KUALA LUMPUR – The appeals brought by former prime minister Datuk Seri Najib Razak and his two sons over their tax payment, totalling RM1.74 billion, to the Inland Revenue Board (LHDN) will be mentioned on the same day at the Court of Appeal.
Najib, 67, has to pay RM1.69 billion in additional tax arrears, while his sons, Datuk Mohd Nazifuddin, 37, has to pay RM37.6 million, and Datuk Mohamad Nizar, 42, RM13.16 million.
Based on the cause list of the Court of Appeal, the three appeals have been set for case management before deputy registrar Mohd Khairi Haron on December 16.
The three of them had filed the appeals separately at the Court of Appeal.
Najib, Nazifuddin, and Nizar were required to pay the amount to LHDN after the high courts in Kuala Lumpur and Shah Alam allowed LHDN’s application for a summary judgment to be entered against them.
A summary judgment is where a court decides a case through arguments without hearing the testimony of witnesses in a trial.
The order against Najib and Nazifuddin was issued by the Kuala Lumpur High Court on July 22 and July 6 respectively, while the order against Nizar was issued by the Shah Alam High Court on September 25.
On June 25 last year, the government, through LHDN, filed the suit against the Pekan MP, seeking him to pay RM1.69 billion in unpaid taxes for the period between 2011 and 2017 with interest at 5% a year from the date of judgment, as well as costs and other relief deemed fit by the court.
Judge Datuk Ahmad Bache ruled in his judgment that since the notice of assessment had been properly served to Najib pursuant to Section 103(2) of the Income Tax Act 1967 (ITA), the tax payable under those additional assessments became due and payable to LHDN.
The judge said under Section 106 of the ITA, the court found that the additional income tax was hereby due and recoverable as debt due to the government for the amount of RM1,692,872,924.83, as evident in the certificate of indebtedness issued on August 5, 2019.
“The court holds that a summary judgment is entered against the defendant for the amount claimed by the plaintiff (LHDN) as in the plaintiff’s statement of claims, that is, RM1,692,872,924.83 with costs,” said Ahmad.
Citing a decision from the federal court, Justice Ahmad said the provision as expressed by the federal court – “pay first talk later” – although harsh, was an intentional provision of the legislature because of the high incidence of tax evasions in this country.
On July 24, last year, LHDN filed the action against Nazifuddin claiming that he still had unpaid taxes for the assessment years from 2011 to 2017 totalling RM37,644,810.73 as stated in the assessment notice dated March 15, 2019.
Judge Datuk Ahmad Zaidi Ibrahim in his decision among others said that LHDN as the plaintiff had proven that its claim was clear and obvious while Nazifuddin had failed to show merits in his statement of defence.
LHDN filed the same action on Nizar seeking him to pay taxes amounting to RM13,159,821.94 for the assessment years from 2011 to 2017.
In her judgment, Judicial Commissioner of the High Court Datuk Julie Lack Abdullah ruled the issues raised by Nizar to be devoid of merits, baseless and to not constitute triable issues.
She was of the view that the taxpayer must pay his taxes first regardless of his dissatisfaction with the amount or for any reason.
She also held that the plea of limitation did not apply to the commencement of any proceedings by the government for the recovery of any tax from the taxpayer. – Bernama, November 19, 2020
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