PUTRAJAYA: The Federal Court will determine whether the leave granted by the Kuala Lumpur High Court to former MIC Youth chief A. Vigneswaran to use Maju Institute of Educational Development (MIED)’s name to initiate legal action against its chairman Datuk Seri S. Samy Vellu, seven trustees and its audit firm was proper in law.
Yesterday, Federal Court judge Justice Zulkefli Ahmad Makinudin, who chaired a three-man panel, unanimously allowed leave to MIED to appeal when the case was called up for hearing.
MIED sought leave to appeal to the Federal Court yesterday against the decision of the Court of Appeal on Sept 6 last year affirming unanimously the decision of the KL High Court granting leave to Vigneswaran to commence an action in the name of MIED against MIED trustees.
With him on the panel were Justice Md Raus Sharif and Justice Abdull Hamid Embong.
Vigneswaran’s lawyer A. Vasanthi said the apex court had granted the leave to appeal on grounds that the questions of law posed for the determination when answered would be of public advantage.
“The Federal Court will see if the leave granted to Vigneswaran under Section 181A of the Companies Act 1965 to name MIED as the plaintiff to initiate legal action against Samy Vellu, its trustees and its external audit firm was proper in law,” said Vasanthi.
Vasanthi said the Court of Appeal had held that MIED could bring the action against the trustees because Section 181A was applicable to a company limited by guarantee.
She said MIED was a company limited by guarantee.
MIED lawyer Chetan Jethwani told The Star: “If the apex court decides in favour of MIED, the suit against Samy Vellu, its trustees and audit firm scheduled to be heard in June will be thrown out.”
MIED was represented by lead counsel Datuk Cyrus Das and Chetan while counsel Datuk David Gurupatham and Vasanthi acted for Vigneswaran.
Vigneswaran, who is a member of MIED, had sought leave from the KL High Court to initiate a suit under Section 181A of the Act.
Upon getting the leave, Vigneswaran had named MIED as the plaintiff and initiated a RM100mil suit against Samy Vellu and others.
Apart from Samy Vellu, who is former MIC president, the other defendants are his successor Datuk G. Palanivel, Tan Sri M. Mahalingam, Tan Sri Dr T. Marimuthu, Tan Sri Dr S.K. Ampikaipakam, Tan Sri Dr K.S. Nijhar, Tan Sri K. Kumaran and Tan Sri G. Vadiveloo and an audit firm, Kumpulan Naga.
In the suit filed on July 5, MIED claimed that all the defendants had breached their fiduciary and statutory duties, and failed to discharge their responsibilities as trustees and auditors, which caused MIED to suffer huge losses.
It is also applying for an injunction to restrain Samy Vellu from continuing to helm the institute, that he be stripped of his membership in MIED and for him to return all monies or profits made from MIED either by himself or through family members and close friends.
High Court Judicial Commissioner Mah Weng Kwai on June 14 last year allowed an application by Vigneswaran to name MIED as the plaintiff in its proposed suit against the trustees of MIED.