The High Court in Kuala Lumpur has firmly rejected a last-ditch attempt by three former travel industry figures to stall repayment of nearly half a million ringgit to umrah pilgrims whose journeys were disrupted during the global pandemic. Judge Leong Wai Hong dismissed the application for a stay of execution on June 29, stating that the grounds presented did not meet the threshold for special circumstances. The three applicants—Datuk Dr Fathul Bari Mat Jahya, Sekh Mohd Fazzli Sekh Mohd Ruzi, and Wan Azizul Wan Yusoff—must now proceed with the RM492,480 refund to affected pilgrims, with the court ordering them to cover the defendant's legal costs of RM5,000.
This decision culminates a protracted legal battle that began when KRS Travel Sdn Bhd, a company managing pilgrimage travel arrangements, sought to recover funds from Rehla Travel Services Sdn Bhd over cancelled flight bookings. The underlying dispute has tested Malaysian contract law and consumer protection principles in the travel and tourism sector, particularly in light of unprecedented disruptions created by the COVID-19 pandemic. The case carries significance for how courts evaluate responsibility chains in the travel industry when third parties act as intermediaries between airlines and travel agencies.
The factual circumstances reveal a cascading sequence of events that exposed vulnerabilities in payment handling and refund protocols. In February 2020, KRS engaged Rehla Travel Services to procure flight tickets for its clients heading to the holy cities of Madinah and Jeddah for umrah pilgrimages. KRS remitted RM492,480 to Rehla for these bookings. As an authorised ticketing agent for Malaysia Airlines Berhad, Rehla subsequently passed the payment to MAB, and the airline duly issued Passenger Name Records confirming the reservations. However, when COVID-19 forced Malaysia Airlines to cancel flights globally, the carefully arranged itineraries evaporated, leaving KRS's clients without transportation and facing financial loss.
The defendants' position throughout the litigation reflected a narrow interpretation of contractual obligations and agency relationships. They contended that Rehla functioned exclusively as MAB's ticketing agent, and therefore the funds had already moved beyond their control into the airline's possession. Under this argument, responsibility for refunding pilgrims belonged to Malaysia Airlines rather than to Rehla Travel Services or its directors. This stance effectively positioned the three men as mere conduits rather than parties accountable for customer funds. They argued that KRS's recourse should be directed toward MAB, the actual carrier, not toward the ticketing intermediary.
However, the Sessions Court rejected this reasoning after a full trial, finding that the defendants had engaged in fraudulent conduct by refusing to facilitate refunds to pilgrims despite circumstances that demanded transparency and good faith. The court determined that once Rehla ceased operations without processing refunds, the directors bore responsibility for the missing funds owed to end consumers. This judgment reflected a consumer-protection perspective that prioritises the rights of individual pilgrims over corporate liability hierarchies. The Sessions Court's ruling that fraud had occurred appeared to hinge on the defendants' active refusal to cooperate with refund requests despite having accepted the customer funds initially.
In December 2025, the High Court upheld the Sessions Court decision, dismissing the directors' appeal and affirming the fraud finding. This appellate validation strengthened the precedent that travel agency directors cannot evade accountability by claiming they merely forwarded funds along a payment chain. The court's reasoning suggested that accepting customer money for a specific purpose—booking and facilitating travel—creates a fiduciary-like obligation to ensure completion or proper restitution. When circumstances beyond anyone's control (such as pandemic-driven airline cancellations) prevent completion, the logic suggests that the first party in the chain accepting funds bears residual responsibility to make customers whole.
The stay application rejected on June 29 represented the defendants' final procedural avenue to buy time before executing the refund order. By seeking a stay pending appeal, they hoped to delay immediate payment, possibly calculating that circumstances might change or that appellate processes might ultimately reverse the ruling. However, Judge Leong Wai Hong determined that the appeal grounds did not rise to the level of special circumstances necessary to justify postponing enforcement. This reflects judicial impatience with dilatory tactics and a determination to prioritise the rights of aggrieved pilgrims over the convenience of defendants in meeting their obligations.
For the Malaysian travel and tourism sector, this judgment carries implications beyond the specific parties involved. Travel agencies and their directors must now understand that accepting customer funds creates enforceable obligations regardless of how those funds flow through intermediaries like airlines or ticketing agents. The decision reinforces that contract terms alone cannot shield directors from liability if customers suffer loss and refund requests go unmet. The fraud finding is particularly significant: it moves beyond mere breach of contract into territory suggesting dishonest or deliberately evasive conduct, a distinction that carries reputational and potentially criminal overtones within the industry.
The pilgrims at the centre of this dispute endured not only the disappointment of cancelled religious journeys but also prolonged legal proceedings spanning years to recover their money. For many, the umrah trip represented carefully saved funds and significant personal sacrifice. The protracted litigation likely compounded their frustration, as legal processes moved through sessions and high courts while the funds remained inaccessible. The judgment vindicates their persistence in pursuing claims and signals to the broader pilgrimage community that Malaysian courts will enforce accountability against travel providers who mishandle deposits.
Looking forward, the decision may influence how travel agencies structure their payment acceptance and refund protocols, particularly for religious tourism where cultural and spiritual significance amplifies the impact of cancellations. Insurance arrangements, escrow accounts for customer deposits, and explicit refund policies may become more prevalent as agencies protect themselves against liability exposure demonstrated by this case. The judgment also underscores the importance of operational continuity: Rehla's cessation of operations without addressing outstanding customer claims proved particularly damaging to the defendants' legal position, suggesting that orderly winding-down of travel agencies should include clear protocols for handling customer funds.
The cost award of RM5,000 levied against the defendants carries symbolic weight beyond its monetary value, signalling judicial disapproval of the stay application as lacking merit. For KRS Travel and the affected pilgrims, the successful defence of their refund claim across multiple court levels vindicates their decision to pursue the matter through the judiciary rather than accept the defendants' position. The case now closes, with the burden firmly on the three former directors to remit RM492,480 to the customers whose journeys they were entrusted to arrange during one of the most disruptive periods in modern travel history.
