the Proof of Debt. S/N oPfxP8smlE8gH0E3p1Ztg 4 **Note : Serial number will be used to verify the originality of this document via eFILING portal [14] The Respondent further contended that section 73(1)(a) of the Insolvency Act also provides the duties of the Respondent pertaining to a bankrupt’s estate. Section 73(1)(a) provides - 73. Duties of DGI as to the bankrupt’s estate (1) As regards the estate of a debtor, the DGI shall (a) act as receiver of the debtor’s estate, and act as manager thereof …”. ISSUE [15] The main issue is whether the property of a bankrupt continues to be vested in the Director General of Insolvency after the absolute discharge of the bankrupt? ANALYSIS AND FINDINGS [16] Section 8 (1) (b) of the Insolvency Act 1967 provides- Effect of bankruptcy order “8 (1) On the making of a bankruptcy order – (b) all the property of the bankrupt shall become divisible among his creditors and shall vest in the Director General of Insolvency and the Director General of Insolvency shall be the receiver, manager, administrator and trustee of all properties of the bankrupt”. [17] Meanwhile, section 33 (1) and (3) of the Insolvency Act 1967 provides- S/N oPfxP8smlE8gH0E3p1Ztg 5 **Note : Serial number will be used to verify the originality of this document via eFILING portal “(1) A bankrupt may at any time after being adjudged bankrupt apply to the court for an order of discharge, and the court shall appoint a day for hearing the application.” (2) (Deleted by Act A827). (3) On the hearing of the application the court shall take into consideration a report of the Director General of Insolvency as to the bankrupt’s conduct and affairs, including a report as to the bankrupt’s conduct during the proceedings under his bankruptcy, and may either grant or refuse an absolute order of discharge, or suspend the operation order of discharge subject to any conditions with respect to any earnings or income which may afterwards become due to the bankrupt, or with respect to his after-acquired property [18] The effect of discharge is provided under section 35(1)(a) of the Insolvency Act that provides- “35. (1) Subject to this section and any condition imposed by the court under section 33, where a bankrupt is discharged, the discharge shall release him from all his debts provable in the bankruptcy but shall have no effect— (a) on the functions (so far as they remain to be carried out) of the Director General of Insolvency; or (b) on the operation, for the purposes of the carrying out those functions, of the provisions of this Act”. (Emphasis Added) [19] Further, section 35A of the Insolvency Act provides- “35A. A discharged bankrupt shall, notwithstanding his discharge, give such assistance as the Director General of Insolvency requires in the realization and distribution of such of his property as is vested in the Director General of Insolvency, and if the discharged bankrupt fails to do so— S/N oPfxP8smlE8gH0E3p1Ztg 6 **Note : Serial number will be used to verify the originality of this document via eFILING portal (a) he shall be guilty of an offence and shall be liable on conviction to a fine not exceeding five thousand ringgit or to imprisonment for a term not exceeding six months or to both; and 56 Laws of Malaysia Act 360 (b) the court may, if it thinks fit, revoke his discharge, but without prejudice to the validity of any sale, disposition or payment duly made, or thing duly done subsequent to the discharge, but before its revocation [20] The Respondent contended that even when a person has been discharged under section 33 of the Insolvency Act 1967, the Respondent is still responsible and has rights over the assets and must realize those assets in accordance with the provision under Section 35A of the Insolvency Act 1967. This Court disagrees. [21] This Court is of the view that since the Applicant has been granted an absolute discharge of the bankruptcy, the functions of the Respondent also ceases. Reference is made to the case of Pravinchandra Doshi (T/A M/S P Doshi & Co) v. Ismail Bin Syed Mohamed & Anor [1998] 8 MLRH 311; [1999] 1 MLJ 35, where the Court held- “…What more, most pertinently, as the plaintiff was granted an absolute discharge and even given a refund of the surplus funds, which could only have been if the OA had satisfied the claims of the plaintiff's creditors, whereupon, the OA had no reason to hang on to the estate of the plaintiff or to continue to realize or distribute the property of the plaintiff. It could only be said, with respect, that Mr Teja's proposition that the plaintiff despite his absolute discharge has no capacity to maintain the action, because of s 33 of the Act, is totally unacceptable. The proposition is as S/N oPfxP8smlE8gH0E3p1Ztg 7 **Note : Serial number will be used to verify the originality of this document via eFILING portal absurd as it is farcical as to suggest that a man who has served his sentence must yet observe the prison rules.” (Emphasis Added) [22] Likewise, the Court in In Re Badan Pengurusan Bersama Kondominium Lagenda [2017] MLRHU 1874 has cited with approval the case of Pravinchandra Doshi (supra) that held- [32] I am in complete agreement with the observations of my learned brother Jeffry Tan J (as he then was) as to the effect of a discharge of bankruptcy. Once an absolute discharge is given, the property of the discharged bankrupt, except for those caught under ss 35(1)(a) and 35A of the Bankruptcy Act 1967, divests from the Director General of Insolvency and the discharged bankrupt is free to deal with these property. The Director General of Insolvency has no reason to hold on to the estate of the discharged bankrupt, especially when all of the bankrupt's debts had been settled. Thus, I do not find any merit in the arguments of learned counsel for the Applicant that ESH as a discharged bankrupt lacked locus standi when making the application for the stay of winding up order. [23] Further, in Chan Chee Chiu & Anor v. Director General of Insolvency & Anor [2025] 3 MLRH 210, it was held- [49] … And that in Malaysia, upon an unconditional discharge, the DGI would be divested of the assets of the JD and such assets would then be returned to the control of the JD to do as he pleases.”. [24] This Court would agree with the contention of the Applicant that the effect of the Discharge Order is that the Applicant has since been released from all his debts provable in bankruptcy except debts due to the S/N oPfxP8smlE8gH0E3p1Ztg 8 **Note : Serial number will be used to verify the originality of this document via eFILING portal Government, State or Attorney General. But these, he has none. The Respondent had not stated that the Applicant is still indebted to either the Government, State or Attorney General in the Respondent’s report under section 33 of the Insolvency Act. Based on the Respondent’s Report under section 33 of the Insolvency Act, it is clear that the Applicant had achieved the target contribution of his provable debt as determined by the Respondent. [25] Accordingly, this Court is of a considered view that section 35A, will only take effect, if the Applicant’s discharge was conditional, but this is not the case. [26] Additionally, the Respondent has no more functions to be carried out as stipulated under Order 35(1)(a) of the Insolvency Act. It is clear from the Respondent’s Report under section 33 of the Insolvency Act, that all dividends due had been fully settled and this fact contributed towards the absolute discharge of the Applicant. [27] Another point that this Court has observed, is that the Land will only vest in the Respondent, if the Land is registered under section 349 of the S/N oPfxP8smlE8gH0E3p1Ztg 9 **Note : Serial number will be used to verify the originality of this document via eFILING portal National Land Code. In this regard, section 350 of the National Land Code has, the provision where the bankrupt is discharged. [28] For ease of reference, section 350 of the National Land Code provides- No disclaimer by the Director General of Insolvency, and no order for the discharge of any bankrupt or the annulment of any adjudication of bankruptcy, shall operate to divest the Director General of Insolvency of any land, share or interest registered in his name, and any such land, share or interest shall continue vested in him until the registration of a transfer thereof, or of any vesting order made with respect thereto by the Court. [29] In this regard, this Court is of the view that the Applicant should also observe section 350 of the National Land Code, when making this application. CONCLUSION [30] As such, the Application is allowed with cost. - SGD – (Y.A DR. SUZANA BINTI MUHAMAD SAID) Judicial Commissioner of the High Court Kuala Lumpur High Court (NCVC1) S/N oPfxP8smlE8gH0E3p1Ztg 10 **Note : Serial number will be used to verify the originality of this document via eFILING portal Dated : 17 APRIL 2025 COUNSELS PLAINTIFF Tetuan Jennifer Thomas & Co. Peguambela & Peguamcara No. F-7-2, Block F, Sri Manja Court Taman Sri Manja 46000 Petaling Jaya RESPONDENT Pegawai Insolvensi b/p Ketua Pengarah Insolvensi Jabatan Insolvensi Malaysia Cawangan Wilayah Persekutuan Tingkat 22, 23, 24 & 25 Menara TH Perdana 1001, Jalan Sultan Ismail 50250 Kuala Lumpur S/N oPfxP8smlE8gH0E3p1Ztg 11 **Note : Serial number will be used to verify the originality of this document via eFILING portal