Kuala Lumpur, Jan 22 — The Seremban High Court has scheduled May 19 to deliver its decision on the mesne profit claim filed by Semantan Estate (1952) Sdn Bhd against the Malaysian government, a long-running legal dispute arising from the acquisition of the Duta Enclave in Jalan Duta.
The ruling will determine whether the government is liable to pay compensation ranging from hundreds of millions to potentially billions of ringgit for what the landowner alleges to be decades of wrongful occupation.
Mesne profits refer to financial compensation claimed for unlawful use or occupation of land and are typically assessed based on the income or rental value the rightful owner could reasonably have earned during the period of trespass.
High Court judge Datuk Ahmad Shahrir Mohd Salleh fixed the decision date after hearing oral submissions from both parties. Semantan Estate was represented by counsel Ira Biswas, while the government was represented by senior federal counsel Mohammad Al Saifi Hashim.
Prior to delivering the ruling, the court directed both sides to submit responses to several outstanding legal questions by Feb 7, with further oral arguments — if necessary — to be heard on April 7. The case, which began in the Kuala Lumpur High Court in 2022, was transferred to Seremban following the judge’s relocation there late last year.
The land in question spans 263.72 acres of prime land in Jalan Duta, an area now surrounded by major government institutions and key urban infrastructure. The property was originally acquired by the government in 1956 for RM1.32 million.
In 2009, the High Court ruled that the government had trespassed on the land, a decision later upheld by both the Court of Appeal and the Federal Court in 2012. A subsequent review application filed by the government in 2019 was also dismissed.
In August 2024, the High Court ordered that the land titles be restored to Semantan Estate. However, this decision was overturned by the Court of Appeal in June 2025, which ruled that the government would retain ownership but must compensate the company based on 1956 land values. The appellate court further instructed that the final compensation amount be determined by the High Court, with a separate hearing scheduled in April before Justice Roslan Mat Nor.
Importantly, the mesne profit claim is distinct from the compensation payable for the original land acquisition.
Semantan Estate has valued its mesne profit claim at between RM3.1 billion and RM13.1 billion, while the government has estimated potential liability at approximately RM290 million.
Today, the Duta Enclave houses several major government facilities, including the Inland Revenue Board headquarters, National Archives, Malaysian Examination Syndicate, National Hockey Stadium, MACC Academy, and the Institute of Integrity.
During oral submissions, Semantan Estate argued that the government’s valuation approach failed to reflect present-day land use and surrounding developments. Counsel for the estate contended that valuation should be based on real market conditions rather than outdated classifications.
The company’s valuation, prepared by an independent valuer, took into account historical land transactions in nearby areas as well as major developments such as Kuala Lumpur City Centre (KLCC), Tun Razak Exchange, and Merdeka 118. The estate also argued that the land is no longer agricultural in nature, given the extensive urban development and government buildings currently occupying the site.
Semantan Estate further highlighted that even government-appointed valuers acknowledged a 2% to 3% rate of return, a key component in determining potential rental yield.
The government, however, defended its use of an extrapolation method, which relies on a historical baseline derived from a 1956 valuation report prepared by AA Wragg, Malaysia’s first chief valuer. The government maintained that compensation should be calculated by adjusting this baseline annually in line with economic changes, arguing that this approach complies with Malaysian Valuation Standards.
Senior federal counsel argued that the estate’s five-year interval valuation method was inappropriate in this case, as it is typically used where rental agreements exist — which is not the case for the Duta Enclave. As such, the government maintained that the private valuation should be rejected.
The outcome of this case is being closely watched by property owners and investors, as it may influence future valuation benchmarks for commercial property in KL, particularly in established government and institutional precincts. It also underscores the importance of land use classification and valuation methodology for large-scale developments involving office space in Bukit Jalil, industrial land in Selangor, and strategic growth areas such as factory zones in Puchong and industrial property in the Subang area, where historical land titles and redevelopment potential remain key considerations.
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