KUALA LUMPUR (July 18): A RM16.5 million counter suit against Tan Chong Motor Holdings Bhd (TCM) by an automotive accessories firm for alleged loss of business has been allowed to be transferred to the High Court from the Sessions Court.

In a filing with Bursa Malaysia, TCM said the High Court allowed the transfer — which was sought by the accessories firm Meka Automotive Industries Sdn Bhd — on July 12.

TCM said its wholly-owned subsidiary, TCM Stamping Products Sdn Bhd, had filed a suit against Meka for RM316,829 relating to the supply of automotive accessories, at the Sessions Court on Aug 12, 2016.

Meka followed through by filing a counterclaim against TCM Stamping Products before making an application to the High Court to transfer the legal proceedings there.

TCM said based on the advice of its solicitors, TCM Stamping Products feels it has a reasonably good chance of succeeding in recovering its claim with costs “as it is a plain and straightforward case of goods sold and delivered.”

“Meka’s counterclaim is totally unsubstantiated and therefore, highly unsustainable,” TCM said.

TCM, Malaysia’s sole franchise holder for Nissan vehicles, said if its subsidiary fails to defend Meka’s counterclaim, the group would be able to fulfill the commitment of the suit.

“With Meka’s counterclaim, the net asset per share of the group would be reduced by three sen. There is no impact to TCM Stamping Products’ business operations,” it added.

TCM said Meka’s counterclaim has no other significant financial and operational impact to the group for the current financial year.

TCM’s share price closed down one sen or 0.56% at RM1.76, for a market capitalisation of RM1.15 billion.