Najib, son fail in appeal over unpaid taxes

PUTRAJAYA: The Court of Appeal today dismissed the appeal of former Prime Minister Datuk Seri Najib Tun Razak and his son Datuk Mohd Nazifuddin against High Court's decision for them to pay additional income tax arrears amounting to RM1.69 billion and RM37.6 million respectively to the Inland Revenue Board (LHDN).

Judge Datuk Abdul Karim Abdul Jalil, who led a three-judge panel in a unanimous decision, said the court found no merit in the appeal filed by the two appellants and no error in the judgment by the two High Court judges.

"As such, the appeals of the two appellants are dismissed with cost of RM10,000 each," Judge Abdul Karim said at the virtual proceedings today. The other two judges were Datuk Vazeer Alam Mydin Meera and Datuk Supang Lian.

Najib and Mohd Nazifuddin, however, need not to pay the additional income tax arrears yet as the court had allowed their application for a temporary stay of the decision.

Both Najib and Nazifuddin are appealing against the decisions of two separate High Courts which allowed the LHDN's applications to enter summary judgment to recover tax arrears of RM1.69 billion from Najib and RM37.6 million from Nazifuddin, respectively.

Judge Abdul Karim in his judgement said the court found that Section 106 (3) of the Income Tax Act 1967 did not contravene Article 121 of the Federal Constitution and that the court has judicial power to hear and decide over disputes under Section 106 even in the circumstances the matters were not allowed to be raised for court consideration.

Section 106 (3) states that in any proceeding under this section, the court shall not entertain any plea that the amount of tax sought to be recovered is excessive, incorrectly assessed, under appeal or incorrectly increased.

Lawyer Tan Sri Muhammad Shafee Abdullah applied for a temporary stay of execution of today's decision as the defence would file an application for leave to appeal in the Federal Court.

Judge Abdul Karim allowed the temporary stay, saying that both appellants had to file the notice of appeal no later than next Tuesday.

On July 22, last year, High Court judge Datuk Ahmad Bache allowed the IRB's application for a summary judgement to be entered against Najib in its suit to recover the RM1.69 billion in taxes from the latter for the period between 2011 and 2017.

A summary judgment is when the court decides a particular case summarily, without calling witnesses to testify in a trial.

As for Nazifuddin, High Court judge Ahmad Zaidi Ibrahim, had on July 6 last year, ordered him to pay RM37.6 million in unpaid taxes to LHDN after allowing the board's application to enter a summary judgment against him in its tax arrears suit seeking to recover the unpaid amount from him (Nazifuddin) between 2011 and 2017.

On Feb 4 this year, the board issued a bankruptcy notice against Najib for his failure to pay the amount as the summary judgment was not stayed.

Mohd Nazifuddin was also served with a bankruptcy notice on April 30 this year over failure to pay the amount as ordered by the High Court.

-- BERNAMA