FGV Annual Report 2016

FELDA GLOBAL VENTURES HOLDINGS BERHAD 332 FINANCIAL REPORT NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016 56 COMMITMENTS (CONTINUED) (a) Operating lease arrangements (continued) (ii) The Group as lessor: (continued) Rental income recognised in profit or loss during the financial year amounted to RM2,132,000 (2015: RM1,442,000). (b) Capital commitments Group 2016 RM'000 2015 RM'000 Capital expenditure approved and contracted for: - Property, plant and equipment 703,445 640,522 - Bearer plants 87,958 65,377 - Intangible assets - 114 Capital expenditure approved but not contracted for: - Property, plant and equipment 704,410 1,242,182 - Bearer plants 18,094 32,384 Investment in subsidiaries - 1,265,750 1,513,907 3,246,329 57 CONTINGENT LIABILITIES (i) On 3 September 2010, FPISB and FELDA were sued by 514 settlers of Felda Serting Scheme and 252 settlers of Felda Gugusan Raja Alias Scheme in Jempol, Negeri Sembilan for alleged fraud and manipulation of the extraction rate for palm oil. The claim amounted to RM15.4 million for the year 2008 only. The learned Seremban High Court Judge on 26 June 2015 has dismissed the Plaintiffs' claim with costs. The Court awarded costs of the sum of RM1,000 per Plaintiff, to be paid to the Defendants. There are 370 remaining Plaintiffs, from the original 766 Plaintiffs, as a portion of them have duly withdrawn and passed away. Therefore, costs awarded to the Defendants amounting to RM370,000. The learned Judge delivered her brief grounds of judgment, the Court found that the Plaintiffs have failed to prove their claim for fraud, conspiracy to defraud and breach of trust. On 22 July 2015, Defendants filed an appeal to Court of Appeal against the whole decision of the Seremban High Court. The Court of Appeal has heard the Plaintiffs' appeal and submissions from both parties on 13 and 14 April 2016. On 31 March 2017, Court of Appeal delivered its decision that the Plaintiffs' (Appellants) appeal dismissed with cost RM100,000 to be paid to Defendants (Respondents). (ii) On 12 July 2011, FPISB and FELDA were sued by 711 settlers of Felda Jengka 1 to 25 and Felda Sg. Tekam in Temerloh, Pahang (Jengka A) for alleged fraud and manipulation of the extraction rate of palm oil. The claim amounted to RM22.9 million for year the 2008 only. This case was called for mention on 18 September 2013 and the Judge has ordered the Plaintiffs to determine who actually has the locus standi to sue in this suit and to determine which Plaintiffs have signed agreements with Felda. The clarification has been completed and the matter which has been fixed previously for decision on 24 October 2016 has been vacated. On 30 November 2016 Temerloh High Court delivered its decision of which dismissed the entire Plaintiffs' claim with cost amounting to RM200,000 to be paid to Defendants. Court found that the Plaintiffs have failed to prove their claim for fraud, conspiracy to defraud and breach of trust. On 14 December 2016, Plaintiffs have filed appeal being not satisfied with the high court's decision. Court of appeal has yet to fix dates to hear the appeal.