The leave application by Libyan-born entrepreneur Dr Sadeg Mustafa to challenge a police order that placed his company InventQJaya Sdn Bhd - an incubator of cutting-edge technology - in receivership will be heard on Friday.

Lawyer Sankara Nair said the first step to overturn the police order, issued under the Anti-Money Laundering Act 2001, will start when Kuala Lumpur High Court judge Raus Sharif hears the application.

"On Friday, the court will hear our ex-parte application for leave which would allow us to initiate the action against the government.

"Once we obtain leave, then we can go to the next stage where the court will set a date to hear the substantial motion to quash the police order of seizure and to restore Sadeg's rights as InventQJaya CEO," he added when contacted.

He said Sadeg - who in his motion made allegations of 'conspiracy, jealousy and sabotage' involving high-profile government figures - will not be in court on Friday as his presence was not required for the motion.

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Sankara is also aware of the notice put up by the police on behalf of InventQJaya in a local English daily yesterday to inform the company's creditors to submit their claims to a special consultant, appointed by the police, as administrator.

"It's just a notice to the company's creditors but it shows how determined the authorities are in taking over the company"," he said.

In the application which named the inspector-general of police and the home minister as respondents - Sadeg is seeking an order to prohibit and prevent any further action by the government that would be detrimental to him and InventQjaya.

It is also seeking for a stay order with regards to the company's business until final determination of the application is made.

Conspiracy allegations

In January 2004, US-based Sadeg set up InventQJaya in Cyberjaya - Malaysia's Silicon Valley - after receiving a soft loan of RM437 million to be drawn down in four tranches.

He was invited by former premier Dr Mahathir Mohamad, who was impressed with his 'InventQbation Business Model' to help under-developed countries achieve technology sovereignty.

In February this year, allegations of fraud in the company involving some RM50 million and mismanagement were reported in the media. This led the police to raid the premises.

Following this, the government took action to freeze the finances of InventQjaya in a bid to safeguard the remaining RM60 million of a RM228 million loan it disbursed and to protect its other long-term investment in the company.

Sadeg had since denied all allegations and stated that he had executed his obligations under the loan agreement by transferring eight technologies and more than 600 patents, hired and trained more than 140 scientists and technologists and conceived 53 new inventions in Malaysia.

In his affidavit filed on March 30, Sadeg claimed he had carried out his tasks professionally, ethically and with the highest standards, and these virtues had made him the target of several disgruntled ex-employees who were terminated due to low performance and low ethics such as corruption, theft and document forgery.

He claimed that everything went smoothly until Mahathir stepped down in November 2003.

He also claimed that "those who wanted to destroy him and the company" had used a police report lodged by InventQjaya's former chief financial officer Sushamma Gokhale who alleged that he (Sadeg) had committed criminal breach of trust.

The businessman said he would reveal the identity of the "saboteurs" when the matter is tried in court. Sadeg also claimed that the police's actions were "propagated or motivated" by the same high-level personalities.