KUALA LUMPUR – The Inland Revenue Board (LHDN) has appealed to the High Court here to set aside Tan Sri Muhammad Shafee Abdullah’s (picture) application for a stay of proceedings in relation to the LHDN’s suit against him seeking payment of income tax arrears amounting to RM9.41 million, as the lawyer’s intention was to delay the claim.
The matter was stated in the affidavit in reply sworn by LHDN’s Control Unit principal assistant director Shamsul Effendi Khamis, which was obtained by the media through a search of the court system.
The LHDN in filing the affidavit on Jan 26 on behalf of the Malaysian government as the plaintiff, claimed that Muhammad Shafee had also abused the court process.
“If this happens (stay of proceedings is allowed) the rights of the plaintiff and Malaysians will be denied and seriously prejudiced.
The government needs adequate revenue for the development and smooth administration of the country as well as to look after the welfare of the people and address the impact of the COVID-19 pandemic which has led to healthcare crisis and economic uncertainty, according to Shamsul Effendi in the affidavit.
The court has set the case management before senior assistant registrar Noordura Mohamed Din, to be held online on Feb 16.
On Nov 3 last year, Muhammad Shafee filed an application to temporarily suspend the proceedings pending the disposal of his appeal to the Special Commissioners of Income Tax of Malaysia, apart from other special circumstances to suspend the proceedings.
The lawyer said the application was also filed pending the outcome of the application by Datuk Seri Najib Tun Razak and his son Datuk Mohd Nazifuddin on the payment of income tax amounting to RM1.69 billion and RM37.6 million respectively to LHDN, to be heard in the Federal Court on Feb 16.
On Sept 27, 2021, the LHDN requested that the suit against Muhammad Shafee be decided through summary judgement, whereby the court decides without hearing the testimonies of witnesses.
The LHDN filed the suit against Muhammad Shafee, on May 6, 2021 claiming that to date, the lawyer has not settled payment in tax arrears for five assessment years from 2011 to 2016.
Muhammad Shafee, the lawyer representing Najib in the case involving the misappropriation of SRC International Sdn Bhd and 1Malaysia Development Berhad (1MDB) funds, is also facing two charges of receiving RM9.5 million in proceeds from unlawful activities from Najib, and two charges of making false declarations to the LHDN.