Govt didn't provide necessary infrastructure - NFC chairman

Mohamad Salleh said it was true that the government had made the loan available to the NFC, but the government had failed to deliver the infrastructure including the Export Quality Abattoir (EQA) to enable the company to commence full production in the project.

"This resulted in the NFC being unable to generate income from the project to repay a government loan," he said.

Mohamad Salleh said this when testifying at the hearing of the government's suit against NFC to recover RM253.6 million in loan repayments and interest from the company in connection with the National Feedlot Centre project in Gemas.

Mohamad Salleh, who is the second defendant said the loan disbursed to NFC in 2008 was tied to the implementation and lease agreements.

Mohamad Salleh said NFC could not pay the first instalment in 2012 as its bank accounts were frozen.

Under the loan agreement, NFC was supposed to repay RM17 million annually from 2012 to 2028.

The witness, however, disagreed with the suggestion made by Senior Federal Counsel Asliza Ali, representing the government, that NFC never requested any extension of time for the payment of the said loan.

Asliza: I put it to you that NFC never made any payment after 2012.

Mohamad Salleh: We requested the postponement, that's why we do not make any payment.

The witness also disagreed with the counsel's suggestion that the company never asked for the payment to be rescheduled.

In its suit, the government named the NFC as the first defendant, while Mohamad Salleh, who is former Women, Family and Community Development Minister Tan Sri Shahrizat Abdul Jalil's husband, and their three children, Wan Shahinur Izran, Wan Shahinur Izmir and Wan Izzana Fatimah Zabedah, as the second to fifth defendants, respectively.

The government claimed that it had signed a loan agreement totalling RM250 million with NFC on Dec 6, 2007, to finance the costs of establishing and operating a National Feedlot Centre in Gemas as part of its policy to develop and increase beef production.

The loan was disbursed in three tranches and Mohamad Salleh's family was claimed to have made 10 withdrawals amounting to RM180.51 million from Jan 24, 2008, to Jan 3, 2011.

The hearing before Judge Anand Ponnudurai continues tomorrow.