KUALA LUMPUR – There is nothing unusual in the Inland Revenue Board’s (IRB) RM40 million settlement with former federal territories minister Datuk Seri Tengku Adnan Mansor, says a tax consultant.
Mohannan Narayanan said it is common for taxpayers to challenge IRB’s initial assessment.
In this case, IRB initially sued Tengku Adnan for RM57 million in unpaid taxes and later accepted a RM40 million settlement.
“When the IRB presents an amount of taxes to be paid, an individual can dispute the assessment with the help of professional tax consultants.
“The tax consultants will present legal arguments and documents to the IRB to justify a lower settlement,” said Mohannan.
Based on court documents obtained by The Vibes, Tengku Adnan hired PKF Tax Services Sdn Bhd to assist him with the assessments.
Lawyer Joel Reuben said settling an IRB suit is not only common but encouraged.
The Malaysian legal system has laws in place that encourage parties to settle their suits. For example, the insertion of Order 22B into the Rules of Court allowed an easier method in which defendants can present settlement offers to plaintiffs.
“Before the trial, the parties will go through a mediation process in which a judge (not the one who presided over the trial) will guide them to a settlement.
“Lawyers may also encourage their clients to accept the settlement offer, even at a lower amount because going to trial can prove more costly,” he said.
"Given that our national courts are facing a massive backlog of cases, parties are always encouraged to settle whenever possible. This then allows the court to settle other cases," lawyer R. Vikaraman also told The Vibes. — The Vibes, October 15, 2020
