Carpet-man, bagman, toy-boy bites the dust?

ARCHIVES 2012

By MT Webmaster On Jul 18, 2012

Remember Deepak Jaikishan A/L Jaikishan Rewachand, the infamous carpet-man cum bagman cum toy-boy? Well, he is now engaged in a legal tussle with Kuwaiti Finance House for an unpaid banking facility amounting to RM170 million and he is crying conspiracy. It seems he can’t service his loan and is alleging that there is a conspiracy to bring him down. It is also said he is no longer welcome in the ‘White House’ in Purtajaya. What a spectacular way to fall.

THE CORRIDORS OF POWER

Raja Petra Kamarudin

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR

DALAM WILAYAH PERSEKUTUAN KUALA LUMPUR

GUAMAN NO : 22NCVC–778–06/2012

ANTARA

1. DEEPAK JAIKISHAN A/L JAIKISHAN REWACHAND

(NO. K/P : 720311-04-5165)

2. EZUL EHSAN BIN ISMAIL

(NO. K/P : 790219-14-5239)

3. PREMIER WEAVERS SDN BHD

(NO. SYARIKAT : 680163-X)… PLAINTIF-PLAINTIF

DAN

1. JAMELAH JAMALUDDIN

(NO. K/P : 570503-01-6640)

2. AZMAN BIN ABDUL MALEK

(NO. K/P : 570511-06-5231)

3. KFH (MALAYSIA) BHD

(NO. SYARIKAT : 672174-T)

4. SHAHEEN H A KH SH ALGHANEM

(NO. PPT : 3253134/KUWAIT)… DEFENDAN-DEFENDAN

STATEMENT OF CLAIM

1. The First Plaintiff, Mr Deepak Jaikishan A/L Jaikishan Rewachand is an individual of full age, a Malaysian citizen and having his address as No. 6, Simpang Tunku Putra, Bukit Tunku, 50480 Kuala Lumpur. The First Plaintiff is and was at all material times the beneficial owner of the Third Plaintiff.

2. The Second Plaintiff, Ezul Ehsan Bin Ismail (hereinafter referred to “Ezul”) is an individual of full age, a Malaysian citizen and having his address at No. 2, Jalan Kapur 3/3 40000 Shah Alam, Selangor.

3. The Third Plaintiff, Premier Weavers Sdn Bhd (hereinafter referred to as “PWSB”) is incorporated in Malaysia under the Companies Act 1965 with its business address in at Lot 107, Jalan 6, Off Jalan Chan Sow Lin, Sungai Besi, 55200 Kuala Lumpur.

3.1 PWSB is and was at all material times wholly owned by a company named Affluent Corridor Sdn Bhd (Company No. 758628-P), of which Deepak is a shareholder.

4. The First Defendant, Jamelah Jamaluddin (hereinafter referred to as “Jamelah”) is an individual of full age, a Malaysian citizen and having her address for service at Level 26, Menara Prestige, No. 1, Jalan Pinang, 50450 Kuala Lumpur.

4.1 Jamelah is, and before this since 2009 the Chief Executive Officer, CEO of the Third Defendant i.e. Kuwaiti Finance House (Malaysia) Sdn Bhd (Co. No : 672174-T).

5. The Second Defendant, Azman Bin Abdul Malek (hereinafter referred to as “Azman”) is an individual of full age, a Malaysian citizen and having his address at No. 10, Jalan 2/2, Taman Tun Abdul Razak, 68000 Ampang, Selangor.

5.1 Prior to Azman’s retirement in 2011, he was the Head of Credit Control, Assistant Director of the Third Defendant and was an officer of the Third Defendant that managed PWSB’s account.

6. The Third Defendant (hereinafter referred to as “KFHM”) is incorporated in Malaysia under the Companies Act 1965 and having its registered address at Level 26, Menara Prestige, No.1, Jalan Pinang, 50450 Kuala Lumpur.

6.1 KFHM is and was at all material times a banking institution wholly owned by Kuwait Finance House, Kuwait (hereinafter referred to as “KFHK”).

7. The Fourth Defendant, Shaheen H A KH SH Alghanem (hereinafter referred to as “Shaheen”) is an individual of full age, a Kuwaiti citizen and having his address at Level 26, Menara Prestige, No. 1, Jalan Pinang, 50450 Kuala Lumpur.

7.1 Shaheen is the Deputy Chairman of KFHMsince September 2011, prior to which he was from March 2007 to September 2011 the Chairman of KFHM.

8. The First and Second Defendants were at all material times employees and Senior Officers of KFHM and the Fourth Defendants is and was a member of the Board of KFHM. The Defendents wereempowered to make decisions with respect to finance facilities held by the Plaintiffs.

BACKGROUND FACTS

9. The 1st Plaintiff’s business interests extend across a range of companies known collectively as “the Deepak Group”. The 1st Plaintiff has used the 3rd Defendant as financier or banker over a period of time across 15 of the companies in the Deepak Group including PWSB. Further most of these facilities have held cross securities, so that defaulting in respect of one facility would result in defaults and a calling in of security across a multitude of securities across different facilities.

10. On 16.11.2007 PWSB accepted a letter of offer dated 16.11.2007 from KFHM in respect of Islamic finance facilities totalling RM170 million. This was varied by a Supplementary Letter of Offer dated 11.12.2007 (hereinafter referred to as the “PWSB Facilities”).

11. The PWSB Facilities amounting to RM170 million consisted of the following:

11.1 KFH Ijarah Muntahiah Bithamlik Asset Backed Financing-I (“Ijarah 1”) for the amount of RM12,685,000;

11.2 KFH Ijarah Muntahiah Bithamlik Asset Acquisition Financing-I (“Ijarah 2”) for the amount of RM107,315,000;

11.3 KFH Murabahah Tawarruq Working Capital Financing-I (“MTQ”);

11.4 KFH Wakalah Letter of Credit-I (“WLG”);

11.5 KFH Kafalah Bank Guarantee-I (“KBG”) for the combined amount of RM50,000,000 together with the MTQ and the WLG; and

11.6 KFH Promissory FX Contract-I (“Forex Line”) in the amount of RM5,000,000 as part of 11.5 above.

12. The Securities in respect of the PWSB Facilities were as follows:

12.1 1st party 1st legal charges over 3 blocks of carpet factory located at H.S (D) 136204 PT 24333, H.S (D) 136206 PT24335, H.S (D) 136207 PT 24336, H.S (D) 136251 PT 24380 Mukim Seremban, Daerah Seremban, N. Sembilan;

12.2 Joint and Several Guarantee for RM170 million by Affluent Corridor Sdn Bhd’s directors and shareholders, namely: Deepak Jaikishan A/L Jaikishan Rewachand, Mohd Shukri bin Abdullah & Ezrul Ehsan bin Ismail;

12.3 Personal Guarantee for RM170million from Shahrizal bin Ahmad;

12.4 Corporate Guarantee for RM170million from Affluent Corridor Sdn Bhd supported by Board Resolution;

12.5 Security Deposit of RM7,256,600 supported by Memorandum of Deposit and Letter of Set-Off;

12.6 Debenture for RM170 million over all fixed and floating, present and future assets of PWSB incorporating 3 blocks of factory, both movable and immovable assets, including the machines to be financed under Ijarah 2;

12.7 Assignment over the rights, interest and benefit of Customer under Insurances taken over the assets pledged to KFHM;

12.8 Irrevocable Letter of Undertaking from Carpet Raya Sdn Bhd that it will purchase 100% of PWSB’s products.

12.9 Any other security imposed by KFHM’s approving authority and advised by KFHM’s solicitors.

13. The lease term for Ijarah 1 and Ijarah 2 provides for a lease term of seven (7) years or 84 months (including 24 months principal and 12 months profit moratorium period) from the date KFHM purchases the Assets or initial drawdown of Ijarah. Based on the Statement of Accounts by KFHM the maturity date is 25.1.2015.

14. At all material times the 1st Plaintiff through his other business interests and companies held other financial facilities with KFHM. Such facilities were cross securitised with the PWSB Facilities in that a default upon any of the PWSB Facilities would result in a cross default upon other facilities held by various other companies of the 1st Plaintiff.

These other facilities included facilities with Carpet Raya Sdn Bhd; Capet Raya Manufacturing Sdn Bhd; Carpet Plus Sdn Bhd; Reliance Pillar Sdn Bhd; Vivaldi Partnership Sdn Bhd; Asta Canggih Sdn Bhd and Lembaran Segimaju Sdn Bhd.

All these other facilities were at all material times operated in the normal business course and in good standing todate.

15. In respect of the PWSB Facility, from time to time, PWSB utilized the facilities and has made payments of profits principal and other administrative costs to KFHM of about RM30 million. These payments covered the profits due to KFHM under syariah principles. Based on conventional banking they translate to an equivalent of about 7% interest per annum and a gross profit to KFHM of about RM12 million.

16. PWSB has always maintained a clear balance sheet as indicated in its audited accounts and has an employee base of over 360 people. Its business operation is continuing in the normal course and is profit making. Based on its audited accounts for financial year ending 30.6.2011, its fixed assets amount to RM167,402,823.00 and its net profit after tax is RM1,666,934.00, also based on its audited account for financial year end 30.6.2010 its fixed assets amount to RM179,316,536.00 and its net profit after tax is RM1,004,932.00.

17. On or around 2009, KFHM did undergo a change of executive management in which Jamelah was appointed Chief Executive Officer. In or around 2009, KFHM experienced difficult financial exposure, probably arising from their loan to KFH Reetaj Sdn Bhd (now known as Intrared Sdn Bhd (“Intrared”) of about RM600 million for the acquisition of the shares of PSSB with the object of acquiring Glomac Tower KLCC (now known as “Menara Prestige”).

This financial exposure was compounded by the fact (unknown to the Plaintiffs at the material time) that in fact KFHM wholly owned Intrared and the loan to Intrared contravened various statutory and regulatory provisions including but not limited to the fact that it had a paid up capital of RM727,000,000 only and when it gave the facility of about RM600,000,000/- to Intrared, it effectively exceeded 25% of KFHM’s capital base ; and upon deduction of about RM600,000,000 from their capital base, that effectively left a balance only of about RM100,000,000 at the material time.

The Plaintiff will refer to Bank Negara Malaysia (BNM) letter to KFHM dated 29th July 2005 for its full terms and effects.

It can be reasonably inferred that at this time, KFHM embarked on a course of conduct to deliberately hasten the redemption of its various facilities with its customers.

18. In this context, KFHM undertook the actions listed below:

PARTICULARS

19. On 16.12.2010 KFHM issued PWSB with a Renewal Letter imposing the condition wherein the monthly re-payment of about RM660,000 per month was to be increased to RM2.7 million per month as a part of the original facility’s accelerated premium payment scheme.

20. PWSB was not in a financial position to service the Agreement with such an accelerated repayment amount based on its cash flow and financial statements which KFHM had full knowledge of.

21. The Renewal Letter dated 16.12.2010 further imposed a deadline on 23.12.2010 for PWSB to accept the Renewal Letter. Further, it is also pertinent to note that the Renewal Letter contained what appears to be an unlawful and unreasonable Endorsement of Consent in Schedule 2, which required PWSB to agree to the following:

“I,……hereby confirmed my irrevocable consent to the terms of this Letter of Offerand any subsequent or supplemental letter(s) of offer, notice(s) of variation, agreement(s), guarantees(s) or security documents(s)…”

22.This was not agreed upon by PWSB as it would unilaterally bind PWSB to any future adjustment of facility by KFHM.

23. After lodging a complaint to Bank Negara Malaysia on 23.12.2010, KFHM held a meeting with the 1st Plaintiff on 03.01.2011 at which it was resolved:

23.1 that the monthly repayments be increased from RM660,000.00 to RM1.43 million.

23.2 PWSB would be given a period of nine (9) months to enable a new financier to fulfil PWSB’s obligation to fulfil the PWSB Facilities and to procure a letter of offer to PWSB in that period of time;

23.3 PWSB provided an undertaking to furnish nine (9) post-dated cheques for the settlement of the monthly payments to show that PWSB was at all times able to meet its financial obligations for the PWSB Facilities.

23.4 KFHM would provide a Letter of Restructured Offer to PWSB for the purposes of obtaining new finance.

24. Vide letter dated 5.1.2011, PWSB forwarded to KFHM post-dated cheques amounting to RM12,369,984 covering the period for January 2011 (RM930,000.00) and Feb – Sept 2011 (RM1,430,000.00 monthly).

24.1 PSWB also gave notice to KFHM vide the letters dated 5.1.2011 and 7.1.2011 that it required a new restructuring scheme in the form of a restructuring letter from KFHM to avoid the loan being designated a Non-Performing Loan (“NPL”) as it would jeopardize PWSB’s intent to procure a new loan from another financier to meet the exit deadline in September 2011.

25. KFHM however insisted that the payment scheme agreed on 3.1.2011 was without prejudice and that it was not obliged to accept the payment proposal by PWSB nor was it willing to issue a new restructured offer letter, leaving the issue of a future NPL unresolved.

26. KFHM unreasonably and without basis and against the usual banking practice and custom refused to present the post-dated cheques for RM12,369,984 referred to in Paragraph 24 above for payment to itself in part-payment of the facility.

27. The Plaintiffs contend that KFHM by its most extraordinary and uncharacteristic conduct as a banker demonstrated an intention to harm PWSB by deliberately characterizing the PWSB Facilities as a Non-Performing Loan and at the same time expecting PWSB to meet the exit deadline of 31.9.2011 by procuring another loan from another financier.

28. On 14.1.2011, even while the post-dated cheques remained in the possession of KFHM without being presented for payment of the PWSB Facilities, KFHM raised another issue concerning purported overdue payments retrospectively from 1.1.2010 to 31.12.2010 amounting to RM548,825.97 for which there were no instances of billings or any entries in their Statements of Accounts. KFHM had by a letter dated 11. 2.2011, later confirmed that this was a normal practice of KFHM.

28.1 KFHM demanded payment within five (5) days by 19.1.2011 failing which they would trigger an event of default of the Facilities.

28.2 The Plaintiffs contend that KFHM intended to cripple PWSB Facilities across the Deepak Group by appearing to show in its letters and documents that PWSB was in default albeit by 19 days (which PWSB denied) although the calling of a NPL occurs three (3) months AFTER non-payment and NOT 19 days.

29. PWSB denied the event of default and provided accounts detailing its compliance with the payment scheme for December 2010, PWSB had also on 31.01.11 send a cheque for RM609,954.00 to KFHM which was returned by KFHM without any logical reason, PWSB and KFHM then engaged in a series of exchanges disputing the alleged amounts outstanding until it was finally agreed between the parties in or around March 2011 that the outstanding amount was RM202,041.48 and a cheque was provided in such an amount by PWSB to KFHM on 25.03.2012.

30. Throughout the time of this dispute, PWSB was unable to secure a new financier as it had not been issued with a restructured letter of offer.

31. The Restructured Letter of Offer for the PWSB Facilities was provided to PWSB on 07.04.2011 which stated that a Letter of Offer from a new financier would have to be secured by 30.06.2011and the facility would be fully settled through refinancing on or before 30.09.2011 (“the exit deadline”). In the meantime PWSB was to pay RM1.43 million monthly from February – September 2011.

32. A letter of offer from a new financier could not be obtained with only 2 months from the granting of the Restructured Letter of Offer from KFHM and PWSB requested an extension of 3 months to secure a new financier. PWSB also requested that their cheques be banked on 11.05.2011 as opposed to 04.05.2011.

33. KFHM refused the request for 7 days extension to present the cheques for payments.

34. On 04.05.2011, although PWSB had notified KFHM to bank in their post-dated cheques on 11.05.2011,PWSB received a Letter of Demand from Messrs Benjamin Dawson for the amount of RM759,618.72 and RM6,831,481.01 purportedly for the outstanding arrears under the PWSB Facilities. These purported outstanding arrears were wrongfully computed on the basis of about RM2.7 million monthly instead of RM1.43 million per month.

35. On 12.05.2011, PWSB through its solicitors filed an action – Civil Suit 22A-447-2011 (hereinafter referred to as “Suit 447”) against KFHM seeking to restrain KFHM from appointing Receivers and Managers for PWSB. PWSB further instructed for an application for an injunction on the same suit.

36. On 01.06.2011, PWSB further filed an action – Civil Suit 22NCVC-458-2011 (hereinafter referred to as “Suit 458”) against Jamelah Jamaluddin, Azman Bin Abdul Malek and KFHM for conspiracy to economically injure PWSB.

37. On 15.06.2011, the 1st and 2nd Plaintiffs launched Suit 22NCC-1001-2011 (hereinafter referred to as “Suit 1001”) against Intrared and KFHM in respect of a part of the wider conspiracy. This Suit is currently pending submissions and Judgement before the High Court.

37.1 In this regard, KFHM and its Special Purpose Vehicle Intrared (which for all intents and purposes it exercised control over) failed to make payments under a Share Sale Agreement dated 25.07.2008 (hereinafter referred to as the “SSA”) with the 1st and 2nd Plaintiffs in respect of shares in PSSB that had already been transferred to and registered in the name of Intrared.

37.2 On 09.10.2008 the 1st Plaintiff assigned payments under the SSA to Bank Rakyat in order to service a facility with Bank Rakyat (hereinafter referred to as the “Bank Rakyat Facility”). Accordingly, Intrared acknowledged the assignment on 29.09.2008 and KFHM (as financier for Intrared) provided an irrevocable letter of undertaking on 31.12.2008 confirming it would make payments under the SSA to Bank Rakyat directly.

37.3 The failure to make payment to Bank Rakyat in the sum of RM17,999,867.70 caused the 1st Plaintiff to default on the Bank Rakyat Facility and the 1st Plaintiff suffered loss as a result of the default. Further the 1st and 2nd Plaintiffs were listed in the “defaulters list” in Central Credit Risk Information System Services (“CCRISS”).

38. On 22.09.2011 in a meeting between Jamelah and the 1st Plaintiff, it was agreed that:

38.1 PWSB would withdraw Suit 447 and Suit 458;

38.2 PWSB would withdraw against KFHM in Suit 1001;

38.3 KFHM would cause Intrared to enter into a favourable settlement agreement with the 1st and 2nd Plaintiffs in respect of Suit 1001;

38.4 PWSB would be given until 30.06.2012 to redeem the PWSB Facilities in full after obtaining a new financier with the exit deadline on 30.09.2012.

38.5 The unlawful and unreasonable Endorsement of Consent clause referred to in Paragraph 21 of the Statement of Claim be amended by KFHM in the new supplemental letter of offer.

39. On 17.11.2011, PWSB and KFHM entered into a settlement agreement in the form of a ‘Supplemental Letter of Offer’ dated 28.10.2011 (hereinafter referred to as “the Supplemental Letter of Offer”) which:

39.1 provided an adjusted repayment schedule for the KFHM facilities held by PWSB;

39.2 required all of the abovementioned Civil Suits to be withdrawn as against KFHM, Jamelah and Azman;

39.3 required a complete redemption of the PWSB facilities by 30.06.2012.

40. On 21.11.2011 Intrared indicated it would not enter into the Draft Settlement Agreement in contravention of the agreement stipulated in paragraph 38.3.

41. KFHM entered into the Supplemental Letter of Offer with among other intentions, of being removed as party from the Suit 447, Suit 458 and Suit 1001in an apparent attempt to prevent exposure:

(i) in Suit 1001 that it had created a Special Purpose Vehicle (Intrared), in contravention of the provisions of BAFIA, Islamic Banking Act 1983, Guidelines for Foreign Investment 2008 and Securities Commission Act 1993 (hereinafter collectively referred to “Malaysian Financial Regulations”); and

(ii) that it was in fact the 100% owner of Intrared which both collectively failed to pay RM17,999,866.70 to Bank Rakyat pursuant to the SSA triggering a “default” by the 1st and 2nd Plaintiffs and their blacklisting in CCRISS.

42. The Defendants had failed to make a full and frank disclosure to the Plaintiffs and knowingly induced, enticed and applied economic pressure on the Plaintiffs for PWSB to enter into the Supplemental Letter of Offer and the Defendants wrongfully and knowingly conspired and proceeded with the intention to make performance under the Supplemental Letter of Offer impossible.

43. The Malaysian Anti Corruption Commission (hereinafter referred to as the “MACC”) informed the1st Plaintiff that on or about 21.11.2011 that a report had been lodged by KFHM. The complaint by KFHM alleged that PWSB through its officers and/or agents had gifted watches and other expensive luxury items to the various officers in the loan approval department of KFHM, i.e approximately 4 days after signing the Supplemental Letter of Offer with PWSB.

44. KFHM through its officers and/or agents then proceeded to inform other Financial Institutions that PWSB was under investigation by the MACC, prejudicing and frustrating the opportunity for PWSB to secure a banking facility for refinancing.

45. PWSB was unable to secure refinancing. PWSB was informed by its prospective financiers that PWSB’s application for financing was rejected as there was an investigation on PWSB by MACC. The prospective financiers also informed the 1st Plaintiff that they were informed of the MACC investigation on PWSB, by KFHM officers.

CONSPIRACY TO INJURE

46. By reason of the matters stated above, the Plaintiffs contend that from on or around December 2010 until 30.06.2012, the Defendants unlawfully conspired with the predominant purpose to injure the Plaintiffs by unlawful means, namely by:

46.1 Causing the 1st and 2nd Plaintiffs to default on a financial facility with Bank Rakyat;

46.2 Concealing from the 1st and 2nd Plaintiffs that KFHM was using a Special Purpose Vehicle to purchase shares from the 1st and 2nd Plaintiffs, which the 1st and 2nd Plaintiffs have now come to be aware in Suit 1001, was created in contravention of Malaysian Financial Regulations;

46.3 Imposing unreasonable terms and making unreasonable claims of default on the PWSB Facilities.

46.4 Impugning the credibility of the 1st Plaintiff during court proceedings in Suit 1001 with the use of a Forged Letter with the intention to mislead the honourable court;

46.5 Inducing PWSB into entering a Supplemental Letter of Offer by misrepresentation;

46.6 Inducing a breach of the same Supplemental Letter of Offer by means of interference;

46.7 Causing PWSB to enter into the Supplemental Letter of Offer by using economic duress.

47. In pursuance of the said conspiracy, the Defendants did the following overt acts:

47.1 Procuring Intrared which the Defendants controlled, to breach the SSA with the 1st and 2nd Plaintiffs;

47.2 Misrepresenting the Shareholdings of Intrared to be KFHM (19%) and Wong Choon Kee and Dr Radzuan (81%), when in fact both held the shares absolutely on trust for and on behalf of KFHM.

47.3 Producing successive Letters of Offer containing unfair terms and making unreasonable and unjustified demands of payment;

47.4 Producing a forged letter in court proceedings of Suit 1001 in an attempt to damage the credibility of the 1st Plaintiff and to mislead the honourable court;

47.5 Misrepresenting to the 1st Plaintiff that entry into the Supplemental Letter of Offer in relation to one Civil Suit would result in the favourable settlement in relation to another Civil Suit;

47.6 Using economic duress and pressure on the Plaintiffs to cause PWSB to enter into the Supplemental Letter of Offer;

47.7 Reporting the 1st Plaintiff and PWSB to MACC and informing other Financial Institutions of an MACC investigation so as to prevent PWSB from being able to obtain new finance and thus causing PWSB to default under the Supplemental Letter of Offer with KFHM.

PARTICULARS

48. In relation paragraph 47.1:

48.1 At all material times, KFHM and its officers exercised control over Intrared.

48.2 KFHM caused Intrared to default on its obligations to the 1st and 2nd Plaintiffs, causing the 1st Plaintiff to suffer loss as a result of defaulting under the Bank Rakyat Facility (as described above in Paragraph 37).

49. In relation to Paragraph 47.2:

49.1 On 25.07.2008, the 1st and 2nd Plaintiffs sold their shares in PSSB to Intrared under the SSA when Intrared was in fact a wholly owned subsidiary of KFHM. If the 1st and 2nd Plaintiffs had known at the time of entering into the SSA with Intrared, that Intrared was a subsidiary of KFHM, PWSB would have insisted and requested that an independent bank issue the irrevocable and unconditional letter of undertaking for the payments pursuant to the SSA so that the irrevocable and unconditional letter of undertaking for payment would have been complied with and could not have been negated on as was wrongly done by KFHM with the intention to conspire and put economic duress and pressure on the Plaintiffs.

49.2 KFHM therefore entered into its transaction with the 1st and 2nd Plaintiffs to purchase shares in PSSB using a Special Purpose Vehicle created in contravention of Malaysian Financial Regulations.

50. In relation to Paragraph 47.3:

50.1 The Letter of Offer dated 07.04.2011 contained unfair and unreasonable terms;

50.2 When PWSB sought compromise in relation to such terms, KFHM refused.

51. In relation to Paragraph 47.4:

51.1 During the conduct of the trial in Suit 1001, Counsel for PSSB produced a letter which was used to impugne the credibility of the 1st Plaintiff.

51.2 The said letter was a forgery.

51.3 Lawyers for PSSB have stated that the document originated from lawyers for KFHM.

52. In relation to Paragraph 47.5:

52.1 As described above in paragraph 38.3, the meeting between the 1st Plaintiff and Jamelah on or around September 2011 resulted in a verbal agreement that entry into the Supplemental Letter of Offer dated 28.10.2011 would result in the entry into a favourable settlement agreement in relation to Suit 1001.

52.2 Based on the verbal agreement on 22.09.2011, PWSB entered into the Supplemental Letter of Offer on 17.11.2011.

52.3 Intrared indicated on 21.11.2011 that it was unwilling to enter into the Draft Settlement Agreement, thus departing from the representations of Jamelah.

53. In relation to Paragraph 47.6:

53.1 KFHM caused PWSB facility to become NPL by raising unreasonable issues and making unwarranted claims as outstandings so that the settlement sum could not be finalised and to delay the banking in of the cheques that were already in their possession.

53.2 KFHM wrongfully failed to honour their irrevocable and unconditional letter of undertaking to make the payments to Bank Rakyat resulting in the 1st Plaintiff being blacklisted with Bank Negara CCRISS

54. In relation to Paragraph 47.7:

54.1 Just after the signing of the Supplemental Letter of Offer on 17.11.2011, the Defendant’s individually or collectively made allegations against the Plaintiffs to the MACC.

54.2 On 21.11.2011, i.e. 4 days after signing the Supplemental Letter of Offer, MACC informed the 1st Plaintiff that there had been a complaint lodged against PWSB. PWSB’s directors were then summoned for investigation with alleged fresh evidence in respect of the same complaint previously lodged by KFHM.

54.3 In November 2011, KFHM through its officers and/or agents made it known to other banks that PWSB was currently under investigation by the MACC which prevented PWSB from obtaining further finance.

MISREPRESENTATION AND FRAUD

55. By reason of the matters stated above, the Plaintiffs contend that Jamelah and KFHM misrepresented for fraudulent purpose to the Plaintiffs that Jamelah and KFHM would cause Intrared to enter into the favourable proposed settlement as stated above in Paragraph 38.3 and Paragraph 52.

56. The Plaintiffs will also contend in law and equity that they are entitled to set off whatever sums that may be due in respect of the facilities against the damages suffered by the Plaintiffs in Suit 1001 as well as the damages adjudged herein.

57. The Plaintiffs contend that KFHM is in breach of the following statutes and regulations;

(i) Section 29 Banking and Financial Institutions Act 1989; and/or

(ii) Sections 11(1) (b), (c), (d), 18 (1) (a) (iii), 21 (2), (3), (4), (5), (6), 24 (1) (c), 24 (2), 27A (1) and 47 of the Islamic Banking Act 1983, and/or

(iii) Regulations and/or stipulations of the Securities Commission Act 1993 and Guidelines of the Foreign Investment Committee 2008.

58. As a result of the matters pleaded above, the Plaintiffs have suffered loss and damage.

59. The Plaintiffs seek the following reliefs:

59.1 A declaration that the Supplemental Letter of Offer dated 28.10.2011 is null and void and has no effect and all steps taken pursuant thereto or based on the Supplemental Letter of Offer are void;

59.2 A order for specific performance against the 3rd Defendant for the KFH Ijarah Muntahiah Bithamlik Asset Backed Financing-I (“Ijarah 1”)and KFH Ijarah Muntahiah Bithamlik Asset Acquisition Financing-I (“Ijarah 2”);

59.3 A declaration that the 3rd Defendant breached:

(i) Section 29 Banking and Financial Institutions Act 1989; and/or

(ii) Sections 11(1) (b), (c), (d), 18 (1) (a) (iii), 21 (2), (3), (4), (5), (6), 24 (1) (c), 24 (2), 27A (1) and 47 of the Islamic Banking Act1983, and/or

(iii) Regulations and/or stipulations of the Securities Commission and Guidelines of the Foreign Investment Committee 2008.

59.4 Damages against the Defendants jointly and/or severely to be assessed by the Registrar;

59.5 Damages to be used as a set off for any outstanding sum wholly or in part;

59.6 Aggravated damages;

59.7 Exemplary damages;

59.8 Interest at 8% per annum from the date of the order until full payment by the Defendants;